Obama Oversees Trashing of the Dream- Ensures Continued Despair & Corporate Control of Government

In This Edition"

- Matt Taibbi: Obama's Big Sellout

- Bill Moyers Journal - "Truth is, our capitol's being looted"

- Robert Reich: Slouching Toward Health Care Reform
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Bill Moyers is said to be leaving PBS in the spring, so cherish one of the few outstanding journalists left while you have time.

On Friday's"Journal," Moyer's guests were Robert Kuttner and Matt Taibbi, both of whom have been mentioned on this blog. (Taibbi's blog is linked on my sidebar, but here it is: http://trueslant.com/matttaibbi/) Moyers referred to Matt Taibbi's December 9, 2009 article in Rolling Stone, so I will put it first, followed by the transcript from Fridays Bill Moyers Journal.

In the third article, Robert Reich writes about Obama and the Democrat's deal making with "Big Insurance, Big Pharma, and the AMA," as well as the Republicans, and how real health care reform slipped through the cracks in the process.
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Obama's Big Sellout
The president has packed his economic team with Wall Street insiders intent on turning the bailout into an all-out giveaway

MATT TAIBBI

Posted Dec 09, 2009 2:35 PM
http://www.rollingstone.com/politics/story/31234647/obamas_big_sellout/print


(Watch Matt Taibbi discuss "The Big Sellout" in a video on his blog, Taibblog: http://taibbi.rssoundingboard.com/matt-taibbi-on-obamas-economy)

Barack Obama ran for president as a man of the people, standing up to Wall Street as the global economy melted down in that fateful fall of 2008. He pushed a tax plan to soak the rich, ripped NAFTA for hurting the middle class and tore into John McCain for supporting a bankruptcy bill that sided with wealthy bankers "at the expense of hardworking Americans." Obama may not have run to the left of Samuel Gompers or Cesar Chavez, but it's not like you saw him on the campaign trail flanked by bankers from Citigroup and Goldman Sachs. What inspired supporters who pushed him to his historic win was the sense that a genuine outsider was finally breaking into an exclusive club, that walls were being torn down, that things were, for lack of a better or more specific term, changing.

Then he got elected.

What's taken place in the year since Obama won the presidency has turned out to be one of the most dramatic political about-faces in our history. Elected in the midst of a crushing economic crisis brought on by a decade of orgiastic deregulation and unchecked greed, Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias, while packing the key economic positions in his White House with the very people who caused the crisis in the first place. This new team of bubble-fattened ex-bankers and laissez-faire intellectuals then proceeded to sell us all out, instituting a massive, trickle-up bailout and systematically gutting regulatory reform from the inside.

How could Obama let this happen? Is he just a rookie in the political big leagues, hoodwinked by Beltway old-timers? Or is the vacillating, ineffectual servant of banking interests we've been seeing on TV this fall who Obama really is?

Whatever the president's real motives are, the extensive series of loophole-rich financial "reforms" that the Democrats are currently pushing may ultimately do more harm than good. In fact, some parts of the new reforms border on insanity, threatening to vastly amplify Wall Street's political power by institutionalizing the taxpayer's role as a welfare provider for the financial-services industry. At one point in the debate, Obama's top economic advisers demanded the power to award future bailouts without even going to Congress for approval — and without providing taxpayers a single dime in equity on the deals.

How did we get here? It started just moments after the election — and almost nobody noticed.
Read entire Article: http://www.rollingstone.com/politics/story/31234647/obamas_big_sellout/print
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Bill Moyers Journal

December 18, 2009
http://www.pbs.org/moyers/journal/12182009/transcript4.html

BILL MOYERS: Welcome to the JOURNAL.

Something's not right here. One year after the great collapse of our financial system, Wall Street is back on top while our politicians dither. As for health care reform, you're about to be forced to buy insurance from companies whose stock is soaring, and that's just dandy with the White House.

Truth is, our capitol's being looted, republicans are acting like the town rowdies, the sheriff is firing blanks, and powerful Democrats in Congress are in cahoots with the gang that's pulling the heist. This is not capitalism at work. It's capital. Raw money, mounds of it, buying politicians and policy as if they were futures on the hog market.

Here to talk about all this are two journalists who don't pull their punches. Robert Kuttner is an economist who helped create and now co-edits the progressive magazine THE AMERICAN PROSPECT, and the author of the book OBAMA'S CHALLENGE, among others.

Also with me is Matt Taibbi, who covers politics for ROLLING STONE magazine where he is a contributing editor. He's made a name for himself writing in a no-holds-barred, often profane, but always informative and stimulating style that gets under the skin of the powerful. His most recent article is "Obama's Big Sellout," about the President's team of economic advisers and their Wall Street connections. It's been burning up the blogosphere. Welcome to both of you.

BILL MOYERS: Let's start with some news. Some of the big insurance companies, Well Point, Cigna, United Health, all surged to a 52 week high in their share prices this week when it was clear there'd be no public option in the health care bill going through Congress right now. What does that tell you, Matt?

MATT TAIBBI: Well, I think what most people should take away from this is that the massive subsidies for health insurance companies have been preserved while it's also expanded their customer base because there's an individual mandate in the bill that's going to provide all these companies with the, you know, 25 or 30 million new people who are going to be paying for health insurance. So, it's, obviously, a huge boon to that industry. And I think Wall Street correctly read what the health care effort is all about.

ROBERT KUTTNER: Rahm Emanuel, the President's Chief of Staff, was Bill Clinton's Political Director. And Rahm Emanuel's take away from Bill Clinton's failure to get health insurance passed was 'don't get on the wrong side of the insurance companies.' So their strategy was cut a deal with the insurance companies, the drug industry going in. And the deal was, we're not going to attack your customer base, we're going to subsidize a new customer base. And that script was pre-cooked so it's not surprising that this is what comes out the other side.

BILL MOYERS: So are you saying that this, what some call a sweetheart deal between the pharmaceutical industry and the White House, done many months ago before this fight really began, was because the drug company money in the Democratic Party?

ROBERT KUTTNER: Well, it's two things. Part of it was we need to do whatever it takes to get a bill. Never mind whether it's a really good bill, let's get a bill passed so we can claim that we solved health insurance. Secondly, let's get the drug industry and the insurance industry either supporting us or not actively opposing us. So that there was some skirmishing around the details, but the deal going in was that the administration, drug companies, insurance companies are on the same team. Now, that's one way to get legislation, it's not a way to transform the health system. Once the White House made this deal with the insurance companies, the public option was never going to be anything more than a fig leaf. And over the summer and the fall, it got whittled down, whittled down, whittled down to almost nothing and now it's really nothing.

MATT TAIBBI: Yeah, and this was Howard Dean's point this week was that this individual mandate that's going to force people to become customers of private health insurance companies, the Democrats are going to end up owning that policy and it's going to be extremely unpopular and it's going to be theirs for a generation. It's going to be an albatross around the neck of this party.

ROBERT KUTTNER: Think about it, the difference between social insurance and an individual mandate is this. Social insurance everybody pays for it through their taxes, so you don't think of Social Security as a compulsory individual mandate. You think of it as a benefit, as a protection that your government provides. But an individual mandate is an order to you to go out and buy some product from some private profit-making company, that in the case of a lot of moderate income people, you can't afford to buy. And the shell game here is that the affordable policies are either very high deductibles and co-pays, so you can afford the monthly premiums but then when you get sick, you have to pay a small fortune out of pocket before the coverage kicks in. Or if the coverage is decent, the premiums are unaffordable. And so here's the government doing the bidding of the private industry coercing people to buy profit-making products that maybe they can't afford and they call it health reform.

BILL MOYERS: So explain this to the visitor from Mars. I mean, just this week, the Washington Post and ABC News had a poll showing that the American public supports the Medicare buy-in that-

ROBERT KUTTNER: Right.

BILL MOYERS: By a margin of some 30 points-

ROBERT KUTTNER: Right.

BILL MOYERS: And yet, it went down like a lead balloon.

ROBERT KUTTNER: Look, there are two ways, if you're the President of the United States sizing up a situation like this that you can try and create reform. One is to say, well, the interest groups are so powerful that the only thing I can do is I can work with them and move the ball a few yards, get some incremental reform, hope it turns into something better. The other way you can do it is to try to rally the people against the special interests and play on the fact that the insurance industry, the drug industry, are not going to win any popularity contests with the American people. And you, as the president, be the champion of the people against the special interests. That's the course that Obama's chosen not to pursue.

