Budget

Beware of CEOs Bearing Budget Gifts

Stan Collender — Fri, 26 Oct 2012 15:12:14 -0400

The mainstream media and blogosphere lit up like Christmas trees yesterday when 80 CEOs came together to call on Congress and the president to agree on a comprehensive deficit reduction plan that includes revenue increases and spending cuts. Here's David Wessel's story from The Wall Street Journal.

(Note: I'm linking to the story on the Fix The Debt website only because you need a subscription to the WSJ to see Wessel's story there. This definitely is not an endorsement of Fix The Debt.)

As I told Janet Novak of Forbes yesterday, while it's great to see the CEOs engaged on the issue there's much, much less here than meets the eye.

The ultimate value in the CEO statement is that it lends credence and provides some political cover for members of Congress who vote for a deficit reduction plan that includes tax increases and Medicare and Medicaid cuts.

But the statement fails to move the needle as much as the hype wants you to believe because its way too general to demonstrate that any of the CEOs are willing to give up spending or tax provisions that are important to their companies.

Yes, as wealthy individuals they are likely to pay more if income tax rates rise.

But it's not at all clear that they can or will recommend changes in federal tax and spending laws that will hurt their corporate bottom lines. Indeed, their boards and stockholders would likely see support for those types of changes as a violation of their fiduciary responsibilities as CEO and several of them would be facing the corporate equivalent of a recall.

I suspect, therefore, that this will change nothing. At the same time the CEOS take credit for the anti-deficit push, the companies they represent will continue to push behind the scenes for the tax breaks they already have, the new revenue provisions they want, and the spending programs that create profits while the CEOs take credit for this anti-deficit push. That makes this statement more like business as usual in Washington than a major departure from the past.

You'll know something like this is serious when, for the greater good, one or both of two things happen:

1. A company says its going to stop doing business with the federal government and/or is voluntarily giving up the tax break that is so important to its bottom line

2. A company announces that its political action committee and its executives will no longer financially support candidates, political parties or super PACs that support higher spending and lower taxes.

This post originally appeared on Stan Collender's Capital Gains and Games.

The GOP/Lockheed Martin "Layoff Notice" Hoax - We'll Need Some "E. Coli Notices" If It Succeeds

Richard Eskow — Mon, 30 Jul 2012 21:19:53 -0400

The defense industry and its Republican allies in Congress are up in arms - metaphorically speaking,of course - over the possibility that an agreement which the GOP signed might actually take effect as agreed.

They hate when then happens. So they're cooking something up that could create big problems for your wallet ... not to mention your digestive tract.

Republicans routinely express contempt at the thought of using government funds to save jobs. But when it comes to defense spending, they want us to know that government funds should be used to save jobs. For their part, defense contractors just want our money. So, in what appears to be a coordinated plan, Lockheed Martin threatened to send out fraudulent "layoff notices" to over one hundred thousand employees, while its minions in Congress simultaneously demand that the Pentagon do the same.

We'll need to send out a few hundred million more notices if they succeed - including a warning about the E. Coli outbreaks their plan's likely to create. Drop those hamburgers, kids! Lockheed Martin wants a few more billion from your Mommies and Daddies.

Lockheed's Lie

Nobody knows if the sequestration process will be triggered, or where and how the mandated cuts would be applied to if it were. Nevertheless, Lockheed Martin CEO Robert "Bob" Stevens told Congress that "a very rough 'seat of the pants' estimate is that we might be required to lay off about 10,000 employees."

But since Mr. Stevens has absolutely no information on the nature of those cuts, that figure must have been pulled out of something inside those pants.

Stevens goes on to claim that sequestration's "reductions... are likely to trigger the law (called) the WARN Act - requiring 60 days or more advanced notification in certain locations before workers can be laid off. But since we don't know exactly who will be affected," says Stevens, "our best judgment is that we may have to notify a substantially higher number of our employees ... that they may not have a job if sequestration takes place."

Stevens says that the law forces Lockheed Martin to send layoff notices to most of its 123,000 workers, many of whom just happen to live in battleground electoral states - even though most of them won't be laid off, according to Lockheed's own beneath-the-seat-of-the-pants scenario. And the media's taking the bait. "Virginia Voters Ask Whom to Blame for Defense Cut Risk," said Bloomberg BusinessWeek in a typical headline.

There's only one problem: Lockheed Martin CEO Bob Stevens is lying. And unless he's an incompetent executive with an equally incompetent legal team, he knows he's lying.

Who's the Boss?

Here's what the WARN Act actually says: "An employer may order a plant closing or mass layoff before the conclusion of the 60-day period if the closing or mass layoff is caused by business circumstances that were not reasonably foreseeable as of the time that notice would have been required." (Emphasis ours.)

Since the outcome of the sequestration process isn't "reasonably foreseeable," Lockheed and other defense contractors aren't obliged to send notices to anybody. And since Lockheed made it clear that more than 90 percent of the employees receiving those notices would not be laid off, even under its own hypothetical and hyper-hysterical scenario, the unlucky 1 in 10 won't even know who they are -

- which means nobody would be receiving a genuine layoff notice. They'd just be frightened and intimidated, right in time for Election Day. That's why the Labor Department has stated that it would be "inappropriate" to send out layoff notices under these circumstances.

Word to a company whose motto is "We never forget who we're working for": I think you forgot something.

High Anxiety

The Lockheed Martin lie was part of a broader offensive which is based on what seems to be a new tactic: terrorizing working people, in a time of high unemployment, purely for political and financial gain.

While Bob Martin was pulling his little scam House Republicans were pressing a Defense Department official to acknowledge that, if the Pentagon were to lay off civilian employees, it would also have to send out layoff notices before the election. They then scolded the official, however, when he explained that no layoffs were currently being planned.

"The anxiety is building on a daily basis," said Virginian Republican Rep. Rob Wittman, a member of the House Armed Services Committee. But Wittman's not on record as expressing any "anxiety" over the loss of jobs, children's health services, or other important services from sequestration's non-defense cuts. In fact, he seems to have faced these possibilities with considerable equanimity.

Worst. Jobs. Plan. Ever.

Sequestration was always a dumb idea, and Democrats should've known from past experience that Republicans would welsh on the deal anyway.Now the GOP wants to increase defense spending well above previously agreed-upon levels, while slashing all other government spending to well below the original deal's already dangerously-low limits. The Center for Budget and Policy Priorities (CBPP) shows us what they have in mind:

For all their caterwauling about lost defense jobs, far more jobs will already be lost in other areas under the current plan - and their proposed changes would make those losses rise even further. A study by Sen. Tom Harkin notes that sequestration's $2.7 billion in lost federal education grants would force "46,349 employees to either lose their jobs or rely on cash-strapped States and localities to pick up their salaries instead."

