Obama's Deficit Commission Proposals & Will he Cave on Tax Cuts for the Rich?

The Corporate Republican and Corporate Democrat Appointed by the Corporate Obama Come Up With a (Surprise!) Corporate Idea

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Obama Deficit Commission Criticized for Proposals to Slash Social Security, Medicare

The co-chairmen of the bipartisan presidential deficit commission released a list of recommendations Wednesday on ways to reduce the nation’s deficit by $4 trillion by 2020. Co-chairmen Erskine Bowles and Alan Simpson have proposed raising the retirement age for Social Security to 69 by the year 2075, decreasing the cost of living benefits for Social Security recipients, imposing new limits on the Medicare health insurance program, and ending several middle-class tax breaks. We speak with economist Robert Kuttner. [includes rush transcript]

Guest:
Robert Kuttner, Journalist and economist. He is the co-founder and co-editor of The American Prospect magazine, as well as a Distinguished Senior Fellow of the think tank Demos. His latest book is A Presidency in Peril: The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to Control our Economic Future.

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RUSH TRANSCRIPT

JUAN GONZALEZ: On Wednesday, the co-chairmen of the bipartisan presidential deficit commission released a list of recommendations on ways to reduce the nation’s deficit by $4 trillion by 2020. Co-chairmen Erskine Bowles and Alan Simpson have proposed raising the retirement age for Social Security to 69 by the year 2075, [decreasing] the cost of living benefits for Social Security recipients, imposing new limits on Medicare health insurance programs, and ending several middle-class tax breaks.

Many of the proposals read like a wish list for the Republican Party, including the elimination of funding for the Corporation for Public Broadcasting, the capping of jury awards in malpractice cases, and a major reduction in corporate income taxes.

But the commission is also making significant cuts to the Pentagon budget. The draft proposals call for the closing of one-third of the nation’s overseas military bases, a temporary freeze on Defense Department salaries, and a reduction on the Pentagon’s reliance on private contractors.

AFL-CIO President Richard Trumka slammed the commission’s proposals. He said, quote, "The chairmen of the Deficit Commission just told working Americans to 'drop dead.' Especially in these tough economic times," Trumka said, it is, quote, "unconscionable to be proposing cuts to the critical economic lifelines for working people, Social Security and Medicare."

The commission’s co-chair, Erskine Bowles, said Wednesday that the nation is facing an economic crisis if the budget deficit is not addressed.

ERSKINE BOWLES: We are on the most predictable path towards an economic crisis that I can imagine. The path we’re on today is not sustainable. And I don’t know a soul on this commission or anywhere else in the Congress that believes it is. The arithmetic is compelling. This debt is like a cancer that will truly destroy this country from within if we don’t fix it, and we can’t grow ourself out of this problem. We could have double-digit growth for decades and not solve this problem. We can’t tax our way out of this problem, and we can’t cut our way out of this problem. It’s going to take some combination thereof.

JUAN GONZALEZ: To talk more about the deficit commission’s proposals, we’re joined by the journalist and economist Robert Kuttner. He’s the co-founder and co-editor of The American Prospect magazine. His latest book is called A Presidency in Peril: The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to Control our Economic Future.

Welcome to Democracy Now!, Robert Kuttner.

ROBERT KUTTNER: Thanks so much for having me. Thanks so much for having me.

JUAN GONZALEZ: Your reaction to the preliminary proposals, because obviously the commission has not yet even voted on these proposals. This is sort of the outline of what they’re considering. Your reaction?

ROBERT KUTTNER: Well, the only thing worse than the economics is the politics. The economics are totally perverse. Bowles talks about being on a path to an economic crisis. Of course, we’re in an economic crisis. We’re in a prolonged recession that bears more resemblance really to a depression. And you cannot get out of a depression by austerity. The idea that you should have an arbitrary set of cuts in the deficit at a time when you need more public spending is totally perverse. It’s the economics of Herbert Hoover. It’s the politics of the Republican right. And it’s one more indication of the capture of the Obama administration by Wall Street.

I mean, Erskine Bowles gets over $300,000 a year for attending a few meetings of Morgan Stanley, the investment bank, on whose board he sits, so he gets more money in board fees than 99 percent of Americans earn. And you’ve got three privately funded commissions by the Peterson Foundation, Pete Peterson, proposing the same stuff. It’s intended to create a drumbeat to carry out a wish list that has long been the goal of fiscal conservatives, that has nothing to do with this crisis. Social Security is in surplus for the next 27 years. So, the idea that you can somehow get the budget closer to balance by cutting Social Security is perverse. It’s politically insane.

And if the President had the kind of spine that we hoped he had when we elected him, he would be saying, "No way are we going to balance the budget on the backs of working people." Instead, I think the risk is that the President is going to embrace some version of this. And the hope is that the four progressives on the commission, three of whom have already said "no way," plus Max Baucus, the chair of the Senate Finance Committee who’s on the commission, will view this as a threat to his prerogatives as a Senate committee chairman. The best thing about this commission is that maybe it will deadlock.

JUAN GONZALEZ: And when you say the four progressives, who are the other progressives that you are expecting to stand up on these issues?

ROBERT KUTTNER: Well, Jan Schakowsky, who’s a member of the Democratic House leadership, she’s a very progressive member of Congress from Chicago; Xavier Becerra, also a progressive; and Dick Durbin, the senator from Illinois. They have said "no way." Andy Stern, the former head of the Service Employees International Union, is on the commission. Andy is a bit of a free spirit. Andy loves to see if there can be some kind of a deal. But I think this particular deal will even stick in Stern’s craw. So, I think the hope is that the Republicans, some of them, will say, "Well, nothing that reduces defense spending or reduces tax loopholes are we going to support," and the liberals on the commission will hang tough and say, "No way are we going to cut Social Security and Medicare."

I think the problem is that the editorialists of this country—if you read this morning’s New York Times editorial—are saying, "Well, gee, anything that the left and the right don’t like must be pretty good." And that’s exactly wrong. I mean, this is a case where the so-called center just completely has it wrong. You cannot get out of a depression by having deeper cuts in spending. And I think if you look at the criticism of the Federal Reserve policy of buying treasuries because it doesn’t know what else to do, in the hope that that will lower interest rates and somehow stimulate recovery, the Fed is doing that as a last resort because Congress is opposed to increasing social investment. The only way you can really get out of a prolonged slump like this is to increase social investment in job creation, in the infrastructure, in the clean energy that the country needs. And yet that path seems to be blocked. And instead of fighting for some degree of public investment, Obama, who, after all, appointed this commission, is at risk of embracing at least some of its proposals.

So I think the only thing that’s going to block this—and we heard some of this from Rich Trumka—the progressive movement needs to put forward its own version of a budget that would cut defense spending, cut tax loopholes, insist on suspending the Bush tax cuts for the wealthy, and dramatically increase social investment, and explain to the American people why that’s a better route out of the real crisis that we’re in. There’s one resource I want to commend to all of your viewers and listeners. It’s a new website, ourfiscalfuture.org, which proposes a counter-strategy for getting the economy out of this mess. That’s a coalition of progressive think tanks—Demos, where I’m a fellow, Economic Policy Institute, Century Foundation. And we have a huge fight on our hands, because the other side is investing tens of millions, if not hundreds of millions, of dollars in a propaganda effort on behalf of austerity. It’s backed by Wall Street. And all we can do is try and argue that this whole set of proposals is bad economics and bad politics for the Obama administration and the Democrats.

JUAN GONZALEZ: Well, Robert Kuttner, one of the arguments of those who would support many of these cuts are saying that this will allow the government to further cut the nominal tax rates for—not only for high income, but for middle-class Americans, as well. But isn’t the reality—I mean, there was a time in this country when the highest tax brackets, in the 1950s, were being taxed at a 90 percent rate. Now they’re down into the mid-thirties, and they think that that is too high a rate, and they want it lowered further. What about this tax policy that now, for years, has continued to reduce the tax rates for the highest-earning Americans in the country?

ROBERT KUTTNER: Sure. Well, the Alice in Wonderland character of this whole exercise is demonstrated by the fact that, on the one hand, they’re talking about some kind of a tax deal where you cut loopholes and you raise rates—or lower rates. And by the way, one of the so-called loopholes that they want to close is the child tax credit. Hundreds of millions of dollars of relief for working poor people, where you get a refundable tax credit to help you raise your kids, that’s one of the supposed loopholes that the commission wants to get rid of. That’s crazy. Also, the idea that you cut loopholes and then cut rates, that produces no net increase in revenue. It simply reshuffles the deck.

And the other thing that’s deceptive is that at the same moment that the Republicans on the panel are proposing this deal, they’re also demanding that the Bush tax cuts from 2001, which expire at the end of this year, be extended not just for the 98 percent of Americans who make less than $250,000 a year, as President Obama proposes, but for very, very rich people. Now, continuing those tax cuts for very rich people would add almost a trillion dollars to the deficit over the next ten years, and yet the commission is treating that as absolutely untouchable, because there’s no way the Republicans would buy into that. So, you’re absolutely right. I mean, if we want to do something about the deficit in the long run—and we should not be doing anything about it in the short run. In the short run, with the economy in the condition that it’s in, we need more deficit spending, not less. But if we want to deal with the deficit in the long run, restore higher tax rates on the people who got us into this mess, who are still making an absolute killing and, unlike working people, who can afford to pay higher taxes.

JUAN GONZALEZ: Also, I’d like to ask you—you were mentioning the people who got us into this mess. Clearly, the enormous amounts of speculation that has been occurring—and the financial speculation has been growing exponentially, not only in the United States, but across the world, on markets. There’s never any kind of a discussion of being able to tax stock transactions on all of these various markets, which obviously, if these companies want to continue to engage or investors want to continue to engage in speculative activity, why not have the government tax it as a means of being able to close our deficit? But that’s never somehow discussed.

ROBERT KUTTNER: Well, no, and it’s not even in the proposal. And again, here’s Erskine Bowles. He’s on the board of directors on one of the top five banks that would actually be taxed if you taxed financial speculation. And he’s the chair of this, appointed by President Obama. And that proposal is nowhere to the seen. I would call that a conflict of interest. I mean, if Obama had put, you know, Rich Trumka as one of the two co-chairs, the right would be screaming bloody murder, and so would Wall Street. And yet, Wall Street got one of its people, not as the Republican co-chair, but as the Democrat co-chair.

JUAN GONZALEZ: Well, I want to thank you very much for being with us, Robert Kuttner, journalist and economist. He’s also the co-editor of The American Prospect magazine and the author of A Presidency in Peril: The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to Control our Economic Future. And we’ll continue to be covering this issue of what happens with the deficit commission proposals.
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CEPR Statement on Deficit Commission Proposals
Center for Economic and Policy Research (CEPR)

Statement on Deficit Commission Proposals
For Immediate Release: November 10, 2010
Contact: Alan Barber, (571)306-2526

Washington, D.C.- Dean Baker, Co-Director of the Center for Economic and Policy Research (CEPR) released the following statement on the proposals offered by Erskine Bowles and Alan Simpson, co-chairs of the President's deficit commission:

"Senator Alan Simpson and Erskine Bowles appeared to have largely ignored economic reality in developing the proposals they presented to the public today.

"The country is suffering from 9.6 percent unemployment with more than 25 million people unemployed, underemployed or who have given up looking for work altogether. Tens of millions of people are underwater in their mortgage and millions face the prospect of losing their home to foreclosure.

"This situation is not the result of government deficits, contrary to what Mr. Bowles seemed to suggest at the co-chairs' press conference today. The downturn was caused by the bursting of an $8 trillion housing bubble. This bubble was the basis of the construction and consumption demand that drove the economic expansion through 2007. 

"The large government deficits are the only factor sustaining demand following the loss of this bubble wealth. If today's deficit were smaller, we would not be helping our children; we would just be putting their parents out of work. Simpson and Bowles somehow think they have covered this concern by delaying their cuts until fiscal year 2012, 11 months from now. Virtually all projections show the unemployment rate will still be over 9.0 percent at the point when the Simpson-Bowles cuts begin to slow the economy further. This leaves the economy like a plane with one engine already out and Simpson Bowles prepared to knock out the other engine as well.