MATT TAIBBI: And I think, you know, a lot of what the Democrats are doing, they don't make sense if you look at it from an objective point of view, but if you look at it as a business strategy- if you look at the Democratic Party as a business, and their job is basically to raise campaign funds and to stay in power, what they do makes a lot of sense. They have a consistent strategy which involves negotiating a fine line between sentiment on the left and the interests of the industries that they're out there to protect. And they've always, kind of, taken that fork in the road and gone right down the middle of the line. And they're doing that with this health care bill and that's- it's consistent.

Read the rest of this transcript at: http://www.pbs.org/moyers/journal/12182009/transcript4.html.
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Robert Reich's Blog
Robert Reich was the nation's 22nd Secretary of Labor and is a professor at the University of California at Berkeley. His latest book is "Supercapitalism." This is his personal journal.

THURSDAY, DECEMBER 17, 2009
Slouching Toward Health Care Reform
http://robertreich.blogspot.com/2009/12/slouching-toward-health-care-reform.html

"Don't make the perfect the enemy of the better," says the President and congressional insiders when confronted with the sorry spectacle of a health-care bill whose scope and ambition continue to shrink, and whose long-term costs to typical Americans continue to grow. They're right, of course. But by the same logic, neither the White House nor congressional Democrats will be able to celebrate the emerging legislation as a "major overhaul" or "fundamental reform." At best, it's likely to be a small overhaul containing incremental reforms.

Real reform has moved from a Medicare-like public option open to all, to a public option open to 6 million without employer coverage (still in the House bill), to a public option open only to those same people in states that opt for it, or about 4 million (the original Harry Reid version of the Senate bill), to no public option but expanded Medicare (the Senate compromise) to no expanded Medicare at all (the deal with Joe "I love all the attention" Lieberman).

In other words, the private insurers are winning and the public is losing.

Pharmaceutical companies are winning as well. Yesterday, proposals to allow US pharmacies and wholesalers to import prescription drugs from Europe and Canada were defeated in the Senate. No matter that American consumers pay up to 55% more for their prescription drugs than Canadians, or that the measure would have saved the government at least $19.4 billion over ten years (according to the Congressional Budget Office). Big Pharma's argument that the safety of such drugs couldn't be assured was belied by the defeat of another proposed amendment that would have allowed drug imports only if their safety and economic benefits were certified by the Secretary of Health and Human Service.

Doctors and hospitals are also winning. More and more of the putative "savings" from health care reform ("savings" should really be understood as projected costs that are under the wildly-escalating costs projected without such savings) rely on contraints on future Medicare spending. But the details of such constraints keep vanishing, while ever more of the messy work of coming up with them is assigned to a so-called Medical Advisory Board that will supposedly recommend them later on. What no one wants to admit is that Congress never actually implements promised Medicare savings. When crunch time comes, it caves in to the AMA and the AARP. In a few years time, when boomers swell the ranks of seniors, and the political power of the AMA and AARP together rival that of Wall Street, the cave-ins will be boggling.

Meanwhile, opponents of abortion are winning, too. Ben Nelson (a Nebraska Democrat who enjoys being the spoiler even as much as Joe Lieberman) is holding out for even more restrictions.

The political reality right now is that Harry Reid will do anything to get sixty votes -- which means Lieberman, Nelson, and even Olympia Snowe are able to use extortion on behalf of Big Insurance, Big Pharma, the AMA, and abortion foes. The President, meanwhile, remains eerily above the fray. Having closed deals months ago with Big Insurance, Big Pharma, and the AMA -- in order to get their support in exchange for guaranteeing them big profits -- his only apparent interest is keeping the deals going while helping Reid corral sixty votes for just about anything. (The deals have caused some awkwardness for the White House. Drug importation would have cost Big Pharma far more than the $80 billion price tag it agreed to, forcing the White House to oppose importation even though the President had publicly supported it during his presidential campaign last year, and even though John McCain supported yesterday's amendment.)

Is the effort worth still worth it? Yes, but just. Private insurers will have to take anyone, regardless of preconditions. And some 30 million people who don't now have health insurance will get it. But because Big Insurance, Big Pharma, and the AMA will come out way ahead, the legislation will cost taxpayers and premium-payers far more than it would otherwise. Cost controls are inadequate; in fact, they barely exist. If Wall Street's top brass are "fat cats," as the President described them last weekend, the top brass of Big Insurance, Big Pharma, and the AMA are even fatter. While they don't earn as much, they're squeezing the public for even more.

We are slouching toward health-care reform that's better than nothing but far worse than we had imagined it would be. Even those of us who have seen legislative sausage-making up close, even those of us who never make the perfect the enemy of the better, are concerned. That two or three senators are able to extort as much as they have is appalling. Why hasn't Reid forced much of the bill into reconciliation, requiring only 51 votes? Why has the President been so cowed? In all likelihood, the White House and the Dems eventually will get a bill they can call "reform," but they will not be able to say with straight faces that the reform is a significant improvement over the terrible system we already have.
posted by Robert Reich | 5:57 AM

Hell on Earth

In This Edition:

- Copenhagen Climate "Talks"
- Joe Lieberman, Veterans, & Health Care "Reform"
- Dean: Public Option Essential to Real Health Care Reform
- Simon Johnson on Economic "Reform"
- McCain Leads Senate Effort to Reinstate Glass-Steagall
- U.S. gave up billions in tax money in deal for Citigroup's bailout repayment
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Copenhagen Climate "Talks"

Copenhagen: Only the numbers count – and they add up to hell on earth
Climate Interactive's software speaks numbers, not spin – which is where the true understanding of the Copenhagen summit lies

Bill McKibben

guardian.co.uk, Tuesday 15 December 2009
http://www.guardian.co.uk/environment/cif-green/2009/dec/15/bill-mckibben/print

Climate change activists form the number 350 at the Sydney Opera House in Australia. Photograph: Tim Cole/EPA

The Bella centre is a swirl of chatter, the streets of Copenhagen are a swirl of protest. Depending on what hour you listen to the news bulletin, the UN climate negotiations have "come off the rails" or are "back on track" or have "stalled" or are "moving swiftly". Which is why the only people who really understand what's going on may be a small crew of folks from a group of computer jockeys called Climate Interactive. Their software speaks numbers, not spin – and in the end it's the numbers that count.

First number to know: 350. It's what scientists have been saying for two years is the maximum amount of carbon dioxide we can safely have in the atmosphere, measured in parts per million. Those scientists have been joined by an unprecedented outpouring from civil society: in late October, activists put on what CNN called "the most widespread day of political action in the planet's history," with 5,200 demonstrations in 181 countries, all rallying around that number. Three thousand vigils last weekend across the planet spelled out the number in candles. Thousands of churches rang their bells 350 times on Sunday, and yesterday the World Parliament of Religions, meeting in Melbourne and representing the "largest interreligious gathering on earth" sent an emergency 350 declaration here to Copenhagen.

The second number: 100. That's (roughly) how many countries are backing a 350 target here at Copenhagen. That's more than half the nations in attendance – unfortunately, they're the small, poor ones. But it's amazing to see them, in the face of enormous pressure, keeping the idea of real action alive. Yesterday Mohamed Nasheed, president of the Maldives, spoke to a roaring crowd of thousands: "We know what the laws of physics say: the most important number in the world is 350."

The third number: 4%. That's how much the US is offering to cut its emissions from their 1990 levels by 2020. Scientists tell us that the developed world would need to reduce by at least 40% to get us back on a 350 track, so the American offer is exactly an order or magnitude off. And they're not alone. All the rich countries, not to mention China, are looking to do as little as possible and still escape here with some kind of agreement they can hide behind.

The fourth number – and the most important one. When the folks at Climate Interactive plug in every promise made at these talks (the American offer on the table, the Chinese promise to reduce "energy intensity", the EU pledges, and so on) their software tells them almost instantly how much carbon they would eventually produce. When they hit the button last night, the program showed that by 2100 the world's CO2 concentrations (currently 390) would be – drumroll please – 770. That is, we would live in hell, or at least a place with a similar temperature.

So that's the scorecard. You may hear a lot of happy talk from world leaders over the next few days as they "reach a historic agreement". But that's how it all adds up.

