Privatization

Among GOP Candidates, Not a Single Friend of Social Security

Daniel Marans — Mon, 19 Dec 2011 11:58:42 -0500

The Strengthen Social Security Campaign has created a guide evaluating the “friendliness” of six Republican candidates, “Among Republican Candidates, Not a Single Friend of Social Security.” The Campaign has also produced longer individual profiles of Mitt Romney, Rick Perry and Newt Gingrich’s particular records on Social Security.

Some key take-aways that may have slipped by casual observers of the 2012 race can be found in the Strengthen Social Security Campaign’s guide to the Republican candidates (click link for version with supporting quotes not included below):

Every candidate except for Rick Santorum has smeared Social Security a Ponzi scheme, fraud or unconstitutional.
Although Ron Paul and Newt Gingrich have never explicitly endorsed raising the retirement age, it is almost beside the point, because they both are outspoken advocates of much more radical changes. Paul thinks Social Security is unconstitutional and should therefore be dismantled. Gingrich would like to privatize the program along the lines of the Chilean or Galveston model. (Unfortunately both approaches failed their participants. See Economic Opportunity Institute on Chile, and Michael Hiltzik of the LA Times on the Galveston plan.)
Despite Romney's early claim to be a defender of Social Security, he supported George Bush’s attempt to privatize the program.

Here is the Strengthen Social Security Campaign’s guide to the Republican candidates (click here for a pdf with supporting quotes not included below):

Click here to download this chart with supporting quotes as a PDF.

Additional Detailed Fact Sheets:

Newt Gingrich

Rick Perry

Mitt Romney

Privatizing Liberty

Richard Eskow — Thu, 17 Nov 2011 20:46:42 -0500

As Mayor Bloomberg's forces swooped down on Occupy Wall Street, news reports described the "hundreds of police and private security guards" who had re-taken Zuccotti Park. Those private guards were used against public citizens who had been exercising their civil liberties in a public area.

That's not just wrong. It's un-American.

This incident holds an important lesson for anyone who loves our freedoms: When something public is made private, our liberties are privatized too. And privatized liberty isn't liberty at all.

Privatizing Liberty

Zuccotti Park. New Yorkers knew it as Liberty Plaza Park for nearly half a century. Like other sites in New York, the plaza was created through an agreement between the city and a private company, United States Steel, that wanted to erect a building that exceeded the city's height limits. So the city made them a deal: You can take up more than your share of the public skyline, but in return you have to give the city some open space at ground level.

This wasn't a gift. It was a fair exchange between two parties, a private corporation and the people of New York. The people gave up a chunk of their skyline and the owner agreed to provide an open - and, by agreement, fully public - space in return. New York City makes these deals fairly often. The plazas created by these agreements are called "privately owned public spaces," or "POPS," and the city has lots of them.

The Mayor may want to read that phrase again: It doesn't say "privately owned private spaces." Both the owner and the city are obligated to keep them for public use, in the public sphere, with all the laws and freedoms that apply to public space.

The park's current owner, Brookfield Properties, rebuilt the park with private donations after it was damaged in the 9/11 attacks. With Mayor Bloomberg's permission, they also overstepped tradition and the bounds of propriety by renaming the park - not for the thousands of innocent people who died that day, but for their own chairman.

The symbolism is perfect:They replaced a treasured word for freedom with the name of a rich guy who'd done nothing to create the park. With the Mayor's blessing, they literally privatized the word "liberty."

Like I said, perfect. Tragic, but perfect.

Private Dicks

Brookfield overstepped its bounds when its CEO sent the mayor a letter saying that the Occupation "violates the law, violates the rules of the Park, deprives the community of its rights of quiet enjoyment to the Park, and creates health and public safety issues." Those aren't decisions a private company, even an owner, should make about a public space. They are judgments an elected official makes on behalf of a free citizenry.

This week Bloomberg and Brookfield have used the park's semi-private status as an excuse to invade a public space with a private security force. Whoever these guys were - besides rude and uncivil - they served as a kind of Blackwater militia, but targeting New Yorkers instead of Iraqis. (At least Brookfield says it fired the guard who called a citizen a "faggot.")

When it comes to privatization, it seems the Mayor has boundary issues. He has repeatedly used the park's private ownership status to claim, that the public has fewer rights there than it does in other public spaces. That's false. But then, that's the problem with "public/private partnerships." The "public" partner always gets rolled the public one.

But then, that's how these people are. Give 'em an inch and they'll take a mile. The lesson of Zuccotti Park is: Never give them an inch.

Thin Blue Line, Thick Green Wallets

News reports made noted the presence of two different groups, New York City police officers and private security guards, but in some ways that's become a distinction without a difference. The NYPD is frequently rented by the same Wall Street banks that broke the law, crashed the economy and got away with it. As Pam Martens reported in Counterpunch, Rudy Giuliani created an operation called the "Paid Detail" unit that turns New York's Finest into a "rent-a-cop" service for anyone with the money to pay for it.

And who has more money in New York than the banks? As Martens reports, companies like Lehman Brothers, Goldman Sachs, and the New York Stock Exchange have rented the Thin Blue Line with the cash from their Thick Green Wallets. Even after the Stock Exchange was found to have illegally taken over public streets and walkways and "created a public nuisance," nobody was fined or arrested.

But then, it must be hard for a cop to arrest anybody that he sometimes has to address as "boss." Maybe that's one of the reasons why a retired Philadelphia police officer, Capt. Ray Lewis, was willing to be handcuffed and arrested by fellow officers during the protest. Capt. Lewis called their rationale for arresting him a 'farce' and promised to return.

(photo by permission of the photographer, Lauren Thorpe)

New York isn't the only city that rents out its police force. But the financial capital of the nation bears moral and civic responsibilities that Mayors Guiliani and Bloomberg have disrespected and violated. The photograph of Capt. Lewis is like an image of law enforcement's honor, handcuffed by the mercenary instincts of Gracie Mansion's two most recent occupants.

Checkbook Democracy

But then, why would Michael Bloomberg be expected to understand that privatization is undemocratic? He "privatized" the electoral process, one of our most sacred democratic institutions, by buying himself the mayoralty. And he spent unprecedented levels of campaign cash from his personal billions to do it. Then, when he didn't like the term limits that the people of New York had decreed for their mayor - well, he "privatized" that too.