"The failure to understand current deficits contributes to a misunderstanding of the debt burden. For example, Simpson and Bowles raised fears of an exploding debt reaching 90 percent of GDP by the end of the decade. There is no reason that the Fed can't just buy this debt (as it is largely doing) and hold it indefinitely If need be, the Fed can use other tools at its disposal to ensure that this expansion of the monetary base does not lead to inflation.

"This creates no interest burden for the country, since the Fed refunds its interest earnings to the Treasury every year. Last year the Fed refunded almost $80 billion in interest to the Treasury, nearly 40 percent of the country's net interest burden.

"This means that the country really has no near-term or even mid-term deficit problem, just paranoia being spread by many of the same people who led the economy into its current disastrous situation.

"Over the longer term, the country is projected to face a deficit problem but this is almost entirely attributable to the projection that private sector health care costs grow at an explosive rate. This projected growth rate of health care costs would eventually lead to serious budget problems in addition to leading to enormous problems for the private sector. However, the underlying problem is the broken health care system, not public sector health care programs. For some reason, though, Simpson-Bowles never directly addresses these of the health care system.

"Simpson and Bowles apparently never considered a Wall Street financial speculation tax (FST) as a tool for generating revenue. This is an obvious policy-tool that even the IMF is now advocating, in recognition of the enormous amount of waste and rents in the financial sector. Through an FST, it is possible to raise large amounts of revenue, easily more than $100 billion a year, with very little impact to real economic activity. The refusal to consider this source of revenue is striking since at least one member of the commission has been a vocal advocate of financial speculation taxes. It is also worth noting that Mr. Bowles is a director of Morgan Stanley, one of the Wall Street banks that would be seriously impacted by such a tax.

"Finally, it is striking that the Co-Chairs felt the need to address Social Security, even though it was not part of their mandate. The commission's mandate was to deal with the country's fiscal problems. Since Social Security is legally prohibited from ever spending more than it has collected in taxes, it cannot under the law contribute to the deficit. Their proposal would cut benefits for tens of millions of middle class workers who are overwhelmingly dependent on Social Security for their retirement income. It would also raise the retirement age for lower income workers who have seen little increase in life expectancy.

"While there are some positive items in the report (it would limit the mortgage interest rate deduction get rid of the deduction for cafeteria benefit plans), it suffers from the fact that the co-directors never reflected on their basic economic assumptions. It is hard to avoid the conclusion that this exercise was a waste of time and that we should go back to having Congress determine our budgets through the normal process rather than secret commissions."

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Cuts to Social Security and Medicare are Fiscal Commission’s Primary Solution to Nation’s Debt Crisis

By NCPSSM | November 10, 2010

 Sometimes you’d just rather be wrong…and this is one of those times. 

The Chairmen of the President’s Fiscal Commission unveiled their solutions for the nation’s debt/deficit mess in a hastily called news conference today and– as predicted– it’s all about cuts to Social Security and Medicare.

“America’s retirees, disabled and their families had hoped for a balanced approach to solving our nation’s fiscal crisis.  Unfortunately, that is not what we received in today’s report by the Chairmen of the President’s Fiscal Commission.  This proposal relies far too heavily on benefit cuts which will hurt millions of Americans.  Lowering COLA’s which hit even current retirees, raising the retirement age, and making benefit cuts in Social Security have nothing to do with solving this fiscal crisis and do not offer a balanced solution to debt reduction by any stretch of the imagination.”…Barbara B. Kennelly, President and CEO 

Specifically, the proposal released today by the Chairmen of the National Commission on Fiscal Responsibility and Reform, former Senate Alan Simpson and Erskine Bowles would: 

Raise the Retirement Age to 69 – this proposals calls for a gradual increase to age 68 by the year 2050 and 69 by 2075. This would result in substantial benefit reductions for the generations of Americans.

 Reduce Cost of Living Adjustments – this proposal suggests a different method of calculating the cost-of-living adjustment resulting in smaller COLAs as soon as 2012, impacting even current retirees. Estimates are this would lower benefits by approximately 3 percent after 10 years of retirement and 6 percent after 20 years of retirement. 

Cut Social Security Benefits – by changing Social Security’s benefit formula this proposal would cut benefits for millions of future retirees.  

More Medicare cuts – this time directly to benefits  

Increased Cost Sharing for Seniors – Congress just enacted the Affordable Care Act, which included billions in savings from Medicare yet did not target beneficiaries.  However, this Commission proposal includes hundreds of billions of additional Medicare cuts, over $100 billion of which will come directly out of the pockets of seniors in the form of increased cost-sharing.  The average senior is already spending 30% of his/her Social Security benefit on Medicare Part B & Part D out-of-pocket costs alone; this proposal would increase that amount.   

Reduced Provider Reimbursements – This proposal includes a new round of cuts in Medicare provider reimbursements before reforms in the health care law have even been implemented, which could leave seniors without access to affordable health care.   

“America’s seniors and their families want Washington to get its fiscal house in order; however, they also know Social Security did not create this economic mess and should not foot the bill for failed economic policies of the past.  The American people are serious about deficit reduction and have said in poll after poll that they’ll support a balanced proposal.  This isn’t it.”…Barbara B. Kennelly, President and CEO

The only good news here is no one takes this proposal seriously beyond those who’ve pushed this anti-Social Security and Medicare agenda from the beginning, such as the Peterson Foundation and all of the other anti-entitlement groups it funds. 

According to CBS:

The document, from co-chairs Erskine Bowles and Alan Simpson, is not the bipartisan commission’s final proposal, which is due at the end of the month. It likely could not win support from 14 of the commission’s 18 members, which is necessary to advance it to Congress for consideration.
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Cutting Social Security is the New TARP
Cenk Uygur
Host of The Young Turks
Posted: November 11, 2010 12:41 AM
. . . .
They propose to cut the top rate from 35% to 23% for the personal income tax, and the corporate tax rate would get cut from 35% to 26%. What an unbelievable joke. So, you have to cut Social Security and Medicare because you just had to give the rich one more gigantic tax cut? They'll claim they are getting rid of some tax exemptions and credits, but that doesn't come close to making up for the tax cuts they have proposed.

But we have to thank them for making their intentions undeniably clear. This Deficit-Reduction Commission has nothing to do with the deficit. It never did. I . . . always thought it was an excuse to cut Social Security to pay for the tax cuts that went to the rich and ate up the Social Security surplus. It turns out, it's more audacious than that. It cuts Social Security to pay for whole new round of tax cuts for the rich. The balls on these guys.

A new poll out by PPP indicates that when asked how to balance the budget, 43% of real Americans said tax the wealthy, 22% said cut defense spending and only 12% said cut Social Security. They didn't stutter. That's crystal clear. If some of our current politicians make the mistake of backing these cuts for Social Security, those numbers are going to come back to bite them. And they'll be our former politicians. I, for one, will work the rest of my life to kick out of office anyone who signs off on this robbery. I don't give a damn what party they claim to be from. That includes the president.

Through all of my frustrations with the president, I have never called for a primary opponent against him in 2012. And I don't know any other established progressive that has. If he pushes for this plan, he should definitely get a primary challenger. Because I couldn't vote for a guy who agreed to rob the middle class like this. This is definitely the last straw. If he does this, then he was never on our side to begin with.
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Ten Flash Points In The Fiscal Commission Chairmen's Proposal
Dan Froomkin
froomkin@huffingtonpost.com

The two deficit-hawk extremists President Obama put in charge of his fiscal commission released their personal suggestions for cutting the federal budget deficit on Wednesday. And while it's quite possible that not a one of them will make it into the commission's official recommendations, which require the approval of 14 of the 18 commissioners (not just two), the document will inevitably be welcomed as a "serious" contribution to the debate - at least by Republicans and conservative Democrats.
. . . .
As New York Times opinion columnist Paul Krugman writes: “Even if those cuts are offset by supposed elimination of tax breaks elsewhere, balancing the budget is hard enough without giving out a lot of goodies -- goodies that fairly obviously, even without having the details, would go largely to the very affluent.”
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See Also:

The Wall Street TARP Gang Wants to Take Away Your Social Security
by Dean Baker [CEPR]

Just over two years ago, the Wall Streeters were running around Congress and the media saying that if they don't immediately get $700 billion the world will end. Since they own large chunks of both, they quickly got their money.

Even more important than the hundreds of billions of loans issued through the TARP was the trillions of dollars of loans and guarantees from the Fed and the FDIC. This money came with virtually no strings attached. It kept Goldman Sachs, Citigroup, Morgan Stanley, and Bank of America and many others from collapsing. As a result, folks like Goldman CEO Lloyd Blankfein are again pocketing tens of millions a year in wages and bonuses, instead of walking the unemployment lines. Instead, 15 million ordinary workers are being told to just get used to being unemployed; it's the "new normal."

But wait, it gets worse. The thing about Wall Streeters is that no matter how much money you give them, they always want more. Now they are using their political power and control over the media to attack Social Security. . . . .
[See article above for rest and for links]
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Many deficit commission staffers paid by outside groups
By Dan Eggen
Washington Post Staff Writer
Wednesday, November 10, 2010; 8:12 PM
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The Draft Proposal
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Will Obama Cave (once again) on Tax Cuts for the Rich?

Obama’s First Stand

Robert Reich
WEDNESDAY, NOVEMBER 10, 2010

The President says a Republican proposal to extend the Bush tax cuts to everyone for two years is a “basis for conversation.” I hope this doesn’t mean another Obama cave-in. 

Yes, the President needs to acknowledge the Republican sweep on Election Day. But he can do that by offering his own version of a compromise that’s both economically sensible and politically smart. Instead of limiting the extension to $250,000 of income (the bottom 98 percent of Americans), he should offer to extend it to all incomes under $500,000 (essentially the bottom 99 percent), for two years.

The economics are clear:

First, the top 1 percent spends a much smaller proportion of their income than everyone else, so there’s very little economic stimulus at these lofty heights.

On the other hand, giving the top 1 percent a two-year extension would cost the Treasury $130 billion over two years, thereby blowing a giant hole in efforts to get the deficit under control.

Alternatively, $130 billion would be enough to rehire every teacher, firefighter, and police officer laid off over the last two years and save the jobs of all of them now on the chopping block. Not only are these people critical to our security and the future of our children but, unlike the top 1 percent, they could be expected to spend all of their earnings and thereby stimulate the economy.

Conservative supply-siders who argue the top 1 percent will stop working as hard if they have to return to the 39 percent marginal rate of the Clinton years must be smoking something (probably an expensive grade).

The incomes of the top are already soaring (Wall Street is reading a 5% boost in bonuses, executive salaries and perks are back on the trajectory they were on before the collapse, and the stock market is booming), so it’s hard to argue much hardship.

Besides, only earnings over $500,000 would be affected because — remember — we’re talking about the marginal tax rate.

In addition, the Clinton years weren’t exactly bad years, economically, for the top 1 percent.

Finally, the Bush tax cuts didn’t trickle down anyway. To the contrary, between 2001 and 2007, the median wage dropped. And Bush’s record on jobs was pitiful.

The politics are even clearer. Over the next two years, Obama must clarify for the nation whose side he’s on and whose side his Republican opponents are on. What better issue to begin with than this one?

The top 1 percent now takes in almost a quarter of all national income (up from 9 percent in the late 1970s), and its political power is evident in everything from hedge-fund and private-equity fund managers who can treat their incomes as capital gains (subject to a 15 percent tax) to multi-million dollar home interest deductions on executive mansions. 

If the President can’t or won’t take a stand now — when he still has a chance to prevail in the upcoming lame-duck Congress — when will he ever?

Chomsky on the Recent Election

Outrage, Misguided

By Noam Chomsky

November 09, 2010 "-----The U.S. midterm elections register a level of anger, fear and disillusionment in the country like nothing I can recall in my lifetime. Since the Democrats are in power, they bear the brunt of the revulsion over our current socioeconomic and political situation.