• Bill McKibben is the coordinator of 350.org (http://www.350.org/)

Other Links:
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[The Elephant in the Climate Change Living Room--Human Population Size & Growth - Chris]

Population control called key to deal
By Li Xing (China Daily)
Updated: 2009-12-10 07:37

http://www.chinadaily.com.cn/china/2009-12/10/content_9151129.htm

COPENHAGEN: Population and climate change are intertwined but the population issue has remained a blind spot when countries discuss ways to mitigate climate change and slow down global warming, according to Zhao Baige, vice-minister of National Population and Family Planning Commission of China (NPFPC) .

"Dealing with climate change is not simply an issue of CO2 emission reduction but a comprehensive challenge involving political, economic, social, cultural and ecological issues, and the population concern fits right into the picture," said Zhao, who is a member of the Chinese government delegation.

Many studies link population growth with emissions and the effect of climate change.

"Calculations of the contribution of population growth to emissions growth globally produce a consistent finding that most of past population growth has been responsible for between 40 per cent and 60 percent of emissions growth," so stated by the 2009 State of World Population, released earlier by the UN Population Fund.

Although China's family planning policy has received criticism over the past three decades, Zhao said that China's population program has made a great historic contribution to the well-being of society.

As a result of the family planning policy, China has seen 400 million fewer births, which has resulted in 18 million fewer tons of CO2 emissions a year, Zhao said.

The UN report projected that if the global population would remain 8 billion by the year 2050 instead of a little more than 9 billion according to medium-growth scenario, "it might result in 1 billion to 2 billion fewer tons of carbon emissions".

Meanwhile, she said studies have also shown that family planning programs are more efficient in helping cut emissions, citing research by Thomas Wire of London School of Economics that states: "Each $7 spent on basic family planning would reduce CO2 emissions by more than one ton" whereas it would cost $13 for reduced deforestation, $24 to use wind technology, $51 for solar power, $93 for introducing hybrid cars and $131 electric vehicles.

She admitted that China's population program is not without consequences, as the country is entering the aging society fast and facing the problem of gender imbalance.

"I'm not saying that what we have done is 100 percent right, but I'm sure we are going in the right direction and now 1.3 billion people have benefited," she said.

She said some 85 percent of the Chinese women in reproductive age use contraceptives, the highest rate in the world. This has been achieved largely through education and improvement of people's lives, she said.

This holistic approach that integrates policy on population and development, a strategy promoting sustainable development of population, resources and environment should serve as a model for integrating population programs into the framework of climate change adaptation, she said.

(China Daily 12/10/2009 page10)

Copyright By chinadaily.com.cn. All rights reserved
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Regulation, Not the "Free Market," Drives Technological Innovation

US left behind in technological race to fight climate change
A speech by the US energy secretary, Steven Chu, shows how America's unquestioning belief in the free market has held back technological innovation

guardian.co.uk 12/15/09

http://www.guardian.co.uk/environment/georgemonbiot/2009/dec/14/us-technological-race-climate-change/print

I have just been watching the tragic sight of a fallen giant flailing around on its back like a beetle, desperately trying to turn itself over.

The occasion was a speech by the US secretary of energy, Steven Chu. He is, of course, a Nobel physicist, brilliant, modest, likeable, a delightful contrast to the thugs employed by the previous administration. But his speech was, in the true sense of the word, pathetic: it moved me to pity.

Yesterday afternoon in Copenhagen – where the UN climate talks are entering their second week – Professor Chu unveiled what would have been a series of inspiring innovations, had he made this speech 15 years ago. Barely suppressing his excitement,
he told us the US has discovered there is great potential for making fridges more efficient, and that the same principle could even be extended to lighting, heating and whole buildings. The Department of Energy is so thrilled by this discovery that it has
launched a programme to retrofit homes in the US, on which it will spend $400m a year. . . . .
http://www.guardian.co.uk/environment/georgemonbiot/2009/dec/14/us-technological-race-climate-change/print
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Copenhagen police release hundreds of detained activists
Only 13 protesters remain in custody after nearly 1,000 arrests during demonstrations at climate change summit
http://www.guardian.co.uk/environment/2009/dec/13/copenhagen-protesters-freed/print
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High-profile activist's arrest fuels fears of police crackdown in Copenhagen
Climate Justice Action spokesman to face charges, as Danish
police prepare for mass protests at Copenhagen's Bella centre
Bibi van der Zee
guardian.co.uk, Tuesday 15 December 2009

http://www.guardian.co.uk/environment/2009/dec/15/danish-police-mass-protest-copenhagen/print

A high-profile climate activist was arrested ahead of tomorrow's major protests planned outside the Copenhagen climate summit, fuelling anxiety about how the Danish authorities are policing demonstrations.

Tadzio Mueller, a spokesman for the umbrella group Climate Justice Action (CJA), was arrested today by plainclothes police as he left the Bella centre, where the official climate talks are taking place. The police are holding him at the Retorvej detention
centre, and he will be charged in court tomorrow morning. The police refused to say what charges will be brought. . . . .
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Joe Lieberman, Veterans, & Health Care "Reform"
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Joe Lieberman and the Health Care Train Wreck
Tuesday 15 December 2009
by: William Rivers Pitt, t r u t h o u t | Op-Ed

http://www.truthout.org/1215098?print

When last we heard from Sen. Joe Lieberman of Connecticut, he was throwing sand into the gears of the Democratic push for health care reform by declaring he would filibuster any legislation containing the so-called public option. "I feel so strongly about the creation of another government health insurance entitlement," said the senator back in November. "The government going into the health insurance business - I think it's such a mistake that I would use the power I have as a single senator to stop a final vote."

This pronouncement came at the same time as word got out that Lieberman was also planning to actively campaign for GOP candidates during the 2010 midterms, further undercutting his erstwhile party's hold on the majority in Congress."There's a hard core of partisan, passionate, hardcore Republicans," he said at the time. "There's a hard core of partisan Democrats on the other side. And in between is the larger group, which is people who really want to see the right thing done, or want something good done for this country and them - and that means, sometimes, the better choice is somebody who's not a Democrat."

For some reason, these twin insults did not motivate the Democratic Congressional leadership to expunge this hypocritical cretin from their ranks. Lieberman kept his committee chairmanship and was not even mildly censured by his colleagues. One month later, the decision to ignore his brazen disregard for his colleagues has come back to bite us all, for Mr. Lieberman has once again elbowed his way into the center of the health reform debate, and with a vengeance. "Mr. Lieberman threatened on national television to join the Republicans in blocking the health care bill, President Obama's chief domestic initiative," reported The New York Times on Tuesday. "Within hours, he was in a meeting at the Capitol with top White House officials. And on Monday night, Democratic senators emerged from a tense 90-minute closed-door session and suggested that they were on the verge of bowing to Mr. Lieberman's main demands: that they scrap a plan to let people buy into Medicare beginning at age 55, and scotch even a fallback version of a new government-run health insurance plan, or public option."

This turn of events is sickening and appalling on a couple of different levels.

First, of course, is the shameless reality that is Mr. Lieberman himself. During his 2004 presidential run, and again during his 2006 Senate campaign, Lieberman actively supported the public option's inclusion in any health care reform, and specifically supported the expansion of Medicare. As late as this past September, Lieberman continued to support such an expansion, as reported by The Connecticut Post. "As to how 47 million uninsured will afford coverage," said The Post, "Lieberman said only 12 million don't have insurance because they cannot afford it. By allowing citizens who are not eligible for Medicare or Medicaid to buy in for a rate below the private market, the government can extend coverage to more of those who are currently uninsured, he said."

That was then, and this is now. In one of the most astounding examples of political flip-floppery, Lieberman opened this week by declaring himself dead-set against the very health care reform policies he once championed, and once again announced his intention to don a Republican cloak and tear up the Democrats' legislative efforts. Again.

Why? One would have to be deep into a severe state of personal denial to believe Lieberman has legitimate concerns about the impending health care legislation, given the fact that he very recently supported the exact provisions he now wants removed or destroyed. The only sensible explanation would seem to be that Lieberman is actively needling the Democratic leadership, and has become such an obnoxious obstructionist only to keep his name in the news. Josh Marshall of Talking Points Memo explains the situation, and what it means going forward:

The key issue senate Democrats now have in dealing with Joe Lieberman isn't his position on the Medicare Buy-In. They need to confront the problem that Lieberman isn't negotiating in good faith. No surprise that Republicans are giddy with what a problem he's creating for Harry Reid & Co. But in my conversations with them, it's as clear to them as it is to anyone else that he's now basically mocking his Democratic colleagues by moving the goal posts every time a new agreement is struck.