But this isn't really about Michael Bloomberg. Despite his reputation for healthy self-regard, even the billionaire mayor is only a symptom of a much larger problem. Rich people have been buying elections for so long that it's become the newest form of self-indulgence, conveying even more status than a Citation jet or a private island. Public office is the newest must-have item for the excessively vain and excessive well-to-do, a kind of vanity press for the self-published authors of their own meritless political careers. Bloomberg is merely the today's most conspicuous, extravagant, and fiscally irresponsible member of an increasingly ordinary club.

You don't have to be a billionaire to run for office these days, of course. But if you're not you'll spend most of your time begging them for money. No wonder the 1% call all the shots in government. They own it.

I've always thought it would be a good idea if elected officials wore the insignia of the corporations that sponsor them, the way race car drivers do.

Sold American

Republicans want to privatize Social Security and Medicare. The Bush and Obama Administrations have privatized law enforcement on Wall Street by asking banks to police themselves. And during the devastating San Diego fires, residents learned that AIG had created a private fire department that saved the homes of its clients while other nearby houses burned.

Privatized police. Privatized fire departments. Privatized prisons. Privatized armies of Halliburton and Blackwater soldiers. When for-profit companies perform government functions, they'll do it in a way that makes them money. That's not hard to understand, but our "leaders" keep doing it anyway.

Why? Because they've privatized their consciences, too.

Perry’s Social Security Plan: A “Monstrous Lie”

Daniel Marans — Wed, 26 Oct 2011 12:39:11 -0400

A few weeks after calling Social Security a “Ponzi scheme,” Rick Perry claims he has just the plan to save the program. That is nothing but a monstrous lie.

In fact, Perry’s Social Security plan is a smorgasbord of awful Social Security ideas that conservatives have proposed over the years. It is George W. Bush meets Paul Ryan meets Alan Simpson.

While Perry leaves the specifics fuzzy, broadly speaking, here’s what his plan does:

Privatizes Social Security. Perry would allow workers to divert a portion of their payroll tax contributions into private accounts. But the recent financial crisis has completely discredited privatization. Americans do not want to see their savings gambled in the casinos of Wall Street. If Social Security had been private in 2008, when private pensions and 401(k) plans lost 37 percent of their value, millions more people would have lost their livelihoods than already did. What’s more, private accounts are less financially efficient. Social Security has 1 percent overhead costs; the administrative costs 401(k)’s are always much higher.
Slashes benefits for middle-class workers. Perry’s plan uses a technical change known as “progressive price indexing” to dramatically reduce benefits for all but the poorest beneficiaries. The details are unclear, but past progressive price indexing proposals, like that of Paul Ryan, cut benefits for all those making more than about $28,000. For example, a 65-year-old worker retiring in 2050 with average pre-retirement earnings ($43,518 in 2011), who is scheduled to receive a $15,156 benefit under current law, would see his benefits reduced $2,577 (17 percent) to $12,579 if price indexing were adopted.
Raises the retirement age. Increasing the retirement age two years from 67 to 69 would be a 13 percent across-the-board benefit cut at whatever age a person retires. What’s the rationale for such a massive cut? Perry claims people are living 14 -15 years longer than they were in 1940. But he fudges the numbers, using gains in life expectancy at birth since 1940, which are larger due to the high rates of infant and child mortality at the time. Life expectancy at age 65 has only increased about 6 years since 1940. And even these gains have been unevenly distributed, with men and women in the lower half of the earnings distribution seeing little or no gains in the past thirty years.
Allows state employees to opt out of Social Security. Perry holds up the county of Galveston, Texas, which opted out of Social Security in 1981, as a successful model for local retirement management. But the Galveston plan is already a proven failure. It provides smaller benefits than Social Security for all but the highest paid workers; it does not provide guaranteed lifetime benefits, so beneficiaries risk outliving their benefits; it does not automatically provide spouse’s and children’s benefits; and its benefits are not adjusted for inflation . Luring state employees out of Social Security with false promises will both jeopardize the economic security of millions of Americans, and undermine Social Security for those who retain its coverage.
Eliminates income taxes on Social Security benefits. This may sound like a nice idea. But income from other pension plans is taxed, so why should Social Security benefits be treated any differently? More to the point, the money has to come from somewhere. Revenue from income taxes paid on Social Security benefits provided 3 percent of the trust fund’s income in 2010. These taxes are a fair, progressive way to pay a small part of Social Security’s costs. The benefits of lower-income beneficiaries are exempt from the tax altogether, and people in higher income tax brackets pay more into the program.

Worse than Perry’s ideas though, are the lengths to which he goes to mischaracterize Social Security in its current form to make his plan more appetizing. Perry hits all of the classic canards:

There are not enough workers to support today’s generation of retirees. Perry repeats the oft-cited myth that because there were 42 workers for every retiree in 1940, but many fewer now, the program is unsustainable. In reality, the reason for the current shortfall has virtually nothing to do with the worker-to-retiree ratio. Social Security, like pension plans of all kinds, had high worker-retiree ratios when it first started. That is because the first generations of retired workers are essentially given credit for prior years of service, despite not having paid into the program for as many years as subsequent generations of workers. But increases in Social Security’s tax rate and tax base have offset these start-up costs. In addition, as the economy grows and technological innovation increases, fewer workers are needed to generate the same and higher levels of economic productivity. Currently, there are three workers for every beneficiary, and Social Security has a $2.7 trillion surplus.
The trust fund has been raided. Perry actually treats “protecting the Social Security trust fund” as a provision of his plan. But it cannot really be considered a reform, since it tries to solve a problem that doesn’t exist. Contrary to Perry’s apparent beliefs, Social Security’s $2.7 trillion surplus is invested in United States Treasury bonds, backed by the full faith and credit of the United States government. It has not been “raided.” The bonds can only be redeemed to pay for Social Security benefits and associated costs. Taking Social Security’s income out of Treasury bonds—where by definition, they are being borrowed by the government—as Perry seems to be proposing, would either mean putting them in a riskier investment vehicle, or letting them decline in value due to inflation.
Social Security has an unfunded liability of $17.9 trillion. This statistic refers to the unfunded liability from 1935 through the “infinite horizon”—an absurd benchmark. That means from the program’s inception out to an unknown date in the distant future—possibly billions of years from now when the sun has burned out. For the more manageable 75-year horizon that most experts look at, Social Security can be restored to long-range actuarial balance very easily.

Perry has proven unable, or unwilling, to understand Social Security’s basic structure, goals and history. Perhaps that is why his proposals to reform Social Security are so poor.

Views expressed are the author's own, and do not necessarily reflect the views of Social Security Works or the Strengthen Social Security Campaign.

