George Will misread's the source of Republican's Immigration Quagmire

Two quotes from Yogi Berra seem appropriate looking over the field of Republican Presidential candidates – and particularly their tortured responses to America’s desire for leadership on immigration. 

“You've got to be very careful if you don't know where you are going, because you might not get there.”

Today’s column on immigration (and particularly the xenophobic approach of Donald Trump to the issue) by George Will hints at the disconnect between the Tea Party “base” that allegedly captures the Republican Primary vote, and the reality of America’s history and modern economy.  In a nut shell, Mr. Will reports on, but doesn’t really analyze, the disconnect between the vast majority of Americans who favor a path to legal status for America’s 11 million undocumented immigrants, and Mr. Trump’s call for mass deportations and a border wall that keep the “bad” immigrants out while allowing the future return of the “good” immigrants – a deportation and return that will require (in Mr. Will’s estimation) a significant growth in the size of government, since immigration and border control are a governmental function that cannot (yet anyway) be outsourced to a private entity.  Mr. Will casts Mr. Trump’s immigration plan as a mysterious assault on the Small Government Principles the Republican Party allegedly stands for, and manages to include the supposed failures of the “government” to “run” Amtrak as but one example of why bureaucracy will fail to do what Trump suggests.

For starters, Mr. Will grossly misleads readers on why Amtrak has problems.  Created in 1970 to answer the abandonment of passenger service by private railroads, AMTRAK is not a government agency like the FBI or USDA – rather is a Congressional Chartered semi-private corporation providing a public service to Americans.  Further,  Amtrak’s budget is approved every year by a Congress that insists it make a profit (competing against airlines and personal automobiles), while starving it of operating capitol, failing to invest in highspeed rail, and (until the late 1990’s) preventing Amtrak from advertising in the same way as airlines or even Greyhound.  So Mr. Will’s operational analogy is failed on its face, a fact the WaPo would do well to correct publicly.

All that, however, pales in comparison to Mr. Will’s most notable and most enduring failure as a pundit – his unwillingness to call out Republican’s for the bed which they have created for themselves.  After decades of demonizing minorities to gain electoral advantages (including Blacks, Asians, Muslim Arabs, and now Latinos); after claiming to want to reduce the reach of government while bailing out Too Big TO Fail banks for their misdeeds in the Great Recession, and after taking America into a decade long war based on purposely falsified intelligence (a war used to create and enhance fear and mistrust of “the other”) – What exactly does Mr. Will think the Republican base would accept as immigration policy?  Republicans have fought tooth and nail (added and abetted by a spineless Democratic Party since late 2001) to create a xenophobic surveillance state where needs of corporations outweigh the needs and freedoms of average citizens.  Those illegal immigrant – who FWIW pick our fruits and vegetables, clean our offices, build our homes, and care for many of our children – can no more be successfully turned away from our borders then can the lily white poor who became Tea Party supporters because they wanted the same bailout the banks and stock brokers and hedge fund managers got.

In his closing, Mr. Will notes that mis-handled immigration policy –in a nation built on and proud of its immigrant heritage – has cost the republican Party national elections before.  As Yogi also says:

It's like deja-vu, all over again.

Tax Day Redux - The Washington Post slaps Feds too!

So on April 15, the Washington Post published the usual polemics about the 4%of federal employees with tax "deficiencies" meaning they owe some sorts of back federal taxes. The stories also highlighted legislation making its way through the House to make it easier to fire Feds who don't pay taxes properly and on time.

Sadly, both the Post and the House seem to think that the fed tax delinquency rates font merit placement in context. If they did, they would have to acknowledge that Feds at a 4% rate are doing better then the rest of the citizenry, who are running between 9% and 10% deficient (depending on what source you read).

But hey, what role do facts have in a good polemic?

