With Economic Plans, GOP Abandons Middle Class Entirely
I have watched with a truly curious sense of amazement as the Republicans, especially the presidential candidates, have stuck it to the middle class.
What have they been thinking with their tax plans and their relentless pursuit of even greater tax-cut largess for the very wealthiest of Americans? What do they have against the middle class, those who have seen their incomes drop by 4.8 percent this past decade, according to a report in the Wall Street Journal?
The latest Republican proposal made to the Senate’s Gang of 12 “supercommittee” is to lower the tax rate on the top wage earners from 35 percent to 28 percent; this on top of the temporary tax cut that Bush provided. The Republicans propose various revenue increases to help reduce the budget deficit but take them away with this giveaway to the wealthy.
Once again, the middle class is left holding the bag, watching as they get stuck with less take-home pay and more expenses for rent, mortgage, college tuition, basic essentials.
Let’s look at the Republican presidential candidates‘ tax proposals. Governor Perry has proposed a huge tax windfall for those whose income averages over a million dollars. For those millionaires and billionaires, he would give them a $512,733 average tax break! How can that possibly be justified since these wage earners have seen a 385 percent increase in their wealth over the last 20 years?
Perry’s plan would actually see tax rates go up for those who make less that $50,000, according to the Tax Policy Center.
Herman Cain’s pie in the sky 9-9-9 plan would see the poor and middle class lose with a 15.8 percent drop; those families who make the average of $49,445 would see their effective tax rate go from 14.3 percent to 23.8 percent, according to the Tax Policy Center.
The Romney tax plan is more of the same. More tax cuts for the wealthy: 67 percent of his lower capital gains taxes would go to millionaires; 50 percent of the continuation of the Bush tax cuts go to the top 5 percent of wage earners.
The policy prescriptions we are seeing from Republicans as we approach 2012 are coupled with a complete lack of explanation of why it is important to help middle-class families. All their rhetoric is ideological—anti-Washington, anti-government, anti-taxes. They have drunk the Grover Norquist Kool-Aid, even to the detriment of those families struggling to make it in a tough economy.
The benefits go to Wall Street, not Main Street; the analyses of all the tax plans clearly point to giveaways to those top 2 percent of Americans, with the squeeze put on those in the middle.
As they campaign in the next 12 months, the Republicans will find it increasingly difficult to make the case that they stand for hard-working, middle-class families. This could well be their downfall come next November.
By: Peter Fenn, U. S. News and World Report, November 9, 2011
Wall Street Is Still Playing Us For Suckers
As a mere youth, I bought a used car in New York to drive to California to be with the woman of my dreams. Inexplicably, she decided to rush back to New York, so I promptly took the car back to the dealer. He made a shockingly low offer. The car had been in an accident, he explained. The chassis was bent. I was flabbergasted. I had just bought the car from him. If the chassis was bent, it was bent when I bought it. The salesman offered me a take-it-or-leave-it shrug. He probably now works on Wall Street.
That the morality of the used car lot has been adopted by Wall Street is now abundantly clear. Citigroup recently settled a civil complaint in which it was accused of selling mortgage-related investments that it knew were dogs. It was so certain that the investments were the financial equivalent of my used car that it bet against them — heads I win, tails you lose — and even selected the investments themselves, choosing from a cupboard of depleted and exhausted financial instruments. An investment in the Brooklyn Bridge would have been safer.
These investments are known as collateralized debt obligations (CDOs), and they consisted of the sort of mortgage securities that nearly sunk the U.S. financial system. According to federal regulators, they were sold with the full knowledge that they were careening toward worthlessness and that, by deduction, their buyers were patsies. The bank made substantial profits on them. But when the Securities and Exchange Commission decided to act, it got Citigroup to pony up a mere $285 million fine that, to presumed chuckles, will doubtlessly be taken out of petty cash. The bank last quarter reported a profit of $3.8 billion.
