Thursday, December 31, 2009

Republicans In League with Lobbyists to Weaken Health Care Reform

Original Link: http://www.huffingtonpost.com/david-latt/republicans-in-league-wit_b_403942.html

By David Latt

Liberal bloggers have attacked the health care reform bill now in the conference committee. The all-but-eliminated-public option, the proposed taxes on so-called Cadillac health plans won by union workers over years of difficult labor negotiations, the attack on abortion rights, the lack of restraints of insurance company fees, the rejection of competition in drug pricing, all these and many more failings in the bill have been railed against on this site and others.

The amount of money spent by lobbyists on the campaign to influence the health care debate has been enormous. Their successes would appear to be the direct result of a massive PR campaign combined with seemingly unlimited political donations.

There is no doubt that health care reform has been weakened by these pressures. But let's not forget that in the end more Americans will be covered by health care and egregious practices such as being denied health care coverage because of a previous medical condition will have been ended.

Unfortunately, notwithstanding the tremendous efforts by the President and the Democratic leadership, the resulting bill will create a health care system as ugly and absurd as a gerrymandered Congressional district.

The blame for these defeats invariably is placed on the Democrat's lack of will in facing up to lobbyists. President Obama too is attacked for not sticking to his principles and caving in to special interests and big campaign donors.

I think there are failings a plenty on that side of the aisle, but let's not forget that the Republicans have entirely removed themselves from this process. The mealy mouthed Mitch McConnell, leader of the Senate Republicans, and his disingenuous side-kick in the House, Eric Cantor, have played the spoiler role. Offering up only the most cynical counter-proposals, they have stayed on the side-lines hectoring the effort.

Without a legitimate, elected opposition engaged in the process, lobbyists gained undue power. Did the Republican Party make a backroom deal with the lobbyists? Whether or not it was done covertly, the lobbyists did the Republican Party's dirty work.

Republicans opened the door to the lobbyists and they rushed in. If liberal bloggers want to attack the process, put the Republican leadership into their sights.

The Cash Committee: How Wall Street Wins On The Hill

Original Link: http://www.huffingtonpost.com/2009/12/29/the-cash-committee-how-wa_n_402373.html

By Ryan Grim and Arthur Delaney

The question was simple: Should the lending practices of auto dealers be regulated?

It was already October and the 42 Democrats and 29 Republicans on the House Committee on Financial Services had spent the better part of the year hashing out the details of a new federal agency dedicated to protecting consumers from dangerous and deceptive financial products.

Auto dealers seemed like an obvious target for the new agency; nearly every time someone buys a car, the dealer also sells them an auto loan, complete with promises like zero per cent interest and a pile of cash back. Americans hold some $850 billion in car debt and dealers are responsible for marketing roughly four-fifths of that amount. They pocket lucrative commissions with little oversight, and the committee seemed poised to change that.

Enter Rep. John Campbell (R-Calif.), a former Saab dealer from Orange County, who according to his latest financial disclosure statement still collects rent from some of his former auto dealer colleagues. Campbell downplayed the importance of his industry partners and proposed an amendment to the bill exempting dealers from the new agency's purview. On October 22, it came up for a vote.

As usual, the members filed into the high-ceilinged first-floor hearing room in the Rayburn House Office Building. Committee Chairman Barney Frank oversaw the vote atop four tiered rows of seats, a full story above the witnesses and the audience. The longest-serving Democratic members of the panel -- informally known as the banking committee -- sat to the right or just below the chairman; it can take years, if not decades, for a freshman representative to ascend up the risers.

The clerk called the roll, starting from the top. Senior Democrats roundly rejected Campbell's amendment. It appeared as if the Democrats would beat back the effort and apply the same standard to car dealers that was applied to everyone else.

Then came the bottom two rows, the place where reform goes to die. Despite the disapproval of the powerful chairman and nearly every consumer group in the country, the Campbell amendment passed by a 47-21 margin.

Gen. Eaton: Dick Cheney Was "Incompetent War Fighter"

Original Link: http://www.nsnetwork.org/node/1442

Today, National Security Network Senior Adviser Gen. Paul Eaton (Ret.), who served more than 30 years in the United States Army and from 2003-2004 oversaw the training of the Iraqi military, responded to Dick Cheney's accusations on Afghanistan from last night:

"The record is clear: Dick Cheney and the Bush administration were incompetent war fighters. They ignored Afghanistan for 7 years with a crude approach to counter-insurgency warfare best illustrated by: 1. Deny it. 2. Ignore it. 3. Bomb it. While our intelligence agencies called the region the greatest threat to America, the Bush White House under-resourced our military efforts, shifted attention to Iraq, and failed to bring to justice the masterminds of September 11.

"The only time Cheney and his cabal of foreign policy 'experts' have anything to say is when they feel compelled to protect this failed legacy. While President Obama is tasked with cleaning up the considerable mess they left behind, they continue to defend torture or rewrite a legacy of indifference on Afghanistan. Simply put, Mr. Cheney sees history throughout extremely myopic and partisan eyes.

"As one deeply invested in the Armed Forces of this country, I am grateful for the senior military commanders assigned to leading this fight and the men and women fighting on the ground. But I dismiss men like Cheney who inject partisan politics into the profound deliberations our Commander-in-Chief and commanders on the ground are having to develop a cohesive and comprehensive strategy, bringing to bear the economic and diplomatic as well as the military power, for Afghanistan -- something Bush, Cheney and Rumsfeld never did.

"No human endeavor can be as profound as sending a nation's youth to war. I am very happy to see serious men and women working hard to get it right."

Tuesday, December 29, 2009

Blue Cross Blue Shield Lobbyists Quietly Helping Extreme Effort To Declare Health Reform Unconstitutional

Original Link: http://thinkprogress.org/2009/12/05/bcbs-alec-health/

By Lee Fang

ThinkProgess has documented how the private health insurance industry is waging a duplicitous, “two-faced” campaign to kill health reform. Because the industry understands that the public views it in a largely negative light, the industry presents itself as proactively working hand-in-hand with legislators to produce reform. However, behind the scenes, the industry is coordinating a massive effort to kill all reform — employing attacks from front groups, allied politicians, think tanks, lobbyists, and right-wing media.

The Blue Cross Blue Shield Association, which is a lobbying group representing 39 independent Blue Cross and Blue Shield Plans, is also engaged in this two-faced campaign. Like most of industry, the BCBS Association says it fully supports the concept of health reform, but continually demands drastic changes to the bills in Congress. Some have begun to question the BCBS Association’s claim of support given its new study attacking reform legislation in the Senate. The criticism of BCBS is bolstered by a new revelation that BCBS Association lobbyists are helping to orchestrate a right-wing movement to invalidate all of health reform.

Yesterday, the BCBS Association released yet another industry-sponsored study to distort health reform and falsely claim that premiums will skyrocket because of the legislation. However, the nonpartisan CBO reported earlier this week that under the Senate health reform bill, “most Americans would pay the same or less in premiums.” A New York Times editorial yesterday criticized BCBS Association’s study, and noted correctly that it is yet another example of the private insurance industry doing whatever it can to frighten Americans.

But while the study certainly damages BCBS’ credibility, BCBS is involved in another anti-health reform ploy that they do not bother to promote on the BCBS website. The American Legislative Exchange Council (ALEC), founded in 1973 by conservative activist Paul Weyrich, is a DC-based front group which helps state lawmakers craft corporate-friendly legislation. As the Atlantic has noted, ALEC developed template health care “states’ rights,” legislation to declare aspects of health reform unconstitutional. ALEC has promoted this “tenther” legislation using its network of mostly far right Republican state lawmakers. The bills, which have been adopted in some form in 24 states so far, aim to invalidate federal regulations of health insurance, the public option and the individual mandate using the Tenther Amendment.

According to the ALEC website, the resolution was developed by a three member task force of industry representatives. One of the of the members is Joan Gardner, who is executive director of state services with the BCBS Association’s Office of Policy and Representation. In an interview with ThinkProgress, Christie Herrera, the director of ALEC’s health task force, confirmed that Gardner played a pivotal role in crafting this anti-health reform states’ rights initiative. Herrera told us that Gardner’s unique position at the BCBS Association brought “great knowledge” to the issue, and that Gardner voted to press forward with the campaign.

Part of the reason the BCBS Association has claimed that it opposes the reform bill in its current form is because of what it perceives as a weak individual mandate. However, the BCBS Association-supported ALEC campaign depicts the very notion of an individual mandate as “anti-freedom.” So either way the Senate acts, BCBS will be able to trash the bill and try to kill reform.

Private insurers have already been caught using a stealth lobbying firm to send employees to rowdy town halls (and radical tea party events), sharing lobbyists with slash-and-burn anti-health reform attack groups, and paying a number of conservative pundits who regularly appear in major media outlets to slam health reform. Now that it is clear that BCBS helped write the script for the radical tenther movement, any claim that the industry supports reform must be viewed with heightened skepticism.

Health Care Industry Coordinating Effort To Opt States Out Of Health Care Reform

Original Link: http://thinkprogress.org/2009/12/29/health-sector-state-opt/

By Igor Volsky

As Congress prepares to pass the final health care reform legislation early next year, health care lobbyists are mobilizing legislatures in approximately 14 states to ratify constitutional amendments that would repeal all or parts of the new measure. “The states where the amendment has been introduced are also places where the health care industry has spent heavily on political contributions,” the New York Times notes:

Over the last six years, health care interests have spent $394 million on contributions in states around the country; about $73 million of that went to those 14 states. Of that, health insurance companies spent $18.2 million.