Trickle Down Economics and smaller govenrment led to the Great Recession

Following hard on the heals of all the Thomas Piketty kerfuffle, Harold Meyerson reports on a new paper in the Harvard Business Review by William Lazonik titled "Profits Without Prosperity:" (Emphasis mine)

Like Thomas Piketty, Lazonick, a professor at the University of Massachusetts at Lowell, is that rare economist who actually performs empirical research. What he has uncovered is a shift in corporate conduct that transformed the U.S. economy — for the worse. From the end of World War II through the late 1970s, he writes, major U.S. corporations retained most of their earnings and reinvested them in business expansions, new or improved technologies, worker training and pay increases. Beginning in the early ’80s, however, they have devoted a steadily higher share of their profits to shareholders.

How high? Lazonick looked at the 449 companies listed every year on the S&P 500 from 2003 to 2012. He found that they devoted 54 percent of their net earnings to buying back their stock on the open market — thereby reducing the number of outstanding shares, whose values rose accordingly. They devoted another 37 percent of those earnings to dividends. That’s a total of 91 percent of their profits that America’s leading corporations targeted to their shareholders, leaving a scant 9 percent for investments, research and development, expansions, cash reserves or, God forbid, raises.

Meyerson summarizes Lazonick's research as essentially throwing open - and the beating to death - the notion of Trickle Down Economics, and draws a stark link to President Reagan's changes in Securities and Exchange Commission regulations on stock buy-backs as the culprit of today's Great Recession (which still very much lingers everywhere BUT Wall Street).  I know that fact-impervious conservative pundits will no doubt shy away from the whole thing, but it should give real conservatives - and fiscal conservatives especially - pause that deregulation (i.e. LESS GOVERNMENT) in the early 1980's resulted in an economic crash in the late 2000's.  Like it or not, as we get ready to "celebrate" American labor this week that the economic fortunes of that labor pool are no longer in their own hands - and all so we can inflate corporate CEO pay apparently.

You can read more HERE

Get out the Hoover: the NSA records phone calls as it nails shut the coffin of democracy

Three recent articles show not only how much the Security and Surveillance State has expanded in the last decade, but why the dangers of that expansion are largely going unchecked.

In the first, Glenn Greenwald, Ryan Devereaux and Laura Poitras report on further revelations from the Edward Snowden NSA document file – specifically that the NSA has taken its previous programs of spying on pretty much everyone (including Americans) by collecting their cell phone metadata to a new level.  They report that the NSA is actively intercepting both the phone metadata (records of calls to whom by whom from where) AND the call contents, which it stores in a play-back enabled form for up to a month:

The program raises profound questions about the nature and extent of American surveillance abroad. The U.S. intelligence community routinely justifies its massive spying efforts by citing the threats to national security posed by global terrorism and unpredictable rival nations like Russia and Iran. But the NSA documents indicate that SOMALGET has been deployed in the Bahamas to locate “international narcotics traffickers and special-interest alien smugglers” – traditional law-enforcement concerns, but a far cry from derailing terror plots or intercepting weapons of mass destruction.

Part of Greenwald’s reporting is, in keeping with his prior work, to call out the Washington Post, which reported on this program in March, but did not explicitly mention the countries being targeted.  Greenwald and his colleagues pull the veil back a little further, noting the program is active in the Bahamas, Mexico, the Philippines and Kenya.  They also report that the access to the phone systems was gained through a legitimate law enforcement activity, namely the Drug Enforcement Agency’s agreements with those countries governments that allow DEA agents to collect phone information to track suspect drug cartels.

The DEA has long been in a unique position to help the NSA gain backdoor access to foreign phone networks. “DEA has close relationships with foreign government counterparts and vetted foreign partners,” the manager of the NSA’s drug-war efforts reported in a 2004 memo. Indeed, with more than 80 international offices, the DEA is one of the most widely deployed U.S. agencies around the globe.

But what many foreign governments fail to realize is that U.S. drug agents don’t confine themselves to simply fighting narcotics traffickers. “DEA is actually one of the biggest spy operations there is,” says Finn Selander, a former DEA special agent who works with the drug-reform advocacy group Law Enforcement Against Prohibition. “Our mandate is not just drugs. We collect intelligence.”

