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The EU is set to impose new sanctions on Iran / The Myth of the Forbes 400

The European Union is set to increase sanctions on Iran on Monday after failed negotiations over Iran's contested nuclear development program. British Foreign Secretary William Hague said they will continue to increase pressure on Iran until negotiations succeed. EU Foreign Policy head Catherine Ashton said sanctions that were imposed in July are "quite clearly having an effect" and the heightened sanctions are "to persuade Iran to come to the table."

Riots broke out earlier this month due to the dramatic fall of Iran's currency, the rial, which is down by about 80 percent since the beginning of the year. The new sanctions are expected to target Iran's banks, as well as trade and gas imports. Additionally, 30 more companies will be subject to an EU assets freeze.

Meanwhile, the United States and EU are working to close loopholes in sanctions on Iran after discovering that Tehran has been covertly using offshore tax havens in order to maintain crude oil shipments.  The National Iranian Tanker Co. (NITC), Iran's largest oil-vessel operator, has reportedly registered ownership of some of its tankers in Central America.  The NITC claims it is privatized but the United States classifies it as a government entity.

Despite severe sanctions, U.S. exports to Iran have risen by 32 percent this year up to $199.5 million. Exports were comprised primarily of wheat and other grains, dairy products, and medical, dental, and surgical products.  However, some humanitarian goods have declined including medicinal and pharmaceutical products.

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On the homefront:

The Forbes 400 or 400 Richest Americans (first published in 1982) is a list published by Forbes Magazine magazine of the wealthiest 400 Americans, ranked by net worth. The average net worth of a member on the list is a whopping $4.2 million.  Their total net worth rose to $1.7 trillion.  That's about a sixth of the EU's GDP.  

In 2011 the net worth of the Forbes 400 rose $200 billion.  A net worth of $1.1 billion is the minimum to make the list.

Source: 1995-2008: Arthur B. Kennickell, "Ponds and Streams: Wealth and Income in the U.S., 1989 to 2007," Federal Reserve Board Working Paper, January 7, 2009, Table A1, p. 55. 2009-10: Forbes Magazine press release via Business Wire. Adjusted for inflation using CPI-U.

In 2011 the median household income, adjusted for inflation, dropped by 1.5% to $50,054.

Forbes 400 Reinforces Flawed "We Built It" Claims & Misleads About Wealth & Opportunity in the U.S.

Forbes Magazine calls their list of the 400 richest Americans the "definitive scorecard of wealth in America," but a new report asserts the magazine is misleading. Born on Third Base: What the Forbes 400 Really Says About Wealth & Opportunity in America, released this week by Boston-based non-profit United for a Fair Economy, examines the sources of wealth for members of the Forbes 400 and uncovers the role of inheritance and privilege in economic mobility. The report urges Forbes to stop glamorizing the "self-made man" while minimizing the other factors in wealth accumulation, including tax policies, birthright, gender, and race.

The report finds that 40 percent of the Forbes 400 list inherited a sizable asset from a family member or spouse, and over 20 percent inherited sufficient wealth to make the list. In addition, 17 percent of the Forbes 400 have family members on the list.

"Forbes spins a misleading tale of what it takes to become wealthy in the U.S. by understating the overwhelming impact of birthright and privilege," said Shannon Moriarty, co-author of the report. "Economic success should be a function of achievement, not just a guarantee for people lucky enough to be born into wealthy families. The Forbes 400 shows that birthright and family privilege are still very much at play in the American Dream."

The report explains that the net worth of the Forbes 400 grew fifteen-fold between the launch of the list in 1982 and 2011, while wealth stagnated for the average U.S. household. In 1982, the wealth threshold for the Forbes 400 was $75 million; today, every person on the list is a billionaire.

Women accounted for just 10 percent of the list in 2011, and nearly 90 percent of those women inherited their fortunes. The whiteness of the Forbes 400 list also makes clear the racial wealth divide. In the past two years, just one African American made the list. "Instead of asserting that ‘the American dream is very much alive,’ Forbes should acknowledge that the opportunity to become wealthy has never been equally shared," said Moriarty. "The billionaire members of the Forbes 400 are exceptions, not the rule."

Born On Third Base takes Forbes to task for their misuse of the loaded term "self-made" and the undervaluing of privilege and social capital in financial success. "We disagree with Forbes claim that 70 percent of the list made their fortunes entirely from scratch," said Brian Miller, executive director of United for a Fair Economy and co-author of the book The Self-Made Myth.

"The 'self-made' and 'I built this' narratives wrongly present the opportunity to become rich as equally attainable by all people in today's highly stratified society. Forbes’ story also ignores the important contributions of others and the role of government in the success of the wealthiest Americans."