Sen. Harkin also notes that under fhs current sequestration plan, "659,476 fewer people would be tested for HIV, 48,845 fewer women would be screened for cancer; and 211,958 fewer children be vaccinated." Harkin adds:

"At a time when the unemployment rate is still above 8 percent, 1.6 million fewer adults, dislocated workers and at-risk youth would receive job training, education and employment services; and the families of 80,000 fewer children would receive child care subsidies, making it harder for parents to find work."

Defense Dollars ≠ Jobs

Those figures won't stop fthe defense industry's Hill shills from bemoaning "lost jobs" - even as they work to make real job losses even greater to further enrich their military-industrial patrons. A number of studies have shown that defense spending produces fewer jobs per dollar than other government programs. A 2007 study by the University of Massachussetts, reaffirmed and updated in 2011, demonstrated that military expenditures produced far fewer American jobs per billion dollars than did spending for education, health, or clean energy.

But never mind. The defense industry and its minions keep crying over "jobs" anyway. In fact, the Congressional Record is still damp from crocodile tears.

Disclose This!

Now the Republican House has upped the ante by passing a bill which demands that the President publicly reveal exactly how he would achieve the cuts required by the sequestration process. We're all for transparency - but don't stop there, Congress! The House should now pass a law forcing itself to answer questions about its own budget, such as:

When do you plan to provide details on your budget's extreme, partially-concealed cuts to Medicare? They include raising the Medicare eligibility age and drastically lowering the amount of funds it will have available on a per-person basis.

When will you provide details on your budget's $1.9 trillion in cuts to the social safety net - including your plan to keep civil order in the wake of widespread disease and deprivation?

Why do you call your budget a "deficit reduction" plan when, despite its massive spending cuts, the Congressional Budget Office says it won't produce a surplust until the year 2040 - more than a quarter-century from now?

What kind of nation do you foresee in the year 2050 - when, as the CBPP explains, "most of the federal government aside from Social Security, health care, and defense would cease to exist"?

Your budget imposes all these drastic cuts on the public, yet would keep the Bush tax cuts for millionaires - and, incredibly, would also give them an average of $265,000 in additional tax breaks. When and how sill se new jobs as a result of this "stimulus spending through the tax code"?

On Notice

Dear GOP: Since you were so eager to have the Pentagon send layoff notices in battleground political states, I'm sure you'll agree that other government agencies should start sending out notices too - especially if your radical changes to the already reckless sequestration plan are passed. Here are a few suggestions:

3,700,000 Teacher Layoff Notices: We'll need Lockheed Martin, Bob Stevens-style "layoff notices" to 3.7 million elementary and secondary school teachers. Most of them won't be laid off, but ... well, Bob can explain this one for you.

Several Hundred Thousand Latchkey Kid Notices: We'll also need to send notices to hundreds of thousands of working parents explaining that they may not have day care services after January. That means they'll either have to quit their jobs or become parents to a new generation of latchkey children.

21,800,000 Million No Care For Veterans Notices: We'll also need to send notices to all 21.8 million veterans of our armed forces, informing that they may not receive the medical services they need. We'll also need to send Lockheed-style "layoff notices" to the VA's 285,000 employees since, in Bob Martin's words, "we don't know exactly who will be affected (so) we may have to notify a substantially higher number of our employees."

As a freebie, we'll allow all Republican Representatives to include a personal letter with these notices. They can use it to explain how much they "support our troops."

311 Million 'Better Start Worrying About Your Social Security and Medicare' Notices: Then we'll need notices for all current and future recipients of Social Security, Medicare, Medicaid and unemployment insurance -- the first two alone include every citizen of the United States -- that they may not receive their checks. (Sequestration doesn't cut these programs' benefits, but it does their administrative budgets. Your check may get cut -- but it may sit on a desk somewhere for a long, long time.)

Several Million Private Businesses' Smackdown Notice: For you private-sector enthusiasts, we'll need notices for all the employees of private businesses which may downsize or close altogether - A lot of businesses depend on income from teachers and parents who have jobs, veterans who are well enough to live a full life, and people who depend on Social Security, Medicare, and unemployment.

These private-enterprise layoff notices will to have to go out to grocery stores, doctors' offices, auto dealers, movie theaters, restaurants, clothing retailers ... well, the non-defense side of sequestration will hurt pretty much every real business in the country - except yacht dealerships.

And Lockheed Martin, of course.

311 Million 'Gut-Bombs, New Diseases, and Deadly Foods' Notices: Then there are those E. coli notices we told you about -- along with the potentially lethal effects of other un-inspected food and drugs, the result of sequestration cuts to food and drug safety and inspection programs. In fact, we might as well just broadcast these announcements 24/7 on every channel, since nothing's going to be safe to eat or drink anymore unless you watched it grow yourself.

And lastly, it looks like we're going to need ...

Several Dozen 'Need Help Writing Notices' Notices: As you can see, House Republicans, we've got a big job ahead of us. There are thousands of different notices to write and time's a-wastin'. We're going to need all the help we can get. - experience in writing scary warnings preferred.

So could one of you guys call Bob Martin over at Lockheed? It's true that his"layoff notice" was a phony, while these warnings will be genuine. But at least he's got some relevant work experience - and we're pretty sure you have his number.

Deficit Trouble - Right Here In River City!

Dave Johnson — Sun, 01 Apr 2012 17:10:52 -0400

River City faces a terrible deficit, and if we don't cut spending on the things We, the People do for each other right now, there will be trouble. We gotta do some austerity! We gotta eat that seed corn. We gotta stop taxing the 1% and stop paying for things the 99% need!

It's a con as old as the hills. Whip up the people with fear, and then offer them the ready-made "solution." In his post, Ya Got Trouble — A fresh look at an old con, Tom Sullivan nails it with a scene from The Music Man. For those not familiar with The Music Man, here is the lead-up: "River City ain't in any trouble." "Well, we're going to have to create some." Then the ~~Republican Congressman~~ Music Man goes out and whips the town into a state. He does it to sell them. (The following is from a local production, which YouTube allowed to be embedded here. To see the clip from the movie click here.)

From Sullivan's post:

Trouble with a capital “T”
And that rhymes with “P”
and that stands for pool!

In one, short speech — building intensity as he goes — Professor Harold Hill gathers a crowd of onlookers and rattles off a litany of big city sins “the right kinda parents” worry about corrupting their children and their small town: sloth, drinking, gambling, being “stuck-up,” smoking, loose morals, and indecent pop culture. In a fevered crescendo, Hill warns parents of “shameless music • That’ll grab your son, your daughter • With the arms of a jungle animal instink!”