More than half the “mainstream Americans” in a Rasmussen poll last month said they view the Tea Party movement favorably—a reflection of the spirit of disenchantment.

The grievances are legitimate. For more than 30 years, real incomes for the majority of the population have stagnated or declined while work hours and insecurity have increased, along with debt. Wealth has accumulated, but in very few pockets, leading to unprecedented inequality.

These consequences mainly spring from the financialization of the economy since the 1970s and the corresponding hollowing-out of domestic production. Spurring the process is the deregulation mania favored by Wall Street and supported by economists mesmerized by efficient-market myths.

People see that the bankers who were largely responsible for the financial crisis and who were saved from bankruptcy by the public are now reveling in record profits and huge bonuses. Meanwhile official unemployment stays at about 10 percent. Manufacturing is at Depression levels: one in six out of work, with good jobs unlikely to return.

People rightly want answers, and they are not getting them except from voices that tell tales that have some internal coherence—if you suspend disbelief and enter into their world of irrationality and deceit.

Ridiculing Tea Party shenanigans is a serious error, however. It is far more appropriate to understand what lies behind the movement’s popular appeal, and to ask ourselves why justly angry people are being mobilized by the extreme right and not by the kind of constructive activism that rose during the Depression, like the CIO (Congress of Industrial Organizations).

Now Tea Party sympathizers are hearing that every institution—government, corporations and the professions—is rotten, and that nothing works.

Amid the joblessness and foreclosures, the Democrats can’t complain about the policies that led to the disaster. President Ronald Reagan and his Republican successors may have been the worst culprits, but the policies began with President Jimmy Carter and accelerated under President Bill Clinton. During the presidential election, Barack Obama’s primary constituency was financial institutions, which have gained remarkable dominance over the economy in the past generation.

That incorrigible 18th-century radical Adam Smith, speaking of England, observed that the principal architects of power were the owners of the society—in his day the merchants and manufacturers—and they made sure that government policy would attend scrupulously to their interests, however “grievous” the impact on the people of England; and worse, on the victims of “the savage injustice of the Europeans” abroad.

A modern and more sophisticated version of Smith’s maxim is political economist Thomas Ferguson’s “investment theory of politics,” which sees elections as occasions when groups of investors coalesce in order to control the state by selecting the architects of policies who will serve their interests.

Ferguson’s theory turns out to be a very good predictor of policy over long periods. That should hardly be surprising. Concentrations of economic power will naturally seek to extend their sway over any political process. The dynamic happens to be extreme in the U.S.

Yet it can be said that the corporate high rollers have a valid defense against charges of “greed” and disregard for the health of the society. Their task is to maximize profit and market share; in fact, that’s their legal obligation. If they don’t fulfill that mandate, they’ll be replaced by someone who will. They also ignore systemic risk: the likelihood that their transactions will harm the economy generally. Such “externalities” are not their concern—not because they are bad people, but for institutional reasons.

When the bubble bursts, the risk-takers can flee to the shelter of the nanny state. Bailouts—a kind of government insurance policy—are among many perverse incentives that magnify market inefficiencies.

“There is growing recognition that our financial system is running a doomsday cycle,” economists Peter Boone and Simon Johnson wrote in the Financial Times in January. “Whenever it fails, we rely on lax money and fiscal policies to bail it out. This response teaches the financial sector: Take large gambles to get paid handsomely, and don’t worry about the costs—they will be paid by taxpayers” through bailouts and other devices, and the financial system “is thus resurrected to gamble again—and to fail again.”

The doomsday metaphor also applies outside the financial world. The American Petroleum Institute, backed by the Chamber of Commerce and the other business lobbies, has intensified its efforts to persuade the public to dismiss concerns about anthropogenic global warming—with considerable success, as polls indicate. Among Republican congressional candidates in the 2010 election, virtually all reject global warming.

The executives behind the propaganda know that global warming is real, and our prospects grim. But the fate of the species is an externality that the executives must ignore, to the extent that market systems prevail. And the public won’t be able to ride to the rescue when the worst-case scenario unfolds.

I am just old enough to remember those chilling and ominous days of Germany’s descent from decency to Nazi barbarism, to borrow the words of Fritz Stern, the distinguished scholar of German history. In a 2005 article, Stern indicates that he has the future of the United States in mind when he reviews “a historic process in which resentment against a disenchanted secular world found deliverance in the ecstatic escape of unreason.”

The world is too complex for history to repeat, but there are nevertheless lessons to keep in mind as we register the consequences of another election cycle. No shortage of tasks waits for those who seek to present an alternative to misguided rage and indignation, helping to organize the countless disaffected and to lead the way to a better future.

© The New York Times News Service/Syndicate
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Comments [On the Information Clearing House website]:
Abraham Weizfeld · 2 hours ago
Looking for leverage.. use ideas.

sam · 5 hours ago
Given the widespread and blatant anti-semitism on this web site I find it rather curious that it would be publishing something that criticized Nazi Germany. I would think that today's nazis would be great fans of their predecessors. Also rather curious that Chomsky would criticize the Nazis when he himself openly supports violent attacks on Jews and questions their right to defend themselves against such attacks.

Personally I'll take the Tea Party over the anti-semites any day.

GlobalCitizen · 5 hours ago
You better get used to "widespread and blatant anti-semitism", as you call it: people are no longer fooled by these accusations.

You wonder why?

Because you 'chosen people' show each and every day that you have learned absolutely nothing from the drama of WWII: you imprison an entire population in what is by right their own country. You bomb it into oblivion, you murder, torture, and abuse as you see fit. You stop the most basic necessities of being imported. You terrorize anyone who dares to speak out.

In short: you behave just like the nazis did.

With that you have completely wasted the goodwill that you used to have: people around the globe are disgusted with your fascist tendencies.

You can ignore this, as you have so far. But at the end of the day you are not alone in this world and you will face the consequences of that.

ALI · 2 hours ago
hahaha the magic word "anti-semi" is now shit.. has no magic any more..
yeah.. look at the "chosen people" yourself and what do you see?
Look at the "nation" they created called ISRAEL and what do you see?
A bunch of thieves and murderers of all kinds.

Thomas O. Anderson · 5 hours ago
You've become part of the problem, Mr. Chomsky. You could have helped lead the world into a new age of enlightenment; a world free from our deceitful tyrants and their corporate media cheerleaders. But like an unbelievably gullible rube from River City, you stay silent on the controlled demolitions of 9/11, helping "manufacture consent" for the American/Israeli Death Machine.

Bill Duke · 4 hours ago
When Chomsky starts taking 911 truth seriously, I'll pay him some mind...until then...F off Gnome!

Scott Lindsay · 2 hours ago
This is for Sam who speaks of the poor defenseless Zionists and the attacks they have endured by those awful stone throwing teenagers that have chipped the paint off their military hardware or even worse those katusha rockets that have killed so many, what was it four in the last 12 years, so much for homemade rockets, but then the Zionists get there bombs from the good ole USA and are loaded with phosphorus to burn those women and children for being Arabs.Yes Sam your letter breaks my heart for those poor defenseless Zionists.

Telemachus · 2 hours ago
The solution is always the same - "organize". What does that mean exactly? You can't "organize" the terminally stupid until they pull Rush Limbaugh out of their ass. Good luck with that!

Olberman Sidelined & More Notes on Obama's 2010 Election Debacle

In This Issue:

- Olbermann placed on indefinite suspension without pay
- More Notes on Obama's 2010 Election Debacle

__________

The main stream media (MSM) likes to pretend that they don't have a political agenda. To support the myth, they love to fire or suspend moderate to slightly left-leaning commentators like Juan Williams and Keith Olbermann, as if they are not American citizens with the right, as commentators, to give their opinions regardless of who they work for, or have no right to donate to the political causes of their choice, even when the commentator's alleged purpose is, in fact, to offer political opinions. FoxNews, NPR, Viacom, and MSNBC are nothing if not political--both rabidly political Fox News' Glenn Beck and Viacom's Jon Stewart have both held political rallies in Washington D.C. with no adverse reaction, Fox New's Hannity has been obnoxiously political, and NPR's subtle support of both wars, Jewish issues, and of course Israel, have brought little reaction from the press or any corporate entity. NBC did a terrific job of coaxing the American People into war with Iraq. But to be sure, these occasional human sacrifices are nothing more than window dressing for their myth (bullshit that seems to work in this case) of being non-partisan, objective, and unbiased MSM outlets. (see below concerning Olbermann)

Chris
__________

If Olbermann's Donations Are Bad, What About GE's?
http://www.fair.org
11/5/10

MSNBC host Keith Olbermann has been placed on indefinite suspension without pay in the wake of a Politico report (11/5/10) that revealed Olbermann had donated $7,200 to three Democratic candidates, in violation of NBC's standards barring employees from making political contributions.

A journalist donating money to a political candidate raises obvious conflict of interest questions; at a minimum, such contributions should be disclosed on air. But if supporting politicians with money is a threat to journalistic independence, what are the standards for Olbermann's bosses at NBC, and at NBC's parent company General Electric?

According to the Center for Responsive Politics, GE made over $2 million in political contributions in the 2010 election cycle (most coming from the company's political action committee). The top recipient was Republican Senate candidate Rob Portman from Ohio. The company has also spent $32 million on lobbying this year, and contributed over $1 million to the successful "No on 24" campaign against a California ballot initiative aimed at eliminating tax loopholes for major corporations (New York Times, 11/1/10).

Comcast, the cable company currently looking to buy NBC, has dramatically increased its political giving, much of it to lawmakers who support the proposed merger (Bloomberg, 10/19/10). And while Fox News parent News Corp's $1 million donation to the Republican Governors Association caused a stir, GE had "given $245,000 to the Democratic governors and $205,000 to the Republican governors since last year," reported the Washington Post (8/18/10).

Olbermann's donations are in some ways comparable to fellow MSNBC host Joe Scarborough's $4,200 contribution to Republican candidate Derrick Kitts in 2006 (MSNBC.com, 7/15/07). When that was uncovered, though, NBC dismissed this as a problem, since Scarborough "hosts an opinion program and is not a news reporter." Olbermann, of course, is also an opinion journalist--but MSNBC seems to hold him to a different standard.

Two years earlier, the Washington Post reported (1/18/04):

NBC chief executive Robert Wright has contributed $8,000 since 1999, including $3,500 to the Democratic Congressional Campaign Committee and $1,000 to Sen. John McCain (R-Ariz.). Andrew Lack, a former NBC News chief, gave $1,000 to Rep. Billy Tauzin (R-La.) while NBC president, and Wright contributed $1,500--after the House committee Tauzin chairs held hearings on the networks' election night failures. NBC spokeswoman Allison Gollust said the network allows its executives to make contributions and that Wright "does not make any decisions specific to news coverage."

Wright, however, was reported in a recent New York magazine piece (10/3/10) to have told then-NBC News chief Neal Shapiro to move to the right of Fox News in response to the September 11 attacks: "We have to be more conservative then they are," the magazine quoted Wright.

MSNBC's treatment of Olbermann is also in sharp contrast to Fox News' handling of Sean Hannity, who was revealed by Salon (9/23/10) to have given $5,000 to the campaign of Rep. Michele Bachmann (R.-Minn.), a Tea Party favorite--without Fox expressing any public disapproval. Hannity has allowed Republican candidates to use his Fox program for fundraising (Mediaite, 10/17/10); as Salon noted, Hannity was this year's keynote speaker at the National Republican Congressional Committee's annual fundraising dinner.

If the concern is about how giving money to politicians threatens journalistic independence, then companies like NBC should explain why their parent companies can lavish so much money on political candidates or causes with no concern about conflicts of interest or the need to disclose these donations to viewers. The lesson here would seem to be that some of the workers shouldn't make political donations, but the bosses are free to give as much as they'd like. Anyone who watches Olbermann's show knows what his political views are. So what do the far larger contributions from GE tell us?

ACTION:
Ask NBC and MSNBC to explain their inconsistent standards regarding political donations.