This puts the Democrats in an extremely difficult, politically untenable position. Yes, they need 60 votes. But they're not going to be able to hang on to Lieberman's vote long enough to get the bill passed. That now seems unquestionably clear. People who say that the Dems should just move to reconciliation don't necessarily realize the difficulties involved - either procedurally or politically, in terms of losing even more Democratic votes. Personally, I'd like to see them try it. But I don't know if it's possible.

Until a couple days ago I was close to certain a health care bill would pass. I still feel relatively confident one will simply because the Dems just don't have any choice but to pass one. Once it is passed, if it is, it's definitely time for the Democratic caucus to strip Lieberman of all the benefits he receives as a member of the Democratic caucus. But that doesn't accomplish anything at the moment. The only path I can see for the Dems is that they need to try to put 60 votes together with Sen. Snowe. Yes, that sounds crazy to me too. But I think she actually has a set of policy priorities that could be met. I don't think that's true with Lieberman. So further negotiating just means more game-playing.

The solution to all this, one would think, would be for the Democratic leadership in Congress to wrap Lieberman in bright red wrapping paper, slap on a bow, and ship him across the aisle to his ideological compatriots in the GOP as an early Christmas present. Strip him of his leadership position, show him the door, and publicly denounce him as nothing more than a stinking chunk of cholesterol clogging up the arteries of progress.

But no. Of course that isn't going to happen. Instead, Democrats appear poised to once again knuckle under to this fraud and further denude what has already become a half-a-loaf bill. According to several sources, Rahm Emmanuel and the White House are actively pressuring the Democratic leadership in Congress to give Lieberman whatever he wants in order to pass some form of health reform legislation, no matter how ragged, damaging and useless the final product may turn out to be.

The Senate won't vote on health care reform until next week, and the process has changed course two dozen times already, so the outcome of this latest idiot eruption is far from certain, but the writing does appear to be on the wall this time around. Joe Lieberman doesn't give a tinker's damn about the people he represents, the party that coddles him, his own positions on key issues or anything else beyond getting his mug in front of television cameras in the guise of someone who actually matters. The Obama administration is once again moonwalking away from doing the right thing on this issue, and the jellyfish pond that is Congress appears poised to do what jellyfish do: float, flop, flounder and drift with the scum in this rising tide.

In short, this whole thing is about to become a train wreck of galactic proportions. Stay tuned.
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135,000 Uninsured Americans Will Die Before Health Reform Takes Effect, Analysis Finds

Over 6,600 Uninsured Veterans Will Die by 2013: Estimate

By Brad Jacobson

http://rawstory.com/2009/12/135000-uninsured-americans-die-health-reform-takes-effect-study/

December 15, 2009 "Raw Story" -- If Democrats manage to pull off efforts to reform the US healthcare system and ensure coverage for millions who are currently without insurance, the new system -- by design -- will likely still leave tens of thousands to die without insurance before reforms kick in.

A Raw Story analysis, based on a recent Harvard Medical School study, estimates that 135,000 American citizens and over 6,600 US veterans will die due to a lack of health insurance before current proposed healthcare reform measures would take effect.

One hundred and thirty-five thousand US lives far exceeds the total number of Americans who died in the Korean War, the Vietnam War and the attacks of 9/11 combined. The lives of over 6,600 US veterans is more -- by over 1,300 -- than the total number of US soldiers who have thus far died in both the Iraq and Afghanistan wars.

Dr. Steffie Woolhandler, a professor of medicine at Harvard University and co-author of the Harvard Medical School study, called Raw Story's estimates "quite reasonable."

Even more shocking is that these are modest estimates.

Health reform policy experts who spoke with Raw Story confirmed that the House and Senate bills would do virtually nothing for currently uninsured Americans until 2013 and 2014, respectively. Raw Story's calculations are based on the House health reform bill's projections. The Senate bill, however, would add another year of lethal lag time, driving up the estimated death rate by tens of thousands more US citizens and veterans. . . . .
http://rawstory.com/2009/12/135000-uninsured-americans-die-health-reform-takes-effect-study/
__

Dean: Public Option Essential to Real Health Care Reform

http://voices.washingtonpost.com/44/2009/08/17/dean_public_option_essential_t.html?waporef=evri.widget.1
The Associated Press reports:

Former Democratic Party Chairman Howard Dean, a leading figure in the liberal wing of his party, said Monday he doubts there can be meaningful health care reform without a direct government role.

Dean urged the Obama administration to stand by statements made early on in the debate in which it steadfastly insisted that such a public option was indispensable to genuine change, saying that Medicare and the Veterans Administration are "two very good programs that have been around for a long time." Dean appeared on morning news shows Monday amid increasing indications the Obama White House is retreating from the public option in the face of vocal opposition from Republicans and some vocal participants at a town-hall-style meetings around the country.

The former Vermont governor was asked on NBC's "Today" show about President Barack Obama's statement over the weekend that the public option for insurance coverage was "just a sliver" of the overall proposal. Obama's health and human services secretary, Kathleen Sebelius, advanced that line, telling CNN Sunday that a direct government role in a system intended to provide virtually universal coverage was "not the essential element." Dean, a physician, argued that a public option is fair and said there must be such a choice in any genuine shake up of the existing system.

"You can't really do health reform without it," he said. Dean maintained that the health insurance industry has "put enormous pressure on patients and doctors" in recent years.

He called a direct government role "the entirety of health care reform. It isn't the entirety of insurance reform ... We shouldn't spend $60 billion a year subsidizing the insurance industry." Dean also said he doesn't foresee any Republican support for a public option. "I don't think the Republicans are interested and in order to have a bipartisan bill, you've got to have both sides interested," he said.
___________________________

Dean urges defeat of emerging health care bill
The Associated Press
Wednesday, December 16, 2009; 8:52 AM
http://www.washingtonpost.com/wp-dyn/content/article/2009/12/16/AR2009121600755_pf.html

WASHINGTON -- Former Democratic Party Chairman Howard Dean argued Wednesday that the health care overhaul bill taking shape in the Senate further empowers private insurers at the expense of consumer choice.

"You will be forced to buy insurance. If you don't, you'll pay a fine," said Dean, a physician. "It's an insurance company bailout." Interviewed on ABC's "Good Morning America," he said the bill has some good provisions, "but there has to be a line beyond which you think the bill is bad for the country."

"This is an insurance company's dream," the former Democratic presidential candidate said. "This is the Washington scramble, and it's a shame."

Dean asserted that the Senate's health care bill would not prohibit insurance companies from denying coverage for preexisting conditions and he also said it would allow the industry to charge older people far more than others for premiums.

Rep. Anthony Weiner, D-N.Y., a prominent House liberal, protested the absence of any government-run insurance option in the Senate bill.

"We can't let the perfect be enemy of the good," Weiner said on CBS' "Early Show," "but we are reaching a tipping point."

When House and Senate negotiators go to conference to work out a compromise bill, Weiner said, "We should move away from some of the things the Senate has done and move back to where the House is. You need to contain cost. You do that with a public option."
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Is Joe Lieberman Protecting Israel?

By Robert Parry

December 16, 2009 "Consortiumnews" - http://www.consortiumnews.com/2009/121509.html

http://www.informationclearinghouse.info/article24195.htm

Sen. Joe Lieberman’s latest threat to scuttle health-care reform – vowing to join a Republican filibuster to block an over-55 buy-in to Medicare, a proposal that he has long championed – is raising questions about his motives. But no one is mentioning the unmentionable, the cause that has come to define Lieberman’s career: Israel.

Is it possible that Lieberman’s obstructionist behavior doesn’t relate to Connecticut’s insurance industry or to his political ego – the two most cited explanations – but rather to a calculation that he can use his leverage on health care to limit the pressure that President Barack Obama can put on Israel to make concessions on a Mideast peace plan?

After all, the more common explanations of Lieberman’s behavior have holes in their logic.

While it is true that Lieberman’s constituent Hartford-based insurance companies fear any government intrusion in their industry, the actual proposals for the Medicare buy-in or the tightly constrained “public option” actually would benefit the industry in the near term.

Those uninsured Americans 55 to 64 are customers whom the insurance industry doesn’t want. They are the part of the uninsured population that is most likely to need medical care, which is why private insurers have driven up the rates so high that these people can’t afford to buy health insurance.

Letting these desperate Americans buy into Medicare wouldn’t cost the health insurance industry much of anything – and it would reduce the moral (and PR) crisis that has led so many Americans to view private insurers as vultures preying on the most vulnerable.