Sullivan explains the con:

Hill presses every button the people of River City, Iowa have to press, plus appeals to patriotism and God to create a city-wide moral crisis that four minutes earlier the townspeople didn’t know they had. Sound familiar?

Now strike pool. Insert contraception, voter fraud, death panels, or a half dozen other right-wing bogey men and the grifter’s pitch works the same. Today, Harold Hill would be working for Fox News or Americans for Prosperity. He’d be running American Crossroads, and making a lot more money.

This con has been perfected in recent years as The Shock Doctrine, forcing entire countries into debt or other crisis, then stepping in to plunder and privatize their resources, like what is happening to Greece right now.

Whipping Up Deficit Hysteria

This "con game" is what is happening to our own country as well, with the whipped-up terrification over deficits. The Reagan plan was cut taxes and increase military spending to force the country into debt, and then use the debt to force privatization of public resources into the hands of a few. George 'W' Bush said after cutting taxes on the rich and raising military spending that the resulting transformation of Clinton's budget surplus into huge budget deficits was "incredibly positive news" because it would force us into near-bankruptcy. Yes, he said that.

But the solution offered -- the current Republican budget that phases out Medicare and guts our government -- doesn't even cut the deficit! The Republican "austerity" budget starts with $10 trillion in tax cuts for the 1%! Then it guts most of what We, the People do for each other.

Don't be fooled, it is just one more conservative con game.

Desolation Row: Five Pictures of the Future in a Paul Ryan/Mitt Romney America

Richard Eskow — Fri, 30 Mar 2012 15:43:11 -0400

Economic radical Paul Ryan has endorsed Mitt Romney, Romney's embraced the Ryan budget, and the House Republicans have voted to enact the Romney/Ryan vision of the future into law. Yet an eerie silence has settled over the vision itself: How would it affect our daily lives? What kind of country would we become?

The Romney/Ryan America of tomorrow is more like the science-fiction worlds of H.G. Wells' Time Machine or Fritz Lang's Metropolis than it is like the United States as we know it. The privileged few would be even more wealthy than they are today, while the rest of us struggle to survive in a dystopic world of disease, deprivation, and fear.

That's not lefty rhetoric, either. All you have to do is read the budget.

What did Romney say about Ryan's budget? "He is setting the right tone for finally getting spending and entitlements under control. Anyone who has read my book knows that we are on the same page." For his part, Paul Ryan expressed confidence that Romney will enact something very close to the budget he proposed and House Republicans passed this week.

And yet the real vision they're offering for the country is somehow off-limits in polite company. They're being treated like reasonable politicians, rather than as radicals whose social agenda is severely out of step with that their predecessors in both parties. That has to stop. We need to quit discussing the political horse-race and start talking in real-life terms about the country they intend to create.

Here are five glimpses of the American future under Romney, Ryan, and the Republicans:

1. Diseased America

Forget what it means to be a just society for a moment (they certainly have) and think about what it will mean for the public health of our nation if the Romney/Ryan budget is ever enacted.

By 2022 their plan would cut Federal Medicaid funding by roughly one-third. The Urban Institute has estimated that states would drop between 14 million and 27 million people from Medicaid by 2021. Provider reimbursements would drop by roughly one-third, too, meaning that even people who still have Medicaid coverage will find it increasingly difficult to find doctors and hospitals willing to treat them. The Romney/Ryan plan's radical changes to Medicare would also dramatically cut older Americans' access to health care.

We live with the constant threat of deadly pandemics like avian flu and SARS. The fact that those two diseases didn't kill millions shouldn't be taken as proof that it can't happen, any more than failed terrorist attacks prove we aren't at risk: We are. And we're increasingly facing the risk of MRSAs and other deadly drug-resistant infections, which have a tendency to develop and spread in medically underserved populations such as inner cities and prisons.

So forget the inhumanity of this plan, one-percenters, and look at it selfishly: The Romney/Ryan plan to dismantle health will endanger your lives.

2. Time Machine America

Middle class? Not in their world. There will be the rich -- and everybody else.

The Romney/Ryan plan guts the financial security of middle-class Americans by leaving them to face on old age of deprivation, impossibly costly health care, and reduced benefits. What's more, their radical cuts will create a cascading wave of unemployment that will make today's intractable job situation even worse.

At the same time the Romney/Ryan plan promises more huge tax cuts for the wealthy and uber-wealthy (more about that shortly), which it tries to offset by closing unspecified loopholes.

Which loopholes could they mean? There aren't many to choose from. They probably intend to cut or eliminate the mortgage interest tax deduction, which would decimate already-struggling middle class homeowners, and the tax deduction for employer-provided healthcare, which would leave middle-class Americans with even less health coverage than they have today.

Their tax policy, along with the dismantling of our retirement security, will guide us toward that H.G. Wells world, where a small pampered elite frolicking in luxurious gardens while the rest of the country struggles in dark underground tunnels of job insecurity and financial difficulty.

3. Starving America

And a lot of those "underground Americans" will starve. As the Center for Budget and Policy Priorities documents, 62 percent of the Ryan/Romney cuts come from programs that serve low-income communities.

Millions of people would http://www.offthechartsblog.org/ryan-budget-takes-big-bite-out-of-food-s... ">lose access to food stamps

or see their benefits cut substantially, even though studies have shown that this program doesn't contribute to the deficit in any substantial way. (In other words, they're just doing it because they don't like people in need.)

The Ryan/Romney plan to promote what Ryan calls "Welfare Reform Part 2" ignores the lessons of Part 1. By reducing funds and turning many of these programs back to the states, their plan would subject low-income Americans to humiliating tests, steep benefit cuts, and other cutbacks.

The end result would be a steep increase in food insecurity and hunger, in a nation that's already at or near the top of the charts for these problems when compared to other industrialized nations. In fact, at last report more than 9 percent of US homes experienced "food insecurity" and 5.4 percent of homes were severely food insecure. Expect those figures to rise sharply in Ryan and Romney's America.

4. Death-Star America

Romney and Ryan don't want to cut all government spending. They're proposing steep increases to defense expenditures, in ways that clearly violate the last "grand bargain" between Congressional Republicans and the President.

When combined with their steep cuts elsewhere, which reduces all non-mandated government spending to something close to zero, the Romney/Ryan vision of government is one that provides less than the bare minimum to its citizens while spending many times (see CBPP and Matt Yglesias for more) what other nations spend on extravagant and needless military programs.

Mitt Romney and Paul Ryan would turn our nation into an armed fortress, ringed on the outside with expensive but often nonfunctional science-fiction weaponry and rotting from within from poverty and fear.