Overall, at least 21 states have indicated a desire to opt out of federal health care reform or block fundamental features of the reform bill, including mandatory health coverage. While Arizona, is the only state legislature to place an opt-out measure on the 2010 ballot, a significant number of gubernatorial and state legislature candidates across the country have also said that they are strongly “leaning towards” opting out of reform.

Lawmakers in Wyoming, New Mexico, Montana, Kansas, Texas, Pennsylvania, Utah, Virginia, Arizona, Alabama, Michigan, Missouri, Ohio, West Virginia, Louisiana, Alaska, Minnesota, North Dakota, Georgia Illinois and Florida have introduced ballot measures to protect their states from reform legislation or promised to spearhead such efforts if reform is enacted.

While it’s unlikely that conservatives and their health care industry allies could repeal health care reform, (they are more likely to water-down certain elements of reform), a successful challenge would devastate the populations suffering from the most pronounced health care crisis. A back-of-the envelope analysis conducted by ThinkProgress suggests that on average, the repealing states have experienced very substantial premium increases, high rates of uninsurance and annual percent growth in health care expenditures and higher insurance market concentration:

- 42% (9 of 21): have an uninsurance rate higher than the national average of 15.4%.

- 62% (13 of 21): have an average annual percent growth in health care expenditures that his higher than the national average of 6.7%.

- 62% (13 of 21): experienced premium increases of more than 75% between 2000 and 2007.

- 90% (19 of 21): are dominated by two insurers that control more than 50% of the health insurance market.

The effort to repeal health care reform “began at the conservative Goldwater Institute in Arizona” and was latter “picked up by the American Legislative Exchange Council [ALEC], a business-friendly conservative group that coordinates activity among statehouses.” As the New York Times points out, “five of the 24 members of its ‘free enterprise board’ are executives of drug companies and its health care ‘task force’ is overseen in part by a four-member panel composed of government-relations officials for the Blue Cross and Blue Shield Association of insurers, the medical company Johnson & Johnson and the drug makers Bayer and Hoffmann-La Roche.”

Earlier this month, Lee Fang reported that Joan Gardner, executive director of state services with the BCBS Association’s Office of Policy and Representation and a member of ALEC’s ‘task force’ “played a pivotal role in crafting this anti-health reform states’ rights initiative.”

Sunday, December 27, 2009

The rise of the filibuster: An interview with Barbara Sinclair

Original Link: http://voices.washingtonpost.com/ezra-klein/2009/12/the_right_of_the_filibuster_an.html

By Ezra Klein

Barbara Sinclair is a political scientist at UCLA who specializes in Congress. She's also one of relatively few scholars to have quantified the rise in the filibuster over the previous few decades.

You've published a study showing that about eight percent of major bills in the 1960s faced filibusters or filibuster threats and 70 percent of bills in the current decade did the same. Tell me a bit about the methodology.

My definition of major legislation is as follows: the things that CQ lists as "legislation to watch." It used to be called "major legislation." in addition, bills that had what CQ called "key votes."

That's an agenda with about 40 to 60 pieces of legislation per Congress. It's not naming post offices, but it's not just Medicare either. I've been gathering this data over time, and I select Congresses and do a case study of each bill. The way in which I get those figures on the percentage of major measures that ran into some kind of extended debate problem is really from reading what various sources write about these bills, from CQ to the New York Times to the Congressional Record. I don't just look at cloture votes.

Because you're looking also at threatened filibusters?

Right, so if people put a hold on a bill. Or if the bill isn't brought up due to the threat of a filibuster.

And is there a particular moment where the filibusters accelerate? Or is the rise gradual?

It's gradual, to some extent. But in terms of its impact on legislation, it really has a big impact from the first Clinton Congress on. If one can say there's a break point, that's where filibusters become a regularly used partisan tool.

Previously, the filibuster frequently had some partisan element, but you'd have a lot of cases where individuals or small groups would hold them. But now it's much more a tool of the minority party. And the minority party is organized and relatively large, even when it's small by our standards. Forty Republicans is as small as it's been in a long, long time. That still means if you really get the minority to hang together, everyone on the other side becomes key.

Which is how you get the process we just saw, where Lieberman and Nelson and others become absolutely must-have, can't-lose votes.

And that means it's an invitation to extortion.

What's the story that you tell your students, or that political scientists tell their students, about the rise of the filibuster? Why did it happen?

It's not a simple story. in the more recent period in the 90s and on, it does have to do with partisan polarization. You have two fairly distinct and ideologically distinct parties. For example, one could make the argument that the first time it became official policy on the part of the minority party to use extended debate to deprive the majority of real victories was that first Clinton Congress.And then the Senate Republicans not only didn't pay a price, but they ended up gaining control. Then combine that with the fact that in a more polarized country, is harder to come up with deals that both the majority and minority think is better than the status quo.

So part of it is polarization, but part of it, you're saying, was a strategic realization that the American people do not reward the majority if it fails to deliver on its promises, and the minority recognized it had the power to keep the majority from delivering on its promises.

That's right, and we're seeing the result. It seems pretty clear that at some point early in this Congress, the Republicans really did decide their best approach was to bring Obama and the Democrats down. It is hard to make yourself popular, but to make the other guys look incompetent is not that difficult, and it worked for the Republicans in the first Clinton Congress, and the Republicans would argue the Democrats used these techniques as well.

What about filibuster reform? What's your assessment of the chances for that sort of project?

This goes way, way back. During all those years that the Southern Democrats were blocking civil rights legislation, every Congress began with liberal Democrats trying to change the filibuster rule and not getting anywhere. You do get a change in 1975, but part of why that was possible was the big Civil Rights stuff was off the table.

Technically, the rules made cutting off debate easier, because now it only required 60 votes rather than 67. But in reality, you had to do it more often. There was less restraint. The underlying cause is that the Senate -- our whole political system, really -- changed, and opened up in many ways. There were all kinds of ways that you could become a really big player through being partially outer-directed -- aiming yourself at the media and interest groups and the like. It was less necessary to simply be on really good terms with the most senior members of the Senate.

Saturday, December 26, 2009

Two tax votes reveal Republican priorities

Original Link: http://www.bleedingheartland.com/diary/3459/two-tax-votes-reveal-republican-priorities

By desmoinesdem

The House of Representatives approved the Tax Extenders Act of 2009 on Wednesday by a vote of 241 to 181. As you can see from the roll call, all but ten Democrats voted for the bill, including Iowa's Bruce Braley, Dave Loebsack and Leonard Boswell. All but two Republicans voted against it, including Iowa's Tom Latham and Steve King. After the jump I've posted more details about the business tax credits that would be extended if this bill becomes law.
On December 3, the House passed the Permanent Estate Tax Relief for Families Farmers and Small Businesses Act, which caps the estate tax at 45 percent and exempts estates worth up to $3.5 million (preserving this tax at 2009 levels). Again, all of Iowa's Democrats voted for the bill. Iowa's Republicans voted against it. If Congress had not acted, the estate tax would have been repealed in 2010 and then would have reverted to its 2001 level in 2011 (a 55 percent tax on estates valued above $1 million).

Republicans claim the so-called "death tax" is a burden to small business owners and farmers. Candidate Jim Gibbons already used this canard in a press release targeting Boswell. Right-wingers can't find any real-world families who had to sell the farm because of the estate tax. The Center on Budget and Policy Priorities has concluded (emphasis added),

If the 2009 estate tax rules are extended, only 100 small business and farm estates in the entire nation will owe any estate tax at all in 2011, according to the new estimates by the Tax Policy Center, and virtually none of those businesses and farms would have to be sold to pay the tax. [...]
Under 2009 law, the estates of more than 997 of every 1,000 people who die will owe no estate tax whatsoever. [...] In its latest analysis, the Tax Policy Center projects that only 0.25 percent of the estates of people who die in 2011 - i.e., the estates of 1 of every 400 people who die - will be subject to the estate tax if the 2009 estate tax rules are continued.

Less than 1 percent of estates in Iowa were subject to the estate tax in recent years.

To sum up: Republicans are for saving farmers and small business owners from the so-called "death tax" that doesn't apply to them. But when they had a chance on Wednesday to extend tax credits affecting farms and small businesses, House Republicans said no.

Why am I not surprised?

desmoinesdem :: Two tax votes reveal Republican priorities
Provisions in the Tax Extenders Act of 2009, approved by the U.S. House on December 9, 2009 (excerpt from a Democratic Congressional Campaign Committee press release):

The measure provides $17.8 billion in business tax relief.
The measure extends the research and experimentation (R&E) tax credit for another year, encouraging businesses to increase investments in technology and create more high-tech jobs for the twenty-first century.

It helps American businesses create jobs here at home and supports American competitiveness by extending the R&D tax credit for nearly 11,000 corporations and the special rules for active financing income.

Approximately 70% or more of the benefits of the R&D tax credit are attributable to salaries of workers performing U.S. based research and the credit stimulates American made innovation in all 50 states.

It increases to $350,000 the amount of investments that small businesses in a disaster area can expense in the year. It also raises to $1.4 million the amount of investment used to determine when the ability to use the expensing rules begins to phase out, thus allowing a greater number of businesses to qualify for the rules.