Petition: Put Olbermann Back On The Air NOW!
http://act.boldprogressives.org/sign/petition_olbermann/?akid=2633.266266.qOoQX0&rd=1&source=e1-12mo-tst&t=2

CONTACT:

MSNBC President
Phil Griffin
phil.griffin@nbcuni.com

NBC News President
Steve Capus
steve.capus@nbcuni.com

Phone: (212) 664-4444

_____

Keith Olbermann Special Comment On Health Care Reform

__

Rep. Alan Grayson: "Bipartisanship Has Become Code Word for Appeasement"
http://www.democracynow.org/

In the wake of the Democrats’ midterm losses, President Obama has said the way forward lies in finding common ground between Democrats and Republicans. But Democratic Rep. Alan Grayson, who lost his seat in Florida’s 8th District, says that the losses suffered by incumbent Democrats are an outcome of the party’s "strategy of appeasement." We talk to Rep. Grayson about the 2010 elections. [includes rush transcript]

Guest:

Rep. Alan Grayson,
(D-Florida), representing Florida’s 8th District. He just lost the midterm elections to Republican challenger Dan Webster.


JUAN GONZALEZ: On Wednesday, President Obama described the scale of the Democratic defeat in the midterms as, quote, "humbling." But he added that the way forward lies in finding common ground between Democrats and Republicans.

PRESIDENT BARACK OBAMA: Over the last two years, we’ve made progress. But clearly, too many Americans haven’t felt that progress yet, and they told us that yesterday. And as president, I take responsibility for that. What yesterday also told us is that no one party will be able to dictate where we go from here, that we must find common ground in order to set—in order to make progress on some uncommonly difficult challenges.

AMY GOODMAN: Well, not everyone feels that compromising with Republican demands is the best option for Democrats—among them, Congressman Alan Grayson. He lost his Democratic seat in Florida’s 8th District to Republican Dan Webster this week. Congressman Grayson says that the losses suffered by the Democrats are an outcome of the party’s, quote, "strategy of appeasement." Congressman Grayson joins us on the phone right now from Florida.

Welcome to Democracy Now! Your thoughts on your defeat this week?

REP. ALAN GRAYSON: Well, my defeat was part of a wave across the country that had Republicans winning because Democrats didn’t vote. We have the results from the pre-election turnout; we don’t have the results from the Election Day turnout yet. In my district, when you compare that to 2008, the Republican turnout in the early voting was down by 20 percent, and the Democratic turnout in early voting was down by 60 percent. And that wasn’t true just in my district; that was true all around Florida and pretty much the whole country, except for the West Coast and New England. And as a result of that, virtually every Democrat who won in 2008 by less than ten points loss this year. There was only one exception out of twenty-four. And there were forty-four more Democrats who won by more than ten points in 2008 who managed to lose this year, because their Democratic voters didn’t turn up. It’s not a situation where Democrats—Democratic voters decided to vote Republican; it’ a situation where Democratic voters didn’t vote. And when Democrats don’t vote, Democrats can’t win.

JUAN GONZALEZ: And why did so many people stay home, in your estimation?

REP. ALAN GRAYSON: I think it’s because the Democratic leadership has failed to deliver to core constituents of the Democratic Party the thing that the Democrats wanted when the Democrats had sixty votes in the Senate, 59 percent of the House, and control of the White House. That’s my view of it. We didn’t vote on the Employee Free Choice Act. We didn’t vote on immigration reform. And we controlled the agenda. This isn’t a situation where we had votes and loss them in the House or the Senate. We simply didn’t bring up these matters of crucial importance to various elements of the Democratic coalition, when we had complete control of the agenda and enough votes to pass anything.

AMY GOODMAN: Congressman Grayson—because you are still a congressman—you said on the floor of the House—you unveiled your namesofthedead.com, where you laid out the number of people who would die because of lack of healthcare. Can you talk more about that?

REP. ALAN GRAYSON: Well, I think that the right-wing continues to be in denial about this basic fact that over 40,000 people die in this country each year because they have no healthcare. If you take two people who are absolutely identical—same age, same gender, same race, same smoking history, same weight—and one of them has health insurance and one of them doesn’t, the one who does not have health insurance is 25 percent more likely to die each year. So the result of that is that we have forty-odd thousand people around the country who die without healthcare, a hundred in my district alone. We have 100,000 people in my congressional district who have no health coverage, almost half of whom are Latinos, by the way, because while Florida has the second-highest rate of people without health coverage in the country—20 percent—among Latinos in Florida, it’s 40 percent. And you have people dying because they don’t have healthcare.

And I sit in amazement and watch Republicans and right-wingers obsess over whether to build a Muslim health club in Lower Manhattan, while we see our health standards dropping precipitously, day after day, month after month, and year after year. We are now fiftieth in the world in life expectancy, just above Albania, which is fifty-first. After Albania went through a half-century of Communist dictatorship, we’re right on par with them. You know, particularly in the area of health, by objective standards, time after time, you see us dropping in international rankings, but also in the areas of education and the areas of income. In every area that you can think of, the American numbers keep dropping. And we keep being preoccupied by—what the right requires is really crucial questions like "Where is the President’s birth certificate?"

AMY GOODMAN: Congressman Grayson, just on this issue of healthcare, you said on the floor of the House that the Republicans’ healthcare plan involved wanting people to die quickly, apologizing to the dead and their families that, as you said, we haven’t voted sooner to end this holocaust in America.

REP. ALAN GRAYSON: Well, I mocked the absence of a Republican healthcare plan. What I found was that when the President came to speak to us about healthcare, the Republicans claimed to have a plan, and they waved it around on the floor of the House, and it turned out that what they were waving around was actually blank pieces of paper. So, I felt that was worthy of a speech and gave a speech and pointed out that what the Republican healthcare plan amounted to was "Don’t get sick." And that’s still true. I have yet to hear a single suggestion from any member of Congress who is a Republican about what to do about the 40 million Americans who have no health coverage. To this day, they have not come up with a single plan or even idea about what to do about all these people in America who can’t see a doctor when they get sick.

JUAN GONZALEZ: Well, yet now, you have the reality that with the Republicans controlling the House, the likelihood of being able to get any of the progressive planks of the Democratic Party through Congress become dimmer. How do you—how do you—what’s your counsel to those Democrats who are still there, because obviously the Progressive Caucus didn’t lose as many—nearly as many folks as did the Blue Dog Democrats, how they will move—how they should move forward in the next two years?

REP. ALAN GRAYSON: By exposing the Republicans as obstructionists who have no solutions to anyone’s problems. You know the words "bipartisanship" and "cooperation" have become code words for "appeasement" and "capitulation." We gave the Republicans over a hundred amendments to the healthcare bill. They remained implacably opposed to it. Not one Republican member ever said to anyone in the Democratic Party, "If you give us X, Y, and Z, then we’ll vote for this bill." Instead, they took X, Y, and Z as concessions on our part and then voted against it anyway. And this is something that the American people just don’t seem to see or understand, because we don’t publicize it.

I saw effort after effort after effort for the past two years, in the silliest ways possible, to keep matters from coming up to a vote and to stall and to procrastinate and to prevaricate on the right-wing side, and they were never exposed for it. I remember one day, we had the largest number of votes in history in a single day. We voted from morning until late at night. And the reason for that is that every time we had a vote, the Republicans insisted on a recount. So we ended up, instead of having something like thirty-five votes, we ended up having something like seventy votes, simply because the Republicans literally wanted to waste our time, asking for a recount every single time on every single vote. I lived through that. I didn’t see it on Fox. I didn’t see it on CNN. But I had to live through that, knowing that the Republicans were consciously wasting our time, stalling, hoping to drag it out, and not being called to account for it. And I can give you other examples, too. There was one day when dozens of Republicans pretended to have forgotten their voting cards, so they’d all have to vote by hand, and every five-minute vote became a thirty-minute vote.

AMY GOODMAN: Well, Congressman Alan Grayson, some might say now—and we only have a minute—that you certainly could not be accused of being an appeaser, but you also were defeated. So, other Congress members might take the opposite lesson from your approach. Your War Is Making You Poor Act, you did attract fifty co-sponsors, introducing the Medicare You Can Buy Into Act, that would allow people under sixty-five to buy into Medicare. You went for it, but then you lost your job.

REP. ALAN GRAYSON: Well, everybody did. I mean, if you look at how things went last time, of the thirty-four Democrats—sorry, of the twenty-four Democrats who won by ten points or less—and I won by four points last time—of the twenty-four Democrats who won by ten points or less, twenty-three of them lost. And this is true of Blue Dogs, new Democrats, the progressives. If you lost by—if you won by ten last time or less, you lost this time, with only one exception. And then, in addition to that, another forty-four Democrats lost last time after they won last time by more than ten. The neighboring congressman to my east won by fifteen points last time, lost by twenty points this time.

AMY GOODMAN: Will you run again?

REP. ALAN GRAYSON: A thirty-five point swing in two years.

AMY GOODMAN: Will you run again?

REP. ALAN GRAYSON: Oh, I don’t know. If people want me, then they can have me. But—

AMY GOODMAN: Well, I want to thank you very much for joining us, Congress member Alan Grayson, speaking to us from Florida. He represents half of Orlando.

__

It Was the Banks
by James K. Galbraith

Bruce Bartlett says it was a failure to focus. Paul Krugman says it was a failure of nerve[actually, "nerve," "audacity," & "courage" He also says: "There is an alternative: Mr. Obama can take a stand . . . It’s time for him to try something different."]. Nancy Pelosi says it was the economy's failure. Barack Obama says it was his own failure - to explain that he was, in fact, focused on the economy.

As Krugman rightly stipulates, Monday-morning quarterbacks should say exactly what different play they would have called. Paul's answer is that the stimulus package should have been bigger. No disagreement: I was one voice calling for a much larger program back when. Yet this answer is not sufficient.

The original sin of Obama's presidency was to assign economic policy to a closed circle of bank-friendly economists and Bush carryovers. Larry Summers. Timothy Geithner. Ben Bernanke. These men had no personal commitment to the goal of an early recovery, no stake in the Democratic Party, no interest in the larger success of Barack Obama. Their primary goal, instead, was and remains to protect their own past decisions and their own professional futures.

Up to a point, one can defend the decisions taken in September-October 2008 [by the Bush administration] under the stress of a rapidly collapsing financial system. The Bush administration was, by that time, nearly defunct. Panic was in the air, as was political blackmail - with the threat that the October through January months might be irreparably brutal. Stopgaps were needed, they were concocted, and they held the line.

But one cannot defend the actions of Team Obama on taking office. Law, policy and politics all pointed in one direction: turn the systemically dangerous banks over to Sheila Bair and the Federal Deposit Insurance Corporation. Insure the depositors, replace the management, fire the lobbyists, audit the books, prosecute the frauds, and restructure and downsize the institutions. The financial system would have been cleaned up. And the big bankers would have been beaten as a political force.

Team Obama did none of these things. Instead they announced "stress tests," plainly designed so as to obscure the banks' true condition. They pressured the Federal Accounting Standards Board to permit the banks to ignore the market value of their toxic assets. Management stayed in place. They prosecuted no one. The Fed cut the cost of funds to zero. The President justified all this by repeating, many times, that the goal of policy was "to get credit flowing again."

The banks threw a party. Reported profits soared, as did bonuses. With free funds, the banks could make money with no risk, by lending back to the Treasury. They could boom the stock market. They could make a mint on proprietary trading. Their losses on mortgages were concealed - until the fact came out that they'd so neglected basic mortgage paperwork, as to be unable to foreclose in many cases, without the help of forged documents and perjured affidavits.

But new loans? The big banks had given up on that. They no longer did real underwriting. And anyway, who could qualify? Businesses mostly had no investment plans. And homeowners were, to an increasing degree, upside- down on their mortgages and therefore unqualified to refinance.

These facts were obvious to everybody, fueling rage at "bailouts." They also underlie the economy's failure to create jobs. What usually happens (and did, for example, in 1994 - 2000) is that credit growth takes over from Keynesian fiscal expansion. Armed with credit, businesses expand, and with higher incomes, public deficits decline. This cannot happen if the financial sector isn't working.