In his past position in favor of the Medicare buy-in, Lieberman has recognized this reality, noting that this over-55 group faces a particular crisis because they have “retired early or unfortunately have been laid off early” and can’t afford health insurance.

Though Lieberman has long been a major recipient of health insurance industry backing, that has never before prevented him from favoring this Medicare buy-in. Only now does Lieberman say that he would join a Republican filibuster to kill the entire bill if his earlier proposal is included.

So, Senate Democratic leaders have reportedly agreed to drop the buy-in provision to appease Lieberman even though such a watered-down Senate bill may complicate reconciliation with a more liberal House bill and is infuriating the Democratic base.

Killing the Public Option

Similarly, Lieberman has protested any inclusion of a government-run insurance option even if it is only triggered by the failure of private insurers to offer affordable alternatives or if it is so tightly constrained that it would attract only a few million customers, again drawn primarily from the ranks of Americans most in need of medical care.

The Congressional Budget Office has estimated that only about six million people would sign up for the House version of the public option whose rates would likely exceed those of private plans because the sick would gravitate to the government plan. The current Senate version, with a state-by-state opt-out provision, would draw even fewer customers, the CBO said.

Yet either version actually helps the health insurance industry by siphoning off sick people and thus allowing the industry to corner the market on healthier customers, where the biggest profits lie.

So, Lieberman may not be serving the industry’s best interests by jeopardizing passage of a health reform bill. Not only does the industry stand to pick up tens of millions of new customers who will be compelled to buy insurance – and sometimes with government subsidies – but a decent reform bill also blunts demands for more radical changes.

If Americans grow more furious with the current system – its rising costs and its failure to cover nearly 50 million people – voters might press for a single-payer approach which could eliminate private insurers altogether.

For these reasons, the Lieberman-is-in-the-pocket-of-the-insurance-lobby explanation isn’t entirely convincing.
. . . .
The Israel Factor

Which brings us to Israel, which arguably has become Lieberman’s most treasured priority in his political life.

Mark Vogel, chairman of the pro-Israel National Action Committee, once said, “Joe Lieberman, without exception, no conditions … is the No. 1 pro-Israel advocate and leader in Congress. There is nobody who does more on behalf of Israel than Joe Lieberman.”

It was Lieberman’s embrace of neoconservative ideology and his aggressive support for wars against Israel’s Muslim enemies, the likes of Iraq’s Saddam Hussein, that led Connecticut Democrats to deny Lieberman the Senate nomination in 2006 and prompted his successful run as an Independent.

Partly because Obama opposed the Iraq War, Lieberman went on the stump for Republican John McCain in 2008, even questioning Obama’s patriotism.

Standing with McCain in August 2008, Lieberman called the election a choice “between one candidate, John McCain, who has always put the country first, worked across party lines to get things done, and one candidate who has not.’

Since the start of Obama’s presidency, Israel’s hawkish Likud government has made no secret of its concern that Obama might pressure it into making territorial and other concessions to the Palestinians and Syria to secure a Mideast peace agreement.

In Washington, the still-influential neocons also have been demanding that Obama continue Bush’s belligerent policies and side with Israel in a hard-line approach to Iran.

In that sense, Lieberman and the neocons have much in common with Republicans, such as Sen. Jim DeMint, R-South Carolina, who declared in July that “If we’re able to stop Obama on this [health reform], it will be his Waterloo. It will break him.”

A broken Obama could be easier to manipulate regarding Mideast peace talks and Iran.
. . . .
Lieberman has been careful not to connect his disruptive behavior on health-care reform to his support for Israel, but there can be little doubt that a chastened Obama, either defeated on health care or forced to sign a bill that liberals will view as a betrayal, will have much less political capital to expend in applying pressure on Israel.

A hobbled Obama won’t be able to push Israeli Prime Minister Benjamin Netanyahu to halt expansion of West Bank settlements or to take other steps that might lead to a Palestinian state. Obama also could be pushed around himself if Israel – itself an undeclared nuclear power – decides to launch airstrikes against Iran’s nuclear facilities.

The Israel explanation for Lieberman’s behavior on health-care reform is the one that seems to make the most sense.

Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Neck Deep: The Disastrous Presidency of George W. Bush, was written with two of his sons, Sam and Nat, and can be ordered at neckdeepbook.com. His two previous books, Secrecy & Privilege: The Rise of the Bush Dynasty from Watergate to Iraq and Lost History: Contras, Cocaine, the Press & 'Project Truth' are also available there. Or go to Amazon.com.
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Simon Johnson on Economic "Reform"

“Wake Up, Gentlemen”
Posted: 15 Dec 2009 03:06 AM PST

http://baselinescenario.com/2009/12/15/wake-up-gentlemen/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+BaselineScenario+%28The+Baseline+Scenario%29

The guiding myth underpinning the reconstruction of our dangerous banking system is: Financial innovation as-we-know-it is valuable and must be preserved.  Anyone opposed to this approach is a populist, with or without a pitchfork.

Single-handedly, Paul Volcker has exploded this myth.  Responding to a Wall Street insiders‘ Future of Finance “report“, he was quoted in the WSJ yesterday as saying: “Wake up gentlemen.  I can only say that your response is inadequate.”

Volcker has three  main points, with which we whole-heartedly agree:

1. “[Financial engineering] moves around the rents in the financial system, but not only this, as it seems to have vastly increased them.”

2. “I have found very little evidence that vast amounts of innovation in financial markets in recent years have had a visible effect on the productivity of the economy” and most important:

 3. “I am probably going to win in the end”.

Volcker wants tough constraints on banks and their activities, separating the payments system – which must be protected and therefore tightly regulated – from other “extraneous” functions, which includes trading and managing money.

This is entirely reasonable – although we can surely argue about details, including whether a very large “regulated” bank would be able to escape the limits placed on its behavior and whether a very large “trading” bank could (without running the payments system) still cause massive damage. 

But how can Mr. Volcker possibly prevail?  Even President Obama was reduced, yesterday, to asking the banks nicely to lend more to small business – against which Jamie Dimon will presumably respond that such firms either (a) are not creditworthy (so give us a subsidy if you want such loans) or (b) don’t want to borrow (so give them a subsidy).  (Some of the bankers, it seems, didn’t even try hard to attend – they just called it in.)

The reason for Volcker’s confidence in his victory is simple - he is moving the consensus.  It’s not radicals against reasonable bankers.  It’s the dean of American banking, with a bigger and better reputation than any other economic policymaker alive – and with a lot of people at his back – saying, very simply: Enough.

He says it plainly, he increasingly says it publicly, and he now says it often.  He waited, on the sidelines, for his moment.  And this is it.

Paul Volcker wants to stop the financial system before it blows up again.  And when he persuades you – and people like you – he will win.  You can help – tell everyone you know to read what Paul Volcker is saying and to pass it on.
By Simon Johnson
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McCain Leads Senate Effort to Reinstate Glass-Steagall
December 15, 2009 - by Donny Shaw
http://www.opencongress.org/articles/view/1410-McCain-Leads-Senate-Effort-to-Reinstate-Glass-Steagall?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+OpenCongressCongressGossipBlog+%28Open+Congress+Blog%29

Throughout the financial crisis one law has been cited over and over as a main cause of the collapse and, more significantly, the resulting bailouts of “too big to fail” banks. That law is the Gramm-Leach-Biley Act, which repealed a New Deal-era financial regulatory rule known as the Glass-Steagall Act, which was signed into law by FDR to keep regular commercial banks separate from Wall Street investment banks. The law was repealed in 1999 by Bill Clinton; the pen that signed the law to repeal it is now hanging as a trophy in the halls of Citigroup’s corporate headquarters.

Now there’s a movement in the Senate to reinstate the Glass-Steagall protections. It’s being championed by Sen. John McCain [R, AZ] of all people. Newsweek reports:

John McCain lost the 2008 presidential election because of the financial crisis—at least that’s what his chief strategist, Steve Schmidt, suggested. “We were three points ahead on Sept. 15 when the stock market crashed. And then the election was over,” Schmidt said in a postmortem earlier this year. McCain was tarred with the regulatory failures of the Bush years, and it didn’t help that he had been a longtime acolyte of the Senate’s dean of deregulation, Phil Gramm, who once derided Americans as “a nation of whiners.” McCain also seemed to have few new ideas of his own about how to address the financial panic.