Greenwald and his colleagues have, therefore succeeded in not just proving the NSA can store whole phone calls, but have made a lie (again) of the fact that US federal law enforcement agencies are NOT part of the massive Security and Surveillance State because they don’t “spy.”

One of the first reactions to this reporting came from Washington Post pundit Erik Wemple, who spent nearly all of his column today highlighting a squabble between the Post, Greenwald and Company, and Wikileaks over whose revelations really serve the public – i.e. who went far enough to help us understand what the real issue is here.  Wemple SEEMS to acknowledge that the Intercept Piece by Greenwald is on a more robust track then the WaPo reporting was:

The Intercept’s partial defiance of the NSA in publishing the names of four countries surely adds contour to the story of MYSTIC — the example of the Bahamas alone fleshes out various legal and diplomatic considerations involved in foreign surveillance. The more careful Washington Post version of the story was interesting yet unsatisfying: Absent a specific country, it was more difficult to reach hard conclusions on the program’s legitimacy, legality and efficacy. Those are the dangers of scaling back detail in consideration of security concerns. When asked if naming just the Bahamas as a way of explaining NSA capabilities would have been a tolerably cautious approach, Washington Post Executive Editor Martin Baron replied, “You make some assumptions here, but I’m not going to address them.”

There are also perils to The Intercept’s approach. It may have touched off a macho-transparentist scramble to out that one country whose secretness The Intercept genuinely wants to protect.

Whatever the outcome, each outlet apparently got the same pitch from the government: “We shared with both news outlets the very same concerns about risks to human life and national security,” says NSA spokeswoman Vanee’ Vines in a statement to this blog.

Of course, as one of Wemple’s more astute commenters noted, raising the issue of an internecine struggle for who got the “outing” right is a way to down play the significance of the additional reporting.

Likewise, David Frum’s column in the latest Atlantic Magazine seeks to divert attention from the real damage that NSA’s action do by trying to refocus readers on the NEED FOR SECRECY that obviates some of the issues Mr. Snowden’s revelations raise.  

Answering such questions is why states maintain intelligence agencies. Awkwardly, however, the very same imperatives that drive states to collect information also require them to deny doing so. These denials matter even when they are not believed.

Of course Frum is better at some in acknowledging that the NSA MAY well get out of line , but he seems to think that mechanisms exist to correct any missteps:

But the implications for national security are especially disturbing. In a world where danger comes as often from substate actors as from competing national governments, democratic governments need more and wider sources of information than before. Of course, the attainment of that information must be governed by law. If the National Security Agency breaks laws, corrective action is called for. But it’s not illegal, according to the most relevant Supreme Court precedent, for U.S. intelligence agencies to collect information on who connects to whom, provided they do not read the contents of messages without securing a warrant first. It’s certainly not illegal for agencies to intercept—and read—messages transmitted outside the United States. Herbert Hoover’s Secretary of State Henry Stimson famously closed the Cipher Bureau on the grounds that “gentlemen do not read other gentlemen’s mail.” Yet as Franklin D. Roosevelt’s secretary of war, Stimson would read decrypted communications with avidity.

I’m not sure what sort of legal corrective mechanism Mr. Frum envisions, but given that:

1) Congress has given the NSA, American telecom companies (AT&T, Verizon) and probably itself retroactive legal immunity for the spying reported by the New York Times as early as 2004; and
2) The Director of National Intelligence willfully lied to Congress, admitted it, and has yet to be prosecuted for it

I seriously doubt that we’ll ever see any legal corrective actions for the NSA’s over reaches.  That aside, the NSA also appears to have been lying about its desire and ability to collect phone calls themselves, which Mr. Greenwald’s and the Post’s reporting makes clear is not a technical issue so much as a data capacity issue (which the Utah Data Center will likely solve).  And again, now that the lies have been exposed, I suspect we’ll see little if any formal sanctions develop.

Where Frum really gets it wrong (aside from his misguided notions that this sort of spying is still in compliance with the Fourth Amendment) is that allowing Americans to know about this sort of spying is some sort abrogation of effective Executive Branch power execution that Protects Americans.  