5. Obscene-Wealth America

That's the world the rest of us would live in. But for wealthy people like Mitt Romney life would be very sweet indeed. Millionaires would get to keep their extravagant Bush tax cuts, under which a top tax rate that was 91 percent under Eisenhower and 70 percent under Reagan is only 35 percent - and Ryan and Romney would top that off by giving them another $265,000 per year in cuts!

As the CBPP reports, " After-tax incomes would rise by 12.5 percent among millionaires, but just 1.9 percent for middle-income households" - and after the many other cuts and "loophole closings" in Romney/Ryan, after-tax income would actually plummet for those middle-income families.

Conclusion: RomneyWorld USA

All that - and it doesn't even reduce the deficit! In fact, Ira Stoll correctly notes in Reason that "it would increase federal outlays to $4,888 billion in 2022 from $3,624 billion in 2012, an increase of about 35% over ten years."

And yet Ryan's being celebrated in the media as a "bold" advocate for deficit reduction, and he's Mitt Romney's right-hand man on the economy. Americans need to understand what kind of country we will become if they succeed. Mitt Romney is likely to become the standard-bearer for his party, and he has embraced this vision of the future.

Voters need to understand what that means. When they talk about budgets they're not talking about numbers on a page. They're talking about us.

Every Progressive Should Know About The “Budget For All”

Dave Johnson — Wed, 28 Mar 2012 09:49:36 -0400

Every progressive should know about the Congressional Progressive Caucus's "Budget for All." In fact, every American should know about this budget. But the corporate news media sure isn't going to tell people. So you should help get the word out. Read and Share the One-Page Handout. Email this post to friends, relatives, and especially to your right-wing brother-in-law.

The Congressional Progressive Caucus has put together a "Budget for All" that "puts Americans back to work, charts a path to responsible deficit reduction, enhances our economic competitiveness, rebuilds the middle class and invests in our future." This budget "makes no cuts to Medicare, Medicaid, and Social Security benefits, and asks those who have benefited most from our economy to pay a sensible share."

Our Budget Puts Americans Back to Work

Our budget attacks America’s persistently high unemployment levels with more than $2.9 trillion in additional job-creating investments. This plan utilizes every tool at the government’s disposal to get our economy moving again, including:
• Direct hire programs that create a School Improvement Corps, a Park Improvement Corps, and a Student Jobs Corps, among others.
• Targeted tax incentives that spur clean energy, manufacturing, and cutting-edge technological investments in the private sector.
• Widespread domestic investments including an infrastructure bank, a $556 billion surface transportation bill, and approximately $2.1 trillion in widespread domestic investment.

Our Budget Exhibits Fiscal Discipline
• The Budget for All achieves $6.8 trillion in deficit reduction, hits the same debt to GDP ratio as the Republican budget, and has lower deficits in the last five years, but does so in a responsible way that does not devastate what Americans want preserved.
• We achieve these notable benchmarks by focusing on the true drivers of our deficit – unsustainable tax policies, the wars overseas, and policies that helped cause the recent recession – rather than putting the middle class’s social safety net on the chopping block.

Our Budget Creates a Fairer America
• Ends tax cuts for the top 2% of Americans on schedule at year’s end
• Extends tax relief for middle class households and the vast majority of Americans
• Creates new tax brackets for millionaires and billionaires
• Eliminates the tax code’s preferential treatment of capital gains and dividends
• Abolishes corporate welfare for oil, gas, and coal companies
• Eliminates loopholes that allow businesses to dodge their true tax liability
• Calls for the adoption of the “Buffett Rule”
• Creates a publicly funded federal election system that gets corporate money out of politics for good

Our Budget Brings Our Troops Home
• Responsibly and expeditiously ends our military presence in Iraq and Afghanistan, leaving America more secure at home and abroad
• Modernizes our military to address 21st century threats and stop contributing to our deficit problems

Protects American Families
• Provides a Making Work Pay tax credit for families struggling with high gas and food cost 2013-2015
• Extends Earned Income Tax Credit, the Child and Dependent Care Credit
• Invests in programs to stave off further foreclosures to keep families in their homes
• Invests in our children’s education by increasing Education, Training, and Social Services

Let people know that there is a budget alternative that respects We, the People.

Also see: Three Reasons To Rally Around The Progressive Caucus "Budget For All"

Republican Budget For Billionaires: The Impact

Dave Johnson — Tue, 27 Mar 2012 15:03:26 -0400

The new Republican budget (called the "Ryan Budget" by DC insiders) reflects current electoral reality: billionaires and corporations now finance candidates, and we get government of, by and for billionaires and corporations. The rest of us no longer matter, except as "the help" and, at least to the extent we haven't been entirely fleeced, a flock to harvest. This budget starts with $10 trillion in tax cuts -- mostly for the rich. After adding $10 trillion to the deficits Republicans then claim that severe cuts are necessary to "fight deficits." Right. Details below.

Keep in mind where we are starting from: The way our economy and tax system is already structured, the top 1% received 93% of income gains from recovery. As Mitt Romney's tax returns demonstrated, those at the very top -- whose income comes as checks generated by the money they already have -- already pay much lower tax rates than those of us who work for a living.

Shock Doctrine

"Nothing is more important in the face of a war than cutting taxes. -- Republican Majority Leader Tom Delay, 2003"

After passing tax cut after tax cut, and military spending increase after military spending increase, and starting war after war, Republican borrowing has added up. So now Republicans terrify the public, telling them that budget deficits will lead to the destruction of the country -- and soon. After a decade of screaming "9/11," "9/11," noun verb "9/11," they now scream "deficit, deficit, deficit." Then with the public suitably stirred up and terrified they offer "solutions" they say are necessary to cut the scary deficit (that they caused, for this purpose).

Behind a blizzard of fog and mirrors, the new Republican budget completes the ongoing shift of our government and our economy away from "we are in this together" democracy to a "you are on your own" system that is entirely for the benefit of a few at the top.

Cuts Taxes For The 1%

The smoke and mirrors: they claim this budget is necessary to reduce deficits, but it doesn't even pretend to. Instead it starts by cutting taxes on the rich and their corporations by another $4.6 trillion while making permanent the Bush tax cuts, costing another $5.6 trillion. It gives a $187,000 tax cut To every millionaire!

