“Why I Still Support Obamacare”: A Health Care Safety Net Under The Majority Is Morally Right And In The Interest Of A Stable Society
At the recent New York Times forum in Singapore, Eleonora Sharef, a co-founder of HireArt, was explaining what new skills employers were seeking from job applicants, but she really got the audience’s attention when she mentioned that her search firm was recently told by one employer that it wouldn’t look at any applicant for a marketing job who didn’t have at least 2,000 Twitter followers — and the more the better. She didn’t disclose the name of the firm, but she told me that it wasn’t Twitter.
At a meeting with students at Fudan University in Shanghai a few days earlier, I was struck by how anxious some of the Chinese students were about the question: “Am I going to have a job?” If you’re a software engineer in China, you’ll do fine, also a factory worker — but a plain-old college grad? The Times reported earlier this year that in China today “among people in their early 20s, those with a college degree were four times as likely to be unemployed as those with only an elementary school education.”
Stories like these explain why I really hope that Obamacare succeeds. Say what?
Here’s the logic: The Cold War era I grew up in was a world of insulated walls, both geopolitical and economic, so the pace of change was slower — you could work for the same company for 30 years — and because bosses had fewer alternatives, unions had greater leverage. The result was a middle class built on something called a high-wage or a decent-wage medium-skilled job, and the benefits that went with it.
The proliferation of such jobs meant that many people could lead a middle-class lifestyle — with less education and more security — because they didn’t have to compete so directly with either a computer or a machine that could do their jobs faster and better (by far the biggest source of job churn) or against an Indian or Chinese who would do their jobs cheaper. And by a middle-class lifestyle, I don’t mean just scraping by. I mean having status: enough money to buy a house, enjoy some leisure and offer your kids the opportunity to do better than you.
But thanks to the merger of globalization and the I.T. revolution that has unfolded over the last two decades — which is rapidly and radically transforming how knowledge and information are generated, disseminated and collaborated on to create value — “the high-wage, medium-skilled job is over,” says Stefanie Sanford, the chief of global policy and advocacy for the College Board. The only high-wage jobs that will support the kind of middle-class lifestyle of old will be high-skilled ones, requiring a commitment to rigorous education, adaptability and innovation, she added.
But will even this prescription for creating enough jobs with decent middle-class incomes suffice, asks James Manyika, who leads research on economic and technology trends at the McKinsey Global Institute. While these prescriptions are certainly “correct,” notes Manyika, they “may not be enough to solve for the scale and nature of the problem.” The pace of technologically driven productivity growth, he said, suggests that we may not need as many workers to drive equivalent levels of output and G.D.P.
As the M.I.T. economists Erik Brynjolfsson and Andrew McAfee show in their book “Race Against the Machine,” for the last two centuries productivity, median income and employment all rose together. No longer. Now we have record productivity, wealth and innovation, yet median incomes are falling, inequality is rising and high unemployment remains persistent.
To be sure, notes Manyika, a similar thing happened when we introduced technology to agriculture. We did not need as many people to produce food, so everybody shifted to manufacturing. As the same thing happened there, many people shifted to services.
But now, adds Manyika, “a growing share of high-paying services and knowledge work is also falling prey to technology.” And while new companies like Twitter are exciting, they do not employ people with high-paying jobs in large numbers. The economy and the service sector will still offer large numbers of jobs, but many simply may not sustain a true middle-class lifestyle.
As a result, argues Manyika, how we think about “employment” to sustain a middle-class lifestyle may need to expand “to include a broader set of possibilities for generating income” compared with the traditional job, with benefits and a well-grooved career path. To be in the middle class, you may need to consider not only high-skilled jobs, “but also more nontraditional forms of work,” explained Manyika. Work itself may have to be thought of as “a form of entrepreneurship” where you draw on all kinds of assets and skills to generate income.
This could mean leveraging your skills through Task Rabbit, or your car through Uber, or your spare bedroom through AirBnB to add up to a middle-class income.
In the end, this transition we’re going through could prove more exciting than people think, but right now asking large numbers of people to go from being an “employee” to a “work entrepreneur” feels scary and uncertain. Having a national health care safety net under the vast majority of Americans — to ease and enable people to make this transition — is both morally right and in the interest of everyone who wants a stable society.
By: Thomas L. Friedman, Op-Ed Columnist, The New york Times, November 10, 2013
“The Middle Class Doesn’t Write Big Checks”: The Bottom 90 Percent Have Disappeared And Have No Voice In Washington
So how to explain this paradox?
As of November 1 more than 47 million Americans have lost some or all of their food stamp benefits. House Republicans are pushing for further cuts. If the sequester isn’t stopped everything else poor and working-class Americans depend on will be further squeezed.