As we have become safer, we have, in that very human way, increasingly begrudged the means of our safety. The intellectual and political pendulum has swung against national-security agencies—indeed, against the basic requirements of an effective executive branch, which are the same today as when Alexander Hamilton outlined them in “Federalist No. 70” in 1788: “decision, activity, secrecy, and dispatch.” Self-described reformers insist that the present-day U.S. government suffers from too much of these four elements. Since the 1970s, they have achieved great success in shifting government to be less decisive, less active, less secretive, and less able to move quickly—and not only in the domain of national security.

Again, I don’t know what planet Mr. Frum resides on, but “government” – if he means the Federal Executive Branch run by the President – is anything but “less decisive, less active, less secretive, and less able to move quickly.”  That Mr. Snowden had to flee the US after calling his own employers and the NSA to account is prima fascia evidence of that.  Equally importantly, conflating calls for the NSA to stop spying on Americans by hovering up every bit of electronic data they can get about us with equally strident calls to stop the effectiveness of other Executive Branch agencies (NOAA, NASA, HUD and DOT come to mind) just highlights how far we have really fallen in our national discourse.  The federal executive branch can be an effective protector of and advocate for Americans rights without undermining the social contract with those same Americans in the name of SAFETY.

America has one final shot to get this right.  If we don’t then we will be the enemy we used to spy on.  And that would be the most tragic legacy of 9-11.

How the Too Big To Fail Banks are driving America broke while pullingwool over pundits eyes

Like most conservatives in sheep’s clothing, Robert J. Samuelson of the Washington Post appears to be delivering sage advice on the woes of world, and has a handy prescription for their fixing.  Today he pontificates (again) on the fact that America is aging, and this aging is THE driver of government spending, which in turn in A MAJOR CAUSE of our economic woes:

We are locked in a generational war, which will get worse before it gets better. Indeed, it may not get better for a long time. No one wants to admit this, because it’s ugly and unwelcome. Parents are supposed to care for their children, and children are supposed to care for their aging parents. For families, these collective obligations may work. But what makes sense for families doesn’t always succeed for society as a whole. The clash of generations is intensifying.

Sounds frightening!  This, we are told is the reason Detroit is backrupt, this is the driver of ever increasing government spending and debt; This has led to heartfelt but bad decision making by shifty and risk averse decisions:

The explanation for this is politics. For states and localities, benefit cuts affect government workers — a powerful but small group — while at the federal level, it’s all the elderly, a huge group that includes everyone’s parents and grandparents. As a result, the combat has been lopsided. Political leaders of both parties have avoided distasteful choices. Younger Americans have generally been clueless about how shifting demographics threaten their future government services and taxes.

Expect when it isn’t (all about politics or generational warfare).  Take elder care – like many Conservatives Mr. Samuleson is appalled, nay apoplectic, that Social Security, Medicare, and Medicaid account for 44% of total federal spending.  Yet, and slo like other conservatives, he NEGLECTS to tell readers that all three are self-funded from payroll taxes; that Congress regularly reassigns monies collected for these three to the regular federal budget; and that if Congress paid back everything actually owed to these program they’d be solvent indefinitely. Once you understand this – which any  Third Grader with Google could have told Mr. Samuelson – then you understand why these programs have been exempt from deficit reduction talks and mini-bargains up to this point.   For those not yet awake enough to grasp the point – Social Security, Medicare, and Medicaid DO NOT add to the National Debt or the Deficit; they are routinely raided by Congress to make both those things lower.

Rather, the federal deficit is caused by the well documents differences in income tax collection and federal spending on the discretionary side.  Again, remember that in total (including the payroll taxes mentioned above) America’s Exceptional Government only takes in 2/3rds of what it needs to operate.  The rest, which creates the debt by accumulating deficits, is on one big giant monetary credit card.  Conservatives want to pay the credit card off by slashing spending on the Mandatory Expenses (those very same Social Security, Medicare, and Medicaid) whose surpluses have kept deficits (and thus debt) at lower than actual levels for years.  The more sensible approach – until recently the Liberal Approach as well – would be to close tax loopholes in the income tax (and possible raise top end rates) while eliminating the income cap on what can be taxed to support Social Security, Medicare and Medicaid.  I personally include in these reforms the need to get rid of  “Carried Interest” as an income category – this is how investment bankers, high power stock brokers, and financiaers who broke our economy in 2008 pay lower actual tax rates the you and I do as wage earners, even though that “carried interest” is their principle form of income.