Cuts Jobs

Ethan Pollack at the Economic Policy Institute describes how Ryan’s budget cuts would cost jobs -- 4.1 million of them:

Paul Ryan’s latest budget doesn’t just fail to address job creation, itaggressively slows job growth. Against a current policy baseline, the budget cuts discretionary programs by about $120 billion over the next two years and mandatory programs by $284 billion, sucking demand out of the economy when it most needs it and leading to job loss. Using astandard macroeconomic model that is consistent with that used byprivate- and public-sector forecasters, the shock to aggregate demand from near-term spending cuts would result in roughly 1.3 million jobs lost in 2013 and 2.8 million jobs lost in 2014, or 4.1 million jobs through 2014.*

Cuts Everything Government Does For Regular People

This budget starts with $10 trillion in tax cuts for the wealthy! After handing billionaires and their corporations trillions, increasing deficits by an additional $10 trillion, the Republican budget then cuts the things government does for the rest of us: Medicare, Medicaid, food assistance and public investments (mostly infrastructure and education), and pretends it is necessary because of deficits. (It increases funding for military contractors.)

What is cut? The following is from an analysis by the Office of Democratic Whip Steny H. Hoyer:

A Choice of Two Futures: A Look at How the Republican Budget Ends Medicare, Destroys Jobs, Benefits the Wealthy

Ending the Medicare guarantee and raising health care costs for seniors:

Ends the guarantee of health security and shifts higher costs onto seniors and the disabled over time.
Increases seniors’ health care costs just like last year’s budget – which drove up costs by over $6,000 per year, according to CBO.
Reopens the prescription drug donut hole, increasing seniors’ drug costs by up to $44 billion through 2020, including $2.2 billion in 2012 alone, according to HHS.
Increases seniors’ out-of-pocket costs for preventative care and annual checkups by over $110 million in 2012 alone, according to HHS.
54-year-olds would have to save more money just to cover health care costs – an analysis of last year’s budget showed they would have to save an additional $182,000, according to the Center for Economic and Policy Research.

Cutting taxes for the wealthiest Americans at the expense of working families:

Provides millionaires an average tax cut of $150,000.
Reduces revenue by $4.6 trillion on top of the $5.4 trillion cost of permanently extending all of the Bush tax cuts and other expiring provisions, according to the Tax Policy Center.
May force working families to pay higher effective tax rates to cover some of the cost of this $4.6 trillion tax cut for the wealthy by eliminating deductions.

Turning Medicaid into a block grant that jeopardizes access to affordable health and nursing home care for seniors and the disabled:

Cuts a total of $1.7 trillion from Medicaid over the next decade, and according to CBO, is on track to cut the program by 75% by 2050. According to the Urban Institute, block granting the Medicaid program could result in between 14 million and 27 million people losing coverage. An additional 17 million people, who gained Medicaid and CHIP coverage through health care reform according to the CBO, would also lose that coverage as a result of repealing the Affordable Care Act.

Making it harder for Americans to receive Social Security benefits:

Increases backlogs that delay people from getting benefits that they are due and could leave up to 90,000 people with disabilities waiting for a decision in 2013 and leave 300,000 more people with disabilities waiting for a decision each year over the next decade.

Weakening our ability to out-educate competitors and build a competitive workforce:

Reduces Pell Grants by more than $1,000 for 9.6 million students in 2014 and could eliminate Pell Grants for over one million students over the next decade.
Kicks 60,000 low-income children out of the Head Start program in 2013 and 200,000 low-income children out of the program each year over the next decade.
Cuts Title I funding, which could result in nearly 11,000 teachers and aides losing their jobs in 2013 and nearly 38,000 teachers and aides losing their jobs each year over the next decade.
Cuts funding for Individuals with Disabilities Education Act, which could result in 7,800 special education teachers, aides, and other staff serving children with disabilities losing their jobs in 2013, and 27,000 teachers, aides, and staff losing their jobs each year over the next decade.
Reduces work-study funding, meaning almost 37,000 students could lose access to college work-study opportunities in 2013, and more than 166,000 students could be affected each year over the next decade.

Slashing assistance to low-income families:

Cuts the WIC program (Special Supplemental Nutrition Assistance Program for Women, Infants, and Children), kicking 700,000 pregnant or postpartum women, infants, and children off the WIC program and leaving another 100,000 without access to critical foods necessary for healthy child development in 2013. Each year over the next decade, the cuts would kick 1.8 million women, infants, and children off the WIC program and leave another 100,000 without access to critical foods.
Converts SNAP into a block grant beginning in 2016, which could jeopardize access to food assistance for millions of Americans.
Cuts HUD’s rental assistance programs, resulting in over 116,000 fewer low-income families housed through the Housing Choice Voucher program in 2013 and 400,000 fewer low-income families housed through the program each year over the next decade.
Risks permanent loss of affordable units that serve 1.1 million Americans.

Repealing patient protections and putting insurance companies – not American families – in control of health care:

Allows insurers to once again be allowed to discriminate against up to 17 million children with pre-existing conditions.
Subjects 105 million Americans once more to arbitrary lifetime caps on their health insurance.
Increases 54 million Americans’ out-of-pocket costs for preventative care.
Puts up to 15 million Americans who are sick or injured at risk of being dropped from their private insurance because of a simple mistake on an application.
Eliminates tax credits for up to four million small businesses, which are already providing more affordable care to two million workers. [Figures provided by HHS and the Treasury Department]

Weakening national security:

Cuts COPS hiring grants, which could result in 75 fewer local police hires and 6,200 fewer bullet proof vests for state and local law enforcement personnel in 2013, and 285 fewer local police hires and 23,000 fewer vests each year over the next decade.
Cuts Department of Justice (DOJ) funding, resulting in 1,311 fewer federal agents to combat violent crime, pursue financial crimes, secure the border, and ensure national security in 2013, and 4,587 fewer agents each year over the next decade.
Cuts DOJ funding resulting in 948 fewer prison guards to maintain safe and secure federal prisons in 2013, and 3,319 fewer prison guards each year over the next decade.
Reduces Department of Homeland Security funding for preparedness efforts of state and local governments, which could mean 100 firefighters and 80 emergency managers not being hired or laid off in 2013, and 400 firefighters and 300 emergency managers not being hired or laid off each year over the next decade.

Undermining American competitiveness by cutting investments in science, medical research, space and technology:

Cuts funding for biomedical research by NIH, meaning 500 fewer grants NIH could award in a cutting-edge field in 2013 and 1,600 fewer grants each year for the next decade, limiting research that could lead to new cures for diseases.
Cuts funding for NSF, which could result in NSF making up to 1,100 fewer competitive research and education grants supporting over 13,000 researchers, students, and teachers in 2013 and 4,000 fewer grants supporting almost 48,000 researchers, students, and teachers each year over the next decade.
Cuts NASA funding and puts jobs at risk by forcing the agency to terminate major programs and potentially close major facilities.

