(...taking deep breaths ...)
You may have noticed, there are one or two diarists who occasionally hit the Rec list who have diametrically opposed views to mine about the direction of the economy as a whole. Despite that, we are on the same page as to what needs to be done in to help out average Americans. Well, Bobswern published a pretty nice diary earlier this morning on an important issue, that failed to make the Rec list, so I am republishing about it, because there is some very high stakes political kabuki going on in Washington that demands your serious attention, in the form of a deadly serious new assault against Medicare and Social Security, and the villains aren't the usual dumber-than-a-pile-of-Jurassic-rocks GOPers, it's ConservaDems.
The nature of the assault, and how it intersects with the TARP, a new WPA, the national debt, and Social Security, below.
This morning the Wall Street Journal reports that:
The Obama administration, under pressure to show it is serious about tackling the budget deficit, is seizing on an unusual target to showcase fiscal responsibility: ...The administration wants to keep some of the [~$210 billion] unspent [TARP] funds available for emergencies, but is considering setting aside a chunk for debt reduction, according to people familiar with the matter...
A $210 billion surplus in TARP funding could be used to reduced the U.S.'s towering national deficit. ....[T]he potential move illustrates how the Obama administration is trying to find any way it can to bring down the deficit, which is turning into a political as well as an economic liability.
....
The move could buy the Treasury Department time before it hits the so-called debt ceiling, which limits the amount of money the U.S. can borrow. Already, some members of Congress [including Senate Budget Committee Chair Kent Conrad and Diane Feinstein] have said they won't approve an increase in the $12.1 trillion debt cap unless efforts to reduce the deficit are included.
(empahsis mine)
Why is the Administration considering diverting some of the TARP funds to pay down the national debt? Because, as Chris Bowers at Open Left puts it:
Bayh, Conrad, Feinstein, Lieberman and Warner form national suicide pact
Of all the various blocs and gangs that have been formed in Congress this year, Senators Bayh, Conrad, Feinstein, Lieberman and Warner have managed to form the most regressive one yet. Currently, these five Democrats are demanding that Speaker Pelosi hand over all relevant Congressional power to an independent commission that will be allowed to slash and partially privatize Social Security and Medicare, or else they will allow the United States to default on its debt.
In other words, in a deadly serious parody of the Clevon Little scene from "Blazing Saddles", these Senators are threatening to commit national suicide unless the final New Deal and Great Society middle class safety nets are destroyed. The scam is this: Congress hands over power to make recommendations about gutting middle class entitlements to an independent Commission. The Commission's recommendations become law unless a majority in Congress overrides their recommendations -- except that we all know that in the Senate, "majority" means 60. In other words, ain't gonna happen.
A long time ago I wrote a Rec listed diary called The Truth about Social Security: namely, it isn't broke, it isn't insolvent, and in all but the most unlikely scenarios, never will be. The only way the RW nutcases can get their paws on it is to circumvent Congressional majorities. Bayh, Conrad, Feinstein, Lieberman, and Warner are trying to do exactly that.
Contrary to Chris Bowers, that the only way to deal with this threat is to call their bluff, the Obama Administration is engaging in some Kabuki of their own: again h/t to Chris Bowers:
Already, the Obama administration has used TARP money for financial assistance to auto companies ($23.4 billion), homeowners ($75 billion, and now a new program to provide credit to small businesses of a yet to be determined size.
Couldn't the Obama administration just keep using TARP money for stimulus related programs, such as the ones described above, and effectively make it a second stimulus package that does not require Congressional approval?
There certainly seems to be precedent for it. Over 70 years ago, FDR established the Works Progress Administration via executive order, using funds Congress appropriated in the stimulus act of 1935....
We know at this point that the stimulus needed another $600 billion in spending to combat the effects of the recession. Smart pundits like Paul Krugman, Matthew Yglesias and the Center on Budget and Policy Priorities keep talking about the need for a new WPA, a new Civilian Conservation Corps, and more grants to state and local governments to plug their budget gaps. Can't the Obama administration just use the remaining TARP money to just start programs like these, immediately?
In short, there is already nothing preventing it from being used to fund a new WPA -- and/or to pay down enough of the National Debt that the issue of raising the debt ceiling does not come up in Congress soon enough for the "Destroy Social Security 5" to make anything other than empty threats.
If the "Destroy Social Security 5" get their way, then the Democratic Party as it presently exists is utterly meaningless, and I vow right now never to vote for any "Democrat" who enables the dismantling of Social Security. Folks, the stakes are getting enormous.