More than a year after the election, the Arizona Republican is looking to repair that reputation by joining up with Democratic firebrand Maria Cantwell to propose something that will be anathema to both Wall Street and the Obama administration. According to two congressional sources, the two maverick senators want to reinstate Glass-Steagall Act, the Depression-era law that forced the separation of regular commercial banking from Wall Street investment banking. The senators’ proposal echoes a failed amendment introduced in the House last week by Rep. Maurice Hinchey of New York.

The Senate prospects for the success of the McCain-Cantwell bill—which the two plan to announce together on Wednesday morning—seem bleak at best. But McCain and Cantwell join a still small but not insignificant insurgency of chronic doubters, including former Federal Reserve chairman Paul Volcker, who say not nearly enough is being done to change Wall Street and, in particular, to address the “too big to fail” problem. The issue is one of the few in Washington that can unite the left and right sides of the political spectrum. Democrats like Cantwell deplore Wall Street’s outsize role in the real economy and its lobbying influence, and conservatives such as McCain are appalled at the way the market system has been undermined—some would say rigged—by the power of the big banks.

By proposing a bill to reinstate Glass-Steagall, McCain and Cantwell are going well outside the usual D.C. thinking on financial regulation. An anonymous Treasury official, for example, is quoted in the article as saying, “I think going back to Glass-Steagall would be like going back to the Walkman.” Bringing back Glass-Steagall is something that has made a lot of sense to the grassroots and former officials who are no longer in power, but it hasn’t really found much support among people that are currently in positions of power in D.C.

There’s always more to the story than campaign contributions, but in cases like this it’s hard not to take a look. According to OpenSecrets.org, in 2008, financial firms gave an uncommonly large amount of money to the campaigns of current members of Congress. Included in their list (http://www.opensecrets.org/industries/recips.php?cycle=2010&ind=F)of top ten recipients for this year are such powerful senators as Senate Democratic Caucus Vice Chairman Chuck Schumer [D, NY], Majority Leader Harry Reid [D, NV] and Banking Committee Chairman Chris Dodd [D, CT].
________________________

U.S. gave up billions in tax money in deal for Citigroup's bailout repayment
DEAL MADE TO RECOVER BAILOUT
Firms exempted from rule when U.S. sells its stake
By Binyamin Appelbaum
Washington Post Staff Writer
Wednesday, December 16, 2009; A01
http://www.washingtonpost.com/wp-dyn/content/article/2009/12/15/AR2009121504534_pf.html

The federal government quietly agreed to forgo billions of dollars in potential tax payments from Citigroup as part of the deal announced this week to wean the company from the massive taxpayer bailout that helped it survive the financial crisis.

The Internal Revenue Service on Friday issued an exception to long-standing tax rules for the benefit of Citigroup and a few other companies partially owned by the government. As a result, Citigroup will be allowed to retain billions of dollars worth of tax breaks that otherwise would decline in value when the government sells its stake to private investors.

While the Obama administration has said taxpayers are likely to profit from the sale of the Citigroup shares, accounting experts said the lost tax revenue could easily outstrip those profits.

The IRS, an arm of the Treasury Department, has changed a number of rules during the financial crisis to reduce the tax burden on financial firms. The rule changed Friday also was altered last fall by the Bush administration to encourage mergers, letting Wells Fargo cut billions of dollars from its tax bill by buying the ailing Wachovia.

"The government is consciously forfeiting future tax revenues. It's another form of assistance, maybe not as obvious as direct assistance but certainly another form," said Robert Willens, an expert on tax accounting who runs a firm of the same name. "I've been doing taxes for almost 40 years, and I've never seen anything like this, where the IRS and Treasury acted unilaterally on so many fronts."
For rest of article, See: http://www.washingtonpost.com/wp-dyn/content/article/2009/12/15/AR2009121504534_pf.html

Nader.org: Still Waiting for Health Care

Still Waiting for Health Care
http://www.nader.org/index.php?/archives/2147-Still-Waiting-for-Health-Care.html#extended

The House of Representatives debate on the health insurance “reform” is over with the Democrats failing the people and the Republicans disgracing themselves as having left their minds back in the third grade (with apologies to third graders).

House Democrats were determined to pass any bill with a nice sounding name, such as “The Affordable Health Care for America Act”. Single payer, full Medicare for all was never on the table even though a majority of citizens, physicians and nurses support that far more efficient, free choice of health care professionals, system.

There are no effective cost containment or prevention measures in the bill. The public option is so weak it will be a receptacle for the sickest of patients among the meager number of people who qualify for its coverage. There are no provisions to reduce the number of people (100,000) who die annually from medical malpractice in hospitals.

Nor is there a major program to reduce the tens of billions of dollars that is stolen yearly out of Medicare from criminals inside and outside the medical profession.

The cover story in the November issue of the AARP Bulletin is on the elaborate but detectable schemes to swindle Medicare with phantom services, phony rentals of equipment, stolen Medicare numbers and the like. The author, Jay Weaver, writes: “So lucrative, and so low-risk, the FBI reports, that a number of cocaine dealers in Florida and California have switched from illicit drugs to Medicare fraud.”

Although more money is finally going for prosecutions, there is nowhere near enough for this corporate crime wave. Medicare’s office of Inspector General asserts that every dollar of law enforcement will save $17 of theft.

Computerized billing fraud and abuse takes anywhere from $250 billion to double that estimate by the General Accounting Office. (The GAO said ten percent of health care expenditures are going down the drain.) The reason why the estimates cover such a broad range, according to Professor Malcolm Sparrow of Harvard University, is that there are inadequate resources to document the huge hemorrhaging of the nation’s health care budget and come up with better data.

Apart from the impoverishment of the debate, there is the actual doing of harm. The bill, if enacted, doesn’t take effect until after the presidential elections in 2013, mostly to let the drug and health insurance industries adjust, though they can scarcely believe their good fortune at being delivered all those profitable customers paid for by taxpayers with scarcely any price restraints.

The American Journal of Public Health has just published a peer-reviewed study by Harvard physicians-researchers that estimates 45,000 Americans lose their lives yearly because they cannot afford health insurance to receive diagnosis and treatment. Strange how cool the House is to giving these fatalities a four year pass.

Congressman Dennis Kucinich (D-OH), a leading single payer advocate, voted against this legislation for many reasons, most notably the Obama-driven omission of his amendment to clear the way legally for states to pass their own single payer laws. Several states, such as Pennsylvania, are in the process of moving legislation in this direction, but are concerned that the health insurers will claim federal pre-emption.

The victims of medical malpractice – estimated by the Institute of Medicine and the Harvard School of Public Health to be about 100,000 deaths a year – escaped having to overcome more hurdles before they have their full day in court. Helping to beat back the Republicans, who define “medical malpractice reform” as letting the negligent perpetrators get away with their lethal consequences, was Congressman Bruce Braley (D-IA).

Rising on the House floor he delivered a factual plea for patient safety. Hardly had he started to speak with Republicans started shouting “trial lawyer, trial lawyer” referring to his previous profession of representing wrongfully injured people before local juries in Iowa. This rare display of shouting by opponents was punctuated by one of their unleashed members rushing down the aisle shouting “You’ll pay for this.”

During this overall debate on the bill, Republicans stood up one by one, as prevaricatory dittoheads, to often scream and howl (like coyotes) that this is “a government takeover of one sixth of the economy,” “would destroy the economy,” “put 5.5 million people out of work,” “destroy the doctor-patient relationship,” “be a steamroller of socialism,” “force millions of seniors to lose their current health coverage” (meaning, Medicare?) and, in a passionate appeal to the Almighty, Congressman John Fleming (R-LA) declared “God help us as the government takes over your day-to-day life.”

Never mind that this bill is just an expansion, however misdirected, of government health insurance designed to increase corporate profits and increase the corporate grip over the day-to-day decisions regarding who, when and how people get their health care or get their bills paid.

To top off the madness, Senator Joe Lieberman (I-CT), an ever maturing political hermaphrodite, reneged on his assurance to Senate Majority Leader Harry Reid and imperiously announced on Fox News Sunday that “if the public option plan is in there, as a matter of conscience, I will not allow this bill to come to a final vote.”

For media-centric Joe, his motto seems to be “L’Senat c’est moi.” ["The Senate is me."}]

Thinking About Health Care and Financial Reform, + P. A. Sells Out--Again & Obama Hypocrisy

In This Edition:

- Who Pays for Health-Care Reform, and Is It Fair?
- What About Financial Sector Reform?
- Abbas helps Israel bury its crimes in Gaza
- "Mr. Hope & Reform" Comfortable with Rank Hypocrisy of Double Standard on Israel's Nukes
__________________________________

Who Pays for Health-Care Reform, and Is It Fair?
http://www.washingtonpost.com/wp-dyn/content/article/2009/09/22/AR2009092200044.html?nav=rss_opinion/columns
By Simon Johnson and James Kwak
Tuesday, September 22, 2009; 12:36 AM

No one is against expanding health coverage on principle. As we come down to crunch time, the health-reform debate is all about money.