Threatening our clean energy future:

Cuts investments in the Department of Energy Office of Energy Efficiency and Renewable Energy and its applied research program, known as ARPA-E, that was established specifically to conduct energy research that industry by itself cannot support but where success would provide dramatic benefits for the nation.
Eliminates jobs by setting back efforts to put a million electric vehicles on the road, retrofit residential homes, and make commercial buildings more efficient.
Fails to boost all energy sources by eliminating tax support for renewable energy generation and the domestic jobs created by those energy projects.
Unless otherwise noted, all figures from OMB.

Cuts and Consequences - How Budget Cuts Hurt The Economy

Dave Johnson — Fri, 09 Mar 2012 10:25:14 -0500

Is smaller government really better for the economy?

Conservatives chant that taxes and government "take money out of the economy" and we need to "cut and grow," meaning if government spending is cut way back the economy will grow as a result. Europe's conservatives are also forcing cuts in the things their governments do for regular people, claiming "austerity" will bring "confidence" that grows their economies.

How is this experiment working out? What are we learning about the effect on the larger economy when government is cut?

What Does Government Do?

Almost everything the government does is because it needs to be done. We need roads, bridges, schools and colleges, dams, courts, police and fire departments, water management, etc. (We can discuss the need for military spending another time.)

These are all needed and contribute to the functioning of the economy. So if government is cut back and doesn’t do something that is needed, then how does it get done? Or does it just not get done?

Either way, the real question we should be asking is what is the effect on the larger economy when our government cuts back on or stops doing needed things? If you save the “government” a bit of money but cost the economy a lot of money, are you saving money? Or are cuts in government really just shifting and even increasing the costs in the larger economy of doing these things?

Who Is Our Government For?

In the United States, our Constitution says that government is supposed to be of, by and for We, the People. The country was established after the colonists rebelled against the aristocracy of England, a few people who had all of the wealth and power and would not let the colonists have a say in how things were run and who would benefit. So they fought the Revolutionary War and established a country where "We, the People" all have an equal say, and to "promote the general welfare." In other words, a country that aspires to be of, by and for the good of all of us.

So cutting back on government means cutting back on We, the People doing things for the good of all of us. It means cutting back on the things we have a say over. It means relinquishing the wealth and power that we hold in common to ... well, just where does our common wealth and power go if our government is cut back?

Medicare, For Example

Republicans say we need to cut back on what the government spends on Medicare. But if you cut Medicare the health problems of elderly people and the larger problem of fast-rising health care costs in the larger economy don’t disappear. In fact, both problems just get worse.

The "Ryan Budget" that Congressional Republicans voted to approve actually converts Medicare into a program that gives seniors a voucher that pays for part of a private medical insurance policy that seniors have to shop for. The Center for Economic and Policy Research (CEPR), in Cost of Medicare Equivalent Insurance Skyrockets under Ryan Plan, took a look at that plan and explains what happens to the cost of health care. Summary: it shifts the costs to us, except each of us ends up paying as much as seven times more than we would save under Medicare. From the CEPR explanation:

[The Republican] plan to revamp Medicare has been described as shifting costs from the government to beneficiaries. A new report from the Center for Economic and Policy Research (CEPR), however, shows that the [Republican] proposal will increase health care costs for seniors by more than seven dollars for every dollar it saves the government, a point missing from much of the debate over the plan.

... In addition to comparing the costs of Medicare to the government under the current system and under the [Republican] plan, the authors also show the effects of raising the age of Medicare eligibility. The paper also demonstrates that while [the Republican plan ] shifts $4.9 trillion in health care costs from the government to Medicare beneficiaries, this number is dwarfed by a $34 trillion increase in overall costs to beneficiaries that is projected ...

Repeat, the Republican plan to cut Medicare would cost the larger economy seven times as much as it cuts government spending.

Social Security, For Example

Conservatives have been trying to cut or gut Social Security for decades. While this might mean government has to pay out less of what is owed to seniors, such cuts would have a negative effect on the larger economy.

Social Security allows working people to retire with at least a minimal income. If this is cut, many could not retire for many more years (if ever), which would increase the unemployment rate because their jobs would not open up. The same is true when the retirement age is increased: fewer job openings. If Social Security is cut, the spending (on cat food) at local grocery stores and other necessities is reduced by the same amount. And the effect on children of retirees is increased if they contribute to make up the difference.

This is why cutting Social Security or raising the retirement age only shifts costs onto the larger economy, dragging it down (and cruelly hurting our elderly).

Cutting Disease Control, For Example

One of the clearest examples of the way government helps us all, rich and poor, is the government's Center for Disease Control (CDC).

One of the jobs of the CDC is to help prevent the spread of infectious diseases. If an epidemic is spreading and killing people it doesn't matter if those people are rich or poor. And if a serious outbreak spreads this can damage the economy as people are too sick to, or decide not to show up for work. So of course cutting back the budget of the CDC could cause damage to the economy in any given year and is certain to cause damage eventually. (The CDC budget was cut back 11 percent last year.)

Budget Cuts Hurt The Economy

The above are only a few examples.

A government budget cut is like a huge tax increase on regular people because it increases what each of us pays for the things government does—or forces us to go without. This is because cuts in government spending don’t actually cut the costor the need for those things, they just shift those costs onto the larger economy.

But because these shifts attack the economy-of-scale, transparency, integrity and public-good management that government provides, they almost always increase the costs and harms to the larger economy.

As government health care is cut (or not provided in the first place) each of us must take on those costs on our own, and as demonstrated, pay up to seven times what the same care would/could have cost.
As infrastructure maintenance and modernization is cut, our economy becomes less competitive, unemployment increases and our wages and spending power fall.
As spending on education is cut, our costs of educating ourselves and our kids increase. College costs soar. And the overall education level of our people will decrease, making our country less competitive in the world.
As environmental regulation and enforcement is cut the costs of the resulting health problems and cleanups increase and our quality-of-life will decrease.
As enforcement of labor laws is cut, our wages and protections fall.
As etc. is cut, the costs of etc. are shifted to the larger economy, and the total costs of accomplishing etc. actually increase.

As budgets are cut, the costs are increased and shifted to the larger economy.

Austerity In Europe

Several countries in Europe are severely cutting budgets. The result is that the economies in those countries are slowing. Reuters reported in "Euro zone's slump in late 2011 points to recession".

A collapse in household spending, exports and manufacturing sucked the life out of the euro zone's economy in the final months of 2011, the EU said on Tuesday, showing the scope of the downturn that looks set to become a fully fledged recession.

... The European Commission forecasts a recession of the same magnitude this year. That would be the euro zone's second contraction in just three years as the bloc's debt crisis drags on a region that generates around 16 percent of the world's economic output.

[. . .] The battle between austerity and growth was already evident in the fourth quarter. Euro zone government expenditure fell 0.2 percent, while industry contracted 2 percent and imports were down 1.2 percent, making for some of the worst readings since the world was dragged into the 2008/2009 financial crisis.

