Category "Taxes, The Commons & The Social Contract"

The Financial Crash: Simple Cause & Simple Solution

March 17th, 2008 by Andy in Taxes, The Commons & The Social Contract

Good analysis on the whole cause, nature and recommended course of action regarding the present American economic meltdown, posted on The Oil Drum, a site dedicated to discussion about energy and our future.

I never tire of posting this graph of the “W economy”, because it summarizes in a nutshell what happened: growth happened, but was not shared widely. Thanks to wage stagnation, made possible by the threats of outsourcing and offshorization, and by consistent policies over the last 30 years to deregulate and liberalise markets, starting with labor markets), the fruits of growth have to a large extent been captured by a very few - but this has been hidden because consumption was propped up by readily available debt and the apparently growing virtual wealth of homeowners.

The problem is that, while a lot of that growth was illusory (and is now unraveling), the wealth re-allocation that took place thanks to it was very real, and, in particular, the mechanisms ensuring that an ever grower share of the pie get into a few privileged hands are still in place, and will bite even more harshly as the pie shrinks.

Read The Complete Post

The Rich Are Getting Richer Faster

December 23rd, 2007 by Andy in Taxes, The Commons & The Social Contract

Class war anyone?

Whenever you bring up statistics like this, the oblivious opulent tend to screech out about how one is engaging in ‘class warfare.’

Seems to me that its a war that has long been underway, and its pretty obvious who is winning it.

Here from author David Cay Johnston, reporting for The New York Times

The increase in incomes of the top 1 percent of Americans from 2003 to 2005 exceeded the total income of the poorest 20 percent of Americans, data in a new report by the Congressional Budget Office shows.

The poorest fifth of households had total income of $383.4 billion in 2005, while just the increase in income for the top 1 percent came to $524.8 billion, a figure 37 percent higher.

The total income of the top 1.1 million households was $1.8 trillion, or 18.1 percent of the total income of all Americans, up from 14.3 percent of all income in 2003. The total 2005 income of the three million individual Americans at the top was roughly equal to that of the bottom 166 million Americans, analysis of the report showed.

The report is the latest to document the growing concentration of income at the top, a trend that President Bush said last January had been under way for more than 25 years.

Earlier reports, based on tax returns, showed that in 2005 the top 10 percent, top 1 percent and fractions of the top 1 percent enjoyed their greatest share of income since 1928 and 1929.

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Jared Bernstein, an economist at the Economic Policy Institute in Washington who characterizes the Bush administration’s policies as YOYO economics, based on You (Are) On Your Own, said the differences in income growth explained why so many Americans have told pollsters that they are feeling squeezed.

“A lot of people justifiably feel they are working harder and smarter, they are baking a bigger and better pie, and yet their slice is not growing much at all,” Mr. Bernstein said. “It is meaningless to middle- and low-income families to say we have a great economy because their economy looks so much different than folks at the top of the scale because this is an economy that is working, but not working for everyone.”

The rich with the greatest share of income since 1929? We know what went down the last time THAT happened.

Read The Complete Article

Why Progressive Taxation Makes Sense (and Anti-Estate Tax Arguments are Unpatriotic)

November 26th, 2007 by Andy in Taxes, The Commons & The Social Contract

George Lakoff and Bruce Budner of The Rockridge Institute elaborate here on some of the hidden truths and necessary social positives of a progressive taxation system…

Progressive taxation - taxing the wealthy at higher rates than the poor - is a moral issue. Like many moral issues, it sparks heated debate. The debate is borne of conflicting worldviews, values and understandings of values.

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America’s government has at least two fundamental functions: protection and empowerment. Protection includes the police, firefighters, emergency services, public health, the military and so on. Empowerment includes the infrastructure needed for business and everyday life: roads, communications systems, water supplies, public education, the banking system for loans and economic stability, the SEC for the stock market, the courts for enforcing contracts, air traffic control, support for basic science, our national parks and public buildings, and more. We are usually aware of protection. But the empowerment infrastructure, provided by taxes, is usually taken for granted, hidden or ignored. Yet it is absolutely crucial, a fundamental truth about America and why America provides opportunity.