From a press release Congressman Loebsack's office released on December 9:

· Extension of the State and Local General Taxes Deduction. The bill would extend for one year (through 2010) the election to take an itemized deduction for State and local general sales taxes in lieu of the itemized deduction permitted for State and local income taxes.
· Extension of the Deductions for College Tuition. The bill would extend for one year (through 2010) the above-the-line tax deduction for qualified education expenses.

· Extension of the Deduction for Classroom Expenses for Teachers. The bill would extend for one year (through 2010) the $250 above-the-line tax deduction for teachers and other school professionals for expenses paid or incurred for books, supplies (other than non-athletic supplies for courses of instruction in health or physical education), computer equipment (including related software and service), other equipment, and supplementary materials used by the educator in the classroom.

· Extension of the Research and Development Credit for Business. The bill would extend for one year (through 2010) the research credit.

· Extension of Depreciation for Farming Business Machinery and Equipment. The bill would extend for one year (through 2010) the provision that provides a five-year recovery period for certain machinery and equipment which is used in a farming business.

· Extension of Tax Incentives for Biodiesel and Renewable Diesel. The bill would extend for one year (through 2010) the $1.00 per gallon production tax credit for biodiesel and the small agri-biodiesel producer credit of 10 cents per gallon. The bill would also extend for one year (through 2010) the $1.00 per gallon production tax credit for diesel fuel created from biomass.

· Extension of Tax Incentives for Natural Gas and Propane used as a Fuel in Transportation Vehicles. The bill would extend for one year (through 2010) the $0.50 per gallon production tax credit for natural gas and propane used as a transportation fuel.

· Extension of Employer Wage Credit for Activated Military Reservists. The bill would extend for one year (through 2010) the provision that provides eligible small business employers with a credit against the taxpayer's income tax liability for a taxable year in an amount equal to twenty percent (20%) of the sum of differential wage payments to activated military reservists.

IRS Audits Finally Reversing GOP Bias for Wealthy

http://www.perrspectives.com/blog/archives/001702.htm

Score one for working Americans. After enduring both the worst economic downtown and steepest income inequality since the Great Depression, new data from the Internal Revenue Service revealed that lower and middle class taxpayers are being audited at lower rates than the wealthy. And that may finally signal a roll back of the kid gloves treatment for the rich which followed the successful Republican war on the IRS in the 1990's.
As the AP reported, in its efforts to recover more than $300 billion in revenue lost to cheating, last year the IRS was less likely to audit those earning below $200,000 a year:

IRS enforcement numbers, released Tuesday, show that returns under that amount have a 1 percent chance of getting audited.
Returns showing income of $200,000 and above have a nearly 3 percent audit chance. The percentage jumps to more than 6 percent for returns showing earnings of $1 million or more...

The number of audits jumped 11 percent from 2008 to 2009 for returns with earnings of $200,000 or more, but rose 30 percent for returns showing earnings of $1 million or more. For those under $200,000 the number of audits remained steady.

That's a far cry from a decade ago. Then, after the anti-IRS jihad led by Phil Gramm and Congressional Republicans, the agency put working Americans in its crosshairs.

As David Cay Johnston describes in his book Perfectly Legal, the GOP during the Clinton administration waged an all-out war on the IRS, turning the priorities for auditing Americans upside-down. As Senator William Roth's Finance Committee held hearings in 1997 and 1998, Mississippi's Trent Lott and Alaska's Frank Murkowski decried the IRS' "Gestapo-like tactics." Don Nickles of Oklahoma raged, "The IRS is out of control!" Congress went on to pass and Bill Clinton signed the IRS Reform and Restructuring Act in 1998.

Even as IRS Director Charles Rossotti warned Congress about an epidemic of tax cheating which had then reached $195 billion a year, Senator Gramm in May 1998 denounced the agency. Peddling myths of jack-booted IRS agents tormenting American tapayers, Gramm called on Rossotti to fire his 50 worst employees. Gramm concluded:

"I have no confidence in the Internal Revenue Service of this country. You do not have a good system. This agency has too much unchecked power."
As the New York Times recounted that spring, the plan to gut the IRS advocated by Phil Gramm and his allies was a popular political gambit, but almost certain to create incentives for tax evasion:

Mr. Gramm spoke at length of how he had ''no confidence'' in the I.R.S., remarks that were in sharp contrast to those of every other senator, who emphasized that the majority of I.R.S. workers were honest and most taxpayers law-abiding.
A variety of tax experts have said in recent weeks that attacks on the I.R.S., which polls show are a potent device to win votes and contributions for Republicans, give comfort to tax cheats and discourage honest taxpayers.

Which, of course, is exactly what happened.

Those reforms in essence gave wealthier Americans carte blanche to cheat and fundamentally undermined tax fairness in the United States. Within one year, property seizures for unpaid taxes dropped by 98%. Liens were sliced by three quarters and levies on bank accounts by two-thirds. Johnston describes (p. 134) the overnight shift of tax policing onto poorer Americans:

In 1999, for the first time, the poor were more likely than the rich to have their tax returns audited. The overall rate for people making less than $25,000 a year was 1.36%, compared with 1.15% of returns by those making $100,000 or more...Over the previous 11 years audit rates for the poor had increased by a third, while falling 90 percent for the top tier of Americans.
By 2007, the amount of federal revenue lost to fraud and unpaid taxes catapulted to $300 billion. When Congressional Democrats sought expanded funding for the IRS to help stem the losses, the Bush administration and its GOP allies stopped the effort dead in its tracks.

And still the conservative crusade to save the rich continued. That same year, the IRS shed almost half of the 345 lawyers assigned to monitor the gift and estate taxes paid - or not paid - by those with some of the largest fortunes in the United States.

That effort to gut the IRS was simply class warfare by other means. Unable to permanently repeal the estate tax, the Bush administration instead sought to cripple enforcement. As the New York Times reported:

Six I.R.S. estate tax lawyers whose jobs are likely to be eliminated said in interviews that the cuts were just the latest moves behind the scenes at the I.R.S. to shield people with political connections and complex tax-avoidance devices from thorough audits.
Sharyn Phillips, a veteran I.R.S. estate tax lawyer in Manhattan, called the cuts a "back-door way for the Bush administration to achieve what it cannot get from Congress, which is repeal of the estate tax."

According to the Times, deputy IRS commissioner Kevin Brown confirmed the cuts, but claimed that "because far fewer people were obliged to pay estate taxes under President Bush's legislation." Brown also rejected as "preposterous" the notion that IRS looked the other way when it came to rich tax cheaters.

Sadly for Brown, the data suggests otherwise. Six years ago, the I.R.S. reported that 85 percent of large taxable gifts it audited shortchanged the government. And as the Times details:

Over the last five years, officials at both the I.R.S. and the Treasury have told Congress that cheating among the highest-income Americans is a major and growing problem.
Which comes as no surprise. As the Center for American Progress noted, the Bush tax cuts delivered a third of their total benefits to the wealthiest 1% of Americans. And to be sure, their payday was staggering. As the Center on Budget and Policy Priorities detailed, by 2007 millionaires on average pocketed $120,000 from the Bush tax cuts of 2001 and 2003. Those in the top 1% stashed an extra $45,000 a year. As a result, millionaires saw their after-tax incomes rise by 7.6%, while the gains for the middle quintile and bottom 20% of Americans were a paltry 2.3% and 0.4%, respectively. (Another CBPP study demonstrated that the Bush tax cuts accounted for half of the mushrooming deficits during his tenure in the White House.)

And as the New York Times uncovered in 2006, the 2003 Bush dividend and capital gains tax cuts offered almost nothing to taxpayers earning below $100,000 a year. Instead, those windfalls reduced taxes "on incomes of more than $10 million by an average of about $500,000." As the Times revealed in a jaw-dropping chart, "the top 2 percent of taxpayers, those making more than $200,000, received more than 70% of the increased tax savings from those cuts in investment income." So it should come as no surprise that the income share of the 400 richest Americans doubled over the past decade.

But while the IRS is finally showing signs of reversing years of preferential treatment for the rich, the Republican Party is more committed than ever to ensuring windfalls for the wealthy. Thanks to Republican obstructionism in the Senate on their behalf, the estate tax, which in 2009 will impact only 1 in 500 estates while generating tens of billion in revenue, will temporarily expire for one year after December 31. Rep. Louie Gomert (R-TX) suggested that's the way God wants it:

"Jesus never advocated the government go steal. He said 'you do it. Do it with your own money, don't steal it from somebody else.' And that is why this should not pass."

Friday, December 25, 2009

Democrats see GOP hypocrisy in health care debate

Original Link: http://news.yahoo.com/s/ap/20091225/ap_on_bi_ge/us_health_care_deficit

By CHARLES BABINGTON

Republican senators attacking the cost of a Democratic health care bill showed far different concerns six years ago, when they approved a major Medicare expansion that has added tens of billions of dollars to federal deficits.

The inconsistency — or hypocrisy, as some call it — has irked Democrats, who claim that their plan will pay for itself with higher taxes and spending cuts and cite the nonpartisan Congressional Budget Office for support.

By contrast, when Republicans controlled the House, Senate and White House in 2003, they overcame Democratic opposition to add a deficit-financed prescription drug benefit to Medicare. The program will cost a half-trillion dollars over 10 years, or more by some estimates.

With no new taxes or spending offsets accompanying the Medicare drug program, the cost has been added to the federal debt.

All current GOP senators, including the 24 who voted for the 2003 Medicare expansion, oppose the health care bill that's backed by President Barack Obama and most congressional Democrats. Some Republicans say they don't believe the CBO's projections that the health care overhaul will pay for itself. As for their newfound worries about big government health expansions, they essentially say: That was then, this is now.