We’re not talking about a small sliver of America here. Half of all children get food stamps at some point during their childhood. Half of all adults get them sometime between ages 18 and 65. Many employers – including the nation’s largest, Walmart – now pay so little that food stamps are necessary in order to keep food on the family table, and other forms of assistance are required to keep a roof overhead.
The larger reality is that most Americans are still living in the Great Recession. Median household income continues to drop. In last week’s Washington Post-ABC poll, 75 percent rated the state of the economy as “negative” or “poor.”
So why is Washington whacking safety nets and services that a large portion of Americans need, when we still very much need them?
It’s easy to blame Republicans and the rightwing billionaires that bankroll them, and their unceasing demonization of “big government” as well as deficits. But Democrats in Washington bear some of the responsibility. In last year’s fiscal cliff debate neither party pushed to extend the payroll tax holiday or find other ways to help the working middle class and poor.
Here’s a clue: A new survey of families in the top 10 percent of net worth (done by the American Affluence Research Center) shows they’re feeling better than they’ve felt since 2007, before the Great Recession.
It’s not just that the top 10 percent have jobs and their wages are rising. The top 10 percent also owns 80 percent of the stock market. And the stock market is up a whopping 24 percent this year.
The stock market is up even though most Americans are down for two big reasons.
First, businesses are busily handing their cash back to their shareholders – buying back their stock and thereby boosting share prices – rather than using the cash to expand and hire. It makes no sense to expand and hire when most Americans don’t have the money to buy.
The S&P 500 “Buyback Index,” which measures the 100 stocks with the highest buyback ratios, has surged 40 percent this year, compared with a 24% rally for the S&P 500.
IBM has just approved another $15 billion for share buybacks on top of about $5.6 billion it set aside previously, thereby boosting its share prices even though business is sluggish. In April, Apple announced a $50 billion increase in buybacks plus a 15% rise in dividends, but even this wasn’t enough for multi-billionaire Carl Icahn, who’s now demanding that Apple use more of its $170 billion cash stash to buy back its stock and make Ichan even richer.
Big corporations can also borrow at rock-bottom rates these days in order to buy back even more of their stock — courtesy of the Fed’s $85 billion a month bond-buying program. (Ichan also wants Apple to borrow $150 billion at 3 percent interest, in order to buy back more stock and further enrich himself.)
The second big reason why shares are up while most Americans are down is corporations continue to find new ways to boost profits and share prices by cutting their labor costs – substituting software for people, cutting wages and benefits, andpiling more responsibilities on each of the employees that remain.
Neither of these two strategies – buying back stock and paring payrolls – can be sustained over the long run (so you have every right to worry about another Wall Street bubble). They don’t improve a company’s products or customer service.
But in an era of sluggish sales – when the vast American middle class lacks the purchasing power to keep the economy going – these two strategies at least keep shareholders happy. And that means they keep the top 10 percent happy.
Congress, meanwhile, doesn’t know much about the bottom 90 percent. The top 10 percent provide almost all campaign contributions and funding of “independent” ads.
Moreover, just about all members of Congress are drawn from the same top 10 percent – as are almost all their friends and associates, and even the media who report on them.
Get it? The bottom 90 percent of Americans — most of whom are still suffering from the Great Recession, most of whom have been on a downward escalator for decades — have disappeared from official Washington.
By: Robert Reich, RobertReich.org, Published in Salon, November 1, 2013
“Casting Aside The Weak And Fragile”: Cuts To Food Stamp Program Reveal Congressional Hypocrisy
For decades, I’ve proudly asserted that “nobody starves to death in America.” The comment has been addressed to acerbic critics of the American government, often foreign visitors, who insist that the United States is a mean-spirited place that casts aside its weak and fragile citizens.
I still contend that nobody starves to death here, but I’ve had to modify my claims about the country’s social safety net. Even if no one dies for lack of basic nutrition, plenty of people go to bed hungry every night. And if Congress’ harsh Republican caucus has its way, some may starve.
That’s because the band of ultraconservatives who control the House are bent on deep cuts to the Supplemental Nutrition Assistance Program (SNAP), otherwise known as food stamps. They passed a farm bill laden with welfare for farmers, but they left out one of its biggest traditional components: food stamps. It was the first time since 1973 that the nutrition program had been left out of the farm bill.
Now, negotiations have started between the Senate and the House to try to reconcile the upper chamber’s more charitable version with the one the lower chamber put together. It will be a tough slog since the two bills are billions of dollars apart. The Senate wants to cut $4 billion from SNAP over 10 years, while the House wants to cut nearly $40 billion.
Perhaps the most appalling thing about the farm bill presented by the ultraconservatives in the House is that it makes little pretense of cutting spending by ferreting out wastefulness or fraud, no feint at an all-out assault on the deficit. Instead, this is just a base and ugly assault on the working poor.