Geithner, Summers and Bernanke should have known this. One can be fairly sure that they did know it. But Geithner and Bernanke had cast their lots, with continuity and coverup. And Summers, with his own record of deregulation, could hardly complain.

To counter calls for more action, Team Obama produced sunny forecasts. Their program was right-sized, because anyway unemployment would peak at 8 percent in 2009. So Larry Summers said. In making that forecast, the Obama White House took responsibility for the entire excess of joblessness above eight percent. They made it impossible to blame the ongoing disaster on George W. Bush. If this wasn't rank incompetence, it was sabotage.

This is why, in a crisis, you need new people. You must be able to attack past administrations, and override old decisions, without directly crossing those who made them [my emphasis].

President Obama didn't see this. Or perhaps, he didn't want to see it. His presidential campaign was, after all, from the beginning financed from Wall Street. He chose his team, knowing exactly who they were. And this tells us what we need to know about who he really is.

James K. Galbraith teaches at UT-Austin and is the author of The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too .

__

The Obama Postmortem
An Autopsy of a Political Suicide
By Ted Rall
[see link in title above for links within article]

November 04, 2010 "Information Clearing House"

It’s the day after the Republican sweep we all knew was coming. If Obama had any dignity, if he was honest with himself and with us, he would resign. It’s abundantly clear that he isn’t up to the job.

But you don’t become president by being honest or dignified. So now it’s wound-licking time. The President and his cronies are comforting each other. “It’s not your fault the economy sucks,” a Yes Man reassures Obama, sinking his heels into the new Oval Office carpet. “It was like that when we got here.”

Do they scratch him behind his ears? They should. It feels nice.

“It was the poor economy—not the wisdom of the Republicans’ ideas or the brilliance of their tactics—that assured they would retake control of the House,” coos MarketWatch’s Rex Nutting. Which is true. And doesn’t matter. Democrats are taking solace in history. It’s the midterms! The party that holds the White House always loses seats in Congress. Look at Bill Clinton and Ronald Reagan. They suffered midterm defeats, then roared back to landslide reelection wins two years later. Not to worry! The voters will vote against the other party next time! Which is also true. And also doesn’t matter.

In the broken-down shambles of the excuse for a political system we have in the United States, there’s only one stage
of grief: denial.

Barack Obama may well be reelected in 2012. Considering that the current GOP frontrunners are Sarah Palin and Mitt Romney, the odds favor him. But the Obama experiment is effectively dead. There will be no change, and so there is no hope.

Remember what happened to Clinton after the “Republican Revolution” sweep of 1994? He spent 1995 locked in a bizarre “co-presidency” with House Speaker Newt Gingrich before figuring out that his “partner” was more interested in obstructionist sabotage than bipartisanship.

Obama is heading down the same bloody path with John Boehner.

But Clinton did get that second term. During which he accomplished many things, such as…um…well, he did get impeached. Does that count?

I don’t understand why presidents want to get reelected. No president since FDR has gotten much done after his first term. Must be an ego thing. Either that, or it’s cool to have your own chef.

If Obama was going to shine, it was going to be during 2009. Elected by a sizable margin with an undeniable, media-backed mandate for change during a severe economic crisis he could exploit to push through his agenda, Obama also enjoyed the rare luxury of a Democratic House of Representatives and a nearly filibuster-proof Democratic Senate. So what does he have to show for that marvelous gift? Three major items:

One: a healthcare overhaul that increases premiums and insurance company profits, and doesn’t include the public option he and everyone else said was absolutely essential. The good news is, the Republicans will probably repeal or defund this monster before it takes effect.

Two: a financial reform package no one knows about. Which is just as well, since it doesn’t crack down on the banksters.

Three: more dead Afghans.
They’re not much, but I hope Obama is proud of them. That’s as good as he’s going to get from now on. What killed the Obama presidency? Political suicide. There were several death blows:

First and foremost, the economy. 60 percent of Democrats and 63 percent of Republicans told exit pollsters that the lack of jobs was their number-one issue. Obama never proposed a jobs program. He gave trillions of taxdollars to thieving banksters who ought to have been arrested instead, then tried to pass off this outrageous giveaway as economic stimulus. To make things worse, he stuck with an impossibly absurd argument: more people would have lost their jobs without it.

Even if the phony stimulus stopped things from getting worse—and it didn’t—people don’t care. They want the 20 percent of Americans who already lost their jobs—their friends, spouses, children and parents—to find new ones. Obama never addressed that.

He didn’t even try.

Second, he alienated his base. He didn’t even know who his base was.

Obama’s campaign was a potent mix of vague pabulum (“hope,” “change”) and, when he deigned to specify, center-right specifics (stop torture but expand the war against Afghanistan, bipartisan cooperation with the Republicans, no gay marriage, etc.). The problem was that the vagueness that helped him cobble together a winning coalition of leftist and independent voters made it impossible for him govern. Leftists got turned off when he doubled down in Afghanistan and refused to close Guantánamo; independents are notoriously fickle anyway.

If Obama’s advisors had been smart, they would have recognized two truths, one old and one new. The old truth is that the safest time to deliver to your base is the first year of a presidency; the passage of time allows the anger of the moderates to cool in time for the next election. The new truth for Obama was that his base comprised liberals who actually disagreed with much of what he stood for but had paid more attention to the “hope” and “change” posters than to his platform. He didn’t understand that.

Moreover, the world changed between September and November of 2008. Global capitalism collapsed. Millions of Americans lost their jobs and their homes during the next year. Wall Street, bankers, big business, the golden boys of the previous century, were discredited—but unpunished for their countless sins. By mid-2009 America had become a left-wing country, not in the media but among the citizenry, telling polls that their preferred economic system was socialism.

Team Obama didn’t understand that. They still don’t.

The inarticulate rage of the inchoate Tea Party caught the president by surprise. Neither Obama nor the political clones that form his center-right cabinet can see that in a binary political culture anger gravitates to the opposite pole. If Obama were Republican, the Tea Party would be identified with the left. The takeaway is anger, not ideology. People are pissed. They hate the bailouts, but the bailouts aren’t the main point. More than anything else, the American people are angry that their government doesn’t even pretend to give a damn about them.

Ted Rall is the author of “The Anti-American Manifesto.” His website is www.tedrall.com .
COPYRIGHT 2010 TED RALL
__

Media Misreading Midterms
As usual, press urge a move to the right
http://www.fair.org
11/4/10

With the Democrats suffering substantial losses in Tuesday's midterms, many journalists and pundits were offering a familiar diagnosis (Extra!, 7-8/06; FAIR Media Advisory, 2/3/09): The Democrats had misread their mandate and governed too far to the left. The solution, as always, is for Democrats to move to the right and reclaim "the center." But this conventional wisdom falls apart under scrutiny.

For months, the problem for Democrats was correctly identified as the "enthusiasm gap"--the idea that the progressive base of the party was not excited about voting. The exit polls from Tuesday's vote confirm that many Democratic-tending voters failed to show up. How, then, does one square this fact with the idea that Obama and Democrats were pushing policies that were considered too left-wing? If that were the case, then presumably more of those base voters would have voted to support that agenda. It is difficult to fathom how both things could be true.

But reporting and commentary preferred a narrative that declared that Obama's "days of muscling through an ambitious legislative agenda on [the] strength of Democratic votes [are] over" (Washington Post, 11/3/10). "The verdict delivered by voters on Tuesday effectively put an end to his transformational ambitions," announced Peter Baker of the New York Times (11/3/10).

Some thought Obama's post-election speech was still missing the point. As the Washington Post's Dan Balz put it (11/4/10), Obama was "unwilling, it seemed, to consider whether he had moved too far to the left for many voters who thought he was a centrist when he ran in 2008." On CNN (11/3/10), David Gergen said, "I don't think he made a sufficient pivot to the center today. He has to do that, I think, through policies and through personnel." Gergen went on to cite Social Security "reform" as an ideal way to demonstrate he was "taking on his base."

The Washington Post's David Broder (11/4/10) advised Obama to

return to his original design for governing, which emphasized outreach to Republicans and subordination of party-oriented strategies. The voters have in effect liberated him from his confining alliances with Nancy Pelosi and Harry Reid and put him in a position where he can and must negotiate with a much wider range of legislators, including Republicans. The president's worst mistake may have been avoiding even a single one-on-one meeting with Senate Minority Leader Mitch McConnell until he had been in office for a year and a half.

USA Today's Susan Page noted before the election (10/29/10):

During his first two years in office, Obama often acted as if he didn't need a working relationship with congressional Republicans. With big Democratic majorities in Congress... he could court a few moderate Republicans such as Maine Sen. Olympia Snowe in hopes of peeling off a GOP vote or two to block a filibuster or give legislation a bipartisan patina.

This view of Obama's politics meshes poorly with reality. Much of the Democrats' maneuvering over the healthcare bill, for example, was devoted to trying to find any Republicans who might support it, stripping out elements of the bill--such as the public option--that were drawing more enthusiasm from the party base. (A true single-payer plan was rejected from the beginning.) The dramatic escalation of the Afghan War was a major disappointment to the progressive base, along with Obama's embrace of nuclear power and offshore oil drilling. And critics on the left often expressed disappointment with the White House's timid approach to Wall Street reform and economic stimulus.

Yet after the election, it was difficult to find TV pundits who would argue against the media conventional wisdom about an agenda that was too left-wing. Instead pundits were offering plenty of suggestions for Obama to move even further to the right--Time's Joe Klein recommended building more nuclear power plants (FAIR Blog, 10/29/10) and Washington Post columnist David Broder floated a war with Iran to boost the economy and promote bipartisanship (FAIR Blog, 11/1/10).

Bill Clinton, whom media likewise counselled to move right after heavy midterm losses, was frequently held up as an exemplar: "If there is a model for the way forward in recent history, it's provided by President Bill Clinton, who established himself as more of a centrist by working with Republicans to pass welfare reform after Democrats lost their grip on Congress in 1994." (Associated Press, 11/2/10). The advice to move to the "center" was accompanied by reporting and analysis that wondered if Obama was even capable of doing so. "Obama has not shown the same sort of centrist sensibilities that Mr. Clinton did," explained the New York Times (11/3/10).

Of course, Clinton's first two years were centrist--and a disappointment to his base, seriously dampening Democratic turnout in the midterms (Extra!, 1-2/95; FAIR Media Advisory, 11/7/08). And the "Clinton model" failed to build broad Democratic electoral success.

Meanwhile, the pundits had right in front of them, in the sweeping Republican victory, an example of how a political party can organize a comeback--not by moving to the center and alienating its base, but by "using guerrilla-style tactics to attack Democrats and play offense" (New York Times, 11/4/10).

The Economy, Stupid

Much of the election analysis sought to ignore or downplay what was inarguably an election about unemployment and the state of the economy. Reporting that sought to elevate the federal budget deficit (FAIR Action Alert, 6/24/10) as a primary issue of concern served as a diversion--and drove the election narrative into Republican territory, where rhetoric about "big government" and cutting federal spending were dominant themes. "If there is an overarching theme of election 2010, it is the question of how big the government should be and how far it should reach into people's lives," explained the lead of an October 10 Washington Post article. There was little in that article--or anywhere else--to support that contention.

With the economy the overwhelming issue for the public (Washington Post, 11/3/10) the media should have led a serious discussion about what to do about it. Instead, there was a discussion that mostly adhered to a formula where the left-wing position was that nothing could be done to improve the economic situation (when the actual progressive view was that a great deal more could have been done), while the right offered an attack on federal spending but was never required to offer a coherent explanation of how such spending eliminated jobs. As the New York Times' Baker (11/3/10) framed it: "Was this the natural and unavoidable backlash in a time of historic economic distress, or was it a repudiation of a big-spending activist government?"

There were some exceptions--MSNBC interviews with top Republican officials on election night (11/2/10), for instance, revealed that many could not offer a coherent plan for reducing spending or the budget deficit. This should have been a larger part of the media's coverage of the election.

Who Voted?