Six years ago, "it was standard practice not to pay for things," said Sen. Orrin Hatch, R-Utah. "We were concerned about it, because it certainly added to the deficit, no question." His 2003 vote has been vindicated, Hatch said, because the prescription drug benefit "has done a lot of good."

Sen. George Voinovich, R-Ohio, said those who see hypocrisy "can legitimately raise that issue." But he defended his positions in 2003 and now, saying the economy is in worse shape and Americans are more anxious.

Sen. Olympia Snowe, R-Maine, said simply: "Dredging up history is not the way to move forward." She noted that she fought unsuccessfully to offset some of President George W. Bush's deep tax cuts at the time.

But for now, she said, "it's a question of what's in this package," which the Senate passed Thursday in a party-line vote. The Senate bill still must be reconciled with a House version.

The political situation is different now, Snowe said, because "we're in a tough climate and people are angry and frustrated."

Some conservatives have no patience for such explanations.

"As far as I am concerned, any Republican who voted for the Medicare drug benefit has no right to criticize anything the Democrats have done in terms of adding to the national debt," said Bruce Bartlett, an official in the administrations of Ronald Reagan and George H.W. Bush. He made his comments in a Forbes article titled "Republican Deficit Hypocrisy."

Bartlett said the 2003 Medicare expansion was "a pure giveaway" that cost more than this year's Senate or House health bills will cost. More important, he said, "the drug benefit had no dedicated financing, no offsets and no revenue-raisers. One hundred percent of the cost simply added to the federal budget deficit."

The pending health care bills in Congress, he noted, are projected to add nothing to the deficit over 10 years.

Other lawmakers who voted for the 2003 Medicare expansion include the Senate's top three Republican leaders, all sharp critics of the Obama-backed health care plans: Mitch McConnell of Kentucky, Jon Kyl of Arizona and Lamar Alexander of Tennessee. Eleven Democratic senators voted with them back then.

The 2003 vote in the House was even more divisive. It resulted in a nearly three-hour roll call in which GOP leaders put extraordinary pressure on colleagues to back the prescription drug addition to Medicare. In the end, 204 Republicans and 16 Democrats voted for the bill.

Democrats certainly have indulged in deficit spending over the years. They say they have been more responsible over the last two decades, however. Bill Clinton's administration was largely constrained by a pay-as-you-go law, requiring most tax cuts or program expansions to be offset elsewhere with tax increases and/or spending cuts.

Clinton ended his presidency with a budget surplus. But it soon was wiped out by a sagging economy, the Iraq war, GOP tax cuts and the lapsing of the pay-as-you-go restrictions.

Obama and many Democrats in Congress have vowed to restore those restrictions. But they waived them this year for programs, including heavy stimulus spending meant to pull the economy from the severe recession of 2008-09.

The 2010 deficit is expected to reach $1.5 trillion, and the accumulated federal debt now exceeds $12 trillion. When the Republican-led Congress passed the Medicare expansion in 2003, the deficit was $374 billion, and was projected to hit $525 billion the following year, in part because of the new prescription drug benefit for seniors.

Some GOP lawmakers cite these numbers in arguing that their current worries about heavy government spending are legitimate, even if they voted for the deficit-financed Medicare bill in 2003.

But Judy Feder, an analyst with the Democratic-leaning Center for American Progress, said these Republicans had their chance and blew it. In the second Bush administration, she said, "there was a total elimination of any kind of pay-for responsibility."

Those responsible should now show some humility, she said.

Thursday, December 24, 2009

How Wall Street Bought Barney Frank

Original Link: http://www.alternet.org/politics/144454/how_wall_street_bought_barney_frank

By Kevin Connor

Barney Frank takes pride in being the Left's darling, but he's almost entirely funded by Wall Street and his votes show it.

Few members of Congress are considered more liberal than Barney Frank. Gay, left-handed, and Jewish, as his biography’s title proudly proclaims, he clearly enjoys living in direct contravention of right-wing ideals.

A favorite conservative punching bag, Glenn Beck and Bill O’Reilly have their tea party base convinced that it was actually Frank who sent the country into an economic tailspin, through some curious combination of incompetence, redistributive zeal, greed, and homosexuality. Beck’s conspiratorial chalkboards link Frank to the mortgage giants Fannie Mae and Freddie Mac, back to the community organization ACORN, and by implication, to the poor and undeserving. Naturally, liberals have responded by closing ranks around the congressman.

The pseudo-research of Fox News and friends, and their obsession with Fannie and Freddie -- hardly the root of all economic troubles -- have distracted from a core reality of Frank’s recent career in Congress. Since becoming the ranking Democrat on the House Financial Services Committee seven years ago, he has built a formidable Wall Street donor base, even by Washington’s standards; as the housing bubble grew, so too did his fundraising purse and his stature, in Congress and beyond.

In the course of this Wall Street-fueled fundraising blitz, Frank developed a web of relationships, alliances, and attachments to financial elites that have repeatedly undermined his independence on everything from bailout negotiations to the financial reform legislation that he recently shepherded through the House. And his friends in finance continue to extend -- and collect on -- their investment.

Frank on 'FIRE'

On one day in late July of this year, the Weiss family of Brookline, Mass. gave a whopping $24,000 to Barney Frank. He received maximum contributions of $4,800 each from Kara, an MFA student in Seattle; Judith, an undergraduate at UC Davis; Danielle, a psychology PhD at Tulane; and their parents, Bonnie and Andrew. (All campaign finance data is drawn from OpenSecrets.org and LittleSis.org.)

The Weiss daughters, who had previously given a grand total of two $250 contributions, would seem to be unlikely top contributors to Frank. But their father Andrew is a hedge fund manager, and therefore a key constituent of the powerful chairman of the House Financial Services committee.

Joining the Weiss family in funneling Wall Street dollars to Frank that day were two other hedge fund managers, Eric Vincent and Michael Inserra, and former Republican Congressman Richard Baker. Baker is president of the Managed Funds Association (MFA) -- the hedge fund industry’s main lobby -- and Inserra and Vincent are both board members.

Baker had testified before Frank’s committee just ten days earlier on the financial reform package snaking its way through the House. The MFA PAC cut Frank a $10,000 check a few days after the testimony.

By the time the House of Representatives passed financial reform legislation on Dec. 10, the bill reflected one of the hedge fund industry’s main asks -- lax oversight of the financial instruments known as over-the-counter (OTC) derivatives. After the bill passed, financial analyst Chris Whalen told Bloomberg News that “the OTC reform has gotten to be basically irrelevant as far as change… compared with what we thought we were going to get over the summer, it’s night and day.”

Meanwhile, Frank supported Wall Street and the hedge funds on at least two points where they lost out. He opposed an amendment offered by Brad Sherman that forces hedge funds to pay into a systemic risk fund; it passed with the overwhelming support of the committee, 52-17. A bipartisan measure to audit the Federal Reserve also passed without Frank’s support.

The final bill was barely out of the House before Frank was on CNBC, claiming victory but cautioning that the Fed provision -- the most celebrated populist measure in the bill -- threatened the institution’s “independence.”

Maybe the Weiss family’s contributions had something to do with Frank’s lukewarm support for more substantial reforms. Or Baker’s, or Vincent’s, or the MFA’s. Or those of any one of the deep-pocketed Wall Street supporters that Frank has cultivated since rising to a leadership post on the financial services committee.

For years, Frank was a mediocre fundraiser. In 2002, he was ranked 185th out of 215 Democrats in the House in total fundraising take. Previous years were similarly unimpressive.

That all changed in late 2002, when he became the most important Democrat on the financial services committee, replacing Rep. John LaFalce. In the following election cycle, Frank increased his fundraising five-fold, from $268,000 to $1.4 million. He cruised to re-election, though Democrats failed to take back the House that year.

Due to his leadership of the finance committee, Frank derived the greatest share of his cash, and his newfound power, from Wall Street. He consistently raised more than 50 percent of his campaign contributions from the finance, insurance, and real estate industry, often referred to as “FIRE” -- essentially the bundle of interests that had the most to gain from the housing bubble. By contrast, before becoming ranking Democrat, the FIRE share of his money hovered around 25 percent.

Remarkably, only two members of the House have taken in a larger share of their money from Wall Street over the past two campaign cycles -- Paul Kanjorski, a Democrat, and Spencer Bachus, a Republican. And during the 2006 cycle, Frank took in more money from FIRE than any other Democratic member of the House, and all but a few Republicans.

In 2009, Frank has taken in 48 percent of his contributions from FIRE, more than $400,000. Only one Democrat, Jim Himes, has raised more from Wall Street. Melissa Bean, that darling of Wall Street, actually trails Frank by several thousand dollars.

To put Frank’s funding mix in perspective, for every 20 Wall Street donors calling his office, there are two union presidents, one healthcare executive, and a handful of activists and business executives in other industries. (Check out this awe-inspiring graph, to grasp this more fully.)

With all that big money behind him, it's no wonder Frank has gone virtually unchallenged in his recent electoral campaigns. And he has used his Wall Street war chest to fund other Democrats across the country, building his influence and power within the party. It is that power, both symptom and cause of his chairmanship of Financial Services, that made him the Democratic Party’s point man on the financial crisis in fall 2008.

For clues as to how Frank got there, we can look to Representative John LaFalce, Frank’s predecessor as the ranking Democrat on the House Financial Services Committee, who was similarly dependent on FIRE.

