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View Diary: Abbreviated pundit roundup: To create jobs, the U.S. must spend (92 comments)

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  •  I wonder, is Yves Smith wrong to be saying this? (5+ / 0-)

    "Now It's Official: Obama Sells Catfood Futures, Um, Social Security And Medicare Cuts..."

    There is no more pretense possible. As we’ve warned for some time, Obama is eager to put a notch on his belt by being the President that rolled back the New Deal programs that helped create broad-based middle-class prosperity and dignity. He’s cast himself as an adult inflicting discipline on profligate Americans. But in reality, the profligacy was most concentrated among elite financiers who used leverage on leverage vehicles to stoke liquidity that led to worldwide underpricing of risk. They paid themselves record bonuses in the years immediately preceding the crisis, and then in a grotesque display of ingratitude, did so again in 2009, able to do so only thanks to massive taxpayer support, alphabet-soup special borrowing programs, and the tax on savers known as ZIRP. And the direct result of their looting exercise that produced the crisis was the explosion in government deficits, due to a collapse in tax revenues and a rise in payments under countercyclical programs such as unemployment insurance and food stamps.

    But are the real perps the object of Obama’s disciplinary impulses? No. He seems spectacularly unwilling to take on anyone even remotely approaching his size (as if a President should be cowed by senior banker bullies like Jamie Dimon). The President’s failure to reprimand the financial CEOs who dissed him by refusing to attend his address on the first year anniversary of Lehman was a tacit acknowledgement that they were really in the driver’s seat.

    Keep in mind what is happening here. We are not in the realm of Obama kayfabe, where he pretends that those big bad Republicans forced him to do what he wanted to do all along. This is Obama’s budget offer, not the result of pretend hard fought battles over positions that are at most 10 degrees apart. As the Grey Lady describes it:

        President Obama next week will take the political risk of formally proposing cuts to Social Security and Medicare in his annual budget in an effort to demonstrate his willingness to compromise with Republicans and revive prospects for a long-term deficit-reduction deal, administration officials say…

        Besides the tax increases that most Republicans continue to oppose, Mr. Obama’s budget will propose a new inflation formula that would have the effect of reducing cost-of-living payments for Social Security benefits, though with financial protections for low-income and very old beneficiaries, administration officials said. The idea, known as chained C.P.I., has infuriated some Democrats and advocacy groups to Mr. Obama’s left, and they have already mobilized in opposition…..

        Mr. Obama will propose other spending and tax credit initiatives, including aid for states to make free prekindergarten education available nationwide — a priority outlined in his State of the Union address in February. He will propose to pay for it by raising federal taxes on cigarettes and other tobacco products.

    I assume Obama’s flacks understand full well what an extreme porcine maquillage exercise “in an effort to demonstrate his willingness to compromise” is. We now have the absurd spectacle of Paul Ryan’s budget being to the left of Obama’s on the issue of Social Security and Medicare. If the Republicans have an iota of sense, they’ll take full advantage of the weapon Obama has handed them. Every poll ever done over the last 50 years shows substantial majorities favoring continuing and increasing Social Security and Medicare provisions, and either increasing taxes or cutting other spending to do so.

    And Obama will pay for kiddie photo ops by increasing regressive taxes. Charming.

    From another mouth:

    Chapter IX

    Boxer's split hoof was a long time in healing. They had started the rebuilding of the windmill the day after the victory celebrations were ended. Boxer refused to take even a day off work, and made it a point of honour not to let it be seen that he was in pain. In the evenings he would admit privately to Clover that the hoof troubled him a great deal. Clover treated the hoof with poultices of herbs which she prepared by chewing them, and both she and Benjamin urged Boxer to work less hard. "A horse's lungs do not last for ever," she said to him. But Boxer would not listen.

    He had, he said, only one real ambition left--to see the windmill well under way before he reached the age for retirement.

    At the beginning, when the laws of Animal Farm were first formulated, the retiring age had been fixed for horses and pigs at twelve, for cows at fourteen, for dogs at nine, for sheep at seven, and for hens and geese at five. Liberal old-age pensions had been agreed upon. As yet no animal had actually retired on pension, but of late the subject had been discussed  more and more. Now that the small field beyond the orchard had been set aside for barley, it was rumoured that a corner of the large pasture was to be fenced off and turned into a grazing-ground for superannuated
    animals. For a horse, it was said, the pension would be five pounds of corn a day and, in winter, fifteen pounds of hay, with a carrot or possibly an apple on public holidays. Boxer's twelfth birthday was due in the late summer of the following year.