The austerity experiment is making the case: cutting government budgets just shifts costs and hurts the larger economy.

Who Benefits From Cuts?

Governments dance with the ones that brung 'em. Whoever controls government is naturally going to direct government to benefit them – and only them. We-the-People democracies do things for We, the People; plutocracies do things for plutocrats. So when, as now, plutocrats are running government, you will get a government that only does things that benefit plutocrats. And when We, the People were running government, we did things that benefit We, the People -- all of us.

The plutocrats now demanding government budget cuts obviously understand that this will result in slowing economies, but don't care -- they are already fabulously wealthy. What they want is reduced taxes and increased power. They say that cuts will bring growth, in order to persuade people to accept cuts. Blocking governments from providing things that don't directly benefit them and only them is a means to that end. And cutting government cuts government's ability to reign them in.

What We, the People Want

When We, the People are running government we insist that government increases overall prosperity. We demand laws and regulations that bring us good wages, benefits and safe working conditions. We demand good public schools & colleges, parks, safety and opportunities for our smaller businesses to fairly compete. We insist on a clean environment, consumer protections, regulations on business behavior, rules against monopolies and (after learning the hard way) rules that keep banks from taking risks that threaten the economy. And we want controls and limits on the use of wealth and power by the 1%ers.

Plutocrats -- the 1%ers -- of course see all of these protections of regular people as hindering their power and ability to make as much for themselves as they can grab. Plutocrats just don’t see how public parks benefit them. They just don’t see why they should have to pay for public schools. What good do public schools do them, today? Plutocrats don’t see why it should be anyone else's problem if old people don’t have health care -- health care for seniors certainly isn't their problem.

They explain that things for anyone other than themselves and their interests just “wastes money.” Things for regular people are not their problem. And when plutocrats run government, it isn't their problem.

The fact is a public park “costs money.” Schools and infrastructure are just more “government spending.” Things like that just "redistribute income" because taxes on the income of plutocrats is used to build that park or school that anyone can use. The basic message of the plutocrat is, "Why should I pay for anything that benefits you?"

You and I might argue that this kind of austerity, cutting schools, Medicare, infrastructure, etc. slows the larger economy, hurting the plutocrats, too. But that doesn’t hurt the ones who are already rich, which is the definition of plutocrat. It puts more in their pockets, today, by lowering their taxes. They want out of taxes and they don't want government (We, the People) interfering with their power.

What We, The People Need

Democracies where We, the People make decisions demand things that are good for regular people and their small businesses: pensions, health care, modernized infrastructure, good schools & colleges, child care, regulations on the behavior of giant corporations... This is why strong democracies have proven to be more prosperous for regular people and for longer than other forms of government that leave people on their own against the wealthy and powerful and drive all of the income and wealth to a few at the top. This is why so many regular working people in our country were so much more prosperous in the decades before the plutocratic 1%-favoring policies of Reagan steered us toward plutocracy.

Understand what is going on here. Demands for budget cuts and austerity are really about shifting from democracy to a system where regular people -- the 99% -- are on their own, up against the wealthy and powerful. This is about shifting from a system where regular people can be prosperous together, to a system where a few -- the 1% -- have all the wealth and power.

We, the People need democracy restored. We need to be in charge again, before the economy can really serve us again.

Here Is A Budget That Works

Dave Johnson — Fri, 10 Feb 2012 11:23:52 -0500

President Obama is preparing to roll out his 2013 budget. If he wants a budget that gets rid of the deficit, meets human needs and does the things that polls show the public overwhelmingly wants done, The People's Budget Is The Template! This is the budget proposal from the Congressional Progressive Caucus.

The following is directly from the post, The People's Budget Is The Template:

The People's Budget

The Progressive Caucus -- a group of progressives in the Congress -- have put together a budget that fixes the deficit and grows the economy, providing jobs. It is called The PEOPLE'S Budget Plan.

Read the plan at: Congressional Progressive Caucus : FY2012 Progressive Budget,

The CPC proposal:

• Eliminates the deficits and creates a surplus by 2021
• Puts America back to work with a “Make it in America” jobs program
• Protects the social safety net
• Ends the wars in Afghanistan and Iraq
• Is FAIR (Fixing America’s Inequality Responsibly)

What the proposal accomplishes:

• Primary budget balance by 2014.
• Budget surplus by 2021.
• Reduces public debt as a share of GDP to 64.1% by 2021, down 16.5 percentage points from a baseline fully adjusted for both the doc fix and the AMT patch.
• Reduces deficits by $5.6 trillion over 2012-21, relative to this adjusted baseline.
• Outlays equal to 22.2% of GDP and revenue equal 22.3% of GDP by 2021.

Rep. Mike Honda and Rep. Raúl M. Grijalva explain, in The Only Real Democratic Budget: Why Progressives Have the Answer to What the American Public Wants,

Budgets are more than collections of numbers. They are a statement of our values. The Congressional Progressive Caucus Budget is a reflection of the values and priorities of America's working families. The "People's Budget" charts a path that keeps America exceptional in the 21st century, while addressing the most pressing problems facing the nation today. Our Budget eliminates the deficit, stabilizes the debt, puts Americans back to work, and restores our economic competiveness.

[. . .]

Our Budget listens to what the American people are telling us. It does all of the above in a fiscally responsible way that dramatically reduces our borrowing from banks and foreign governments and ensures our long-term economic competitiveness.
...
Our Budget Eliminates the Deficit by 2021: The CPC budget eliminates the deficit in a way that does not devastate what Americans want preserved, specifically, Medicare, Medicaid and Social Security. ...

Our Budget Puts America Back to Work & Restores America's Competitiveness: The CPC budget rebuilds America and makes it competitive again. We put America back to work. We rebuild our roads and bridges, ensuring that those who use it help pay for it. ...

Our Budget's Fair Tax System: The CPC budget implements a fair tax system, based on the American notion that fairness and equality are integral to our society. ...

Our Budget Brings Our Troops Home: The CPC budget responsibly ends our wars, currently paid for by American taxpayer dollars we do not have. ...

Our Budget's Bottom Line (Over 10 year Window)

• Deficit reduction of $5.6 trillion
• Primary spending cuts of $869 billion
• Net interest savings of $856 billion
• Total spending cuts: $1.7 trillion
• Revenue increase of $3.9 trillion
• Public investment of $1.7 trillion
• Budget surplus of $30.7 billion in 2021, debt at 64.1% of GDP.

See research and analysis on how The People's Budget affects middle-class households at TheMiddleClass.org.

Also see the CAF series, The Progressive Path To Deficit Reduction

Ten Years Ago We Were Paying Off The Nation's Debt. But Then We Elected Obama.