In 1999, LaFalce was credited with being a key force behind landmark legislation in the history of financial deregulation -- the Gramm-Leach-Bliley Act.

GLB, as it is known, tore down the walls between commercial and investment banks set up by the Depression-era Glass Steagall Act, paving the way for the creation of too-big-to-fail behemoths like Citigroup. Democrats were in the minority at the time, so LaFalce wasn’t chair of the House Financial Services Committee, but he was credited with making sure the financial modernization bill was of high priority to the Clinton administration.

Soon after the legislation passed, LaFalce and other key policymakers reveled in their victory by gorging themselves on a cake bearing the epitaph of Glass Steagall. And then there was LaFalce’s retirement party, in 2002, where two lobbyists representing Bank of America, Morgan Stanley, and other financial interests sang a humorous tribute named “Big John.” LaFalce hailed from western New York, a region hit hard by financialization and de-industrialization, and far from the area he truly represented: Wall Street.

The staff is where it's at

Frank gladly inherited LaFalce's legacy. The Democratic wing of the financial services committee was still open for business. He indicated to the press that the Gramm-Leach-Bliley Act would not be re-considered, and he would keep key members of LaFalce’s team, including senior counsel Lawranne Stewart and chief of staff Jeanne Roslanowick.

By relying on Stewart and Roslanowick during the unfurling of the financial crisis, Frank has looked to the very enablers of the recent financial catastrophe to remedy the current situation. Both staffers played key roles in shaping the Clinton-era financial reforms that drove the U.S. economy to the brink last year. And as Frank negotiated bailouts and steered financial reform legislation through Congress, they’ve been two of his top lieutenants.

Roslanowick’s various biographies give her credit for playing an important role in crafting GLB, and LaFalce described her as “tough as nails and absolutely unyielding” in negotiations on consumer protections and community reinvestment. But it is unclear which policy questions she held her ground on as the bill’s sole achievements for consumers were toothless privacy reforms and ATM fee notifications, and its most significant community reinvestment provisions were attempts -- authored by GOP Sen. Phil Gramm -- to embarrass community groups.

Granted, it could have been much worse -- Gramm wanted to end the Community Reinvestment Act (CRA) altogether -- but this was certainly not a consumer-oriented legislative achievement to hang one’s hat on. Consumer advocates called the GLB a massive giveaway to Wall Street, and Public Citizen would spend the next decade pointing to the negative effects of banking consolidation brought about by the bill.

In financial reform’s most recent iteration, Roslanowick and company appear to have forfeited on CRA once again. The bill gives the Consumer Financial Protection Agency no oversight of financial institutions on CRA issues.

Roslanowick’s fellow LaFalce/Frank staffer, Lawranne Stewart, has an embarrassing history with the financial products known as derivatives that the bill was supposed to address.

Stewart, now senior counsel at Financial Services, helped author the Clinton-era legislation that cleared the way for the great derivatives explosion of the Bush years, which eventually brought AIG to its knees in September 2008. From 1999 to 2001, she was Undersecretary of the Treasury Gary Gensler’s top lieutenant, and helped craft the legislation known as the Commodity Futures Modernization Act. In March, Senator Bernie Sanders put a hold on Gensler’s nomination as chair of the Commodity Futures Trading Commission, over concern for his role in shaping that legislation. Gensler was eventually confirmed, and has established himself as a tougher critic of Wall Street than was expected.

Stewart’s authorship of that legislation is evident in this celebratory email between Enron lobbyists sent on December 12, 2000.

Stewart passes the document containing “an amendment to the definition of ‘trading facility’ to exempt single dealer markets” along to her boss Gensler, who then forwards it to the lobbyist George Baker with the subject line “as discussed.” Baker then forwards it to derivatives lobbyist Ken Raisler, who then forwards it to Enron lobbyist Chris Long, who then passes it along to the rest of Enron’s lobbying team with a brief analysis, closing with: “They may cut a deal as early as this afternoon!”

Elements of this bill would later become known as the “Enron loophole,” which exempted energy trades from proper oversight and were believed to be behind historic spikes in fuel prices during the spring and summer of 2008. Though Democrats have blamed Senator Phil Gramm for the loopholes, Enron lobbyists were actually worried that Gramm would hold out for something too radically deregulatory, thereby putting their sought-after language in jeopardy. In any case, a compromise was reached, and Stewart played a key role in crafting the Enron-approved language.

Ironically enough, Stewart’s considerable personal fortune is derived from the murky world of international energy privatization, which Enron dominated until its demise. Her husband, Mark Kantor, worked in that field as an international project finance attorney at the law firm Milbank Tweed during the nineties. Milbank Tweed worked closely with Enron on numerous energy deals and off-balance-sheet financings, to the extent that the University of Calfornia filed suit against the firm in 1999. Kantor himself worked on at least one Enron-owned project, a Turkish power plant named Trakya Elektrik.

Indeed, the derivatives market reforms passed by the House this month look like they were written by an Enron attorney; the legislation exempts “end users,” a classification that loops in speculative financial engineers like Enron.

Two other Frank staffers passed through the Wall Street-D.C. revolving door in 2007 and 2008, but in opposite directions. His special counsel, James W Segel, lobbied for the Investment Company Institute, a mutual fund lobby, for ten years before joining Frank’s staff. Board members of ICI include representatives of Goldman Sachs and JP Morgan.

Michael Paese, Frank’s deputy staff director at the financial services committee until 2007, is now a registered lobbyist for Goldman Sachs. He has been lobbying Congress on issues related to financial reform for the past year. At least two other top Frank donors, Mitchell Feuer and Michael Berman, also lobby for Goldman Sachs.

Indeed, Frank’s ties to Wall Street are in evidence whenever he goes on television to articulate his vision for dealing with the financial industry. Bailouts help individuals, not companies, he told 60 Minutes, before accusing the host of attacking welfare and wanting to see people starve. After we bail the banks out, then we can tax them, he told Ed Schultz, who was criticizing the bailouts in a manner that Frank found “condescending.”

He may have a silver tongue, but Frank’s quips over the past year have sounded less than persuasive and more like the defensive posturing of a liberal beholden to Wall Street’s big money.

Can he be a good friend to both sides?

Last Wednesday, Rep. Melissa Bean and a coalition of New Democrats held up the financial reform process in order to win key concessions for Wall Street. Frank criticized her opposition, pointing to the influence of big banks, and entered a meeting with Bean and other leaders of the House.

Frank emerged, after about an hour, remarking that “the differences have been narrowed, and I think you’re getting something that both sides can live with.”

What were the two sides, exactly? Presumably, Frank counted himself among the reformers. But how could someone so dependent on Wall Street for fundraising dollars present any meaningful opposition to the financial industry’s agenda? Any tug-of-war inside that chamber would have consisted of everyone pulling in one direction, and all falling down.

The brief negotiation was certainly successful. Bean got what she wanted on derivatives regulation and federal preemption of state law. Frank got to pass a historic financial reform bill, all the while retaining his power as one of Wall Street’s chosen in Congress. The political theater was reminiscent of the great bailout negotiations of 2008, in which Frank and his liberal friends conceded hundreds of billions of dollars to the sinking Street.

The truly remarkable thing about the Barney Frank phenomenon is that liberal advocacy groups continued to treat the Congressman as an ally during the financial reform process. Public Citizen issued a press release that criticized parts of the bill, but thanked Frank for his work. Marcy Wheeler of Firedoglake called him a “good progressive,” fighting the good fight against banking interests. ActBlue, the progressive political action committee, is Frank’s biggest donor this cycle.

Meanwhile, Frank has spent much of the last seven years cultivating relationships with individuals like Richard Baker and Andrew Weiss, Wall Street executives and lobbyists who leverage their influence to game the democratic process. The Weiss family and its hedge funds have actually outspent ActBlue on Barney Frank this cycle -- all during that fateful summer of 2009, when meaningful derivatives reform was still on the table.

The numbers don’t lie. Forget Fannie or Freddie -- Wall Street owns Barney Frank. He has been lifted to power by the entire class of Wall Street financiers that brought the U.S. economy to the brink.

Why should he abandon them now?

A Dangerous Dysfunction

Original Link: http://www.nytimes.com/2009/12/21/opinion/21krugman.html

By PAUL KRUGMAN

Unless some legislator pulls off a last-minute double-cross, health care reform will pass the Senate this week. Count me among those who consider this an awesome achievement. It’s a seriously flawed bill, we’ll spend years if not decades fixing it, but it’s nonetheless a huge step forward.

It was, however, a close-run thing. And the fact that it was such a close thing shows that the Senate — and, therefore, the U.S. government as a whole — has become ominously dysfunctional.

After all, Democrats won big last year, running on a platform that put health reform front and center. In any other advanced democracy this would have given them the mandate and the ability to make major changes. But the need for 60 votes to cut off Senate debate and end a filibuster — a requirement that appears nowhere in the Constitution, but is simply a self-imposed rule — turned what should have been a straightforward piece of legislating into a nail-biter. And it gave a handful of wavering senators extraordinary power to shape the bill.

Now consider what lies ahead. We need fundamental financial reform. We need to deal with climate change. We need to deal with our long-run budget deficit. What are the chances that we can do all that — or, I’m tempted to say, any of it — if doing anything requires 60 votes in a deeply polarized Senate?

Some people will say that it has always been this way, and that we’ve managed so far. But it wasn’t always like this. Yes, there were filibusters in the past — most notably by segregationists trying to block civil rights legislation. But the modern system, in which the minority party uses the threat of a filibuster to block every bill it doesn’t like, is a recent creation.