Hutchison and Sessions Attempt to Kill Social Security

Josh Rosenblum — Thu, 16 Jun 2011 17:53:31 -0400

Retiring U.S. Senator Kay Bailey Hutchison (R-No Shame, TX) today unveiled a plan to steal Social Security from Americans by cutting their benefits and lying to them about it. In a release and fact sheet with more holes than a piece of swiss cheese in front of Dick Cheney on a hunting trip, Hutchison claims not to cut any “core benefits” in Social Security, but cutting those benefits is exactly what she does, and she cuts them by at least 13% or more. She gave her bill the great, blatantly full of rodeo bull manure title of the Defend and Save Social Security Act. This bill wouldn’t save and defend Social Security in the least. Even the most casual observer can tell the bill would more aptly be named the Attempted Murder of Social Security Act.

Hutchison wrote a letter to Vice President Biden’s deficit commission too. In it she said “I am concerned that Social Security reform must be part of the debt ceiling.” Leaving the bad grammar in that sentence aside, Social Security hasn’t contributed one penny to the deficit since by law it cannot do so.

Rep. Xavier Becerra (CA-31), Vice Chair of the House Democratic Caucus and a champion for Social Security said “Social Security has never added a dime to the deficits but Senator Hutchison’s plan would force massive benefit cuts on retired Americans in an effort to reduce the deficits created by the unfunded Bush tax cuts, the unfunded wars in Iraq and Afghanistan and the economic recession.”

Becerra’s office also said:

According to the Social Security Actuary, Senator Hutchison’s plan would result in the following:

No COLA this year
Cuts in COLA benefits in future years affecting current seniors: $408-$540 per year
Cuts in benefits by raising the retirement age: $2,000-$2,700 per year
Total cuts in future benefits per middle income worker: $2,400-$3,600 per year

Last week Pete Sessions, chairman of the Republican House campaign committee released a plan that would privatize Social Security, just a few years after the stock market collapsed, and just six years after fellow Texan President Bush released a privatization plan that sunk so gloriously it made the Titanic look like a tea party. Sessions’ privatization scheme is a gift to Wall Street’s greediest players, who he’s depending on to raise money for his candidates. His bill is called the Savings Account For Every American (SAFE) Act. The only thing safe about it would be a bet that it fails.

I once knew a Texan from El Paso whose demeanor was the same as Hutchison’s and Sessions on these bills. He smiled like a happy little kid when he spoke to anyone who might help him out. He’d talk about how he wanted to work hard, then go skip out on any promises he’d made. I finally realized that almost every time he showed that smile, he’d be lying right through it and didn’t care one bit. Sessions and Senator Hutchison are smiling that lying smile on Social Security. They’re talking about saving the program that in reality they want to kill dead. But thankfully their aim stinks and Americans know it.

Today Gallup put out a new poll in which 66% of Americans say they’re worried about not having enough money for retirement. So while the vast majority of Americans worry about having enough money to live out their golden years these two Washington politicians with Wall Street friends put out bills with great names that strip Americans of their retirement security. No wonder so many of us are worried.

108 miles southeast of Dallas is Anderson County, which has a life expectancy of 69.8 years for their men. 18 Texas counties have life expectancies of under 72 years for males. Most Americans are not living longer, and according to a study from the University of Washington “large swaths of the United States are showing decreasing or stagnating life expectancy.” So why introduce a bill that increases the retirement age for Social Security?

For the 2012 election cycle, every Republican running for office who takes a dime from the National Republican Campaign Committee (NRCC) that Sessions heads should be asked by voters and their opponents whether they support their campaign chief’s plan to privatize Social Security.

Most political candidates know that Americans don’t want Social Security privatized or benefits cut. But Republican and Democratic candidates must take the right position on these issues or face the wrath of the voters. So make sure to ask Republicans who take any money or advice from the NRCC if they support their campaign chief’s Wall Street plan to privatize Social Security and his Senator’s plan to take away our benefits. If the candidates don’t take a stand, that’s as good as saying they support privatizing Social Security and cutting our benefits.

If they’re going to kill Social Security, they’re going to have to get it by voters, not just by Wall Street, and they should know better than to think so poorly of all of us who don’t work on Wall Street.

Where the $ Is: Modern Maryland's Ancient Revenue

William Neil — Mon, 21 Mar 2011 19:31:13 -0400

WHERE THE $ IS: MODERN MARYLAND’S ANCIENT REVENUE

March 21, 2011

Dear Citizens and Elected Officials:

We are writing this post in the wake of the monumental union rally held in Annapolis on Monday evening, March 14, which drew some 15,000 people. Given the tremors the turnout set off, perhaps now it’s clearer why there is no legislative push to restore train service to the state capital.

Once again, as we reported in an earlier posting about the more tepid February 26th rally, there were no legislators who spoke, and, according to the Maryland State Education Association, none were invited. Governor O’Malley did manage to get in a brief speech near the end of the rally, following AFL-CIO President Trumka’s. Our translation of the Governor’s message is this: unlike Wisconsin, he’s not going to put public workers on the rack, or strip them of their bargaining rights, just give them a regrettable but necessary financial squeeze, because we all have to sacrifice and where else can we find the money?

Yes indeed, that seems to be the question of the day, nationally, and at the state budget tables: where, oh where, could the money have gone, other than to the pockets of public workers and their too generous pensions? Of course, as many on the left have said, we are not broke; we are a very wealthy nation, and Maryland is one of the very wealthiest states of that nation, standing 4th in median income, with Gov. Chris Christie’s New Jersey ranking second. In other words, we know perfectly well where the money has gone. Over the past 30 years, money and wealth has defied the old notion of gravity and flowed uphill to those who were already well situated near the crest of the slope.

Governor O’Malley likes to use the theme of One Maryland, the implication being, as he said Monday evening, that no one group is going to bear the brunt of the sacrifices, although the crowd at Lawyers Mall didn’t sound entirely convinced, chanting “Tax the Rich!” and “Keep the Promise.” They have a right to be skeptical, even as it’s true that Maryland is not Wisconsin and O’Malley is no Governor Walker. That’s because he, like the President, is not operating with a fully developed public philosophy and consequently their version of the political economy still overlaps in too many critical places with that of the fundamentalist Right. After all, the Center (think back to President Clinton) and the Right (Republicans and all the business lobbies except those for manufacturing) pushed neo-liberalism (another term for economic fundamentalism) down the throats of protesting labor, as Thomas Palley has reminded us all in his fine little essay America’s Exhausted Economic Paradigm (June, 2009). As if to rub salt into the wound of our very immediate troubles, Palley wrote that workers were trapped inside a four sided “policy box,” the four sides being “globalization, small government, labor market flexibility, and retreat from full employment.” Although they would probably protest, there is no doubt in our minds that Governor O’Malley and President Obama are still pushing in on workers from all four of the sides Palley has noted. Here’s the link to Palley’s work at http://www.newamerica.net/publications/policy/america_s_exhausted_paradi...