    Meanwhile life was hard. The winter was as cold as the last one had been, and food was even shorter. Once again all rations were reduced, except those of the pigs and the dogs. A too rigid equality in rations, Squealer explained, would have been contrary to the principles of Animalism. In any case he had no difficulty in proving to the other animals that they were NOT in reality short of food, whatever the appearances might be. For the time being, certainly, it had been found necessary to make a readjustment of rations (Squealer always spoke of it as a "readjustment," never as a "reduction"), but in comparison with the days of Jones, the improvement was enormous. Reading out the figures in a shrill, rapid voice, he proved to them in detail that they had more oats, more hay, more turnips than they had had in Jones's day, that they worked shorter hours, that their drinking water was of better quality, that they lived longer, that a larger proportion of their young ones survived infancy, and that they had more straw in their stalls and suffered less from fleas. The animals believed every word of it. Truth to tell, Jones and all he stood for had almost faded out of their memories. They knew that life nowadays was harsh and bare, that they were often hungry and often cold, and that they were usually working when they were not asleep. But doubtless it had been worse in the old days. They were glad to believe so. Besides, in those days they had been slaves and now they were free, and that made all the difference, as Squealer did not fail to point out.

    What was the last version of the Animal Laws? "All animals are equal, but some are more equal than others..."

    "Is that all there is?" Peggy Lee.

    by jm214 on Fri Apr 05, 2013 at 05:01:52 AM PDT

    •  You know, bobswern gets permission to (1+ / 0-)
      Recommended by:
      One Opinion

      reprint all that Naked Capitalism stuff in full.  Unlesss they just give blanket permission for reprints, that comment looks a lot like more than fair use.

    •  Obama would damage his legacy by cutting SS (7+ / 0-)

      ACA is his legacy currently; cutting SS would add a question mark to this legacy.  The bad news is that the banksters who crashed us before continue to dabble in the derivatives that betrayed everyone before.  That is why the market has taken off during an anemic recovery.

      There should be a law that brokers have to have "skin" in the game or, in other words, should not collect commissions when they lose money

    •  They've been predicting (1+ / 0-)
      Recommended by:

      that Obama would cut SS for the last 4 and half years, along with a lot of other alarmist stuff that has never happened. They run around with their hair on fire, getting TOTALLY outraged, and then nothing happpens.

      Putting something on the table to get Republicans TO the table doesn't mean it's going to happen.
      For one thing there aren't enough votes in the Senate to cut SS benefits.
      Who can take people seriously when they say stuff like this?

      We now have the absurd spectacle of Paul Ryan’s budget being to the left of Obama’s on the issue of Social Security and Medicare.

      “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

      by skohayes on Fri Apr 05, 2013 at 05:48:34 AM PDT

      [ Parent ]

      •  It's not for lack of trying (1+ / 0-)
        Recommended by:

        Even when Republicans were unwilling to propose SS cuts, Obama has time and again waded in.  It's not something he is doing reluctantly or is being forced into by intransigent Republicans; it is his policy.  The only reason I'm not sorry I voted for him is that the alternatives were so much worse.

        "[W]e shall see the reign of witches pass over . . . and the people, recovering their true spirit, restore their government to its true principles." Jefferson

        by RenMin on Fri Apr 05, 2013 at 07:21:50 AM PDT

        [ Parent ]

        •  I guess you've never bought a home or (1+ / 0-)
          Recommended by:

          a car? Never had to negotiate with someone who didn't want to drop the price of their home or a sales manager at a dealership? It isn't "This is what I want and I'm not budging from this place (that's how Republicans do it and how's that working out for them so far?)"
          Furthermore, putting an offer on the table doesn't make anything a "policy".

          “We are not a nation that says ‘don’t ask, don’t tell.’ We are a nation that says ‘out of many, we are one.’” -Barack Obama

          by skohayes on Fri Apr 05, 2013 at 09:00:03 AM PDT

          [ Parent ]

    •  It's Yves Smith, so of course, yes and no (2+ / 0-)
      Recommended by:
      One Opinion, skohayes

      On one hand, I was shocked and saddened  to see that Obama is including Chained-CPI in his budget.

      On the other hand, naked capitalism is like a suicide hotline, but without all the good cheer. While disagreeable, Chained-CPI doesn't "end" Social Security, it just reduces the rate at which payments accrue annually. Considering Obama has done the most to expand the New Deal since LBJ to date, it is melodramatic to say that Chained-CPI undoes it.

      •  The president shouldn't be doing ANYTHING (8+ / 0-)

        to reduce the benefits paid to SS recipients.  It's unnecessary and there are other ways to address a looming shortfall twenty years in the future that don't require cutting benefits for retirees, 90% of whom count on SS payments to afford them a small income when they can no longer work.

        I don't like slippery slope or camel's-nose-under-the-tent arguments, but the CPI on which current COLA's are based does not reflect the differences in spending of seniors compared to the general population, particularly for health care, and to change it to be even less reflective of reality is unconscionable.  

        "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

        by SueDe on Fri Apr 05, 2013 at 06:28:23 AM PDT

        [ Parent ]

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