———

As Warren Buffet famously observed, he likely couldn’t have achieved his financial success had he been born in Bangladesh instead of the United States, because Bangladesh had no banking system and no stock market.

Ordinary people just drive on the highways; corporations send fleets of trucks. Ordinary people may get a bank loan for their mortgage; corporations borrow money to buy whole companies. Ordinary people rarely use the courts; most of the courts are used for corporate law and contract disputes. Corporations and their investors - those who have accumulated enough money beyond basic needs so they can invest - make much more use, compound use, of the empowering infrastructure provided by everybody’s tax money.

The wealthy have made greater use of the common good - they have been empowered by it in creating their wealth - and thus they have a greater moral obligation to sustain it. They are merely paying their debt to society in arrears and investing in future empowerment.

This is the fundamental truth that motivates progressive taxation.

It is a truth that undercuts conservative arguments about taxation. Taxes provide and maintain the protecting and empowering infrastructure that makes our income possible.

Our tax forms hide this truth. They do not indicate the extent to which taxes have created and sustained the common wealth so you could earn what you have. They make it look like the empowering infrastructure was just put there by magic and that the government is taking money out of your pocket. The most likely truth is that, through the common wealth, America put more money in your pocket than it took out - by far.

Read The Complete Article

It’s Katrina All the Time In Bush’s America

November 13th, 2007 by Andy in Taxes, The Commons & The Social Contract

Paul Krugman, the Princeton economist who serves as one of the most lucid voices in the media today, thanks to his column in the NY Times, delivers with this expose’ on how in America under the Bush crony system of government, it’s Katrina all the time for the public infrastructure of American society.

…Federal officials were oblivious. “We are extremely pleased with the response that every element of the federal government, all of our federal partners, have made to this terrible tragedy,” declared Michael Chertoff, the secretary for Homeland Security, on Wednesday. When asked the next day about the situation at the convention center, he dismissed the reports as “a rumor” or “someone’s anecdotal version.”

Today, much of the Gulf Coast remains in ruins. Less than half the federal money set aside for rebuilding, as opposed to emergency relief, has actually been spent, in part because the Bush administration refused to waive the requirement that local governments put up matching funds for recovery projects - an impossible burden for communities whose tax bases have literally been washed away.

On the other hand, generous investment tax breaks, supposedly designed to spur recovery in the disaster area, have been used to build luxury condominiums near the University of Alabama’s football stadium in Tuscaloosa, 200 miles inland.

But why should we be surprised by any of this? The Bush administration’s response to Hurricane Katrina - the mixture of neglect of those in need, obliviousness to their plight, and self-congratulation in the face of abject failure - has become standard operating procedure. These days, it’s Katrina all the time.

————

Most disturbing of all, the number of Americans without health insurance jumped. At this point, there are 47 million uninsured people in this country, 8.5 million more than there were in 2000. Mr. Bush may think that being uninsured is no big deal - “you just go to an emergency room” - but the reality is that if you’re uninsured every illness is a catastrophe, your own private Katrina.

Yet the White House press release on the report declared that President Bush was “pleased” with the new numbers. Heckuva job, economy!

————

Future historians will, without doubt, see Katrina as a turning point. The question is whether it will be seen as the moment when America remembered the importance of good government, or the moment when neglect and obliviousness to the needs of others became the new American way.

Read The Complete Essay

Don’t Believe the Hype on Medicare Part D

October 11th, 2007 by Andy in Taxes, The Commons & The Social Contract

It is simply amazing to me that this fraud of a program was able to ever be enacted in the first place. But then, the power of the Corporate State cannot be underestimated. This from Smartmoney.com

You can tell a lot about a product by the way it’s sold, and the Bush administration has hawked Medicare’s prescription-drug benefit - “Part D” - almost as honestly as it rolled out the Iraq war. The results are going to start slamming millions of seniors right here, right now, in the fall of 2007.