Oh, conservatives claimed that their cuts to food stamps were in response to fraud, as their claque filled the airwaves with the same example of a carefree California surfer enjoying his “wonderful” life on food stamps. They neglected to point to government data which show that SNAP is among the most efficient of government programs, with fraudulent spending restricted to about 2 percent of its budget.
Meanwhile, the same conservatives have said nothing — nothing — about the millions of dollars in fraud related to farm subsidies. A June audit by the Government Accountability Office found that millions of dollars in subsidies have been sent to farmers who’ve been dead for at least a year. That’s just the illegal stuff.
That doesn’t touch the entirely legal fraud: The entire network of agricultural subsidies is a massive boondoggle, welfare to people who hardly need it. While conservatives hector the working poor about their alleged laziness, some agricultural programs pay farmers not to plant. Why don’t Fox News and Rush Limbaugh ever talk about that?
Farmers hardly need the money. (Forget about the struggling family farmer of lore. He has largely disappeared.) Earlier this year, the Agriculture Department projected that farm income in 2013 would be $128.2 billion, the highest since 1973.
One of the more egregious examples of the sheer hypocrisy surrounding the debate over the farm bill was revealed by The New York Times, which wrote about U.S. Rep. Stephen Fincher (R-TN). He voted for the bill that eviscerates SNAP, but he received nearly $3.5 million in farm subsidies from the government between 1999 and 2012, according to the Times.
“We have to remember there is not a big printing press in Washington that continually prints money over and over,” he said, apparently without irony.
Conservatives claim to be alarmed by the dramatic increase in food stamp outlays, up 77 percent since 2007 to a record high of $78.5 billion in fiscal year 2012. (The SNAP program is already scheduled for a 5 percent cut as a provision related to the 2009 stimulus bill lapses.) But that’s because so many more people are struggling to make ends meet.
The Great Recession accelerated a trend that has hollowed out the middle class, leaving many Americans without college degrees in a downward spiral. The U.S. Department of Agriculture estimates that nearly 49 million Americans are “food insecure” — bureaucratese that means they don’t have enough to eat.
If we aren’t willing to see to it that they have basic nutrition, I’ll have to reconsider what I believe about my country.
By: Cynthia Tucker, The National Memo, November 2, 2013
“A Very Low Bar”: How A Crazy Senator Became A Sudden Darling Of The So-Called Respectable Right
Fanfare! Trumpets! There has been a Big Important Speech on the Future of Conservatism. Let’s take it Really Seriously. Sen. Mike Lee, Republican of Utah, went to the Heritage Foundation Tuesday and spoke. Milton Friedman and Irving Kristol were namechecked! Russell Kirk was quoted! The gas tax was proposed to be slashed 80 percent! Oh wait, I am supposed to still be mentioning the Serious parts.
I shouldn’t make fun, maybe. There are serious parts. Lee’s concern for “immobility among the poor,” the middle-class squeeze, and “cronyist privilege at the top,” and his desire to fashion a conservative response to them, is the right note for a Republican senator to strike. Amen to calls for “a new conservatism of the working and middle class,” because either we will get one or the failed attempt to give us one will prove it to be a contradiction in terms. Conservative intellectuals of a reformist bent welcomed the speech—Ross Douthat, Reihan Salam (they co-wrote a book on these themes), Rich Lowry, Jennifer Rubin. BuzzFeed political editor McKay Coppins called it a “lofty, agenda-setting speech” for its ringing declaration, “frustration is not a platform. Anger is not an agenda. And outrage, as a habit, is not even conservative” and for its forceful denunciation of the House Republicans’ sociopathic shutdown tactic, which futilely damaged the U.S. economy and very nearly caused the federal government to default—a narrowly evaded catastrophe.
Except, of course, Lee didn’t do that last thing. Lee was pro-shutdown! Other than Ted Cruz, he was probably the House Republicans’ most important ally in the Senate. And he did not denounce—or, in his case, repudiate—the shutdown tactics. So now you see why I couldn’t help but make fun.
I suppose if we set the bar low enough that insects can do the limbo with it, you could read his speech as endorsing a less insane way forward. But here is what happened Tuesday: One of Washington’s most staunchly pro-shutdown politicians, appearing at maybe Washington’s most important pro-shutdown organization, pointedly refused to condemn the shutdown or suggest he would not support a future shutdown if it meant trying to repeal the Affordable Care Act, a.k.a. Obamacare.
