Today's output from Blogistan Polytechnic Institute’s state-of-the-art HEMMED (High-Energy Meta Mojo Elucidation Detector) machine is ... please sit down for this ... some sensible Progressive wisdom from the Senate.
Oh, wait. We should not be surprised by that. The sensible Progressive wisdom is coming from sensible Progressive Senator Bernie Sanders.
Bernie Sanders is calling for a commission to propose alternatives to President Obama's National Commission on Fiscal Responsibility and Reform (Bowles-Simpson). Erskine Bowles is former Chief of Staff for Bill Clinton (noted triangulator and DLC poster child) and Alan Simpson is a former Wyoming Senator most recently known for his comment characterizing Social Security as a cow with 310 million teats. The president's commission is sometimes referred to as the Catfood Commission and that makes perfect sense given that what they gave us last week certainly looks like a hairball.
Senator Sanders is inviting "members of Congress, labor unions, seniors’ organizations and others" to develop progressive alternatives to proposals released by the commission to the media last week.
The Commission's "Commission"?
Others have weighed in on the commission's report. Paul Krugman commentson the "rough draft":
What the commission was supposed to do was ... produce a package that Congress would give an up and down vote. To do this, it would have to produce something much better than a package with some good stuff buried in among the bad stuff; it would have to produce a package good enough to accept as is. And it didn’t do that.
Dr. Krugman had earlier remarked that:
...it’s no mystery what has happened on the deficit commission: as so often happens in modern Washington, a process meant to deal with real problems has been hijacked on behalf of an ideological agenda. Under the guise of facing our fiscal problems, Mr. Bowles and Mr. Simpson are trying to smuggle in the same old, same old — tax cuts for the rich and erosion of the social safety net.
Can anything be salvaged from this wreck? I doubt it. The deficit commission should be told to fold its tents and go away.
Brookings Institute economist Henry Aaron also has some concerns with the commission's plan, particularly as it relates to timing:
The Bowles-Simpson plan would start deficit reduction in fiscal 2012, which starts on October 1, 2011, not even eleven months from now. Since unemployment is likely then to still be in the vicinity of 9 percent or higher, that is too soon, as premature deficit reduction could intensify and lengthen the recession. This is not a minor issue, as nothing more effectively depresses revenues and generates deficits than a weak economy.
Even more troubling than timing, is the program itself. Over the first nine years, 70 percent of the deficit reduction under the Bowles-Simpson "mark" would come from spending cuts, 30 percent from added taxes. The steady-state spending level, as a share of GDP, would be 20.5 percent of GDP. That is lower than spending averaged from 1980 to 2008 when none of the baby boomers had yet retired and claimed Social Security and Medicare and when spending on health care per person was a minor fraction of what it will be in 2020.
Finally, the American people are not too keen on this plan either. Most Americans (56%) would prefer Congress focus on the enomomy and jobs rather than the deficit:
"For all the recent frenzy over reducing the deficit, a new poll by CBS News shows that only 4% of Americans consider it the biggest problem faced by the country.
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The Sanders Progressive Commission
The Big News from Senator Sanders' Press Release:
"It is no surprise that these two favor draconian cuts to Social Security, Medicare, Medicaid, the needs of our veterans, and education while proposing tax reductions for the wealthy and large profitable corporations," Sanders said. Simpson is a darling of the Republican right wing and Bowles is a former investment banker who made a fortune on Wall Street. Their plan was floated amid reports that the two were struggling to cobble together enough support on their own commission to go forward by a Dec. 1 deadline.
"Everyone agrees that over the long-term we have got to reduce the record-breaking $13.7 trillion national debt and unsustainable federal deficit," Sanders said, but he stressed that deficits mushroomed in recent years because of two unpaid wars, tax breaks for the wealthy, a Medicare prescription drug bill written by the pharmaceutical industry, and the Wall Street bailout. "The national debt is a very serious issue and we’ve got to tackle it but we can do it without balancing the budget on the backs of the middle class."
Sanders, in his letter, invited progressive activists and economists to meet next week to develop a progressive plan to reduce the deficit. "We all know that there are a number of fair ways to reduce deficits without harming the middle class and those who have already lost their jobs, homes, life savings and ability to send their kids to college. The time has come to put these proposals into a package so that a fair and progressive deficit reduction plan will become part of the national discussion," he said.
From the letter:
"There is a growing concern among progressives that this Commission will come up with a plan to reduce the deficit not by asking large, profitable corporations or the wealthiest in our society to begin to pay their fair share, but by cutting the most important and successful federal investments for the middle class, working families, the disabled, seniors on fixed incomes, and veterans. This concern has only been made worse by the recent proposal put forward by the co-chairs of this Commission that would make draconian cuts in Social Security, Medicare, Medicaid, the needs of our veterans, and education, all while reducing tax rates for the wealthy and large, profitable corporations.
Everyone agrees that over the long-term we have got to reduce the record-breaking $13.7 trillion national debt and unsustainable federal deficit. But, we can and must put forward a plan that does not reduce the deficit on the backs of the shrinking middle class and the least fortunate in our society who have already born the brunt of the worst economic crisis since the Great Depression.
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About Those Taxes
Now to the point of this piece (yes, there is one believe it or not!).
I want to know who took "tax increases" off the table. No, I am not talking about the tax increases that raise FICA rates...I am talking about honest to goodness increases like the kind that Senator Sanders wants to include: "asking large, profitable corporations or the wealthiest in our society to begin to pay their fair share".
For republicans, who do not miss any opportunity to wax nostalgic about the "good old days" (read: "we want June Cleaver back as a female role model"), I would like to point to this table on historical Marginal Tax rates:
Years...........First Bracket.....Top Bracket
1954-1963......20%................91%
1964..............16%................77%
1965-1967......14%................70%
(Update: fast forward to today)
2003-2009......10%................35%
Some of those were probably considered by many to be some pretty darned "good old days".
And most disheartening of all related to taxes? It turns out that most corporations pay no U.S. income taxes at all:
The Government Accountability Office said 72 percent of all foreign corporations and about 57 percent of U.S. companies doing business in the United States paid no federal income taxes for at least one year between 1998 and 2005. More than half of foreign companies and about 42 percent of U.S. companies paid no U.S. income taxes for two or more years in that period, the report said.
I think it is time to find a sweet spot somewhere above 0% for corporations that reflects the benefit those corporations get from doing business in the United States.
And, for crying out loud, won't someone PLEASE put tax increases back on the table!
Happy Tuesday Wednesday to everyone and fist bumps!
Crossposted from Blogistan Polytechnic Institute (BPICampus.com)
The BPI Campus Progressive agenda:
- People matter more than profits.
- The earth is our home, not our trash can.
- We need good government for both #1 and #2.
Return to HEMMED In three days a week on Tuesday, Thursday and Saturday for more output from BPI’s state-of-the-art HEMMED (High-Energy Meta Mojo Elucidation Detector) machine.
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