The political scientist Barbara Sinclair has done the math. In the 1960s, she finds, “extended-debate-related problems” — threatened or actual filibusters — affected only 8 percent of major legislation. By the 1980s, that had risen to 27 percent. But after Democrats retook control of Congress in 2006 and Republicans found themselves in the minority, it soared to 70 percent.

Some conservatives argue that the Senate’s rules didn’t stop former President George W. Bush from getting things done. But this is misleading, on two levels.

First, Bush-era Democrats weren’t nearly as determined to frustrate the majority party, at any cost, as Obama-era Republicans. Certainly, Democrats never did anything like what Republicans did last week: G.O.P. senators held up spending for the Defense Department — which was on the verge of running out of money — in an attempt to delay action on health care.

More important, however, Mr. Bush was a buy-now-pay-later president. He pushed through big tax cuts, but never tried to pass spending cuts to make up for the revenue loss. He rushed the nation into war, but never asked Congress to pay for it. He added an expensive drug benefit to Medicare, but left it completely unfunded. Yes, he had legislative victories; but he didn’t show that Congress can make hard choices and act responsibly, because he never asked it to.

So now that hard choices must be made, how can we reform the Senate to make such choices possible?

Back in the mid-1990s two senators — Tom Harkin and, believe it or not, Joe Lieberman — introduced a bill to reform Senate procedures. (Management wants me to make it clear that in my last column I wasn’t endorsing inappropriate threats against Mr. Lieberman.) Sixty votes would still be needed to end a filibuster at the beginning of debate, but if that vote failed, another vote could be held a couple of days later requiring only 57 senators, then another, and eventually a simple majority could end debate. Mr. Harkin says that he’s considering reintroducing that proposal, and he should.

But if such legislation is itself blocked by a filibuster — which it almost surely would be — reformers should turn to other options. Remember, the Constitution sets up the Senate as a body with majority — not supermajority — rule. So the rule of 60 can be changed. A Congressional Research Service report from 2005, when a Republican majority was threatening to abolish the filibuster so it could push through Bush judicial nominees, suggests several ways this could happen — for example, through a majority vote changing Senate rules on the first day of a new session.

Nobody should meddle lightly with long-established parliamentary procedure. But our current situation is unprecedented: America is caught between severe problems that must be addressed and a minority party determined to block action on every front. Doing nothing is not an option — not unless you want the nation to sit motionless, with an effectively paralyzed government, waiting for financial, environmental and fiscal crises to strike.

Tuesday, December 22, 2009

The Republican Way: Keeping Everything The Way It Is

Original Link: http://www.huffingtonpost.com/alec-baldwin/the-republican-way-keepin_b_369123.html

By Alec Baldwin

Didn't you know, all along, that the goal of U.S. policy in Iraq was about accessing oil?

Not oil as in those production levels at the onset of the Bush era incursion in March, 2003. But newer, stronger, American-style production levels. American oil companies had been forbidden from exploring and developing new oil fields since the nationalization of Iraq's reserves in 1972 and those American oil companies have long contended that Iraqi estimates of their potential reserves are grossly underestimated, by perhaps as much as a couple of hundred billion barrels.

Likewise, didn't you know all along that Republican opposition to current health care reform is about maintaining the unconscionable monopoly that insurance companies have in the American economy. Why? For the same reason Bush went to war in Iraq, spent money we didn't have, pushed the country into financial ruin and did more to threaten our long term national security than any modern president. The GOP needs contributions. I would never contend that the GOP is alone in this practice. When an administration awards contracts to some supporter, they anticipate more support. But no group, in the history of this country, has ever done this to such an extent. Remember, I am always careful to separate the leadership of any party from its rank and file. So when I level such a charge against "Republicans", I am referring to their leadership on Capitol Hill. But, I think it's safe to say now that the war in Iraq was started to provide U.S. oil companies with the opportunity to develop new oil fields there in return for the massive campaign contributions those oil companies will make to the Republicans in 2010 and, especially, 2012 in their effort to unseat President Obama.

The same is true for the health care industry, and insurance companies in particular. They don't want reform. The current system works quite well for them. If an excess of Americans die due to insufficient health care, so what. Republican leaders argue that health care reform will lead to a big, fat, incompetent bureaucracy that will gobble up billions of U.S. taxpayer dollars and provide little accountability. But wait. Isn't the Pentagon a big, fat, incompetent bureaucracy that gobbles up...? Well, you get it.

The Pentagon wastes more money on more crap that you and I don't need and gets it wrong, on a policy level, more often than not since 1960 (I'll give them a pass on Korea, due to all the Cold War anxiety at the time). Republicans never flinch. Spending on the military, and subsequent sales of those weapons systems around the world, help the U.S. economy, in their mind. Those companies, in turn, contribute to the campaigns of men like George W. Bush. This is especially so now that the Pentagon, in the ultimate sign of their stupidity, abdication of their responsibilities and tacit compliance with GOP fundraising goals, have privatized the U.S. military to the tune of one million dollars per soldier in Afghanistan.

Think about that. Recruitment is down. This Pentagon has a shortage of willing and competent soldiers who can run our military machinery. So what do they do? Do they improve recruitment, training and pay for soldiers? No. They privatize as much of these duties as they can (with no bid contracts for staggering sums of money) and create new businesses that, in turn, will contribute to those that helped them

The health care industry wastes untold billions, then passes those costs on to insurance companies who then exploit your fear and pass them on to you. Fear of Al Qaeda. Fear of getting sick without insurance and, therefore, access to effective medical care. Keep everything the way it is, out of fear. Fear that it could get worse. That's the Republican way. These guys have this country coming and going.

Health care reform means less money for insurance companies. Thus less money for the GOP. We should pass this bill for that reason alone.

Michele Bachmann: Welfare Queen

Original Link: http://www.truthdig.com/report/item/michelle_bachman_welfare_queen_20091221/

By Yasha Levine

Michele Bachmann has become well known for her anti-government tea-bagger antics, protesting health care reform and every other government “handout” as socialism. What her followers probably don’t know is that Rep. Bachmann is, to use that anti-government slur, something of a welfare queen. That’s right, the anti-government insurrectionist has taken more than a quarter-million dollars in government handouts thanks to corrupt farming subsidies she has been collecting for at least a decade.

And she’s not the only one who has been padding her bank account with taxpayer money.

Bachmann, of Minnesota, has spent much of this year agitating against health care reform, whipping up the so-called tea-baggers with stories of death panels and rationed health care. She has called for a revolution against what she sees as Barack Obama’s attempted socialist takeover of America, saying presidential policy is “reaching down the throat and ripping the guts out of freedom.”

But data compiled from federal records by Environmental Working Group, a nonprofit watchdog that tracks the recipients of agricultural subsidies in the United States, shows that Bachmann has an inner Marxist that is perfectly at ease with profiting from taxpayer largesse. According to the organization’s records, Bachmann’s family farm received $251,973 in federal subsidies between 1995 and 2006. The farm had been managed by Bachmann’s recently deceased father-in-law and took in roughly $20,000 in 2006 and $28,000 in 2005, with the bulk of the subsidies going to dairy and corn. Both dairy and corn are heavily subsidized—or “socialized”—businesses in America (in 2005 alone, Washington spent $4.8 billion propping up corn prices) and are subject to strict government price controls. These subsidies are at the heart of America’s bizarre planned agricultural economy and as far away from Michele Bachmann’s free-market dream world as Cuba’s free medical system. If American farms such as hers were forced to compete in the global free market, they would collapse.

However, Bachmann doesn’t think other Americans should benefit from such protection and assistance. She voted against every foreclosure relief bill aimed at helping average homeowners (despite the fact that her district had the highest foreclosure rate in Minnesota), saying that bailing out homeowners would be “rewarding the irresponsible while punishing those who have been playing by the rules.” That’s right, the subsidy queen wants the rest of us to be responsible.

Bachmann’s financial disclosure forms indicate that her personal stake in the family farm is worth up to $250,000. They also show that she has been earning income from the farm business, and that the income grew in just a few years from $2,000 to as much as $50,000 for 2008. This has provided her with a second government-subsidized income to go with her job as a government-paid congresswoman who makes $174,000 per year (in addition to having top-notch government medical benefits). “If she has an interest in a farm getting federal subsidy payments, she is benefiting from them,” Sandra Schubert, director of government affairs for the Environmental Working Group, told Gannett News Service in 2007, when the subsidies to Bachmann were first publicly disclosed.

But Bachmann isn’t the only welfare recipient on Capitol Hill. As it turns out, there is a filthy-rich class of absentee farmers—both in and out of Congress—who demand free-market rules by day and collect their government welfare checks in the mail at night, payments that subsidize businesses that otherwise would fail. Over the past couple of decades, welfare for the super-wealthy seems to be the only kind of welfare our society tolerates.

In the 11 years for which the Environmental Working Group has compiled data, the federal government paid out a total of $178 billion to American farmers. We’re not talking about the Joads here. The bulk of subsidies go to the wealthy, not small farmers, as Ken Cook, the group’s president, explained to the Central Valley (Calif.) Business Times:

American taxpayers have been writing farm subsidy checks to wealthy absentee land owners, state prison systems, universities, public corporations, and very large, well-heeled farm business operations without the government so much as asking the beneficiaries if they need our money. ... Even if you live smack in the middle of a big city, type in a ZIP code and you’ll find farm subsidy recipients.