On the contrary, Lee said, “I am proud of my friend Ted Cruz and the dozens of others—including Speaker John Boehner and the House Republicans—who fought Obamacare, continue to fight it, and will not stop fighting it.” At the outset, he narrated, “It began with our effort to stop Obamacare—a goal that all Republicans share even if we have not always agreed about just how to pursue it.” Absent a declaration that he no longer agrees with how he pursued it, one is forced to conclude that he feels the same way now. Douthat, Salam, and Lowry do not mention this.
There is a broader point here. If I ever found the bulk of my political views articulated by somebody whose most prominent action ever—undertaken in the past month and unrepudiated—was as grotesquely irresponsible as what Cruz, Lee, and the House Republicans put us through, it would cause me to question my views. I would reflect upon the fact that Lee and I share these beliefs, and that he logically extends them toward something totally self-destructive and crazy. I would have to conclude either that he is correct to do this, and therefore that my views must be wrong and that I must change them, or that he is not worth listening to, because he takes perfectly good ideas and warps them into something powerfully hazardous. There is apparently no such reckoning among the right’s respectable intellectuals—most of whom did oppose the shutdown itself, and not only for pragmatic reasons.
But in the meantime, let’s stick to the matter at hand. Can’t all reasonable people agree to ignore Mike Lee completely until he says he was wrong about the shutdown? Should this be a controversial suggestion? Given the gravity of the threat of a future shutdown, isn’t that the only responsible response?
Salam highlights several promising policy sketches that Lee offered; and truly, it is hard not to appreciate a Republican concerned with work-life balance issues. But Salam and the others misrepresent Lee—who, Salam notes, holds a relatively safe seat, and so presumably may speak his mind. Giving parents greater flexibility isn’t Lee’s foremost priority. According to Lee, “The first and most important policy goal Republicans must adopt to improve the lives of middle-class families is, and will remain, the full repeal of Obamacare.” How? Again, we have no choice but to presume that Lee believes that a legitimate tactic for repealing Obamacare is, and will remain, shutting down the government and threatening its default. How about we hear Lee out, and maybe even talk to him, sometime after he puts his gun away.
By: Marc Tracy, The New Republic, October 30, 2013
“Up To His Eyeballs In Alligators:” Mitch McConnell Flirts With The Tea Party Crazies On The Debt Ceiling
Sen. Mitch McConnell is so up to his eyeballs in alligators, he’s long since forgot about cleaning the swamp.
No question the senator hears the steady, galloping horses from the tea party extremists closing fast. To be sure, he faces a tough general election against Kentycky Secretary of State Alison Lundergan Grimes – some polls even show him behind. But before he gets to next November he faces the threat of a challenge from within his own party. Wealthy tea party candidate Matt Bevin is definitely nipping at his heals.
Maybe that is why McConnell is showing signs of joining the “crazy caucus” – that large band of Republicans who are ready to see a default on the debt, a shutdown of the government, a continuation of the sequester and the defunding of Obamacare – and by virtue of such insane policies, an economic meltdown.
They profess to be worried about the deficit and spending yet their policies so far, and their future plans, would see drastic reductions in tax revenue as they stall the recovery, put more people out of work and send us back into a recession.
Bad politics, bad economics and bad for America’s middle class.
Yesterday, McConnell expressed the need to use the debt for “leverage” against Obama. “It’s a hostage worth ransoming,” McConnell has said. He embraced the tea party call for not raising the debt limit and watching America default. Sorry – been there, done that, didn’t work.
Maybe the Republicans should follow the example of their hero, President Reagan.
Here is what Ronald Reagan wrote to Congress when it came to raising the debt ceiling in 1983:
The full consequences of a default – or even the serious prospect of default – by the United States are impossible to predict and awesome to contemplate. Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and the value of the dollar in exchange markets. The Nation can ill afford to allow such a result. The risks, the costs, the disruptions, and the incalculable damage lead me to but one conclusion: the Senate must pass this legislation before the Congress adjourns.
Reagan, after all, raised the debt ceiling 18 times.
So, let’s play this out. If McConnell is so intent on joining the tea party in their efforts what is he risking if Obama calls the bluff of the “crazy caucus”? The full weight of responsible economists, editorial writers, business leaders, reasonable elected officials would come crashing down on him. As the minority leader in the Senate he would not be the engineer of a compromise but rather the creator of chaos.
The crazy caucus would become the chaos caucus, led by Mitch McConnell.
In short, he would have drunk the Kool-Aid and end up paying for it at the ballot box. He would be loudly criticized as the man who allowed what Reagan warned against to become a reality. Some legacy.
My guess is that President Obama has had about enough from the threats, the in-your-face tactics of the tea party. He’ll put his foot down, not be intimidated and let the chips fall.
And if I were betting, the Republican “crazy caucus” would morph rather quickly into the “suicide caucus.” And Mitch McConnell would be part of the carnage.
By: Peter Fenn, U. S. News and World Report, September 18, 2013
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