Once you accept that health insurance plans must meet some minimal criteria and that everyone has to have one (or pay a penalty), you are left with the issue of funding. If 30 million to 45 million additional people will have health insurance, then someone has to pay for it. But the first thing to bear in mind is that, seen from the perspective of American society as a whole, this isn't money that we lose; it's money that we spend on health care for members of society and that goes to health-care providers who are, by and large, also members of society. In this view, in other words, it's a question of redistribution.

This should not be surprising. Insurance itself is a mechanism for redistribution. Take homeowners insurance: Money flows from people who don't lose their houses to people who do. In homeowners insurance, the general principle is that the premiums you pay should be proportional to your expected losses (the damage you could suffer times the probability of that damage). We generally consider this to be fair; if your insurance premiums are too high, you could sell your house and move to a smaller one.

The analog to this would be to force everyone to pay the expected cost of his health care. This would be "fair" in the sense that each person's costs would be proportional to his expected burden on the system. But it would break down because you cannot trade in your body for a healthier one that is cheaper to insure. As a result, the health-care bills on the table require that insurers charge the same amount to all people of the same age.

But even after taking differences in people's health status out of the equation, the numbers still don't add up on their own. The median household income in 2008 was $50,000. The average family health insurance policy provided through employer coverage cost more than $13,000. About 8 million people in households making $50,000 to $75,000 (and 29 million in households making less than $50,000) are uninsured. Asking them to suddenly start paying $13,000 per year for health insurance -- and potentially thousands more in out-of-pocket expenses -- is not going to work.

As a result, health-care reform has to involve redistribution. But this should not come as a big surprise. Social Security, for example, is a vast redistribution scheme. The amount you contribute depends on how much you make (up to the income cap, which makes little sense); the amount you receive depends partially on how much you contribute, but also on many other factors, most notably how long you live.

The real question is: Who pays? The House bill has the most generous subsidies, reaching up to 400 percent of the poverty level, and pays for them in part through an increase in income taxes for the very rich. Sen. Max Baucus's bill has less generous subsidies, and instead of taxing the rich directly, it imposes new fees on insurers, drugmakers and medical device manufacturers, and also has an "excise tax" on expensive health insurance plans. (It also includes a shockingly stupid provision to tax employers for hiring low-income people if they don't provide health insurance, but let's assume someone in the Senate Finance Committee comes to his senses and they kill that.)

Once you've made health care mandatory, lower subsidies are a tax on the middle class, plain and simple. The individual mandate -- the requirement that everyone have health insurance -- is itself a tax. The difference from Social Security and Medicare -- other redistribution schemes with mandatory taxes -- is that the individual mandate taxes the very people who are supposed to benefit from the program. Subsidies lower that tax but don't eliminate it. So the main people paying for health care reform are middle-class Americans who don't have insurance now and will probably get insurance after reform. Is that fair? It depends on whether you think taxes should be an even trade between taxpayer and government -- you get what you pay for -- or you think taxes are a way of spreading the benefits that government provides to all of society.

Taxing the rich is, by contrast, a tax on people who are most able to pay, but also the people who will benefit the least from health-care reform. Because the marginal utility -- the amount of extra enjoyment gained -- of one dollar is much lower for a rich person than for a middle-class person, it is also the most painless way to generate tax revenue. Is that fair? Again, it depends on how you see the relationship between taxpayers and the government.

The excise tax is more complicated. All other things being equal, it should affect the rich more than the poor. But other things are not equal. Some people need more expensive plans because of their health conditions. Health care is more expensive in some states than in others. So who pays will depend on a lot of factors that most people have little control over. (The one thing we can be sure of is that insurers won't pay; though this is billed as a tax on insurers, they will just pass the costs to consumers.) The excise tax would also have knock-on effects: As employers start hitting the threshold at which their plans become taxed, they and their employees will shift into cheaper plans with higher deductibles and higher copays -- which means that more of the net costs will shift to employees. Is that fair?

The challenge today is that politicians are wary of voting for anything that is called a tax, even though we know we need to pay for health-care reform somehow. In the end, if you think that individuals are responsible for dealing with their problems on their own, you probably see health-care reform as a special interest program for the uninsured and think the uninsured should pay for it (through lower subsidies). On the other hand, if you think that all Americans should have the right to a minimal level of health insurance, you probably think health-care reform is good for America, pure and simple, and favor increasing taxes on the people who can actually pay them.
_________________________________

What About Financial Sector Reform?
Where Are We Again? (Pre-G20 Pittsburgh summit)
Simon Johnson--Baseline Scenario
http://baselinescenario.com/2009/09/14/where-are-we-again-pre-g20-pittsburgh-summit/#more-4969

This revision to our Baseline Scenario is required reading for my Global Entrepreneurship Lab (GLAB) class at MIT this week.
[see link above for entire article and all links to other articles]

Financial markets have stabilized – people believe that the US and West European governments will not allow big financial institutions to fail. We have effectively nationalized any banking system losses, but we’ll let bank executives enjoy the full benefits of the upside. . . . .

We are on a dangerous and slippery slope.

Yet there is no real reform underway or on the table on any issue central to (a) how the banking system operates, or (b) more broadly, how hubris in finance led us into this crisis. The financial sector lobbies appear stronger than ever. The administration ducked the early fights that set the tone (credit cards, bankruptcy, even cap and trade); it’s hard to see them making much progress on anything – with the possible exception of healthcare (and even there, the final achievement looks likely to be limited).

The latest New York Times assessment of financial sector reforms is bleak. The Washington Post is running an excellent series on exactly how and why the banks have become stronger (part one; part two). Big banks have risen greatly in power over the past 20 years and were already strong enough this winter to ensure there was no serious attempt to rein them in.

Financial innovation is under intense pressure in both popular and technocratic discussions, but does not face any effective regulatory controls (our view; Adair Turner). This is a dangerous combination. Unless and until there is real re-regulation of finance, repeated major crises seem hard to avoid. Wall Street responds, “we have changed how we behave,” but this must at best be cyclical – after any emerging market crisis, the survivors are careful for a while. But then they go on another spree and you re-run the same boom-bubble-bust-bailout sequence, in a slightly different form and with potentially more devastating consequences. The potential for serious crisis will not decline unless and until you change incentives – and this frequently requires a change in power structure (think Korean chaebol, Thai banks, or Indonesia under Suharto).

The consensus from conventional macroeconomics is that there can’t be significant inflation with unemployment so high, and the Fed will not tighten before mid-2010. The financial markets are not so convinced – presumably worrying, in part, about easy credit leading to dollar depreciation, higher import prices, and potential commodity price inflation worldwide. In all recent showdowns with standard macro models recently, the markets’ view of reality has prevailed. My advice: pay close attention to oil prices. The conventional oil market view is that there is plenty of spare capacity so we cannot experience the price spike of early 2008; we’ll see if this proves complacent.

Emerging markets, in particular in Asia, are increasingly viewed as having “decoupled” from the US/European malaise. Increasingly, we hear that Asia’s fundamentals allow strong growth irrespective of what is happening in the rest of the world. This idea was wrong in early 2008, when it gained consensus status; this time around, it is probably setting us up for a new round of financial speculation – based in part on a “carry trade” that now runs out of the US. Most Asian currencies are a one-way bet against the US dollar over the medium-term, as they are already considerably undervalued and their central banks actively intervene to prevent significant appreciation. The appetite for this kind of risk among investors is up sharply.

What should we expect from the Pittsburgh summit on September 24-25? “Nothing much” seems the most likely outcome. The leadership of industrial countries does not want to take on the big banks, and the technocrats have contented themselves with very minor adjustments to key regulations (“dinky” is the term being used in some well-informed circles.) The G7/G8/G20 is back to being irrelevant or, worse, mere cheerleaders for the financial sector.

Overall, the global economy begins to recover, but the crisis created huge lasting costs for many poorer people in the US and around the world. Recovery without financial sector reform and reregulation sows the seeds for the next crisis. The precise timing of crises is always uncertain but the broad contours are clear – just like many emerging markets over past decades, the US, Europe, and the world economy look set to repeat the boom-bailout cycle. This will go on until at least until one or more major countries goes completely bankrupt, or until a real financial reform movement takes hold either among technocrats or more broadly politically – and the consensus then shifts back towards the kind of much tighter financial regulation that was established after the last major global fiasco in the 1930s.