Chuck Grassley, the longtime Republican senator from Iowa who warns his constituents of Obama’s “trend toward socialism,” has seen his family collect $1 million in federal handouts over an 11-year period, with Grassley’s son receiving $699,248 and the senator himself pocketing $238,974. Even Grassley’s grandson is learning to ride through life on training wheels, snagging $5,964 in 2005 and $2,363 in 2006. In the Grassley family they learn early how to enjoy other people’s money.

Sen. Grassley railed against government intervention in the health care market, telling The Washington Times, “Whenever the government does more ... that’s a movement toward socialism.” As the top Republican on the Senate Finance Committee, he ought to know, especially because the government has done more for him and his kin than for Americans struggling with high medical bills and mortgages. Even the free-market think tank the Heritage Foundation criticized Grassley on his deep connections to farming interests and his stubborn lack of transparency.

Then there’s Sen. Sam Brownback, R-Kan., whose family has been on the government take for at least the past 11 years, pocketing some $500,000. The senator recently held a “prayercast” with Michele Bachmann to beseech God to kill health care reform as soon as possible because it would bring an evil socialist spirit into America. Like Bachmann, Brownback has a fierce belief in God, the free market and a two-year limit on all welfare benefits—unless it’s welfare to rich Republicans who don’t need it.

Not surprisingly, Blue Dog Democrats are on board with this welfare-for-the-rich thing. Max Baucus, the fiscally conservative Democratic senator from Montana who did his best to sabotage the health care reform process before it ever began, collected $250,000 in taxpayer subsidies to his family’s farm while fighting to keep Americans at the mercy of free-market health insurance. Sen. Blanche Lincoln of Arkansas, another Democrat, also helped hold the line against so-called socialized medicine for Americans who need assistance, even though her family farm business follows the socialized subsidy playbook to a T. The Lincolns pocketed $715,000 in farm subsidies over a 10-year period, and the senator even admitted to using $10,000 of it as petty cash in 2007. Democratic Rep. Stephanie Sandlin of South Dakota stayed true to her conservative free-market roots by voting against the public option. Meanwhile, her daddy, Lars Herseth, a former South Dakota legislator, collected a welfare jackpot of $844,725 paid out between 1995 and 2006.

That’s just the way the game is played these days. Republicans and conservative Democrats bitch and moan about the allegedly Marxist underpinnings of universal health care and do everything they can to deny struggling Americans access to social services. Meanwhile, many of them profit off taxpayers in a massive welfare program.

Farm subsidies have become so corrupt that payments sometimes go to dead people for years. Federal farm subsidies, which were originally meant to help struggling farmers survive, are now little more than taxpayer robbery, taking taxpayer wealth from working Americans and sending it to the have-mores. According to 11 years’ worth of Environmental Working Group data that tracks $200 billion in subsidies, the wealthiest 10 percent of “farmers” have collected 75 percent of the money. That’s exactly the kind of socialism that Rep. Bachmann and her elite ilk like.

Sunday, December 20, 2009

Campaign Cash From Wall Street Favored Representatives Who Opposed Finance Reform Bill

Original Link: http://www.opensecrets.org/news/2009/12/campaign-cash-from-wall-street.html

By Michael Beckel

On Friday, the U.S. House of Representatives passed its major financial reform proposal by a 223-202 vote. Commercial banks and credit and finance companies stood among some of the fiercest opponents of the bill.

And a Center for Responsive Politics analysis shows these industries, which aggressively fought to water down Democrats’ plans for new regulations and oversight, have long lined the pockets of lawmakers who voted against the bill.

Members of the House who voted against the measure collected 70 percent more from commercial banks since 1989, on average, than those supported it. And they raised an average of 50 percent more from credit and finance companies than the bill's supporters, CRP found.
Members who voted against the bill -- sponsored by House Financial Services Committee Chair Barney Frank (D-Mass.) and known as the Wall Street Reform and Consumer Protection Act of 2009 (H.R. 4173) -- received an average of about $133,200 from commercial banks since 1989, while lawmakers who voted for the bill collected an average of about $77,800.

And members of the House who voted against the bill collected an average of about $39,000 from finance and credit companies since 1989, while members who voted in favor of the bill collected an average of $25,900.

Lawmakers who voted against the measure collected an average of about $849,200 from Wall Street interests over their careers, while lawmakers who supported the bill collected an average of about $694,000, the Center for Responsive Politics found. This means members of the House who opposed the bill received an average of 22 percent more from the finance, insurance and real estate sector since 1989 than supporters.

Frank’s bill calls for new regulation and oversight of derivatives and other trading products through which financial industry workers made risky bets and poor results that helped fuel the economic crisis.

The legislation also seeks to end the “too big too fail” concept by requiring banks and other large financial institutions to develop plans for how to safely dissolve and be dismantled if they can no longer compete. It would give shareholders a say in executive compensation. And it would require credit rating agencies to institute more procedures to curb conflicts of interest and end practices that can lead to inflated credit ratings.

Additionally, the legislation would create a new federal agency to act as a consumer watchdog -- an idea backed by President Barack Obama but opposed by many in the industry, including the lobbying powerhouse U.S. Chamber of Commerce. The new organization would be called the Consumer Financial Protection Agency and would have the authority to regulate mortgages, credit cards, student loans, auto loans, payday loans and more.

Freshman Blue Dog Democratic Rep. Walter Minnick (D-Idaho) led a fight to remove the Consumer Financial Protection Agency from the final bill. The amendment he offered to eliminate the agency failed on the House floor by a vote of 208-223.

Minnick ultimately voted in favor of Frank’s final bill, but 27 other Democrats voted against it. Of these, more than a dozen were Blue Dogs. Two members of the Progressive Caucus -- Reps. Dennis Kucinich (D-Ohio) and Marcy Kaptur (D-Ohio) -- also voted against the final legislation because they were concerned that it didn’t go far enough to help consumers.
No Republicans voted in favor of the final legislation.

Below is a table that shows the amounts that the finance, insurance and real estate sector contributed to all members of the House who voted for and against the bill since 1989, including contributions to their leadership PACs.

It also includes a breakdown of the amounts from specific industries within this sector, including commercial banks, real estate, insurance, securities and investment and credit and finance companies. The table also shows the average amount raised from each of these industries by supporters and opponents of the bill, along with the percentage difference between opponents and supporters.

You can see a full list of how much all members of the House received from these industries as part of our financial tools here.

Saturday, December 19, 2009

Right-Wing Billionaire David Koch Funding SwiftBoat Campaign Against Global Warming Science

Original Link: http://thinkprogress.org/2009/12/07/koch-swiftboat-science/

By Lee Fang

Right-wing billionaire David Koch, who along with his brother Charles owns the oil and gas empire Koch Industries, constantly presents himself as a champion of science. Next year, a wing of the Smithsonian will be named after him because of his generous donations. Indeed, in accepting Koch’s donations, the Smithsonian Human Origins Program director Rick Potts attempted to whitewash Koch’s philanthropist history:

POTTS: What we find in David Koch is a person who’s committed to doing things for the American public that has no relationship to politics

Koch apparently relishes this perception that his money buys. In an interview earlier this year, Koch pretended that he opposes organizations which politicize and distort science:

Q: What role do you think politics should play in educating the public about evolution?

KOCH: That’s an interesting question. I think politicians should really stay out of it and allow scientists to present the facts and discoveries. I hate to see it politicized.

In an op-ed in the Boston Globe yesterday, I observed that Koch has manufactured a positive image for himself by giving to laudable causes, while at the same time, quietly “funneling tens of millions of dollars to more subterranean efforts that reflect his conservative politics.” Despite his funding of the Smithsonian, Koch has done more to politicize and and undermine the public’s understanding of science than any other single person. Koch has funded the leading groups dedicated to spreading skepticism of climate change:

– Koch’s Americans for Prosperity, the right-wing tea party group which Koch founded in 1984 and continues to finance, has just announced that it will send a team of political operatives to Copenhagen for the United Nations Climate Change Conference. AFP intends to hold a press conference to attack any climate change solution the President promises as a mistake that will “kill jobs here” and “infringe on our personal and national freedoms.”

– Koch has funded the Competitive Enterprise Institute, which has been the most aggressive conservative front group heralding hacked e-mails as proof that climate change does not exist.

– Koch funds the “Hot Air Tour,” a campaign led by lobbyists stopping in cities across the country to call into question the science underpinning climate change. The tour also features an actual hot air balloon to illustrate their beleif that climate change science is just “hot air.”

The National Academy of Sciences, the US Global Change Research Program, and the Intergovernmental Panel on Climate Change have all come to the same conclusion: “that carbon dioxide emissions from fossil fuel use and the loss of carbon-sink capacity in heavily timbered forests are increasing temperatures and making oceans more acidic.” David Koch’s Koch Industries derives much of its profit from its oil refineries, one of the major emitters of carbon dioxide, and from its George-Pacific timber subsidiary, one of the largest contributors to the loss of carbon-sink capacity. So while it’s clear Koch’s bottom line is in conflict with addressing the world’s climate crisis, it should also be clear that he is no champion of science — no matter how many halls he buys at the Smithsonian.

Meet the Billionaire Brothers Funding the Right-Wing War on Obama

Original Link: http://www.alternet.org/story/144455/meet_the_billionaire_brothers_funding_the_right-wing_hate_machine

By Faiz Shakir

They're the 9th richest people in America and they're pushing hard to upend President Obama's progressive agenda.

