digby: Lifting UpTo be blunt: recent events suggest that the Republican Party has been driven mad by lack of power. The few remaining moderates have been defeated, have fled, or are being driven out. What’s left is a party whose national committee has just passed a resolution solemnly declaring that Democrats are “dedicated to restructuring American society along socialist ideals,” and released a video comparing Speaker of the House Nancy Pelosi to Pussy Galore.
And that party still has 40 senators.
I wrote last week about the plea for Obama to end the practice of sending the wreath to the Confederate War memorial on Memorial Day and I assumed that he would send it rather than ignite a culture war skirmish. (My thesis was that ending the practice this would have to be a Nixon goes to China thing --- a white southern Republican would have to do it.)Benen: CAN WASHINGTON JUMPSTART ENTREPRENEURSHIP?....
Obama did send the wreath as predicted, but didn't just leave it there:Last week, a group of university professors petitioned the White House to end a longstanding practice of sending a wreath to a monument to Confederate soldiers on the cemetery grounds. Mr. Obama continued that tradition but started another, the White House said, by sending a second wreath across the Potomac River to the historically black neighborhood in Washington where the African-American Civil War Memorial commemorates more than 200,000 blacks who fought for the North in the Civil War.Some of us would like the Lost Cause mythology to be retired altogether, but this is a creative and non-confrontational way to get at the underlying issues that make so much of that mythology toxic. It gives black Civil War veterans equal footing with the confederate soldiers --- which puts out the racists among the Southern Heritage types (who like to pretend it isn't about race) and doesn't bother the non-racist southerners at all. It's vintage Obama at his best. Very clever.
When the economic recovery finally comes (and it will soon, we hope) will it be a jobs-producing, income-boosting boom like the 1990s, or a relative dud like the Bush years? The answer will largely come down to the state of small business, source of nearly all net job growth in the U.S. economy for decades.So what can Washington do now to open up new opportunities for America's cutting-edge entrepreneurs? We take on this vital -- and largely unasked -- question in a special report in the latest issue of the Washington Monthly. We think you'll find our answers illuminating and surprising.
Investor and blogger Paul Kedrosky explains that Lincoln and FDR both took advantage of crises to create new economic platforms on which entrepreneurs could generate growth, and Obama has the opportunity to do likewise.
MIT economist Jonathan Gruber argues than universal health care, if done right, could be a boon to entrepreneurship.
Washington Monthly editor Mariah Blake reports that creating a so-called "smart grid" could yield not only vast energy efficiency gains but a new wave of high-tech ventures -- if Washington gets the regulations right.
Wired magazine senior editor Nicholas Thompson warns that America is falling behind in the global race to provide high-speed broadband, but that we can regain our momentum -- and economic edge -- if Washington chooses wisely.
New America Foundation fellow T.A. Frank bemoans the fact that the U.S. educates brilliant students from around the world, then sends them home to work for our competitors.
Finally, in Paul Glastris' Editors Note, the Monthly's editor-in-chief wonders how different the world might be today if the trillions of dollars that the Bush administration helped direct into real estate and its attendant Wall Street exotica had instead been invested in the new platforms for entrepreneurs that technologists were talking about eight years ago? It's a depressing thought, but it's not too late for America to reach the next stage of capitalism that can benefit us all.
Krugman: Hating on social insurance
What Digby said. Of all the things to worry about in today’s world, the prospect of Social Security shortfalls several decades from now doesn’t rank high on the list. But there’s a whole generation of Very Serious People who think that worrying about entitlements is how they demonstrate their seriousness — while, say, worrying about climate change is hippy-dippy. Indeed, we find the same people who declare that to show how responsible we are we must do something about Social Security RIGHT NOW declaring that saving the planet is, you know, expensive, so let’s not.
- publius: Robert Samuelson's Dishonest Jihad Against Social Security
If the country ever gets around to ending life tenure for Supreme Court Justices, I hope we add a provision ending it for Washington Post columnists too. Or at least ending it for Robert Samuelson. Today, again, we see another extremely misleading op-ed from him on the fiscal health of Social Security.
Here’s a good rule of thumb – anytime you see an op-ed whining about entitlements that uses the phrase “Medicare and Social Security,” it’s safe to stop reading. Samuelson’s is no exception.
This isn’t news, but let’s repeat it for the one millionth time. There is no Social Security crisis. None.
Medicare and Social Security’s fiscal outlooks are completely different. There is no Social Security funding emergency – even after the latest trustees report. Assuming historical rates of growth, there is no shortfall whatsoever for 75 years. Even under more conservative or pessimistic economic assumptions, extremely modest tweaks eliminate the modest shortfall entirely.