Some election reporting and commentary treated the results as if they represented a dramatic lurch to the right. As Alternet's Josh Holland noted (11/3/10), reporting like a New York Times article that talked of "critical parts" of the 2008 Obama vote "switching their allegiance to the Republicans" distracted from the main lesson--that many Obama voters of two years ago did not participate in 2010. Republican-leaning voters, on the other hand, did. That fact, along with the disastrous state of the economy and the normal historical trends seen in midterm elections, would seem to provide most of the answers for why the election turned out the way it did.

But much of the media commentary wanted to turn the election into a national referendum on the new healthcare law or the size of government. The exit polls provide some clues about the sentiment of voters, but the lessons don't seem to fit neatly into those dominant media narratives. Asked who was to blame for the state of the economy, most picked Wall Street and George W. Bush (USA Today, 11/3/10). As a New York Times editorial noted (11/4/10), "While 48 percent of voters said they wanted to repeal the healthcare law, 47 percent said they wanted to keep it the way it is or expand it--hardly a roaring consensus."

Some attention was paid to the exit poll finding that 39 percent of voters support Congress focusing on deficit reduction--which would appear to lend some credence to the media message that voters cared deeply about deficits. But the same exit polling found 37 percent support for more government spending to create jobs. Given that polling of the general public shows stronger concern about jobs--the New York Times reported (9/16/10) that "The economy and jobs are increasingly and overwhelmingly cited by Americans as the most important problems facing the country, while the deficit barely registers as a topic of concern when survey respondents were asked to volunteer their worries"--if anything, this finding serves to reinforce that citizens energized by Republican talking points were the ones who showed up to vote (FAIR Blog, 10/18/10).

In the end, the elections were covered the way elections are often covered--poorly. As Dean Baker of the Center for Economic and Policy Research put it (Politico, 11/2/10), "Until we get better media, we will not get better politics."

__

US Mid-Term Elections:
The Death of Hope and Change

By Andy Worthington

November 04, 2010 "Information Clearing House" -- To be brutally honest, those of us concerned with “national security” issues (indefinite detention without charge or trial at Guantánamo and elsewhere, trials by Military Commission and accountability for the Bush administration’s torturers) and foreign policy (the wars in Iraq and Afghanistan) could tell by May 2009 that “hope” and “change” were dead in the water.

Whereas Barack Obama had never disguised his desire to step up the military occupation of Afghanistan, while scaling down operations in Iraq, he had promised — or had seemed to promise — a thorough repudiation of the detention policies at Guantánamo and Bagram, and the coercive interrogations and torture that had stalked their cells and interrogation rooms.

However, although he promised to close Guantánamo within a year and to uphold the absolute ban on torture in a series of executive orders issued on his second day in office, fine words were followed by months of inactivity, as a cautious Task Force of career officials from government departments and the intelligence agencies was convened to review the Guantánamo cases.

By May 2009, with Republicans seizing on the President’s court-ordered release of a notorious series of “torture memos,” issued by Justice Department lawyers in the Office of Legal Counsel in 2002 and 2005, as a demonstration of his untrustworthiness on national security issues, a fundamental change occurred.

The reviled Military Commission trial system for Guantánamo prisoners, which Obama had suspended on his first day in office, was reintroduced, as was indefinite detention without charge or trial as an official policy, even though this was the heart of the Bush administration’s program, and even though progressive supporters of the President had presumed that there were only two options for the remaining prisoners: federal court trials, or release.

This was followed by another deeply unsavory official policy — resisting any more embarrassing disclosures about the Bush administration’s torture program by inappropriately invoking sweeping “state secrets” privileges, as, for example, in the case of five men subjected to “extraordinary rendition” and torture, who sought to sue Jeppesen Dataplan Inc., a Boeing subsidiary that had operated as the CIA’s torture travel agent.

There were also several other disgraces: fighting a court order providing new homes on the US mainland to Guantánamo prisoners (the Uighurs) who had won their habeas corpus petitions but who could not be repatriated (to China) because of the risk of torture in their home countries; fighting a court order extending habeas corpus rights to a handful of foreign prisoners rendered to Bagram from other countries; preventing the release of any cleared prisoners to Yemen after a hysterical overreaction to the news that the failed Christmas Day plane bomber, Umar Farouk Abdulmutallab, was recruited in Yemen; replacing the Bush administration’s detention and interrogation policies with drone attacks on Pakistan; and approving the assassination of US citizens anywhere in the world.

Although Republicans in Congress — and cowardly members of Obama’s own party — bear considerable blame for the descent into paralysis of those few parts of the President’s bold promises that he had not already undermined voluntarily, the end result of the last 21 months of cowardice and compromise is that, on foreign policy and national security issues, there was little positive momentum that a shift of political power in the mid-term elections could actually erode.

That said, losing control of the House of Representatives guarantees that anything the administration might have still contemplated doing — standing up to critics and insisting that, as announced a year ago, the trial of Khalid Sheikh Mohammed and four others accused of involvement in the 9/11 attacks will take place in federal court, or moving any of the Guantánamo prisoners to a prison on the US mainland — has no chance of happening at all, making the United States a slightly gloomier place than it was before the mid-term elections.

Moreover, given the deepening of Obama’s paralysis that this signifies, it also makes it seem less, rather than more likely that the President and his party will be able to do anything meaningful to lure back the progressive base that helped secure victory in 2008, in time for the 2012 Presidential election, unless, by some miracle, someone decides to try to rein in the Pentagon and the military-industrial complex as an economic necessity (if for no other reason).

That, however, sounds too much like “hope” and “change,” which, to reiterate, are dead in the water in America today.

Andy Worthington is the author of The Guantánamo Files: The Stories of the 774 Detainees in America’s Illegal Prison (published by Pluto Press, distributed by Macmillan in the US, and available from Amazon — click on the following for the US and the UK) and of two other books: Stonehenge: Celebration and Subversion and The Battle of the Beanfield.

Copyright Andy Worthington

Notes About the 2010 Election Debacle

The predicted disaster for Democrats and those who still call themselves "progressives" has occurred. Corporate and special interest money, along with corporate media inspired voter confusion, has helped to defeat two of the last few thoughtful and progressive Congressional voices--Russ Feingold and Alan Grayson--and the "just say no" Republicans have taken over the House of "Representatives."

The only high point for "progressive" Oregonians is that John Kitzhaber has apparently won the Governor's race here.

The message for low income and forgotten Americans is that the Republicans and many Democrats, neighbors, and in some cases friends, simply do not care if you live or die. The "war of all against all" is now upon us. The elites in both parties do not understand and cannot comprehend your situation. They know little about your lives--what you have felt, seen and experienced. This has been especially spelled out in the debate over healthcare, and reinforced by Obama and the rest of Congress in ignoring the plight of the jobless and those being foreclosed upon by the bailed-out banksters.

In thinking about where our country has ended up over the last two years, I am wondering if the only solution for the poor and the abandoned jobless is to find the resources to buy a decent gun, ammunition, and a cleaning kit.

In a recent article concerning the plight of people in England, John Pilger quoted the English poet Percy Shelley. The situation in Britain, you see, is not so different from our own.

See: The Party Game Is Over. Stand And Fight

Shelley wrote:

Rise like lions after slumber
In unvanquishable number.
Shake your chains to earth like dew.
Which in sleep has fallen on you.
Ye are many – they are few.

In the time of Shelley, or Thomas Jefferson, such thoughts would have been taken seriously, but not in our times of American domestication, when we accept the most subjugating insults and loss of our basic rights, like sheep in an impoverished pasture.

What follows are some thoughts on the election from some of our informed voices in what is left of the "progressive" movement in America:

Michael Moore on Midterm Elections

In the morning, President Obama is going to hold a press conference, and he’s going to take the wrong path. He’s going to say what we really need now is more bipartisanship and more kumbaya. And the other side wants none of that. And I don’t know—I don’t know how much you have to be battered and bruised to understand when the abuser is not going to stop abusing.

Ralph Nader: Dems Face Losses to "Most Craven Republican Party in History"

The corporations now dominate every department and agency in the federal government, from the Department of Defense, Department of Treasury, Department of Agriculture, Interior and other departments. By that I mean, the outside influence on these departments is overwhelmingly corporate, even the Labor Department. Number two, they have something like 9,000 political action committees—auto dealers, insurance companies, banks, drug companies—funneling money into members of Congress and the White House. Number three, they’ve put their executives in high government positions. Now, nobody comes close to that kind of triple control of our government. And when Franklin Delano Roosevelt sent a message to Congress in 1938 to set up the national—temporary national commission on corporate concentration—and they did pass that—he said in his message, when government is controlled by private economic power, that’s fascism. That was in 1938. And now, more than ever, we have a corporate government in Washington, DC, corporate-occupied territory, that is destructive of any semblance of democratic process. Voice for the people, voice for labor, a voice for small taxpayers, consumers, they’re shut out. They’re excluded.

Doomsday for Democrats?
By RALPH NADER

The mass media-exaggerated aura of the Tea Party, pumped by Limbaugh, Hannity and the histrionic Glenn Beck, has put the Democrats in a defensive posture. It is giving the puzzled Republicans an offensive image. I say puzzled because they can’t figure out the many disparate strands of the Tea Party eruption which includes turning on the Republicans and George W. Bush for launching this epidemic of deficits, debt, bailouts and unconstitutional military adventures.

Being on the defensive politically becomes a nightmarish self-replicating wave among that 10 percent slice of swing voters who can make the difference between a big win or a big loss. These are also the non-hereditary party voters whose philosophy is to “throw the bums out” again and again until they get themessage.

US Is Not Greatest Country Ever
by Michael Kinsley

The theory that Americans are better than everybody else is endorsed by an overwhelming majority of U.S. voters and approximately 100 percent of all U.S. politicians, although there is less and less evidence to support it. A recent Yahoo poll (and I resist the obvious joke here) found that 75 percent of Americans believe that the United States is "the greatest country in the world." Does any other electorate demand such constant reassurance about how wonderful it is - and how wise? Having spent a month to a couple of years and many millions of dollars trying to snooker voters, politicians awaiting poll results Tuesday will declare that they put their faith in "the fundamental wisdom of the American people."

Not me. Democracy requires me to respect the results of the elections. It doesn't require me to agree with them or to admire the process by which voters made up their minds. In my view, anyone who voted for Barack Obama for president in 2008 and now is supporting some tea party madwoman for senator has a bit of explaining to do. But the general view is that the voters, who may be fools individually, are infallibly wise as a collective - that their "anger," their urgent desire, yet again, for "change," is self-validating.

Everybody will be talking in the next few days about the "message" of the elections. They mean, of course, the message from the voters. This is one of the treasured conventions of political journalism. Yesterday, the story was all about artifice and manipulation, the possible effect of the latest attack ad or absurd lie. Today, all that melts away. The election results are deemed to reflect grand historical trends. But my colleague Joe Scarborough got it right in these pages last week when he argued that the 2010 elections, for all their passion and vitriol, are basically irrelevant.

Nov. 2: The Death Knell of Corporate Liberalism
by Matthew Rothschild


I feel like one of Custer’s relatives after the Little Big Horn.

Except that Tuesday’s slaughter at the polls was not unexpected. It marked the death knell of corporate liberalism, and it signed the death certificate of petty gradualism.

I’m tired of the Democratic Party’s excuses, and Barack Obama’s apologists.

Yes, Bush and Cheney trashed the place like a couple of crazed heavy metal bands in a hotel room.

Yes, they left an exploding economy on Obama’s desk.

Yes, the Republicans in Congress obstructed Obama at every turn and conspired to stop him at all costs.

Yes, the Republican rabble did everything in their power to discredit him, from concocting the birther controversy to spreading the “Is he a Muslim” nonsense.

And yes, the Supreme Court opened the corporate floodgates with its execrable decision in the Citizens United case. As a result, spending by undisclosed outside groups mushroomed by more than 500 percent from the 2006 midterm elections.

Those were the objective conditions, and they were about as nasty as they come.

But Obama didn’t help himself by trying to placate the Republicans and by muddling his messaging.

He didn’t help himself by lowballing the stimulus and by rejecting a moratorium on foreclosures.

He didn’t help himself by playing a Washington insider game, by trying to buy off a couple of Republicans in Congress and by playing footsie with huge industries, like the banks and the pharmaceutical companies.