To see why Part-D Day is at hand, you first have to understand the nasty process by which Medicare added a drug benefit.

———-

The administration and its allies went to unusual and controversial lengths to pass the drug benefit. In 2004 it sent a series of “video news releases” hyping the program to media outlets around the country. These prepackaged broadcasts seemed like news reports, and some TV stations aired them as such, but they were actually political ads. In May 2004 the Government Accountability Office found that these news stories constituted “covert propaganda” and violated publicity or propaganda prohibitions, but the GAO lacked the authority to punish anyone.

———-

Throughout the debate over the drug benefit, President Bush told Congress it would not cost more than $400 billion over 10 years, but soon after the legislation passed, it emerged that administration officials knew that information was false. From June through November 2003, Medicare’s accountants estimated the real cost of the program would run between $500 billion and $600 billion, according to congressional testimony in 2004 by Richard Foster, Medicare’s chief actuary. But Thomas Scully, then Medicare’s administrator, told Foster he would face “extremely severe” consequences if he revealed the truth to Congress. And Foster says a top lawyer at Medicare told him that Scully had the authority to gag him. That lawyer was Leslie Norwalk - a name to keep in mind.

———-

In this description, disseminated by the administration and picked up by countless journalists (including, unfortunately, me in a prior column), the gap in coverage seems to be a manageable $1,450. The very name “doughnut hole” suggests a small problem. Maybe the difference between “prescription costs” and “out-of-pocket expenses” will be confusing enough to make you stop thinking about the whole issue.

Try this on for size instead. Under Medicare’s drug benefit, you pay $4,270 of the first $5,871 in prescription costs you incur.

Packs a much stiffer wallop - both rhetorically and financially - than the first definition, doesn’t it? But it’s the same numbers, just expressed more clearly (and honestly). To get Part D’s “catastrophic” coverage, which pays for 95% of prescription costs, you’ve got to pay the premium for your policy, then a deductible, then 25% of your initial drug costs, and then, on average, another $3,000 or so to get you through the “doughnut hole.” That’s the real cost of structuring Part D as a giveaway to pharmaceutical companies. Maybe it would get some more attention if we started calling it the “Mom’s missing her meds” tax.

And this is just touching on part of this disconcerting report. Read the complete article Here

Ecomonic Study Rebukes Corporate Assertion of Intellectual Property Rights

September 19th, 2007 by Andy in Taxes, The Commons & The Social Contract

This is interesting, from the Computer and Communications Industry Association

Fair Use Economy Represents One-Sixth of U.S. GDP

Fair Use exceptions to U.S. copyright laws are responsible for more than $4.5 trillion in annual revenue for the United States, according to the findings of an unprecedented economic study released today. According to the study commissioned by the Computer and Communications Industry Association (CCIA) and conducted in accordance with a World Intellectual Property Organization methodology, companies benefiting from limitations on copyright-holders’ exclusive rights, such as “fair use” – generate substantial revenue, employ millions of workers, and, in 2006, represented one-sixth of total U.S. GDP.

The exhaustive report, released today at a briefing on Capitol Hill, quantifies for the first time ever the critical contributions of fair use to the U.S. economy.  The timing proves particularly important as the debates over copyright law in the digital age move increasingly to center stage on Capitol Hill. 

Read The Full Study

Public/Private “Partnerships” and Who Benefits?

August 20th, 2007 by Andy in Taxes, The Commons & The Social Contract

Good posting on Wrynet dissecting some of the deceptive arguments and illusionary enticements of so-called ‘public/private partnerships’ and who is really benefitting from them.

Minneapolis - Harbinger of Things To Come?