Billionaire brothers David and Charles Koch are the wealthiest, and perhaps most effective, opponents of President Obama's progressive agenda. They have been looming in the background of every major domestic policy dispute this year. Ranked as the 9th richest men in America, the Koch brothers sit at the helm of Koch Industries, a massive privately owned conglomerate of manufacturing, oil, gas, and timber interests. They are best known for their wealth, as well as for their generous contributions to the arts, cancer research, and the Smithsonian Institute. But David and Charles are also responsible for a vicious attack campaign aimed directly at obstructing and killing progressive reform. Over the years, millions of dollars in Koch money has flowed to various right-wing think tanks, front groups, and publications. At the dawn of the Obama presidency, Koch groups quickly maneuvered to try to stop his first piece of signature legislation: the stimulus. The Koch-funded group "No Stimulus" launched television and radio ads deriding the recovery package as simply "pork" spending. The Cato Institute -- founded by Charles -- as well as other Koch-funded think tanks like the Heritage Foundation, produced a blizzard of reports distorting the stimulus and calling for a return to Bush-style tax cuts to combat the recession. As their fronts were battling the stimulus, David's Americans for Prosperity (AFP) spent the opening months of the Obama presidency placing calls and helping to organize the very first "tea party" protests. AFP, founded in 1984 by David and managed day to day by the astroturf lobbyist Tim Phillips, has spent much of the year mobilizing "tea party" opposition to health reform, clean energy legislation, and financial regulations.

STOPPING CLEAN ENERGY: David Koch presents himself as a champion of science. Next year, because of his donations, a wing of the Smithsonian will be named after him. Nevertheless, Koch has done more to undermine the public's understanding of climate change science than any other person in America. The Competitive Enterprise Institute, funded in part by Koch foundations, has waged an underhanded campaign to falsely charge that a set of hacked e-mails somehow unravels the scientific consensus that global warming is occurring. Koch finances the "Hot Air" tour, a nationwide roadshow using a balloon to depict climate change science as "hot air." Despite the brothers' extravagant wealth, Koch's Americans for Prosperity has run populist ads mocking environmentalists as spoiled brats more concerned about their "three homes and five cars" than about economic conditions. In addition to its efforts to misinform the public, Koch Industries has spent nearly $9 million dollars so far on direct lobbying, much of it on climate change legislation. With a team of Koch-funded operatives going as far as attempting to crash the United Nations Climate Change Conference in Copenhagen this week, the brothers may succeed in scuttling any prospect for addressing climate change.

STOPPING HEALTH REFORM: Much of the fierce opposition to health reform can be credited to Koch organizations. As the health care debate began, AFP created a front group, known as "Patients United," dedicated itself to attacking Democratic health care reform proposals. Patients United has blanketed the country with ads distorting various provisions of the health reform legislation, particularly the public option. Patients United even centered a media campaign around Shona Robertson-Holmes, claiming she had a brain tumor the Canadian system refused to treat. However, the Ottawa Citizen reported that Patients United has been exaggerating Holmes' case, and that she in fact had a benign cyst. In their quest to block health care reform, Koch-funded groups have fostered extremism. A speaker with the roving Patients United bus tour repeatedly compared health reform to the Holocaust while an eight-by-five foot banner at an AFP health care rally with Rep. Michele Bachmann (R-MN) read, "National Socialist Health Care: Dachau, Germany" superimposed over corpses from a concentration camp. Although many were surprised at the level of anger AFP channeled into Democratic healthcare town halls in August, it wasn't the first time Koch groups have helped to hijack the health reform debate. Back in 1994, Americans for Prosperity, then known as Citizens for a Sound Economy, worked closely with then-House Speaker Newt Gingrich to bring mobs of angry men to health reform rallies with then-First Lady Hillary Clinton.

A LONG HISTORY OF STOPPING PROGRESS: The Koch brothers clearly have a financial stake in blocking reform. Koch Industry oil refineries are major carbon dioxide polluters, and George-Pacific, a Koch Industries timber subsidiary, is one of the largest contributors to the loss of carbon-sink capacity. According to the EPA, Koch Industries is responsible for over 300 oil spills in the U.S. and has leaked three million gallons of crude oil into fisheries and drinking waters. So there are clear business-related reasons why Koch would want to block regulatory enforcement, clean energy, labor, and other reforms. But part of their opposition stems from a long family tradition of funding conservative movements to shift the country to the far right. Fred Koch, father of Charles and David and the company's namesake, helped to found the John Birch Society in the late 1950s. The John Birch Society harnessed Cold War fears into hate against progressives, warning that President Kennedy, Civil Rights activists, and organized labor were in league with communists. By presenting progressive reform as a capitulation to the Soviet Union, Fred Koch and the other industrialists bankrolling the Birch Society were able to galvanize hundreds of thousands of middle class people into supporting their narrow agenda of cutting corporate taxes and avoiding consumer regulations.

Financial 'Reform' Preserves Too Big Banks, Too Much Speculation

Original Link: http://www.thenation.com/blogs/thebeat/505878/financial_reform_preserves_too_big_banks_too_much_speculation

By John Nichols

The U.S. House has voted for legislation that is described as "financial services reform."

But most of the "reforms" are so mild that the savviest of the nation's big bankers will be breathing sighs of relief, rather than worrying about being regulated into good behavior.

That's not to say that the House bill is meaningless. It proposes some valuable shifts, including the creation of a Consumer Financial Protection Agency that could – if infused with proper authority and backed by a White House and Congress that want to tip the regulatory balance in favor of the great mass of Americans – give bankers and speculators some headaches.

Unfortunately, that's a vague promise rather than a firm one.

Congressman Barney Frank, the Massachusetts Democrat who crafted the measure, declared Friday that, "We have a set of rules in place that will allow the most productive parts of the free market economy, and particularly the financial system, to play the role they should play, but with much less chance of abuse."

Up to a point, this is true. The legislation, which passed on a 223-202 vote (with all Republicans and 27 Democrats opposing), does sketch the rough outlines for real reform.

The problem is that the details are so sketchy that bank and insurnace company lobbyists have plenty of openings to game the system in their favor. And they could get even more as the Senate weighs reforms and then what are expected to be very different measures are reconciled, reviewed again by both chambers and sent to desk of a president whose administration has expressed discomfort with pieces of the House bill.

In other words, while there were those who claimed on Friday that the House had enacted "the biggest change in oversight of Wall Street since the Great Depression" and that "this bill puts the referees back on the field," the big banks aren't going to get sidelined -- let alone broken up -- anytime soon.

That weakness caused some of the House's most serious backers of banking reform -- including Ohio Democrats Marcy Kaptur and Dennis Kucinich -- to oppose what they saw as an insufficient initiative. "Although I am supportive of the Consumer Financial Protection Agency as well as other provisions in the bill," Kucinich explained, "ultimately I do not think this bill adequately addresses the causes of the financial crisis, and I do not believe the reforms are sufficient to prevent another financial crisis from occurring." Many other Democrats who knew the bill was flawed swallowed hard and votes for it because they saw it as opposing a framework for constraining at least some abuses by bankers and speculators.

On the plus side, as The New York Times notes:

The bill would create, at a cost that could run into the billions, a Consumer Financial Protection Agency in an attempt to head off the kinds of lending practices that led many homeowners to take on mortgages they could not afford.

The bill would bring regulation for the first time to a portion of the over-the-counter market for derivatives. It would create a process for dealing with troubles at very large financial institutions that might pose a risk to the financial system and the economy, and require large firms to contribute to a fund to help with an orderly dissolution of those institutions if they are in danger of failing.

And the bill includes a number of other provisions to address executive compensation, investor protections and regulation of hedge funds.

On the negative side, the House legislation fails to dismantle even the biggest of "too big to fail" firms that could still collapse the U.S. economy. It also fails to even address the most serious abuses of the world's $600 trillion derivatives market.

Why is the House bill so disappointing?

Of course, Republican opposition was a factor.

But the biggest frustration was the Democratic block that tried, at every turn, to defend the big banks and speculators.

Although he had plenty of competition from the likes of Illinois Democrat Melissa Bean (who sought at one point to roll back existing protections for consumers), the the worst player was Idaho Democrat Walter Minnick.

Minnick tried to gut consumer protections in the House legislation by blocking creation of a potentially-powerful Consumer Financial Protection Agency, which would have the authority to regulate everything from mortgages to credit card rates.

Specifically, Minnick proposed an amendment to replace real regulation with a maintain-the-status-quo "council of regulators. (The Idaho Democrat was spectacularly wrong, as Consumers Union President Jim Guest explained: "Consumers have paid a very steep price for years of weak federal oversight of unscrupulous banking and lending practices. It's time for Congress to put an end to do-nothing financial industry oversight and make sure that consumers have a real watchdog looking out for their interests.")

The key vote on financial services reform in the House was on the Minnick amendment, which was easily one of the most anti-consumer measures ever proposed by a Democratic member of the House.

One hundred and seventy five Republicans voted for the Minnick amendment, while none opposed it. No surprise there; while the Republican Party once was in the forefront of advancing consumer protections and smart business reforms, it is for the remainder of this session merely a "Party of No."

Joining the Republican backers of the move to gut the consumer protections were 33 Democrats. Most were southern and western "Blue Dogs" whose philosophy might best be described as: Even a little reform is too much if it makes the bankers unhappy.

They needn't worry too much.

While the House has acted, America is still a long way from "even a little reform."