Because the Republican Right is always reading from a fundamentalist text (Friedrich Hayek’s The Road to Serfdom, 1944) they had no problem pivoting on the wreckage of the financial crisis to launch right into an attack on Keynesian economics, the role of the state and anything that looked like generosity towards public workers, the only unionized workers left standing after their decades of assaults on private workforce unions. As attentive readers also might have noticed, the Right is nothing if not comprehensive: they’ve gone after every possible leverage point the left might have used to turn the public discussion in a more progressive direction: gone after Van Jones and the Green Jobs response to Global Warming; gone after “Cap and Trade” even as it tried to please Goldman Sachs and the Wall Street banks’ derivative trading platforms; gone after ACORN and its inner city help to and voter registration of the poor; gone after Planned Parenthood and reproductive rights, again, especially those for the young and poor; gone after Public Broadcasting, the already greatly intimidated, meek voice trying to balance out Right Wing Talk Radio…there’s not much left standing, therefore, besides public unions…

But the Right still has a list of public functions they would like to privatize, and we’ve seen press accounts over the past year of a Maryland company that even specializes in privatizing public libraries. Topping the list of targets though, is public education, which plays out on so many planes to assist the Right: hedge fund honchos get to push private charter schools, break unions, reduce public pensions and therefore taxes, and attack job security and tenure, all at the same time. It all pushes in a conservative direction, aided and abetted by defensive liberals: who can be against excellence, defend incompetence hiding behind tenure, and merit pay? Who could deny that our schools and teachers could do better, especially in the inner cities? But wait a minute. Behind this whole line of reasoning is the assumption that failing teachers are the prime cause of failing schools, even under ghetto conditions, and we do mean ghetto, the Newark’s and the West Baltimore’s… Why aren’t schools seen as a reflection of society’s failings with race and poverty and the old crises of the inner cities, and as a mirror of America’s broader economic decline? Oh come now, the Right answers….these problems must reflect the failures of the liberalism, line item by line item, even if it was Albert Shanker, the AFT president from 1974 to 1997, who started the idea of charter schools, according to Diane Ravitch’s fine answer to the Right, The Myth of Charter Schools, (New York Review of Books, November 11, 2010.).

Ravitch’s article was a response to the documentary film Waiting for Superman, but her defense of public education and the role of teachers mirrors the chasms of the broader left-right fault lines in our society, now made so apparent by “Wisconsin.” She reminds us that “about 60 percent of achievement is explained by nonschool factors, such as family income…teachers can have a profound effect on students, but it would be foolish to believe that teachers alone can undo the damage caused by poverty and its associated burdens.” Yet that is precisely what we heard one of the national founders of “Teach for America” maintaining on the Charlie Rose show a month or so ago: that inspired teachers and administrators can overcome it all…all the destructive forces so ably laid out for us by David Simon and Edward burns in their tale of West Baltimore’s streets in The Corner…

Here’s how Ravitch maps it out for us: “There is a clash of ideas occurring in education right now between those who believe that public education is not only a fundamental right but a vital public service, akin to the public provision of police, fire protection, parks, and public libraries, and those who believe that the private sector is always superior to the pubic sector. Waiting for Superman is a powerful weapon on behalf of those championing the ‘free market’ and privatization.”

We ask our readers to, again, stop for a moment, pause as each of these individual state funding crises builds towards the grand one looming in Washington this April; stop and consider that every accountability thrust now directed at public school teachers could, just as well, and indeed, even more justly, be directed at America’s national business leaders, who, along with 99% of the economics profession, have presided over our nation’s economic decline, outlined above so succinctly by Thomas Palley. Accountability for failures? Which failures and whose accountabilities are the most significant? Teachers and their unions or Bill Clinton’s and Robert Rubin’s – to go along with Reagan’s, the Bushes’, Angelo Mozilo’s and Alan Greenspan’s?

Needless to say, we think the failures in the national schools (and Maryland should be the last state to take it out on their teachers and their schools) are reflections, rather, of the national economic failures over 30 years, and those failures can also be tracked by the transformations in the Democratic Party: from the party of the New Deal to its current manifestation as America’s second, and self-contradictory business party, one that puts the needs of upper middle class professionals and their view of the political economy far ahead of labor’s rank and file and the average, unorganized citizen, especially the 35.8 percent of the adult population who are no longer participants in the work force. That’s why this party’s President immediately placed a debt and deficit balancing commission on the nation’s agenda, even before he had adequately addressed the nation’s number one problem: tens of millions of missing jobs. He failed to realize, like most Democratic local and state elected officials who are required to balance budgets, that, given the very conservative bias in local fiscal proceedings, there had to be a deep and profound Washington Keynesian offset to what was inevitably to take place locally. There would be no other way to correct the deflationary downdraft unless citizens were to go to leaders like Maryland House Speaker Michael Busch in January of 2008, as we did, and ask him about the possibility of waiving balanced budget requirements under the duress of an economic emergency. Barring that, it was bound to be budget cuts versus revenue increases, where the Right has a 30 years “head start” and standing…and bound to be a wave of austerity instead of a wave of job creation, especially public job creation. This is political terrain that the Right has been licking their chops over for decades now. If you doubt that, please visit Bruce Bartlett’s ‘Starve the Beast’ essay from 2007, which covers the ground all the way back to Reagan, and opens its concluding paragraph this way: “Perhaps a future fiscal crisis will provide political cover for massive cuts in entitlement programs that would be politically impossible except in such dire circumstances.” (Here at http://www.independent.org/publications/tir/article.asp?a=641).

But it gets worse, given Maryland’s democrats’ participation in these trends, and intensified by their proximity to the “Beltway” Insiders’ influence, as Christopher Hayes fine piece in The Nation, “Why Washington Doesn’t Care About Jobs,” shows. Hayes tells us that college graduates have a much lower unemployment rate than the rest of the nation, and that the DC metropolitan area, in turn, being a vast gathering of professionals and college graduates, has the lowest in the nation. He goes on to make another crucial linkage, crucial for that evolution of the Democratic Party away from its New Deal days: “…our system is responsive only to voices at the top of the social pyramid – the bankers and businessmen who are raking in record bonuses and the professional upper middle class, which is recovering much faster than the nation as a whole…” Going further, he cites a political scientist’s finding that “‘when Americans with different income levels differ in their policy preferences, actual policy outcomes strongly reflect the preferences of the most affluent but bear little relationship to the preferences of poor or middle income Americans.’” Following some of the same reasoning, and going after the same indifference, Paul Krugman reminded us of the consequences in his column from March 18th, “The Forgotten Millions” Here they are at http://www.thenation.com/article/158992/why-washington-doesnt-care-about... and

http://www.nytimes.com/2011/03/18/opinion/18krugman.html?partner=rss&emc...