Dave Johnson — Tue, 09 Aug 2011 13:16:01 -0400

Just ten years ago this country was running huge surpluses and paying off its debt. But then we elected Obama and all hell broke loose. Oh, wait...

Something Happened

Between the time ten years ago when we had big surpluses and were paying off the debt and now when we are told the "Obama spending and deficit" mean we have to cut back on the things We, the People do for each other, something happened. Something changed. The things that happened, the things that changed, are being ignored in the current DC discussion about what we need to do to fix things.

Separation From Reality

This DC/Tea Party argument over deficits and the Reagan/Bush debt is completely separated from facts and history. And it is completely separated from what the public wants. There are things that we are supposed to just not remember and which seem to be taboo in the national media. There are things that are "off the table" for discussion, and certainly for solving our problems.

But here is some reality anyway, even if we're not supposed to see it. Just ten years ago we were paying off debt at a rate that would have completely paid it all off by now. But under George W. Bush we cut taxes for the rich and more than doubled military spending. We deregulated and stopped enforcing laws. We let the big corporations run rampant. Our federal budget turned from huge surpluses to massive deficits, and Bush said it was "incredibly positive news" because it would lead to a debt crisis they could use to shock people into letting the corporate right privatize and thereby profit.

And then, under and because of Bush, our economy collapsed.

Deficits From Tax Cuts And Military Spending

Once again: the deficits are the direct result of tax cuts for the rich, and huge increases in military spending. Then that huge jump in already-large deficits up past the trillion-dollar level that occurred in Bush's last budget was the result of the Bush-caused financial collapse. The economy collapsed and the government stepped in with hundreds of billions, even trillions, to rescue the wealthy, with "bailouts," while doing little, even cutting back, on what our government does for We, the People. That all happened in Bush's last budget year, not Obama's first.

To Fix The Damage, Undo The Cause

The way to fix deficits is to undo the damage Bush did, by raising taxes on the rich, and cutting back the huge, bloated, extreme, massive, astonishing, incredible, stratospheric military budget. And we have to boost the economy by investing in rebuilding our infrastructure to get people employed. We have millions of jobs that need doing, while millions are looking for jobs. Then those people will be paying taxes instead of collecting unemployment and food stamps. And the infrastructure improvements will bosst our economy's competitiveness. This is all so simple and obvious that only DC insider types could miss it.

Taxes And Spending = Democracy

Cutting spending doesn't cut the need, it shifts the burden. Cutting government spending does not cut the costs to society and the overall economy of meeting those needs. Cutting government spending just shifts -- or privatizes -- those costs onto the backs of people who can't afford to spend that money. That need and cost is still there in the economy, except without government -- democracy -- handling it, doing it for all of us, less expensively. Cutting government's role opens those functions up to private profit, instead of We, the People taking care of and watching out for each other -- and making the decisions.

Do you really think that if you phase out Medicare, that old people won't still need the medical care? Of course they will still need it, but the government won't be negotiating cost-savings for them, they'll be on their own, up against the giant insurance monopolies.

In the 1950s the top tax rate was 90%, and the country's economy worked a lot better for a lot more of us. We didn't have big deficits. We certainly weren't piling up huge debt. With high tax rates at the top, predatory, sell-the-farm business models didn't make sense. We were investing in infrastructure, and that infrastructure made us competitive in world markets. We as a people were doing better every year, paying our bills, getting educated and becoming more civilized. This empowerment led to demands for equal rights for all of us.

Ignored By Media

The "both sides do it" major media is simply ignoring the majority of the public. But people aren't fooled. Poll after poll (did I already say that?) shows that the public "gets it." Poll after poll shows that the public wants our government to address jobs, not deficits, to restore top tax rates, to invest in America's infrastructure, to leave Social Security and Medicare alone (or increase them,) and to put more money into education. Poll after poll.

The Public Wants Jobs

The public gets it. Poll after poll shows that Americans want their government focused on jobs, not deficits. The latest, from CNN, taken August 5-7, shows 49% of Americans think unemployment is the biggest issue facing the country, while only 27% say deficits. Only 16% say the deficit is the country's biggest problem.

Rebuild The Dream

The The American Dream Movement is rolling out their Contract for the American Dream. The Tea-Party-fascinated press is largely ignoring this, but this movement represents the majority of the public, and can't be ignored for long. I'll be writing more about it later. Update: Contract for the American Dream And The Emergency Jobs Bill.

Also the Take Back the American Dream conference is coming up on Oct. 3. Click through and learn more.

The People's Budget Balances The Budget -- Why Isn't It Part Of These "Deficit" Talks?

Dave Johnson — Sat, 30 Jul 2011 19:14:55 -0400

The Congress is fighting over how to cut the 10-year deficit, and this fight is at the edge of putting the country into default. The thing is, all of the things that polls show the public wants our government to do are off the table in these discussions. The public is not stupid -- the very things the public wants our government to do will actually get rid of the deficit and grow the economy. There is a budget plan before Congress that does just what the public wants our government to do. It's called The People's Budget.

Why isn't The People's Budget part of the deficit discussions in Washington? The answer is because it doesn't give huge favors to Wall Street, multinational corporations or the wealthy. It just helps We, the People have a better life, while growing our economy so our smaller businesses and startups can have a chance to compete.

The People's Budget

The Congressional Progressive Caucus has offered The People's Budget -- a responsible budget that does not just cut the deficit, it eliminates the deficit, balancing the budget and begins to pay down the debt. And it does this while investing in the very things that we need to do to grow our economy, without cutting Social Security, Medicare and Medicaid.

How does The People's Budget accomplish this? It look at the things that caused the deficits, and reverses them. What a surprise! Before we started having these huge budget deficits taxes were higher on the wealthy, the military budget was much lower, and we invested in the things that grow the economy, including infrastructure, education and science. Then we cut taxes dramatically for the wealthy, and everything started to go haywire.

The People's Budget creates a fairer tax system, but without putting rates back to where they were before Reagan. It:

Ends the recently passed upper-income tax cuts and lets Bush-era tax cuts expire at the end of 2012
Extends tax credits for the middle class, families, and students
Creates new tax brackets that range from 45% starting at $1 million to 49% for $1 billion or more
Implements a progressive estate tax
Eliminates corporate welfare for oil, gas, and coal companies; closes loopholes for multinational corporations
Enacts a financial crisis responsibility fee and a financial speculation tax on derivatives and foreign exchange

The Bottom Line

The People's Budget:

Deficit reduction of $5.6 trillion
Spending cuts of $1.7 trillion
Revenue increase of $3.9 trillion
Public investment $1.7 trillion

Isn't this exactly what both sides in DC say they want?