August 5th, 2007 by Andy in Taxes, The Commons & The Social Contract

Truthout has a good posting here with some articles regarding this tragic event and some of its potentially likely underlining causes. This includes a provocative and well-reasoned analysis from AlterNet regarding why this tragedy is the result of conservative ideology…

The tragic collapse this week of a stretch of I-35 spanning the Mississippi river in Minnesota was shocking but should come as no surprise. America’s core infrastrucure has been falling apart in very visible ways during the past few years. It’s a predictable outcome of the rise of “backlash” conservatism; we’ve swallowed 30 years of small-government rhetoric, and it’s led us to a point in which our infrastructure, once the pride of the developed world, is falling apart around us. We’re reaping what we’ve sown.

———–

One of the primary reasons for that is that there aren’t organized constituents lobbying for public goods like highways and bridges - people take those things for granted. A thousand grifters have gained office promising to cut taxes as if they existed in a vacuum, without mentioning the cost; no politician has ever won office promising to keep highways from collapsing on their constituents. For 30 years, we’ve been told by a series of right-wing snake-oil salesmen that they could deliver more and better public services while constantly cutting the taxes that pay for them, but it was always a fraud. The result is that the United States enjoys the third-lowest tax burden among the 30 most advanced economies as its public spaces gradually come apart at the seams.

I would argue that skimping out on infrastructure investments in the name of a low tax burden is a triumph of ideology over commonsense, but it goes beyond that. Conservative philosophy stresses limited government, not bad government, and nothing can change the fact that the public sector remains the only way to organize collectively when there’s no profit involved. So nobody seriously believes that the the hidden hand of capitalism is going to step in and inspect and repair bridges that are open to the public. When lawmakers don’t fund that work, they know full well that it won’t get done.

Read The Full Article

Some colleagues of mine posted some insightful comments on this incident as well.

I think we are beginning to see the tip of the iceberg.

Nationwide we appear to be falling further and further behind with infrastructure maintenance. A recent example was the steam line rupture in New York City. There are plenty of other things — billions of dollars worth of water lines - some in excess of 100 years old - needing replacement. Yet governments don’t want to spend the necessary money to correct these deficiencies because it isn’t the “political thing to do.” Hey, can’t raise taxes or rates. Leave it for the next guy.

I’m at 33 years of local government service, and I don’t like what I see. Frustrating is putting it mildly.

It’s going to become a very real problem for all of us.

Unfortunately, I believe this individual is completely correct here. As our nation continues to more and more resemble the former USSR and authoritarian east bloc nations in the political sphere, that resemblance will begin to manifest itself in the realm of our physical infrastructure as well.

Another, from the Twin Cities, posted this…

I’m also nauseated and angry over reports this morning that our state administration was told in 2001, 2005 and 2006 that the bridge was structurally deficient, and was prone to single fatigue. Our governor this morning is assuring me and other citizens that 179,000 other bridges in the country have the same designation, so there’s nothing to worry about. It’s not the time to go on a political rant, but I know a lot of other people are shocked and angry. As I look at the devastation from one bridge collapse here, it’s hard for me not to think about our brothers and sisters in New Orleans who still haven’t recovered from Katrina in 2005. We have a lot of work to do.

Yes, we do.

E-Democracy.Org has put up a wiki to highlight news, videos, photos and more about the I-35W bridge collapse here. Interesting stuff, and an interesting use of citizen-driven information platforms to better communicate news and information.

Canadian vs. American Health Care Systems: Whose Got The Cure?

July 24th, 2007 by Andy in Taxes, The Commons & The Social Contract

Here is an interesting analysis and comparative study of the Canadian health care system vs. the American one (if you want to call that a coherent system). It seems that Canadians have become healthier than Americans over a thirty year span in the controlled social experiment of public vs. private care.

Publicly funded health care has its problems, as any Canadian or Briton knows. But like democracy, it’s the best answer we’ve come up with so far.

Should the United States implement a more inclusive, publicly funded health care system? That’s a big debate throughout the country. But even as it rages, most Americans are unaware that the United States is the only country in the developed world that doesn’t already have a fundamentally public–that is, tax-supported–health care system.