And that is the background, and the Introduction, to the subject line of our posting, why it is that Maryland can’t raise the revenue to balance its budget and meet its pension obligations, obligations which George Lakoff has reminded us are “deferred payments for work done,” by bringing its ancient (1947) sales tax up into the modern era. That year of the sales tax’s origin, the year of “reigning in” labor with the Taft-Hartley Act, after the greatest strike wave in American history in 1946, was a signature year for the old industrial economy that was based on making things, and not the rise of the service economy that would famously follow its fall, dating, arguably, from the mid-1970’s.

How out of touch is Maryland’s ancient sales tax? So out of touch that out of 168 categories of services which might be included in a sales tax – Maryland taxes only 39 of them – less than a quarter. And which services does Maryland leave out, according to the Puddester Commission findings from 2002? Why it leaves out precisely those professional, modern services that stand in such close proximity to the upper middle class profile of the New Democrats and New Democratic Party made by Bill Clinton & Company: Business Services, Information Services, Professional Services, Transportation, Financial Services…trailing off into the more mundane “Personal” and Repair Services….add them together and the Puddester Commission found missing annual tax revenues to be $1.6 billion to $2.2 billion. And let’s not be coy here; hiding amidst the Commission’s more generic categories are the hints as to why the legislature has so much trouble expanding its reach: these are accounting, engineering, legal, advertising and political “consulting” services, aren’t they?

Yet these would also be the very tax categories that would help make what is a currently a regressive tax much more progressive, because, even though they would be used occasionally by citizens from the lower and middle portions of society, they are used on a much more frequent basis by the participants in the upper middle stretches of our economy.

Indeed, we had a very high ranking legislative leader tell us, after we posed the question in a meeting in January of 2008, that these categories would never even be brought up, never put on the table – the implied, but unstated reason being the professional and business composition of the legislature itself. And there you have it: a very succinct, yet very instructive lesson in the basics of political economy, circa early 21st century.

And is that perhaps why Governor O’Malley’s signature legislation for 2011 is not a bill to bring the Maryland sales tax into the 21st century, but one rather to create yet another Maryland “venture capital fund,” one he hopes, yes, fairly, to create jobs, and replenish the already existing but depleted ones, but one that is quite convoluted and pitched towards the same upper middle class professionals that now tilt the Democratic Party towards the Republicans, and not their own traditional base. Once again, it’s Biotech! and IT!, not WPA and CCC.

So below, please find our little report, submitted to a Progressive Neighbors working committee back in July of 2008, but never really put on the table by progressive groups in Maryland. We urge our readers to share it with you own representatives in Annapolis. And please don’t misunderstand us. We fully support the push for Combined Reporting, but note that even at its most optimistic projections, that’s not a game changer in scope, although it is a good lesson in political economy and how wealth and income is hidden. And we also fully support the efforts of the Fund our Communities groups, with the caveat that abandoning futile Empire maintenance efforts is only the beginning; money not spent on military-industrial Keynesianism doesn’t mean that the Republican Right nor Democratic Center will necessarily agree to spend it on better alternatives…as the current “austerity” debates in Washington amply demonstrate.

That’s hard to believe, given the unemployment situation, but there it is. Progressives have a new political economy to build, and need to construct a philosophy to stand behind it. Even when some of them come together over the right direction, such as at The Campaign for America’s Future’s “Summit on Jobs,” (March 10, 2011, at the National Press Club), it’s pretty clear that they don’t have a common text or even texts (please understand that this is very different from elevating something to be “The Text.”); they’re all about organizing a movement, all urgency and alarm and energized by the Wisconsin moment, but it’s not matched by clarity in philosophy or political economy – not yet, anyhow. The best of the conference, we thought, were: the speech by Leo Hindery, Jr., a Democratic private equity fund investor who called for, among other things, a new WPA for jobs and putting America’s workers first (reminding us that for every person “officially” listed as unemployed, there is another ignored by the statistics, bringing the total to 30 million, and the rate to 20%, not the official 8.9% or so…); the Rev. Paul H. Sherry’s reference to FDR’s “Second Bill of Rights,” from 1944 and last, but not least, Van Jones’ call for a combination of individual hard work, of the “bootstrapping” he learned from his father – but – and a very crucial Social Democratic “but” it is – bootstrapping that’s met with a social “ladder,” the means of ascent to meet the will to ascend – the only way to get out of the very deep economic hole our nation’s economic leaders (not the teachers or other public employees) have dug for us. Right now, without a massive commitment to jobs, including public jobs, there is no meaningful ladder. We also like the way he addressed the Tea Party and their values, their definition of “Liberty” which leaves out “…and justice for all.” Here’s the pathway to the speeches we heard, at
http://ourfuturedotorg.blip.tv/?sort=date;date=;view=archive;user=ourfut...

And, as a proper lead-in to what we wrote almost three years ago, here is the New York Times’ front page article from just a few weeks ago, “Majority in Poll Back Employees in Public Unions.” Aside from that headline finding, the Times/CBS poll also found that “those polled preferred tax increases over benefit cuts for state workers by nearly two to one.” Here at http://www.nytimes.com/2011/03/01/us/01poll.html

MAKING MD’S SALES TAX MORE PROGRESSIVE
Bill Neil
July 2008

In the complex budget maneuvering of 2007-2008, the Maryland Legislature chose to raise the sales tax from 5% to 6% with the expected revenue increase to be $687 million in FY 2009. Based on 2007 numbers, the MD sales tax raised 3.62 billion dollars, 27% of the state’s general revenue, second compared to the 7.04 billion and 52.4% raised by the personal income tax (and just $598 million and 4.5% raised by corporate income taxes) Although Governor O’Malley extended the services taxed to four new categories, it was not a very bold effort and ended up targeting a “weak lobbying link” – computer services – which then rallied to repeal its inclusion. The significant thing here was the potential revenue raised by just this one category of service: $207 million. It is suggestive of Maryland’s deeper failure, to extend the sales tax base from its 1947 starting point of taxing only tangible goods, to capture the vast changes since then in an economy which has become more and more service oriented.