This was timid corporate liberalism, RIP.

Obama was given a mandate for change, and he squandered it.

He never mobilized the base to take on the vested interests.

Example: health care. He didn’t call people to march on Washington for universal health care, or at least Medicare for all who want it. So a few tea party hucksters were able to hijack the debate. He didn’t even push Harry Reid to give the health care bill to Senator Tom Harkin’s committee, throwing it instead into the untrustworthy arms of Max Baucus.

As a result, an inferior law came on the books with some important insurance reforms in it, but it didn’t threaten the private health care providers or the pharmaceutical companies. And it didn’t deliver the immediate relief that most Americans needed.

On the jobs front, he refused to follow the lead of Christina Romer, head of his Council of Economic Advisers, or the recommendations of Nobel Prize winners Paul Krugman and Joseph Stiglitz. All three said he needed a stimulus package that was at least 50 percent larger than the one he proposed. Nor did he propose a new WPA, like FDR did when the country faced a similar, if not quite so staggering, free fall. Obama was afraid to come on too strong. So he came on too weak.

Same on the banking front. Obama could have, and should have, nationalized Bank of America and Citibank, or at the very least, compelled them to halt foreclosures and write down the principal on all their mortgages by 25 or 30 percent. But Obama didn’t get anything from the banks in exchange for the hundreds of billions of dollars the Treasury doled out, and the trillions in guarantees. And so the bankers laughed all the way to the vault, and even some Republicans scored by running commercials against Democrats who voted for the [Bush/Republican inspired - Chris] bailout.

Same on the environment. Obama sold out the cause at Copenhagen, and with amazingly bad timing he came out for offshore drilling just weeks before the BP disaster, in hopes, again, of getting concessions from Republicans and from industry.

His messaging was as poor as his governing. First he blamed the Wall Street CEOs for their obscene bonuses; then he called them “very savvy businessmen,” adding: “I, like most of the American people, don’t begrudge people success or wealth. That is part of the free-market system.”

Similarly, on the budget, first he argued for deficit spending; then he said we need to cut the deficit in half by the end of his term.

This was confusing to millions of Americans, dispiriting to the base, and diverting to his enemies.

But basically, he didn’t give people enough tangible benefits to say, OK, I’m with him. He’s helped me. I’ll vote for Democrats again.

You can’t tell an unemployed person that you’d have been twice as unemployed without my help. You need to give that person a job now.

You can’t tell an elderly person you’re closing the donut hole on prescription drugs—by the year 2020. You need to close it now.

You can’t tell an adult with a pre-existing condition that you’ll force insurance companies to cover you—by the year 2014, when you may be dead. You need to cover people now.

You can’t tell families being foreclosed upon that you’re trying hard to keep them in their homes. You need to keep them in their homes now.

But to do any of that, Obama would have had to confront corporate power head on. But he, and Rahm Emanuel, and Larry Summers, and Tim Geithner were unwilling to do so and ideologically unprepared to even consider it.

They lived by corporate liberalism. And Democrats around the country died by it.

The Tragedy of Under-Reaching
After the Election Disaster: Back to Basics
by Norman Solomon

The mass-media echo chamber now insists that Republicans have triumphed because President Obama was guilty of overreach. But since its first days, the administration has undermined itself -- and the country -- with tragic under-reach.

It's all about priorities. The Obama presidency has given low priority to reducing unemployment, stopping home foreclosures or following through with lofty pledges to make sure that Main Street recovers along with Wall Street.

Far from constraining the power of the Republican Party, the administration's approach has fundamentally empowered it. The ostensibly shrewd political strategists in the White House have provided explosive fuel for right-wing "populism" while doing their best to tamp down progressive populism. Tweaks aside, the Obama presidency has aligned itself with the status quo -- a formula for further social disintegration and political catastrophe.

Payback at the Polls
by Robert Scheer

Barack Obama deserved the rebuke he received at the polls for a failed economic policy that consisted of throwing trillions at Wall Street but getting nothing in return. His amen chorus in the media is quick to blame everyone but the president for his sharp reversal of fortunes. But it is not the fault of tea party Republicans that they responded to the rage out there over lost jobs and homes while the president remained indifferent to the many who are suffering.

At a time when, as a Washington Post poll reported last week, 53 percent of Americans fear they can't make next month's mortgage or rent payment, the president chirped inanely to Jon Stewart that his top economics adviser, Lawrence Summers, who was paid $8 million by Wall Street firms while advising candidate Obama, had done a "heckuva job" in helping avoid another Great Depression. What kind of consolation is that for the 50 million Americans who have lost their homes or are struggling to pay off mortgages that are "underwater"? The banks have been made whole by the Fed, providing virtually interest-free money while purchasing trillions of dollars of the banks' toxic assets. Yet the financial industry response has been what Paul Volcker has called a "liquidity trap"-denying loans for business investment or the refinancing necessary to keep people in their homes.

Instead of meeting that crisis head-on with a temporary moratorium on housing foreclosures, as more than half of those surveyed by the Post wanted, the president summarily turned down that sensible proposal. Instead he attempted to shift the focus to his tepid health care reform and was surprised that many voters didn't think he did them a favor by locking them into insurance programs not governed by cost controls. Health care reform was viewed by many voters with the same disdain with which they reacted to the underfunded and unfocused stimulus program. Neither seems relevant to turning around an economy that a huge majority feels is getting worse, according to Election Day exit polls.

That is a problem that is not obvious to the power elites whom the leaders of both political parties serve or to the high-paid media pundits who cheer them on. The tea party revolt, ragged as it is, fed on a massive populist outrage that so-called progressives had failed to respond to because of their allegiance to Obama. As a result the Democrats squandered the hopes of their base, which rewarded the party with a paltry turnout at polling stations.

Election 2010: A Disaster for Peace
Posted By Justin Raimondo On November 2, 2010

The expected Election Day Republican “wave” that broke over our heads is a disaster for the anti-interventionist cause in the immediate sense – but there may be a silver lining.

The disaster is embodied in the various GOP warmongers who will be placed in key positions in Congress, and a good case could be made that among the worst of the worst will be the probable majority leader in the House: Eric Cantor.

Cantor is a walking, breathing stereotype, a neocon through and through, who pays lip service to the “tea party”-ish idea of limiting government spending, but is in reality committed to lavishing tax dollars on any project as long as it can be somehow construed as contributing to US security. Thus, ForeignPolicy.com references his views on “foreign aid” and the budget:

“Cantor told the Jewish Telegraphic Agency that the president’s proposed budget might have to be rejected outright if Republicans take power – after separating out U.S. aid for Israel, of course.”

Cantor is a big fan of Israel’s, and has gone so far as to say that, in the context of tensions between Washington and Tel Aviv over the settlements and other issues, “Israel is not the problem” – leaving unspoken the presumption the US is at fault. In line with the Israel lobby’s campaign to goad us into war with Iran, he demands that the US cease negotiations with Tehran, impose draconian sanctions unilaterally, and openly threaten the use of force. . . . .

Far worse than anyone I have yet mentioned is Ileana Ros-Lehtinen, Florida Republican, who never saw a war she didn’t salivate at the prospect of and has called for the assassination of Fidel Castro. She is a militant supporter of Israel, constantly criticizes the US for not kowtowing quickly enough to Tel Aviv, and is a vocal supporter of the Mujahideen-e-Khalq, a Marxist terrorist organization that has provided much of the phony “intelligence” purporting to show Iran is developing nuclear weapons. She will be chairwoman of the House Foreign Affairs Committee when the GOP takes the House.

The big problem with a Republican-dominated House is that those GOPers who take an interest in foreign policy issues are invariably hawks: these are the committed neocons, like Cantor and Kyl. The tea partiers, for their part, avoid the issue, focused exclusively as they are deficits, taxes, and budget-cutting.

There is, however, a silver lining to all this: the Empire is going bankrupt. Our invasion of Iraq is estimated by economist Joseph Stiglitz to cost some 3 trillion dollars, when all is said and done. Neocons Bill Kristol and the heads of the American Enterprise Institute and the Heritage Foundation came out with an op ed warning the tea party types not to go near their precious “defense” budget with the cost-cutter’s knife. But the tea partiers are unlikely to listen to Kristol & Co., or, indeed, any members of the Republican establishment, who, after all, presided over the spendthrift Bush administration all the while proclaiming their support for what they called “big government conservatism.”

Objectively, the momentum for cost-cutting will run up against the neocons’ militarism, and a conflict seems inevitable. Yet nothing is inevitable when it comes to human affairs, so we’ll just have to see what happens.

Another discouraging aspect of the GOP’s triumph is that it will give Obama very little room to maneuver on domestic matters – and he’ll have little choice but to concentrate more of his attention on foreign policy. This is not good, from an anti-interventionist viewpoint, because the President will no doubt use foreign policy issues to gain Republican support for his domestic initiatives. This increases the influence of the McCain-Cantor-Petraeus more-troops-to-Afghanistan lobby – but it gets worse….

US Voters Drink Reaganism's Kool-Aid

By Robert Parry

Obama’s Mistakes

Obama’s core political mistake may have been trying to stabilize a very sick patient – the U.S. economy – rather than applying more radical remedies. His stabilization approach largely worked, at least for those heavily invested in the stock markets which have rebounded to two-year highs.

Obama’s stimulus plan and auto bailout also saved many jobs that would have been lost if he had adopted a laissez-faire approach.

His other option would have been to shake up an already badly shaken system by, say, nationalizing ailing Wall Street banks. He also could have challenged the Washington power structure by ordering investigations of Bush-43’s war crimes and bringing the wars in Iraq and Afghanistan to prompt conclusions.

But that course of action would have risked a wider economic collapse, even worse joblessness and bitter conflicts between Obama and potent political/media interests in the power centers of Washington and New York. He would have faced even more accusations of overreaching.

Plus, the weak American Left would have provided little meaningful political support. More than likely, it would have continued to find something to criticize.

The media reality that Obama faced was what I encountered last month when I was driving late at night from upstate New York back to Washington. To stay awake, I sampled what was available on the AM dial and was stunned to discover how many different right-wing voices there were sneering at Obama and the liberals. I could find no channel that offered an alternative.

Even decades into this dangerous media imbalance, the Left mostly continues to ignore its messaging gap. Wealthy progressives spend some money on tracking what the Right is up to (i.e. Media Matters) and subsidizing non-controversial investigative journalism (i.e. ProPublica and the Center for Public Integrity), but they still do little to support real independent journalism that examines systemic problems or high-level crimes.

After Obama’s election in 2008, the Left’s most promising – though flawed – media effort, Air America Radio, was deemed expendable by wealthy progressives. Rather than spend the money and provide the management skills to improve Air America, they pulled the plug in January 2010, the same week of the Supreme Court’s ruling on corporate donations. [See Consortiumnews.com’s “US Democracy’s End of the Road.”]

Today’s other progressive media operations remain fragile or limited.

MSNBC, which is owned by General Electric pending a sale to Comcast, has experimented with a liberal evening line-up (only after failing at everything else, including trying to out-fox Fox). But MSNBC could easily shut down its experiment if it senses a risk to the interests of its corporate parent, whether GE, a charter member of the military-industrial complex, or Comcast.

Faced with this paucity of independent or left-leaning media, many rank-and-file progressives have turned to the liberal-oriented irony of Comedy Central’s Jon Stewart and Stephen Colbert, who sponsored a massive rally for sanity on the National Mall last Saturday.

However, as many progressive writers have noted, Stewart and Colbert are primarily entertainers, not activists committed to changing the political/economic system.

So, Tuesday’s congressional elections represented the latest wake-up call to American progressives that they must make a much bigger commitment to building media. However, they have shown a remarkable tenacity to hit the snooze button no matter how loud the alarm.

Instead of action, one can expect a number of articles from the Left about how Obama and the Democrats failed because they weren’t leftist enough. Despite all the evidence, the Left remains obstinate against the need to reconsider what it’s been doing for the past several decades.

The bottom line is that the Left has a fanciful view of its own influence, or perhaps its problem is an unshakeable faith that the working class will somehow naturally understand its own interests.