Mirth must have turned to guffaws when Citigroup read on. It did not even have to admit guilt — “without admitting or denying” is the language the SEC used — and no single executive was held culpable. The CDOs, apparently, were contrived by no one and sold by no one. There’s a Nobel Prize in something (maybe alchemy) for anyone who can explain how that happened.
The Citigroup settlement is being reviewed by a perplexed U.S. District Court Judge Jed S. Rakoff. Among other things, he wants to know why he should authorize a settlement “in which the SEC alleges a serious securities fraud but the defendant neither admits nor denies wrongdoing.” This is a marvelous question that goes to the heart of the matter. The settlement is itself a CDO, a legal version of a black hole in which next to nothing is disclosed. Why no guilt? Why no guilty people? Why such a non-punishing punishment? The SEC will have to tell it to the judge.
I do not want to be excessively harsh on dear Citigroup. It was not the only one selling smoke. Goldman Sachs and JPMorgan did something similar. In the words of Jesse Eisinger of the online journalistic group ProPublica, “This was the Wall Street business model.” And it was a model permitted and encouraged from the top, by people who became filthy rich from filthy practices and now take umbrage when President Obama calls out their industry for approbation. They should first spend a year in community service and then, if they still feel slighted, denounce Obama.
As for Obama’s government, it has been too gentle with these miscreants. Why not a single major banker has been cuffed and frog-marched to some Financial District Guantanamo is unclear. Why their firms have gotten off with modest fines and non-confession confessions is not clear, either. That, in itself, is a crime.
Somebody has to break this culture. In this sense, Wall Street is no different than the New York Police Department, where it apparently has been customary to fix traffic tickets for friends, family and — almost certainly — the odd person with some cash. When 16 of the alleged ticket-fixers were arraigned last week, hundreds of off-duty cops came to cheer them, denounce the DA and manhandle reporters. Their union took a firm position in defending this behavior. An appalled city awaits firm action by the mayor and police commissioner.
An appalled nation awaits a similar response to what went on in the financial sector. What we would like to see is some version of a public hanging, the appropriate reaction to the breathtaking fleecing of investors. In the end, those investors got their money back.
That’s more than we can say about our lost faith in justice.
By: Richard Cohen, Opinion Writer, The Washington Post, October 31, 2011
If Only GOP Lawmakers Were More Like GOP Voters
I imagine everyone has seen the bumper sticker that says, “Lord, protect us from your followers.” I have an idea for a related sticker that reads, “Republicans, protect us from your elected officials.”
In the existing political landscape, the real problem is not with GOP voters; it’s with GOP policymakers. This isn’t to let the party’s supporters off the hook entirely — they’re the ones who supported and elected the officeholders — but it’s hard to overstate how much more constructive the political process would be if Republican lawmakers in any way reflected the priorities of their own supporters.
Last week, a national poll found that Republican voters broadly support the Democratic jobs agenda — a payroll tax cut, jobs for teachers/first responders, infrastructure investments, and increased taxes on millionaires and billionaires — in some cases by wide margins. This week, Tim Noah noticed this observation can be applied even further.
I’m liking rank-and-file Republicans better and better. Earlier this month we learned that they favor Obama’s plan to tax the rich. Now we learn that a 55 percent majority of them think Wall Street bankers and brokers are “dishonest,” 69 percent think they’re “overpaid,” and 72 percent think they’re “greedy.” Fewer than half (47 percent) have an unfavorable view of the Occupy Wall Street protests. Thirty-three percent either favor them or have no opinion, and 20 percent haven’t heard of them. Also, a majority favor getting rid of the Electoral College and replacing it with a popular vote. After the 2000 election only 41 percent did. Now 53 percent do. How cool is that?
Every one of these positions puts the GOP rank-and-file at odds with their congressional leadership and field of presidential candidates.
I don’t want to exaggerate this too much. The fact remains that the Republican Party is dominated by conservative voters, especially those who participate in primaries and caucuses. I’m not suggesting for a moment that the party’s rank-and-file members are moving to the left.