And as to Detroit – The pension obligations are not the problem. 

First and foremost, Detroit suffered from an unprecedented loss of public revenue. As I’ve previously reported, this was brought on by many factors. The most obvious of those were the recession and free-trade-related deindustrialization, both of which decimated the city’s manufacturing job base and drove population out of the city. On top of that, the state of Michigan reduced its revenue sharing with the city.

Second, the city and state spent — and is still spending — big money on wasteful corporate subsidies to politically connected private interests. That includes a reaffirmed commitment to spend $283 million — or more than the city’s entire annual budget shortfall — on a new professional hockey arena. Such profligate expenditures have drained revenues out of city coffers.

But perhaps the least discussed factor is the financing cost associated with a series of Wall Street-engineered debt deals back in 2005 and 2006. These schemes crafted by UBS and Bank of America’s Merrill Lynch were supposed to reduce pension fund obligations by using derivatives to try to “synthetically” convert variable-rate interest instruments into fixed-rate contracts.

Like many cities, Detroit got sold down the river by large (Too Big To Fail) banks, on everything from municipal bonds to interest rate swaps that mad the banks big bucks, but left Detroit hurting. 

Current estimates put 1/4^th of the city’s budget shortfall – which has necessitated this bankruptcy filing – squarely in the hands of servicing interest and fees on the interest rate swaps along.  In fact (a set of inconvenient things that, again grade school kids with search engines could help Mr. Samuelson find):

Commissioned by the think tank Demos, the new report out today from former investment banker Wallace Turbeville shows that contrary to the myths about a bloated municipal government overspending on lavish social services, Detroit’s “overall expenses have declined over the last five years” by $419 million thanks to the city “laying off more than 2,350 workers, cutting worker pay, and reducing future healthcare and future benefit accruals for workers.” Today, Turbeville notes that “Detroit has a significantly smaller workforce per capita than comparable cities.” Yet, those draconian cuts still left the city with an annual $198 million shortfall because of three big problems — none of which has anything to do with supposedly greedy public workers and their allegedly overly “generous” pension benefits.

Like it or not, spinning the same, worn out lie doesn’t make it true – and Mr. Samuelson should be ashamed of himself for taking these lies to a national platform.  Someone of his supposed intelligence and moxie would do far better to look at the REAL FACTS, and lead us all to better, more informed judgments about the real causes of a crisis.  Until he and other like him do, our Country is doomed to make the same mistakes we’ve always made in public and government budget policy, and therefore we’re doomed to hurt many of our fellow citizens unnecessarily in the process.

The Great Recession, marketing to women, and economic realities

Three things crossed my virtual desk today that are all related – in spite of what their authors might tell you.  First came a piece in Salon about the numbers of people living in or near government poverty levels;  then a WaPo story analyzing where the economic impacts of tax expenditures (i.e. tax breaks) are concentrated in terms of wage earners;  and finally an unusually cogent column for right of center Jennifer Rubin about how the Republican Party is missing out on woman’s issues in a major way.  To Quote Rubin:

The message that too many women heard from the GOP (and that Democrats exploited) was negative – finger-wagging at contraception and demeaning women in the military (as Rick Santorum did), commenting in outlandish ways about rape and decrying gay marriage. For those women not already in sync with Republicans, it came across as harsh, off-putting and mean spirited. They concluded that the GOP had nothing for them and, if they were single mothers, that Republicans didn’t really approve of them.

The message that focused on entrepreneurs, tax cuts and repealing Obamacare was not that attractive either. Most women don’t own or start businesses. If women were bewildered by Obamacare, they didn’t hear anything meaningful from Republicans about what they could do to reduce health-care costs (of which they, in many cases, were the primary purchaser) or protect them if they changed or lost their job. Considering how rotten the message and the tone, it’s remarkable that Romney won as many single women (31 percent) as he did.