And finally – Social Security is not going “bankrupt.” Even assuming 2037 is the magic date, and assuming low growth and no tinkering before then, Social Security will still be able to pay 75% of scheduled benefits.
To lump Social Security together with the more problematic Medicare shortfall (which should be addressed through national health care reform) is blatantly misleading. It’s like saying the combination of a Big Mac and a jelly bean is an extremely high-calorie meal.
But that’s exactly what Samuelson is doing. In fact, Michael Lind had a Salon column a while back outlining all the rhetorical tricks that dishonest Social Security skeptics make. It’s as if Samuelson read that column, and decided to use them all.
For instance, here’s Lind:
In order to frighten gullible Americans, anti-Social Security crusaders conflate Social Security with Medicare and talk about the "entitlement crisis" in general. This masks the fact that Social Security's projected shortfalls are minor, compared to those of Medicare.And Samuelson:
It's increasingly obvious that Congress and the president (regardless of the party in power) will deal with the political stink bomb of an aging society only if forced. And the most plausible means of compulsion would be for Social Security and Medicare to go bankrupt.And Lind:
About a decade ago, conservative and libertarian economists who oppose Social Security, Medicare and other entitlements came up with a clever rhetorical strategy. They would calculate the gap between the payroll taxes that pay for these programs and estimated costs over time. But there was one problem: The gap isn't all that scary, at least in the near future. So in order to frighten the American people and their elected leaders, deficit hawks cite the sum total of Social Security's "unfunded liabilities" over 75 years. But even this -- a paltry $4.3 trillion over three-quarters of a century, according to the 2008 report -- isn't sufficiently terrifying. [So they combine Medicare and SS]. [This] produces a suitably spooky 75-year shortfall of $42.9 trillion. And if this is not alarming enough, deficit hawks can cite the truly apocalyptic figure of $101.7 trillion in combined "entitlement" spending over an infinite time horizon.
The anti-Social Security lobby always presents the "unfunded liabilities" of "entitlements" in scary dollar terms, rather than as percentage points of GDP. Here's why: Over the next 75 years, the Social Security shortfall at most hovers around 1 percent of total U.S. GDP over that same period.And Samuelson:
That the programs will ultimately go bankrupt is clear from the trustees' reports. On Pages 201 and 202 of the Medicare report, you will find the conclusive arithmetic: Over the next 75 years, Social Security and Medicare will cost an estimated $103.2 trillion, while dedicated taxes and premiums will total only $57.4 trillion. The gap is $45.8 trillion. (All figures are converted to "today's dollars.")Lind:
[According to anti-Social Security advocates,] [w]e have only two choices, or a combination -- cutting benefits or raising the payroll tax. False. There are at least two other choices that the deficit hawks never mention. One is more rapid economic growth, which would make it easier to pay Social Security taxes in the future without either benefit cuts or tax increases.And Samuelson:
The inadequate trust funds will steadily diminish. The government bonds in these trust accounts will be presented to the Treasury for payment. Those payments can be financed in only three ways: bigger deficits, higher taxes or spending cuts.One more time – there is no Social Security crisis, no matter how much people like Robert Samuelson dislike the level of Social Security benefits.
California, it has long been claimed, is where the future happens first. But is that still true? If it is, God help America.
The recession has hit the Golden State hard. The housing bubble was bigger there than almost anywhere else, and the bust has been bigger too. California’s unemployment rate, at 11 percent, is the fifth-highest in the nation. And the state’s revenues have suffered accordingly.
What’s really alarming about California, however, is the political system’s inability to rise to the occasion.
Despite the economic slump, despite irresponsible policies that have doubled the state’s debt burden since Arnold Schwarzenegger became governor, California has immense human and financial resources. It should not be in fiscal crisis; it should not be on the verge of cutting essential public services and denying health coverage to almost a million children. But it is — and you have to wonder if California’s political paralysis foreshadows the future of the nation as a whole.
The seeds of California’s current crisis were planted more than 30 years ago, when voters overwhelmingly passed Proposition 13, a ballot measure that placed the state’s budget in a straitjacket. Property tax rates were capped, and homeowners were shielded from increases in their tax assessments even as the value of their homes rose.
The result was a tax system that is both inequitable and unstable. It’s inequitable because older homeowners often pay far less property tax than their younger neighbors. It’s unstable because limits on property taxation have forced California to rely more heavily than other states on income taxes, which fall steeply during recessions.
Even more important, however, Proposition 13 made it extremely hard to raise taxes, even in emergencies: no state tax rate may be increased without a two-thirds majority in both houses of the State Legislature. And this provision has interacted disastrously with state political trends.