But the recent poll results are also hard to miss — many if not most GOP voters are perfectly comfortable with plenty of progressive ideas, including tax increases on millionaires and billionaires. It’s starting to look like the party’s rank and file is made up of mainstream conservatives who want their party to help move the country forward.
And yet, when we look to Republican officials in Washington, how many GOP members of Congress are willing to endorse any of these popular measures? Zero. Literally, not even one Republican lawmaker has offered even tacit support for ideas that most GOP voters actually like. In the Senate, a united Republican caucus won’t even allow a vote — won’t even allow a debate — on popular job-creation ideas during a jobs crisis.
If the actions of GOP lawmakers in any way resembled the wishes of GOP voters, our political system wouldn’t be nearly as dysfunctional as it is now.
Congratulations, congressional Republicans. You’re far more extreme than your own supporters.
By: Steve Benen, Washington Monthly Political Animal, October 25, 2011
Why Democratic Strategists Have Begun To Root For Mitt Romney
It wasn’t long ago that conventional wisdom among Democratic strategists handicapped Mitt Romney as President Obama’s toughest potential Republican challenger. But lately there has been a big shift.
In fact, it is becoming clearer and clearer that Mitt Romney is the very embodiment of the political narrative that will likely define the 2012 Presidential race. Unless there is a miracle, the outcome of next year’s election will likely be determined by whom the public blames for the lousy economy.
Of course the Republicans will argue that the culprit is the “overreaching,” “innovation-stifling” big government and its leader, President Obama. Their prescription to solve the country’s economic woes: eliminate every regulation in sight, cut taxes for the wealthy and free Wall Street bankers that lead us into the promised land.
Democrats, on the other hand, will pin the blame exactly where it belongs — on the reckless speculation of the big Wall Street banks, their Republican enablers — and the stagnant middle class incomes that have resulted from the top one percent of Americans siphoning off virtually all of the country’s economic growth since 1980. They will fault the “do-nothing Republican Congress” for their insistence on defending the status quo, and their refusal to create jobs.
Earlier this summer — when Republicans had succeeded in making “fiscal responsibility” and “deficit reduction” the touchstone of American political discourse — a businessman like Romney appeared to many to be just the ticket. But the tide has turned.
Once they got the debt ceiling “hostage taking” episode behind them, the administration has used its jobs package — and its own budget proposals — to draw a sharp line in the sand. The President has demanded that Congress take action on jobs and pay for it by raising taxes on millionaires.
Then came the Occupy Wall Street Movement — and the worldwide response — that has tapped into the public’s fundamental understanding, and anger, at the real nature of the economic crisis. The fact is that one of the only people around more unpopular than politicians are Wall Street bankers.
Finally, of course, the economic facts on the ground have made it clearer and clearer that right wing economic theories that blame “bloated entitlements” to seniors who make an average of $14,000 a year — and demand “fiscal austerity” — are just plain stupid. According to the Washington Post, even the International Monetary Fund (IMF) — long the world’s leading advocate of deficit reduction and “austerity” — has now warned that “austerity may trigger a new recession and is urging countries to look for ways to boost growth.”
As the national economic dialogue has shifted, the public’s view of Mitt Romney has also come into focus. His out-of-touch “1% moments” proliferated.
On August 11, the blog Think Progress captured the now-famous video of Romney opining, “Corporations are people, my friend.” Of course, given his record of dismembering and bankrupting companies at his old firm, Bain Capital, if “corporations are people,” then Romney is guilty of murder.
On August 29th Romney disputed an account about the expansion of his beach front home. “Romney: Beachfront home is being doubled in size, not quadrupled,” The Hill reported.
Then, just a few days ago, the Center for Responsive Politics reported that Wall Street donors had abandoned President Obama in droves and flocked to Romney.
Finally, an extraordinary photo surfaced from Romney’s days as CEO of Bain Capital, where he made massive profits while five of the companies under his firm’s direction went bankrupt and thousands of workers lost their jobs.
