This is nuts!!

Latest headline at the Post on-line: "Obama Urges Payments For Seniors, Disabled: President
tries to preempt bad news that Social Security checks will not
increase, saying they should receive emergency payments of $250."  This is so crazy.  The checks are not going up because they are tied to the Consumer Price Index and in this bad economy consumer prices have been flat over the past year.  Apparently, today's seniors are so damn entitled that they deserve their annual Cost of Living Adjustment (COLA) even when there's been no change in the cost of living!.  This is just pure political expediency with no redeeming value, despite Obama's protestations about it stimulating the economy.  So wrong.

 

The beginning of the end?

This morning I listened to a podcast of Bill Moyer's Journal's most recent episode on the theme of the lack of reform on Wall Street despite the recent fiasco of a financial crisis.  It was so depressing (but really worth watching or listening to).  Despite the overwhelming evidence of the need for dramatic reform, we're just tinkering at the edges.  Why?  Because there can be little doubt that Wall Street truly owns our Congress.  I don't doubt that there's plenty of good people in Congress (not so many on Wall Street), but we've reached a point where the whole system and institutional structure seems to be hopelessly rotten.  If we cannot get meaningful reform now, will we ever be able to?  Add to this, the latest news from Wall Street about record profitability.  I love the title of Kevin Drum's post, "Burn it down and salt the earth,"

I sort of feel like I've run out of things to say about this.  There's
an insanity here that's almost beyond analysis.  Wall Street can spark
an economic slowdown that misses destroying the planet and causing a
second Great Depression only by a hair's breadth — said hair being an
11th hour emergency infusion of trillions of taxpayer dollars — and
then turn around and use those trillions to return to bubble levels of
profitability within 12 months.  And they can do it even though the
rest of the economy is still suffering through the worst recession
since World War II.  It's mind boggling.

It's really got me depressed thinking about the future of our country.   Though in the midst of a country/empire's dominant era, it surely always seems that it will go on forever.  But just as Rome, France, Spain, Britain were once dominant global powers are no more, surely America's time will pass one of these days.  I think that in a hundred (two hundred?) years from know, when the historians look back at the Decline and Fall of the American empire, they will point to the early 21st century as the beginning of the end.  No, I don't mean to peg it all on George W. Bush, though I'd argue he's done more than his fair share, but I think said future historian may very well point to this as at time when we passed a tipping point on the effective functioning of our society and politics and began a downward spiral.  Pure speculation, of course, to which none of us will presumably ever really know the answer, but as much as I like President Obama, I just have this feeling we as a nation our definitely on the downhill slide. 

10 ways to make health care reform better

No, I'm not going to go to the trouble, but if you are interested enough in the title, check out this post by Jonathan Cohn (fully endorsed by Ezra Klein).

 

The intellectual failure of supply-side economics

In a summary for his new book, thoughtful conservative (I know, the term is practically an oxymoron these days) Bruce Bartlett explains the craziness that is the anti-tax focus of the modern Republican party:

During the George W. Bush years, however, I think SSE became
distorted into something that is, frankly, nuts–the ideas that there
is no economic problem that cannot be cured with more and bigger tax
cuts, that all tax cuts are equally beneficial, and that all tax cuts
raise revenue.

These incorrect ideas led to the enactment of many tax cuts that had
no meaningful effect on economic performance. Many were just give-aways
to favored Republican constituencies, little different, substantively,
from government spending. What, after all, is the difference between a
direct spending program and a refundable tax credit? Nothing, really,
except that Republicans oppose the first because it represents Big
Government while they support the latter because it is a "tax cut."

The supply-siders are to a large extent responsible for this mess,
myself included. We opened Pandora's Box when we got the Republican
Party to abandon the balanced budget as its signature economic policy
and adopt tax cuts as its raison d'être. In particular, the idea that
tax cuts will "starve the beast" and automatically shrink the size of
government is extremely pernicious.

Indeed, by destroying the balanced budget constraint,
starve-the-beast theory actually opened the flood gates of spending. As
I explained in a recent column,
a key reason why deficits restrained spending in the past is because
they led to politically unpopular tax increases. But if, as Republicans
now maintain, taxes must never be increased at any time for any reason
then there is never any political cost to raising spending and cutting
taxes at the same time, as the Bush 43 administration and a Republican
Congress did year after year.

Sounds like the book is worth a look.  Also reminded me of a great Atlantic article by Jonathan Rauch from a few years back, "Stoking the Beast."  This article is required reading for my public policy class and what I love about it is that it actually gets through to students.  I see it cited in their test answers more than about anything else I assign (except for the very disturbing excerpt from Fast Food Nation).  Anyway, it's short, give it a read.  Really.