-- Simon Johnson

Abbas helps Israel bury its crimes in Gaza
Ali Abunimah, The Electronic Intifada, 2 October 2009
http://electronicintifada.net/v2/article10807.shtml

Representing the moribund Palestine Liberation Organization, the executive committee of which seen here, Mahmoud Abbas has abandoned a resolution to hold Israel accountable for its alleged war crimes in Gaza. (MaanImages/POOL/Omar Rashidi)

Just when it seemed that the Ramallah Palestinian Authority (PA) and its leader Mahmoud Abbas could not sink any lower in their complicity with Israel's occupation of the West Bank and the murderous blockade of Gaza, Ramallah has dealt a further stunning blow to the Palestinian people.

The Abbas delegation to the United Nations in Geneva (officially representing the moribund Palestine Liberation Organization) abandoned a resolution requesting the Human Rights Council to forward Judge Richard Goldstone's report on war crimes in Gaza to the UN Security Council for further action. Although the PA acted under US pressure, there are strong indications that the commercial interests of Palestinian and Gulf businessmen closely linked to Abbas also played a part.

The 575-page Goldstone report documents evidence of shocking Israeli war crimes and crimes against humanity during last winter's assault on the Gaza Strip which killed 1,400 Palestinians, the vast majority noncombatants and hundreds of them children. The report also accuses the Palestinian resistance movement Hamas of war crimes for firing rockets into Israel that killed three civilians.

Goldstone's report was hailed by Palestinians and supporters of the rule of law worldwide as a watershed; it called for suspects to be held accountable before international courts if Israel failed to prosecute them. Israel has no history, ever, of holding its political and military leaders judicially accountable for war crimes against the Palestinians.

Israel was rightly terrified of the report, mobilizing all its diplomatic and political resources to discredit it. In recent days, Prime Minister Benjamin Netanyahu claimed that if the report were acted on, it would "strike a severe blow to the war against terrorism," and "strike a fatal blow to the peace process, because Israel will no longer be able to take additional steps and take risks for peace if its right to self-defense is denied."

Unsurprisingly, an early ally in the Israeli campaign for impunity was the Obama Administration, whose UN ambassador, Susan Rice, expressed "very serious concerns" about the report and trashed Goldstone's mandate as "unbalanced, one-sided and basically unacceptable." (Rice was acting true to her word; in April she told the newspaper Politico that one of the main reasons the Obama Administration decided to join the UN Human Rights Council was to fight what she called "the anti-Israel crap.")

Goldstone, whose daughter has publicly described her father as a Zionist who loves Israel, is a former judge of the South African Supreme Court, and a highly respected international jurist. He was the chief prosecutor at UN war crimes tribunals for Rwanda and the former Yugoslavia.

That the Goldstone report was a severe blow to Israel's ability to commit future war crimes with impunity is not in doubt; this week bolstered by the report, lawyers in the UK asked a court to issue an arrest warrant for visiting Israeli Defense Minister Ehud Barak. That action did not succeed, but Israel's government has taken extraordinary measures in recent months to try to shield its officials from prosecution, fearing that successful arrests are just a matter of time. Along with the growing international campaign of boycott, divestment and sanctions, the fear of ending up in The Hague seems to be the only thing that causes the Israeli government and society to reconsider their destructive path.

One would think, then, that the self-described representatives of the Palestinian people would not casually throw away this weapon. And yet, according to Abbas ambassador Ibrahim Khraishi, the Ramallah PA shelved its effort at the request of the Americans because "We don't want to create an obstacle for them."

Khraishi's excuse that the resolution is merely being deferred until the spring does not pass muster. Unless action is taken now, the Goldstone report will be buried by then and evidence of Israel's crimes -- necessary for prosecutions -- may be harder to collect.

This latest surrender comes less than two weeks after Abbas appeared at a summit in New York with US President Barack Obama and Netanyahu despite Obama abandoning his demand that Israel halt construction of Jewish-only settlements on occupied Palestinian land. Also under US pressure, the PA abandoned its pledge not to resume negotiations unless settlement-building stopped, and agreed to take part in US-mediated "peace talks" with Israel in Washington this week. Israel, meanwhile, announced plans for the largest ever West Bank settlement since 1967.

What makes this even more galling, is the real possibility that the PA is helping Israel wash its hands of the blood it spilled in Gaza for something as base as the financial gain of businessmen closely linked to Abbas.

The Independent (UK) reported on 1 October:

"Shalom Kital, an aide to defense minister Ehud Barak, said today that Israel will not release a share of the radio spectrum that has long been sought by the Palestinian Authority to enable the launch of a second mobile telecommunications company unless the PA drops its efforts to put Israeli soldiers and officers in the dock over the Israeli operation." ("Palestinians cry 'blackmail' over Israel phone service threat," The Independent, 1 October).

Kital added that it was a "condition" that the PA specifically drop its efforts to advance the Goldstone report. The phone company, Wataniya, was described last April by Reuters as an "Abbas-backed company" which is a joint venture between Qatari and Kuwaiti investors and the Palestinian Investment Fund with which one of Abbas' sons is closely involved. Moreover, Reuters revealed that the start-up company apparently had no shortage of capital due to the Gulf investors receiving millions of dollars of "US aid in the form of loan guarantees meant for Palestinian farmers and other small to mid-sized businesses" (See "US aid goes to Abbas-backed Palestinian phone venture," Reuters, 24 April 2009).

Just a day before the Abbas delegation pulled its resolution in Geneva, Nabil Shaath, the PA "foreign minister" denounced the Israeli threat over Wataniya as "blackmail" and vowed that the Palestinians would never back down.

The PA's betrayal of the Palestinian people over the Goldstone report, as well as its continued "security coordination" with Israel to suppress resistance and political activity in the West Bank, should banish all doubt that it is an active arm of the Israeli occupation doing tangible and escalating harm to the Palestinian people and their just cause.

Co-founder of The Electronic Intifada, Ali Abunimah is author of One Country: A Bold Proposal to End the Israeli-Palestinian Impasse.
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Obama Agrees to Keep Israel's Nukes "Secret"

By Eli Lake

October 02, 2009 "Washington Times" -- President Obama has reaffirmed a 4-decade-old secret understanding that has allowed Israel to keep a nuclear arsenal without opening it to international inspections, three officials familiar with the understanding said.

The officials, who spoke on the condition that they not be named because they were discussing private conversations, said Mr. Obama pledged to maintain the agreement when he first hosted Israeli Prime Minister Benjamin Netanyahu at the White House in May.

Under the understanding, the U.S. has not pressured Israel to disclose its nuclear weapons or to sign the nuclear Non-Proliferation Treaty (NPT), which could require Israel to give up its estimated several hundred nuclear bombs.

Israel had been nervous that Mr. Obama would not continue the 1969 understanding because of his strong support for nonproliferation and priority on preventing Iran from developing nuclear weapons. The U.S. and five other world powers made progress during talks with Iran in Geneva on Thursday as Iran agreed in principle to transfer some potential bomb fuel out of the country and to open a recently disclosed facility to international inspection.

Mr. Netanyahu let the news of the continued U.S.-Israeli accord slip last week in a remark that attracted little notice. He was asked by Israel's Channel 2 whether he was worried that Mr. Obama's speech at the U.N. General Assembly, calling for a world without nuclear weapons, would apply to Israel.

"It was utterly clear from the context of the speech that he was speaking about North Korea and Iran," the Israeli leader said. "But I want to remind you that in my first meeting with President Obama in Washington I received from him, and I asked to receive from him, an itemized list of the strategic understandings that have existed for many years between Israel and the United States on that issue. It was not for naught that I requested, and it was not for naught that I received [that document]."

The chief nuclear understanding was reached at a summit between President Nixon and Israeli Prime Minister Golda Meir that began on Sept. 25, 1969. Avner Cohen, author of "Israel and the Bomb" and the leading authority outside the Israeli government on the history of Israel's nuclear program, said the accord amounts to "the United States passively accepting Israel's nuclear weapons status as long as Israel does not unveil publicly its capability or test a weapon."
For Rest Of Article See:
http://www.washingtontimes.com/news/2009/oct/02/president-obama-has-reaffirmed-a-4-decade-old-secr//print/