National tax studies indicate about 168 categories of services which might be included in a sales tax – and Maryland taxes only 39 of them. In the fall of 2007, the Center on Budget and Policy Priorities proposed taxing services such as cable and satellite TV, auto repairs, interior decorating, pet grooming, and country club memberships, which they say would have raised an additional $163 million. The list again hints at the unwillingness to take on the tough lobbies and therefore the big numbers: accounting, engineering, legal services, advertising. As a matter of fact, I have been unable to find even studies which would tell us what each of these services would generate if included in the sales tax. The closest we have, using broader categories which don’t highlight these services, comes from the Puddester Commission from November of 2002: Its list of revenue to be raised by “Taxation of Services” reads as follows:

“Business Services” - 600-700 million
“Information Services” – 325-385 million
“Professional Services” – 200-260
“Transportation” - 200-250
“Financial Services” - 150-230
“Personal” - 75-115
“Repair Services” - 50-80
_______________
Total Revenue from taxing “these” services: $1.6-2.2 Billion

House Bill 448 from 2007 started to head down this path. It proposed 30 new services to be included under MD’s existing 5% sales tax, and the revenue generated would have been an additional $657 million – without raising the rate to 6%. A sampling of the new services in the bill: auto repair and services, parking, barber and beauty salons, docking and boat services, engineering, storage, (shoe repair!), tax preparation and locker and storage facilities…..personnel and temp. Agencies….the numbers raised on certain services are impressive: engineering: $82.8 million; personnel and temp. $65.7 million.

This leads me to the conclusion that Progressives should keep the impressive categories from House Bill 448, drop the silly ones like shoe repair, and add advertising, accounting, legal, management and p.r

The obstacle is political: to get a legislature full of lawyers and accountants and sensitive to the lobbying power of the other big services named above (real estate-advertising), to even consider producing a study showing what the excluded services would raise in revenue. (Personal note: I’ve heard a high ranking state leader say these categories would never even be brought up, never put on the table, in answer to me directly raising the question in January of 2008).

Who has pushed in the Past: Progressive Maryland listed the same list as I have above from the Puddester Commission in their “Fiscal Crisis Briefing Book” from 2008, but it was near the end of a long document and did not seem to be a high priority.

Another Approach: There has been some discussion in Annapolis of enacting a Gross Receipts Tax, which 7 states have some variation of: Del., Kent., Mich., New Mexico, Ohio, Texas and Wash. – which functions almost like a sales tax on the purchasers of services as well as goods. Economists don’t like the pyramiding effect: many of our “hollowed out” business entities purchase accounting, advertising, etc. services from outside firms and each time they bought them, they would be hit by this tax…so this is a big obstacle…and progressives don’t seem too high on this approach, nor many economists. In a phone conversation I had with Neil Bergsman of the Maryland Budget and Tax Policy Institute (July 10) he favors, if we want to head down this route of taxing services, that the legislature bring all services under its sales tax – a kind of grand House Bill 448, and then enumerate which categories and exemptions it feels would be necessary to make it function well. I might add that part of the political trade-off in Annapolis might well be to reduce other corporate taxes if either this grand inclusion of services or the Gross Receipts Tax is enacted. Illinois considered the GRT approach – 1-2% would raise 6-8 billion…but it was not enacted.

Until the next post, all the best to our readers…

Bill Neil
Rockville, MD

PS Although it’s very late in the current (March, 2011) budget negotiations in Maryland, another pathway which leads directly from the answer to the question “Where did the money go?” is that the maldistributions of the past 30 years can’t be reached by just taxing income, you have to look at the different forms and places where wealth is stored (and hidden). That leads to the consideration of a surcharge on wealth, broadly defined, not income. An obscure “redistributionist” named Donald Trump suggested that a few years ago, at the national level. His is not the greatest recommendation we can think of, but The Donald just might have some idea of where “it is stored.”

The War Against the Republic: The Battle of Madison

Richard Eskow — Thu, 24 Feb 2011 00:43:02 -0500

Sometimes it's worth looking at current events through the eyes of a historian chronicling the end of an age, or those of a district attorney in a time of corruption. Come to think of it, the two perspectives aren't all that different.

However you look at it, calling the Wisconsin struggle a "labor dispute" is like calling the Battle of Normandy "a fight over a beach." There's a war on, one that's best understand by using an Latin expression popular among prosecutors: Cui bono? Who benefits? Gov. Scott Walker's union-busting budget contains buried goodies for somebody, including possibly the Koch Brothers who paid to have it drafted. More importantly, it's another step toward replacing the American dream of prosperity for all with imperial visions of massive wealth for the few.

The heavily-financed forces behind Scott Walker want to bring down the American Republic. If that sounds like rhetorical overkill, it's worth remembering the words of someone who watched a republic fall. "The enemy is within the gates," said Cicero. "It is with our own opulence, our own folly, our own criminality that we have to contend."

"Money money money money," added the O'Jays, "some people do things, do things, do bad things with it."

If this end-of-the-republic rhetoric sounds extreme, listen to Gov. Walker's phone call with a prankster pretending to be David Koch. He spoke to Koch the way an employee talks to the boss. That's a glimpse into the world of corporate political power. Madison's the epicenter for a battle between the dying American middle class and a plutocracy - no, make that a "Lootocracy" - determined to rob it of everything it's earned over the last 75 years.

But wait, says Joe Klein. He says they're protesting against democracy in Wisconsin. "The Republicans won," Klein says, "and there are consequences to elections." But did Scott Walker announce that he would magnify a budget problem and use it to break the ability of state employees to negotiate on their own behalf? That approach is opposed by 61% of Wisconsin voters, according to the latest Gallup poll.

The election in Wisconsin is the latest example of a two-party system where neither party adequately represents the majority's will. One tramples on it, using lies and fear, and the other offers only the weakest defense. The system's been corrupted by money - "cash money," as the O'Jays would say - which casts a shadow over its results. Those results include the election of leaders like Gov. Walker, who's just a footsoldier in the war on the American Dream. There's big money at stake - cash money - and the government swag in Wisconsin's just the tip of the iceberg.

Klein's energy would be better spent fighting for a truly representative democracy, rather than dismissing protestors who represent a majority of their own state's people.

Civil Discourse vs. Civil War

Historians of the future may look back on our time with an indulgent chuckle when they consider the pundits and politicians who, in their anxiety to ensure a 'civil dialogue,' ignored the cui bono principle. Under current conventions, we're supposed to assume that every political action must be the result of selfless ideologies. We must "disagree without being disagreeable," as the President would say.