Apparently their difficulties in finding places to stash their profits became a joke among the young hotshots at Bain. They posed for a photograph with money stuffed in their pockets — even their mouths. There at the center of the picture was the grinning CEO, Mitt Romney, with money overflowing from his pockets and his suit jacket.
There he is — posing as the poster child for the 1%.
The picture could be the iconic image of the iconic line from the film Wall Street: “Greed is Good.”
Increasingly, many Democratic strategists have begun to feel that Romney could be the best possible opponent for President Obama next year.
Think about the way swing voters make political decisions. They don’t make their judgments about how to vote based on “policies or programs.” They evaluate the personal qualities of the candidates.
In determining who is on their side and shares their values — do swing voters choose Romney — the poster child for the 1% — or President Obama?
In the coming campaign, who is more likely to appear as an insider defending the status quo that people don’t like — and who will appear to be an outsider trying to bring change? Normally you’d have to say that the consummate “insider” is the guy who is President of the United States. Not necessarily so if his opponent is Wall Street’s own Mitt Romney.
And several factors unique to Romney make his situation even worse:
Voters want leaders with strong core values. That’s not a description of Mitt Romney who has flip-flopped on just about every position he’s ever taken in public life. When Karl Rove ran George Bush’s campaign against John Kerry he said that Kerry’s statement that he voted for the War in Iraq before he voted against it was the gift that kept on giving. Rove took a Senator with strong convictions and convinced swing voters that he had none. If Rove could do that to Kerry, think about the easy time Democrats will have in convincing America that Romney’s values shift with the wind.
Voters want to connect emotionally with their leaders. Ask Al Gore how important it is for candidates to “connect” with the voters. Romney has the personality of a statue. He just doesn’t make emotional contact.
Much of the Republican smart money is going to Romney because it thinks he is increasingly likely to be the nominee. I can understand why the Wall Street money is going to Romney — they want their guy to be President.
But I’m guessing that if he gets the nomination, by this time next year, Wall Street’s investment in Romney will look about as “smart” as all that money they put into sub-prime mortgages and credit default swaps four years ago.
Rep. Cantor: Bought And Paid For By Wall Street Investors
Why has Rep. Eric Cantor (R-VA) been “increasingly concerned about the growing mobs occupying Wall Street,” while defending the Tea Party protests as an organic movement?” It’s all about the money.
Rep. Cantor’s campaign committee and leadership PAC have been bankrolled by Wall Street since he was elected in 2000. The financial industry has been his largest contributor, increasing donations to the congressman by 1,326% between the 2002 and 2010 election cycles.
So while Rep. Cantor may believe the Occupy Wall Street movement is “the pitting of Americans against Americans,” the reality is the movement is pitting Americans against his campaign contributors.
Then, of course, there is Rep. Cantor’s wife, Diana, a fixture on Wall Street. Ms. Cantor served as a VP at Goldman Sachs, a Managing Director at New York Private Bank & Trust, and currently is a partner at Alternative Investment Management, LLC – a firm that “invests mainly in hedge funds and private equity funds.”
According to Open Secrets
Thus far in the 2012 election cycle, Rep. Cantor is the second largest recipient of financial industry donations to House members.
In the 2010 election cycle, he was the third largest recipient of Wall Street cash. In fact, ever since his election to Congress, Rep. Cantor has been in the top 16 recipients of financial industry contributions.
Up to now in the 2012 election cycle, five of Rep. Cantor’s top 10 donors to his campaign committee and leadership PAC were in the financial industry.
Rep. Cantor is currently the second largest recipient of Securities and Investment contributions (which includes hedge funds, private equity and venture capital money).
During the 2010 election cycle, six of Rep. Cantor’s top 10 donors to his campaign committee and leadership PAC were from finance related industries.
During the 2010 election cycle he was the fourth largest recipient of Securities and Investment contributions.
By: PR Watch, Center for Media and Democracy, October 18, 2011
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