Rubin then goes on to show how many economic issues – which, as the people who are now 40% of the heads of household women tend to pay attention to - Republicans COULD provide leadership on. 

Put it this way: The image of the fiery, ferocious conservative warrior that the right-wing media applauds is precisely the type that turns off women voters who aren’t already die-hard Republicans.

But it’s the substance that matters most of all. Here Republicans would do well to redirect much of their energy aware from a presently insoluble stand-off on taxes and the budget. There is no grand deal in sight, so why belabor the point?

Sounds great right?  There are some Conservative economic policies even I’d get behind, and lest we forget, most of what’s in the Affordable Care Act (Obamacare) is policy proscriptions lifted from publications of the Heritage Foundation – not Think Progress.  Yet, to many of these women, the Republican Party is still a Party of cronyism, designed to aggrandize and protect benefits to those at the top of the economic ladder.

What sort of benefits?  Consider (From the Post’s Tax breaks analysis):

The 10 largest breaks in the U.S. tax code will save taxpayers more than $900 billion this year, with a little more than half the benefits flowing to the richest 20 percent of households, congressional budget analysts said Wednesday.

And the richest 1 percent of households, those with at least $327,000 in annual income, get an especially big haul — about 17 percent of the total savings, according to the report by the Congressional Budget Office.

Stop and think about that for a second.  Ten things in the supposedly 6 foot tall tax code keep $900 Billion in the pockets of Americans that could (at least in theory) have gone to the federal government to fund all sorts of things.  Just doing away with the preferential rates for capital gains (which is where most hedge fund managers hide their incomes) gives you 4 times as much money as the Sequester will take out of federal budgets by 30 September.

According to the CBO, the biggest tax breaks by dollar value this fiscal year are the tax-free treatment of employer-provided health insurance (about $260 billion), preferential rates for dividends and capital gains ($160 billion) and tax-free contributions to retirement savings ($140 billion). Deductions for state and local taxes ($80 billion), mortgage interest ($70 billion) and contributions to charity ($40 billion) are also among the top 10, as is the tax-free treatment of capital gains on assets transferred at death ($50 billion).

All of those breaks primarily benefit wealthy households, according to the CBO. Rounding out the top 10 are three breaks that primarily benefit lower-income households: the tax-free treatment of most Social Security benefits ($35 billion), the child tax credit ($60 billion) and the earned-income tax credit ($60 billion).

Even if you back out the three bottom tier breaks that mostly impact low income wage earners, you are still left with $ 660 Billion.  

How does that stack up?  The current Congressional Budget Office estimate of the FY 2013 deficit is $642 Billion.  You read that right – the top seven tax breaks give back to Americans more money than we need to erase this year’s deficit.  Half of that amount - $330 Billion – go to the top 20% of wage earning households in the US.  And consider that the infamous 1% get $112.2 Billion of those 7 items (which is only slightly more than the total that the Justice Department will spend this year).   

Republicans have been hard at work the last several election cycles to keep these tax breaks – and the historically low rates that go with them – in place no matter what.  Those actions, which can’t be hidden no matter how hard Republicans spin it, are at the heart of why women don’t want to vote for Republicans.  In addition, they are why a whole lot of other Americans don’t want to vote for Republicans, since the outcomes of preserving this structure is a huge increase in people with significantly declining (or never rising) economic status.

Put another way, if you have advocated for policies that support these breaks, you have preserved an economic system that:

• Leaves ½ of American with NO net assets
• Drove UP the decline in wage income in the US (which has been going down for approximately 30 years)
• Created a median income in the U.S. of $34,000 (which is $4000) above the federal poverty standard for a family of 4
• Gave the top 20 wage earners in the US the same amount of income it takes to deliver the entire federal food assistance program (SNAP)

Harsh, I know, but this is where our country is.  This is what Republicans have fought to protect – and this is what Democrats ARE NOW JOINING IN TO KEEP ALIVE.