Meanwhile the plunder goes on unabated. Kevin Drum toted up the score so far from the plutocratic project: a massive upward redistribution of wealth, and the growing dominance of wealthy interests in politics and the media.

How would things would have turned out if during the days of Tammany Hall in New York City or Huey Long in Louisiana journalists and reformers had adopted that attitude? Wall Street caused a global crash two years ago. Today it's richer than ever and throwing its weight around politically as if nothing happened. Next time someone lectures you about 'civil discourse' just say, Look around, pal. This ain't a debating society. Somebody's wheels are getting greased - and the rest of us are on the skids.

Power Grab

At the risk of sounding disagreeable, it's hard to find an "honest difference of opinion" on ideology that explains a paragraph like this one in Gov. Walker's new bill, spotted by my eagle-eyed pal Mike Konczal: "... the department may sell any state−owned heating, cooling, and power plant or may contract with a private entity for the operation of any such plant, with or without solicitation of bids, for any amount ... no approval or certification of the public service commission is necessary for a public utility to purchase, or contract for the operation of, such a plant ..."

This allows the governor to bypass regulators and legislators and sell the state's power plants, built with millions in taxpayer money to anybody he likes. This paragraph goes on to say that " any such purchase is considered to be in the public interest and to comply with the criteria for certification of a project." The governor can give these plants away if he wants, and nobody can stop him.

Cui bono? Who could possibly benefit from giving the governor the ability to sell the state's "heating, cooling, and power plants" (there are 32 of them), or "contract with a private entity" to operate them, without a bid process or any regulatory oversight?

Let's see now: Wisconsin has nearly one million natural gas customers, so it would presumably be a company that "provides consulting, engineering, design, procurement, fabrication and construction services for the natural gas and gas processing industries worldwide" and has "been the general contractor on some of the largest natural gas plants built in the U.S." And since there are a number of coal-fired plants on the state's list, our corporation would need to be a "leading supplier of coal and related products typically used in industrial applications or to generate electricity."

Those quotes were taken from the website of Koch Industries, the company whose owners are bankrolling a little-known group that's behind initiatives like Walker's budget proposal.

Of course, the winning candidate doesn't have to be Koch Industries. Kris Broughton at BigThink found anothe candidate. ThinkEnergy says it "eliminates the waste of energy and money in facilities through a blend of Supply-Side and Demand-Side energy management measures," and they've placed a hiring ad that reads "Energy client is looking for experienced Plant Managers for multiple power plants located in Wisconsin."

The real issue isn't whether Koch Industries gets the deal to operate Wisconsin's power plants. Somebody will - and the assets built by Wisconsin taxpayers (including the public employees now under assault) will undoubtedly be given to the private sector at very favorable rates. It will be one more step in the Great American Giveaway -- the seizure of public resources by the private sector.

The Great American Giveaway

One of the Lootocracy's objectives is to confiscate all the assets that the middle class has built with its tax dollars. For decades the "privatization" movement has been a front for this plunder of the public's resources, allowing private corporations to enrich themselves by providing services that were once provided at lower cost by the government itself.

How did that work out? Xe, the Company Formerly Known as Blackwater, provides mercenaries for our Middle Eastern wars - at great public expense, and sometimes acting outside the law in ways that harm our national security. The privatization of prisons and reform schools gave us the case of the monstrous judges who railroaded innocent kids into incarceration in return for bribes from a private youth detention facility contractor.

On a national scale, money intended for worthy college students got diverted into private jets and fat salaries after the privatization of the student loan enterprise Sallie Mae, and the privatization of mortgage backers Fannie Mae and Freddie Mac led to a series of scandals, multimillion dollar payouts for incompetent executives, and a worsening of our financial crisis.

Private Parties

With a record like that, you'd think the privatization movement would be dead. And you'd be right - if it weren't for the billions being provided to it by the Koch Brothers and other private financiers. They're major backers of "ALEC" - the "American Legislative Exchange Council" - an organization that proves how smart and determined the armies of the Lootocrats really are. There are two very smart strategies behind ALEC:

1) While everybody's focused on what goes on in Washington, ALEC is able to plunder the massive resources of state and local government.

2) State legislatures are the "farm league" for tomorrow's governors, Senators, and Presidents. ALEC isn't just buying state government. It's buying tomorrow's national leaders too.

This secret army has a clear agenda: Attain power, give away the "store" once in office, and decimate programs that help the middle class and lower income people. Scott Walker's actions fit the playbook perfectly. In fact, his bill was reportedly drafted by ALEC, whose primary objectives include the drafting of "model legislation."

Two enterprising representatives from People for the American Way were able to get into an ALEC meeting in 2005 and, as Joshua Holland reported, they cast a light on ALEC's role as " the connective tissue that links state legislators with right-wing think tanks, leading anti-tax activists and corporate money." They were also able to collect information on the breadth and audacious scope of the ALEC agenda, which is mirrored by other groups offering support for Walker's efforts - groups such as "Americans For Prosperity," another Koch-funded front group.

The war on unions is an essential part of the ALEC Assault. Unions are a double threat: First, they interfere with the Lootocracy's ability to treat its private-sector employees as badly as the law will allow. And government employees are fighting for pay and benefits that interfere with the broader agenda of strangling all forms of government spending so that taxes can be kept low for the Lootocrats. That's why, as Harold Meyerson points out, unions are under attack in a number of GOP-led states, and by Republican members of Congress who are trying to strip funding from the National Labor Relations Board.

All across the nation Republican governors are using the same playbook: Cry "poor" while giving tax cuts to the rich, then use the resulting crises to bust unions and gut services for the poor and middle class. They're all reading from the same script, and if their line readings aren't convincing it doesn't really matter. Ronald Reagan and Arnold Schwarzenegger have already taught us that Republicans don't need to be good actors to succeed.

As Wisconsin Goes

Gov. Walker insists that the state's pension plan is a key driver of the state's fiscal problems. But the state is actually projected to have a small surplus next year, depending on how it handles its debt to Minnesota and a couple of other key issues. In any case, the state's pension plan is extremely well-funded, with 99.67% already in its accounts.

What happened in Wisconsin? The Governor cut taxes for the wealthy, then declared a budget emergency. In classic "Shock Doctrine" fashion, he used that emergency to slash a retirement plan that's highly stable financially, along with medical services for middle-class and lower-income people.

What's happening in Washington? In the name of "austerity economics" and deficit-cutting, a deal was cut that extends tax cuts for the wealthy. Now the conventional wisdom is that we must cut Social Security, a benefit program that's much more solvent than most government programs, and then gut medical assistance programs like Medicare and Medicaid.