For California, where the Republicans began their transformation from the party of Eisenhower to the party of Reagan, is also the place where they began their next transformation, into the party of Rush Limbaugh. As the political tide has turned against California Republicans, the party’s remaining members have become ever more extreme, ever less interested in the actual business of governing.
And while the party’s growing extremism condemns it to seemingly permanent minority status — Mr. Schwarzenegger was and is sui generis — the Republican rump retains enough seats in the Legislature to block any responsible action in the face of the fiscal crisis.
Will the same thing happen to the nation as a whole?
Last week Bill Gross of Pimco, the giant bond fund, warned that the U.S. government may lose its AAA debt rating in a few years, thanks to the trillions it’s spending to rescue the economy and the banks. Is that a real possibility?
Well, in a rational world Mr. Gross’s warning would make no sense. America’s projected deficits may sound large, yet it would take only a modest tax increase to cover the expected rise in interest payments — and right now American taxes are well below those in most other wealthy countries. The fiscal consequences of the current crisis, in other words, should be manageable.
But that presumes that we’ll be able, as a political matter, to act responsibly. The example of California shows that this is by no means guaranteed. And the political problems that have plagued California for years are now increasingly apparent at a national level.
To be blunt: recent events suggest that the Republican Party has been driven mad by lack of power. The few remaining moderates have been defeated, have fled, or are being driven out. What’s left is a party whose national committee has just passed a resolution solemnly declaring that Democrats are “dedicated to restructuring American society along socialist ideals,” and released a video comparing Speaker of the House Nancy Pelosi to Pussy Galore.
And that party still has 40 senators.
So will America follow California into ungovernability? Well, California has some special weaknesses that aren’t shared by the federal government. In particular, tax increases at the federal level don’t require a two-thirds majority, and can in some cases bypass the filibuster. So acting responsibly should be easier in Washington than in Sacramento.
But the California precedent still has me rattled. Who would have thought that America’s largest state, a state whose economy is larger than that of all but a few nations, could so easily become a banana republic?
On the other hand, the problems that plague California politics apply at the national level too.
digby: They're Coming To Get You
Run for your lives:"My insurance wasn't good enough," said Lord McWilliams, 20, who has a deadly liver disease.Obviously, we don't know the whole story, but this sure sounds like so many other so-called terrorists plots that turned out to be a bunch of losers coerced into some stupid plan and then arrested with a bunch of phony fanfare. And the transplant angle is just mind-boggling. As Susie Madrak says:
His brother, David Williams, wanted money "to speed up the process," McWilliams said. "Medicaid only goes so far."
He dismissed as "crazy" federal accusations that Williams was a Jew-hater who wanted to wage jihad.
McWilliams said the FBI informant who lured his brother and three other hapless petty criminals into a plot to blow up synagogues and shoot down a plane promised enough money to take care of his transplant.
"[My brother] told me, 'Don't worry, when you go to the doctor, tell them you got money,'" McWilliams said.
McWilliams, who has already had his spleen removed, said his brother told him he would have $20,000 for the operation.
Their mother, Elizabeth McWilliams, said her older son had told her he would be able to give her a wad of cash Thursday, which was the day after the terrorist plot was to have been carried out.
"He was a loving, sweet kid. He took his brother's illness worse than me," she said.
Lord McWilliams said the informant, who often drove his brother to the hospital to visit, even promised to take him to Universal Studios when he was well again.
"He said I didn't have to pay for nothing," McWilliams said.
Federal prosecutors say Williams, 28; James Cromitie, 44; Laguerre Payen, 27, and Onta Williams, 32, all of upstate Newburgh, were militant Muslims caught on tape railing against Jews and plotting to blow up Jewish temples.
Federal prosecutors say Williams, 28; James Cromitie, 44; Laguerre Payen, 27, and Onta Williams, 32, all of upstate Newburgh, were militant Muslims caught on tape railing against Jews and plotting to blow up Jewish temples.
They were arrested last Wednesday while planting what they thought were plastic explosives outside two Riverdale synagogues.
They also had a Stinger missile - phony, supplied by the FBI - with which they allegedly planned to shoot down a military plane. Family and friends say the four were down-on-their luck ex-cons who apparently thought they would be paid by the FBI informant.
In dozens of interviews around Newburgh, no one can remember hearing any of the four talk of Jews or jihad. They had converted to Islam in prison, but they drank beer, ate pork and rarely prayed, family members said.I hardly know what to say. What’s worse: A healthcare system where someone is so desperate, he’d blow up buildings to pay for his brother’s treatment, or homeland security that thinks nothing of setting people up so they can claim they caught some “terrorists”?
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