However, a near-voiceless progressive movement and a noisy Right telling fearful Americans that they should again follow in Ronald Reagan’s footsteps make a dangerous combination, only likely to get worse when Reagan’s centennial birthday is lavishly celebrated in 2011.

Based on Tuesday’s elections, the American people appear eager to march down the old road marked by Reaganism, even if the path leads to vats of Kool-Aid laced with arsenic.

Darker Economic Days Likely Ahead

By Danny Schechter

Here are the key issues we will still be facing – and many may still be in denial about.

l. There has been no real recovery. Unemployment is up and so are foreclosures. The mortgage mess is only getting worse, and the relationship between these two issues has been confirmed by a new report by the International Monetary Fund.

If there is no progress on foreclosures, there will be no progress on jobs.

AP explains, “A growth rate of 5 percent or higher is needed to put a major dent in the nation's 9.6 percent unemployment rate.” They cite reasons why that's unlikely well into next year and maybe beyond.

The Economic Policy Institute reports: “‘Never since World War Two has it taken so long to recover to pre-recession levels of GDP,’ said Economist Josh Bivens.

“Although the pace of growth in the third quarter marks a modest increase from the 1.5 percent annualized rate of growth in the second quarter, it is a sharp deceleration from the 3.7 percent annualized growth rate show in the first quarter.”

2. Millions of Americans are facing the end of all benefits. What will they do then?

Some will turn to despair and slide into poverty, others, perhaps to crime. And many more to more radicalized politics on the left and right. Mao’s axiom that revolutions are not tea parties may be relevant, even prophetic in this context of continuing economic decline.

3. While some banks and individual banksters, thanks to the bailouts, have done well, hundreds of banks are facing insolvency. The Credit Writedowns site reports: “The U.S. Banking Crisis Has a Long Way to Go.”

The “Calculated Risk website maintains an unofficial problem bank list compiled from publicly available records. The list has now reached 894. The FDIC has an official list of troubled banks and the number of troubled banks was last released August 31 when the total was 829. The FDIC does not make the names of troubled banks on their list public.”

The Guardian in the United Kingdom has even published a map of failing American banks at http://www.guardian.co.uk/news/datablog/2010/nov/02/failed-banks-map-us .

3. The Federal Reserve Bank is moving slowly and sluggishly. Fed Head Ben Bernanke, a Republican, reportedly wants more stimulus money pumped into the economy but has been too frightened to antagonize members of his own party. Many economic wise men fear his plan will fail.

Notes Dean Baker: “A Washington Post article discussing the risks associated with another round of quantitative easing raised the possibility that the Fed could lose its credibility if the program does not lead to the intended growth. It implies that the loss of credibility would be a major harm.

“It is worth noting that the whole economic collapse came about because of the Fed's failure to notice and/or do anything about an $8 trillion housing bubble. Given this enormous failure, it is not clear how much credibility it currently enjoys among people who follow the economy.”

4. The gap between the very rich and what was once the middle class continues to grow, according to Holly Sklar who explains, “Before Wall Street drove our economy off a cliff, bullish Citigroup strategists dubbed the United States a ‘plutonomy.’ They said, ‘There are rich consumers, few
in number, but disproportionate in the gigantic slice of income and consumption they take. There are the rest, the “non-rich,” the multitudinous many, but only accounting for surprisingly small bites of the national pie.’"

Jacob Hacker of Yale and Paul Pierson of the University of California at Berkeley argue that “over the last generation, more and more of the rewards of growth have gone to the rich and superrich. The rest of America, from the poor through the upper middle class, has fallen further and further behind.”

The number of Americans making $50 million or more has increased five fold.

And so it goes. . . .

The Phantom Left

[Edited 11/2/10]
There is the Obama as effective, if hollow, speaker for the Democratic party, and yet a seemingly sincere human being that I want to love and believe in, and also the Obama and his Democrat friends of pathetic inaction, who, like Republicans, take massive amounts of money from drug & insurance companies, not to mention Wall Street, while abandoning any thought of providing us with the medical care experienced in most European countries.They literally shut out progressive voices in the prior debate on that subject. Like Republicans, they give almost wholesale support to Wall Street and the Federal Reserve elites who created our current problems (by denying effective regulation), and almost invariably support the powerful corporations.

Like the prior Bush administration, the "Democratic" Obama administration promotes most of our wars, expands and/or continues the killing of innocents with drones, is silent on defense spending (etc. ad nauseum) while implying that it is not politically expedient to lead strongly, to seize the high ground and to fight the good fight. Perhaps he and the Dems surround themselves with familiar, but way too politically savvy and out of touch advisors? Of course there is the corporate media which somebody is going to be forced to take on at some point. (Where is FDR when you need him?) How much difference would it have made if he and the Democrats had done the right thing and fought strongly for the progressive ideals we perhaps used to believe in?

At least they could have have given voice (and hope) to more progressive ways of managing human affairs, a vision of how things could be. The Dems are likely to go down in flames tomorrow anyway because of the the absence of real leadership during the last two years.

I read recently that a "conservative" is likely to win in one of the European countries, Sweden if I remember correctly, but it was pointed out that even that Swedish candidate is far more progressive than the Obama administration.

In the following article, Chris Hedges, once again, tells us the unpalatable truths that we need to hear.
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The Phantom Left

http://www.truthdig.com/report/item/the_phantom_left_20101031/

Posted on Oct 31, 2010

By Chris Hedges

The American left is a phantom. It is conjured up by the right wing to tag Barack Obama as a socialist and used by the liberal class to justify its complacency and lethargy. It diverts attention from corporate power. It perpetuates the myth of a democratic system that is influenced by the votes of citizens, political platforms and the work of legislators. It keeps the world neatly divided into a left and a right. The phantom left functions as a convenient scapegoat. The right wing blames it for moral degeneration and fiscal chaos. The liberal class uses it to call for “moderation.” And while we waste our time talking nonsense, the engines of corporate power—masked, ruthless and unexamined—happily devour the state.

The loss of a radical left in American politics has been catastrophic. The left once harbored militant anarchist and communist labor unions, an independent, alternative press, social movements and politicians not tethered to corporate benefactors. But its disappearance, the result of long witch hunts for communists [and now "socialists" e.g.: Carl Kostol's laughable LTE--"Socialists posing as Democrats" in the Herald - Chris], post-industrialization and the silencing of those who did not sign on for the utopian vision of globalization, means that there is no counterforce to halt our slide into corporate neofeudalism. This harsh reality, however, is not palatable. So the corporations that control mass communications conjure up the phantom of a left. They blame the phantom for our debacle. And they get us to speak in absurdities.

The phantom left took a central role on the mall this weekend in Washington. It had performed admirably for Glenn Beck, who used it in his own rally as a lightning rod to instill anger and fear. And the phantom left proved equally useful for the comics Jon Stewart and Stephen Colbert, who spoke to the crowd wearing red-white-and-blue costumes. The two comics evoked the phantom left, as the liberal class always does, in defense of moderation, which might better be described as apathy. If the right wing is crazy and if the left wing is crazy, the argument goes, then we moderates will be reasonable. We will be nice. Exxon and Goldman Sachs, along with predatory banks and the arms industry, may be ripping the guts out of the country, our rights—including habeas corpus—may have been revoked, but don’t get mad. Don’t be shrill. Don’t be like the crazies on the left.

“Why would you work with Marxists actively subverting our Constitution or racists and homophobes who see no one’s humanity but their own?” Stewart asked. “We hear every damn day about how fragile our country is—on the brink of catastrophe—torn by polarizing hate, and how it’s a shame that we can’t work together to get things done. But the truth is we do. We work together to get things done every damn day. The only place we don’t is here [in Washington] or on cable TV.”

The rally delivered a political message devoid of reality or content. The corruption of electoral politics by corporate funds and lobbyists, the naive belief that we can somehow vote ourselves back to democracy, was ignored for emotional catharsis. The right hates. The liberals laugh. And the country is taken hostage.

The Rally to Restore Sanity, held in Washington’s National Mall, was yet another sad footnote to the death of the liberal class. It was as innocuous as a Boy Scout jamboree. It ridiculed followers of the tea party without acknowledging that the pain and suffering expressed by many who support the movement are not only real but legitimate. It made fun of the buffoons who are rising up out of moral swamps to take over the Republican Party without accepting that their supporters were sold out by a liberal class, and especially a Democratic Party, which turned its back on the working class for corporate money.

Fox News’ Beck and his allies on the far right can use hatred as a mobilizing force because there are tens of millions of Americans who have very good reason to hate. They have been betrayed by the elite who run the corporate state, by the two main political parties and by the liberal apologists, including those given public platforms on television, who keep counseling moderation as jobs disappear, wages drop and unemployment insurance runs out. As long as the liberal class speaks in the dead voice of moderation it will continue to fuel the right-wing backlash. Only when it appropriates this rage as its own, only when it stands up to established systems of power, including the Democratic Party, will we have any hope of holding off the lunatic fringe of the Republican Party.

Wall Street’s looting of the Treasury, the curtailing of our civil liberties, the millions of fraudulent foreclosures, the long-term unemployment, the bankruptcies from medical bills, the endless wars in the Middle East and the amassing of trillions in debt that can never be repaid are pushing us toward a Hobbesian ["war of all against all" - Chris] world of internal collapse. Being nice and moderate will not help. These are corporate forces that are intent on reconfiguring the United States into a system of neofeudalism. These corporate forces will not be halted by funny signs, comics dressed up like Captain America or nice words.

The liberal class wants to inhabit a political center to remain morally and politically disengaged. As long as there is a phantom left, one that is as ridiculous and stunted as the right wing, the liberal class can remain uncommitted. If the liberal class concedes that power has been wrested from us it will be forced, if it wants to act, to build movements outside the political system. This would require the liberal class to demand acts of resistance, including civil disobedience, to attempt to salvage what is left of our anemic democratic state. But this type of political activity, as costly as it is difficult, is too unpalatable to a bankrupt liberal establishment that has sold its soul to corporate interests. And so the phantom left will be with us for a long time.

Politics in America has become spectacle. It is another form of show business. The crowd in Washington, well trained by television, was conditioned to play its role before the cameras. The signs —“The Rant [Making fun of Jimmy McMillan's statement that the The rent is too damn high! - Chris] is Too Damn High,” “Real Patriots Can Handle a Difference of Opinion” or “I Masturbate and I Vote”—reflected the hollowness of current political discourse and television’s perverse epistemology. The rally spoke exclusively in the impoverished iconography and language of television. It was filled with meaningless political pieties, music and jokes. It was like any television variety program. Personalities were being sold, not political platforms. And this is what the society of spectacle is about.

The modern spectacle, as the theorist Guy Debord pointed out, is a potent tool for pacification and depoliticization. It is a “permanent opium war” which stupefies its viewers and disconnects them from the forces that control their lives. The spectacle diverts anger toward phantoms and away from the perpetrators of exploitation and injustice. It manufactures feelings of euphoria. It allows participants to confuse the spectacle itself with political action.

The celebrities from Comedy Central and the trash talk show hosts on Fox are in the same business. They are entertainers. They provide the empty, emotionally laden material that propels endless chatter back and forth on supposed left- and right-wing television programs. It is a national Punch and Judy show. But don’t be fooled. It is not politics. It is entertainment. It is spectacle. All national debate on the airwaves is driven by the same empty gossip, the same absurd trivia, the same celebrity meltdowns and the same ridiculous posturing. It is presented with a different spin. But none of it is about ideas or truth. None of it is about being informed. It caters to emotions. It makes us confuse how we are made to feel with knowledge. And in the end, for those who serve up this drivel, the game is about money in the form of ratings and advertising. Beck, Colbert and Stewart all serve the same masters. And it is not us.

Chris Hedges, who writes every Monday for Truthdig, is the author of the new book “Death of the Liberal Class.”
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I can only say, why is it that we would look to corporate comedians to guide us? The answer, perhaps, is that we have lost the ability to study, and think for ourselves. Look to your educational institutions and your culture for why that is so.