Let's see: A tax cut for the wealthy, followed by the declaration of a budget emergency and the gutting of retirement and medical programs. And along the way, a giveaway of public resources to private corporations. That's not coincidence: It's the plan.

The Home Front

So, cui bono? The richest 1% of Americans, along with the corporations - and politicians - they own. We know who the warriors are, we know their strategy. We know they're winning, too. Can the tide be turned? Not if the people opposed to this Lootocracy refuse to acknowledge what's happening. Republicans are gutting the republic and not enough Democrats will fight for democracy.

"Don't let money rule you," said the O'Jays. And Cicero, who knew a thing or two about military and economic warfare, said "Nothing is so strongly fortified that it cannot be taken by money."

Cicero and the O'Jays ... have they ever been to Madison?

____________________________________

This post was produced as part of the Curbing Wall Street project and the Strengthen Social Security campaign.

TV Appearance: Talking Egyptian and US Economics on Russia Today

Richard Eskow — Thu, 03 Feb 2011 16:14:00 -0500

Here's a clip of our appearance on the Russia Today network to discuss the economies of Egypt and the United States. It felt very important, while pointing out the possibly surprising similarities, to also point out their greater hardships and dangers - especially now, while they're showing so much courage.

The Egypt discussion allowed us to point out the risks of "austerity economics" and the problems that can arise when economic policy places a premature emphasis on deficits at times when growth and jobs investment are needed; and to point out the parallels between Egyptian and US decisions to offer tax cuts for high-earning individuals and corporations while more stimulus is still needed.

The other panelist was Robert Naiman of Just Foreign Policy. The entire discussion lasted fifteen minutes. For those who only want to see our participation, we were the lead-off commentator and reappeared at 7 minutes and 45 seconds (where, you may notice, I didn't answer a question for which I felt unqualified). Here it is:

"Government Doesn’t Have the Resources to Stop It"

Dave Johnson — Thu, 27 May 2010 13:31:04 -0400

People want the President to exert leadership to turn things around.

The oil leak. Unemployment. Credit card scams. Foreclosures. Predatory corporations. Environmental destruction. Global warming. Roads and bridges crumbling. Incomes stagnant. Schools getting worse. Companies moving overseas. Problem after problem.

People want to know, "Why doesn't the government push BP aside and take over?" The answer is, "Government doesn't have the resources to stop it."

People want to know why the government can't do more to help unemployed people, help with health care, help provide good educations, help with college, maintain the infrastructure, and all the other things that government does.

The answer, these days, is always, "Government doesn't have the resources." And that, in a nutshell, was exactly the plan.

We, the People no longer have the resources to solve our problems. We now must depend on and defer to the corporations and the wealthy few to make the important decisions and get things done instead of being able to decide and do on our own.

This is the legacy of 30 years of conservatism. They called it "starving the beast." Reagan called it “cutting their allowance.” President Bush, told that his policies had turned the country back to massive deficits, said this was, "Incredibly positive news'' because it will create "a fiscal straitjacket for Congress." He came into office with a $236 billion surplus. His last budget left us with a $1.4 trillion deficit. "Incredibly positive news."

They disemboweled the regulatory agencies. They "privatized" government functions and resources, letting a well-connected few profit at the expense of the rest of us.

The Reagan deficit plan was right there for everyone to see:

Step 1: Cut taxes to "cut the allowance" of government so that it can't function on the side of We, the People. Intentionally force the government into greater and greater debt.
Step 2: Use the debt as a reason to cut the things government does for We, the People. When the resulting deficits pile up scare people that the government is "going bankrupt" so they'll let you sell off the people's assets and "privatize" the functions of government. Of course, insist that putting taxes back where they were will "harm the economy."
Step 3: Blame liberals for the disastrous effects of spending cutbacks.

And here we are. Every time you hear someone say that we have to fight the deficit instead of getting things done that We, the People need done you are witnessing The Plan in action.

And now, government doesn't have the resources to stop it.

The Perils of Privatization

OurFuture.org Staff — Mon, 04 Aug 2008 15:08:08 -0400

An idea to radically change Social Security that has already been soundly rejected by the American people—privatization—is being resurrected. If its proponents succeed, 8.6 million older Americans would lose a safety net that keeps them from falling into poverty, according to research released by the Institute for America's Future.

Three years ago, President Bush declared that Social Security faced a financial crisis, and his solution was privatization — taking payroll taxes we all pay into the system and investing a portion of those funds in private stock market accounts.

Now Senator John McCain is bringing the idea back. In March 2008, McCain told the Wall Street Journal, "As part of Social Security reform, I believe that private savings accounts are a part of it — along the lines that President Bush proposed." The idea became more concrete in July 2008, when McCain named economist Martin Feldstein, the "chief intellectual force behind privatization," as a surrogate on his campaign.

In a town-hall event on July 7, 2008, when McCain was asked about the future of Social Security, McCain criticized the fundamental design and structure of the program. He said: "Americans have got to understand that we are paying present-day retirees with the taxes paid by young workers in America today, and that's a disgrace, it's an absolute disgrace and it's got to be fixed," he said.

This report updates research previously published by the Institute for America's Future. It estimates the reduction in Social Security benefits that a typical United States resident can expect and the number of seniors exposed to poverty if Social Security were privatized. The main findings are that for future generations, Social Security privatization would:

Cut lifetime benefits by $240,264
Make 8.6 million senior citizens vulnerable to poverty.

Read the United States report.

Read reports on the impact on: Women | African Americans | Hispanics

Read the state reports:

Alabama Report | News Release
Alaska Report | News Release
Arizona Report | News Release
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Montana Report | News Release

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New Mexico Report | News Release

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Pennsylvania Report | News Release

Rhode Island Report | News Release

South Carolina Report | News Release

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Tennessee Report | News Release

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Utah Report | News Release

Vermont Report | News Release

Virginia Report | News Release

Washington Report | News Release

West Virginia Report | News Release

Wisconsin Report | News Release

Wyoming Report | News Release

More facts are in our Making Sense alert on Social Security privatization. Also browse the Social Security section of our website.

New GAO Report: Extra subsidy makes private Medicare Advantage more expensive than traditional Medicare

Eric Lotke — Wed, 12 Mar 2008 11:24:26 -0400

The GAO reports that Medicare spends more per beneficiary in private Medicare Advantage plans than it does for beneficiaries in the original Medicare program - a projected $54 billion more from 2009 to 2012.

Under Medicare Advantage, the government first reimburses insurance companies for medical expenditures. Then it provides an additional payment for nonmedical expenses such as marketing, sales and profits.