That means that the United States has been the unwitting control subject in a 30-year, worldwide experiment comparing the merits of private versus public health care funding. For the people living in the United States, the results of this experiment with privately funded health care have been grim. The United States now has the most expensive health care system on earth and, despite remarkable technology, the general health of the U.S. population is lower than in most industrialized countries. Worse, Americans’ mortality rates–both general and infant–are shockingly high.

Read the complete report in Yes! Magazine

Social Contracts, Sovereign People & The CIA

July 9th, 2007 by Andy in Taxes, The Commons & The Social Contract

A recent newspaper article from the New York Times Corporation reports on CIA domestic wiretapping, assassination plots, mind-control and spying on Americans. It quotes CIA director Michael Hayden saying that yesterday’s release of highly censored government documents was part of the agency’s “social contract” with the American public.

That’s so silly. There is only one social contract — the one which sovereign people, alleged to be the source of all governing authority — make among ourselves to determine how we go about governing ourselves.

Of course, THAT social contract has been half-assed in practice from In the Beginning, given that a minority of people denied the majority their fundamental rights. But think, for a moment, that maybe it’s the idea that counts.

The CIA — and all creations of law, of government (including business and propaganda corporations) — are nothing but subordinate entities. They have no legitimacy except in being subordinate to the sovereign people.

Neither the CIA nor the Microsoft Corporation has authority — legal, moral, cosmic — to make “social contracts” with its superiors. Their legitimacy comes only from being obedient, from following orders, from licking We the People’s shoes metaphorical and literal, (not to mention our bare toes).

Which makes all this secrecy stuff not only absurd but contrary to fundamentals of self-governance. How can We the People, We the Sovereign People, even dream about governing ourselves when most of what our temporary public servants have been and are doing is kept from our eyes and ears?

There are empirical data galore demonstrating when law and our acquiescence enable mere creations of law — from corporations to government bureaus — to operate in secret, the result is governance by the few.

And destructive, stupid, rights-denying, authoritarian governance at that.

(These data, to be sure, precede today’s ephemeral Bush & Chaney and Pelosi and Reid.)

Of course, they — like their predecessors — make sure it’s all “legal,” and made necessary by some terrifying “other” out there — like for instance a fiendish enemy bent on destroying this country’s values and violets. For millennia, very important people have been obsessed with rendering their destructions and rights denials and oppressions as “legal.”

For them, “legal” has been a fetish.

And, our persistent authoritarians also make sure to instruct us over and over again that their secrecy, repression, fascism and legalities are for our own good.

See, for example, the popes who authorized European pillage of North and South America, Asia, and Africa, the kings and queens who paid for these pillages, their viceroys and generals and captains and men of religion, President McKinley who sent American soldiers to crush the Philippine War of Independence…and the endless violence and rights denials waged by governments from Germany to South Africa around the world. Read their documents and speeches, and see “legal” “legal” “legal” “legal” “legal” (accompanied, of course, by “God’s Will” “God’s Will” “God’s Will”….)

But it’s not about them. Rather, isn’t this all about us? About us as individuals, and us as We the People — and who among us truly aspires to BE the sovereign people, and what does it mean to ACT in concert like sovereign people?

All to say: the headline on the NYTimes Comany’s first page story this morning is “Files on Illegal Spying Show CIA Skeletons from Cold War.” If we the sovereign people really want to know, so we can act commensurately, don’t we need the files on all the LEGAL spying?

When people tore down the Berlin Wall and the East German government evaporated, thousands of people stormed into the STASI (secret police) headquarters and started pouring through the files.

Will We the American people one day storm into the CIA, NSA, FBI, Homeland Security, White House, Congress, Supreme Court, the Library of Congress and other of the people’s buildings so we can begin to learn what we need to know to start governing ourselves?

If we aspire to democratic self-governance, then don’t we gotta demand, and act upon, NO MORE SECRETS?

For starters?

- Richard Grossman, CELDF

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