"Tax policies have for decades been tilted in favor of the very wealthy," said Tim Sullivan, federal policy coordinator at United for a Fair Economy. "Tax rates on capital gains have been slashed to historic lows, which is of particular benefit to the likes of the Forbes 400." The report explains that the wealthiest 0.1 percent (including those on the list) receive half of all net increases in capital gains. "Drastic cuts to the federal estate tax made under George W. Bush and extended with the 2010 Obama tax deal have made it easier for wealthy families to keep and amass even greater fortunes," said Sullivan.

"As was once said of President George W. Bush, many of those on the Forbes 400 were ‘born on third base’ but claim to have ‘hit a triple,’ and the Forbes 400 list perpetuates this falsehood," said Moriarty.
United for a Fair Economy is launching a petition to coincide with the release of the Forbes 400 and the Born on Third Base report, asking Forbes to tell the whole story of wealth and opportunity in the U.S. Download the report and see the petition at www.faireconomy.org/BornOnThirdBase2012.

Paul Ryan's New Novella, Path to Prosperity, is Paul Ryan's Personal Path to Prosperity

I've just finished reading a great work of fiction called Path to Prosperity (PTP) by Paul Ryan.  It's quite a stirring read.   The novel is nearly as captivating as imagining the salivating neocons gnawing at the bit as the PTP races through the spin cycle of the right-wing's brand of media, namely Limbaugh (when's he going to Costa Rica?).  It is set in a mythical land called Ameri-can, whose motto is Yes we can, where people have been trodden on by an evil dictator named Obama and forced to accept an evil plan called Obamacare.  It's almost as thrilling as John Boehner's impassioned remonstration of TARP.  But it's in the conclusions of PTP that this tale competes with Zeus in apocryphal proportions. 

While it may be true that America has a debt problem it might not be right to characterize it as a crisis.  Yet that's what the PTP does. 38 times, just to be sure, I suppose.  It then proceeds to outline cuts from everything like pork and $6.2 trillion dollars in government waste to cuts in taxes.  Yes, cuts in taxes.  Cuts in taxes will clear up the debt; cutting money coming in while increasing money going out, all the while reducing the deficit and American's debt.  Sound plausible? 

Mr. Ryan and the rest of the House Committee on the Budget proposes to reduce the deficit while also reducing revenue. This sounds like someone explaining how to pay off credit card debt, student loans, and a home mortgage by sleeping all day.  IF it sounds too good to be true, it probably is.

There are a few things the PTP does well.  Its articulate description of our nation's debt and deficit is very, well, descriptive.  There are pie charts and graphs including one cool pie chart that has a graphic flag of China in it. Evidently Paul Ryan and his posse are going to fix medicare, cut spending, and get rid of the evil Obamacare (which isn't it's real name, by the way; it's really called Obamamania or the Affordable Care Act) because that's all evil cast upon this great nation from the left, which has really become the center-left, well the ACA is really from the conservative Heritage Foundation, but nevertheless it's wrong for America. 

Mr. Ryan like so many of our politicians in office is living the American dream.  In fact he's Rip Van Winkle.  He would have us believe that he has in his interest the best interests of the country.  In actuality he's just looking after himself and his reelection coffers.

The PTP is long - it's like 70 pages - and it's mostly drivel.  But for a work of fiction it's not a bad first attempt. What it does a really good job at is what it doesn't do.

The PTP doesn't reveal that Congress is looting this country.  I mean wait until these numbers appear - down below - they're actually a bit astounding.  The overarching tenet of debt reduction according to PTP is through tax cuts and the dismantling of medicare and Obamacare.  There's no mention of the wasted dollars on the continuing failed drug war.  No mention of two failed wars.  No mention of mass incarceration and the new Jim Crow.  No mention of the continued tax cuts for the wealthy.  No mention of reducing the military budget; the PTP allots $690 billion to military spending that's not including war funding (think Iran here).  By the way, the Medicare Program's total expenditures in 2010 were $523 billion. And, there's no mention of any reduction of federal salaries. 

Oh, okay, Mr. Ryan mentions salaries.  Yes on page 33, "Salaries for federal workers continue to outpace pay for their private-sector counterparts. Average wages in the federal civilian workforce ($74,311 in 2010) far eclipse the $49,777 median wages in private industry."  That's it.  No mention of his salary or any other members of Congress or the cuts that he would accept.

While the GOP would like the public to believe that the PTP will cut government spending to workers, it won't cut government spending on elected officials or their staffs (maybe they're not workers).

Anyway, members of Congress make quite a bit more money than those federal civilians do and they pay their staff members fairly well too.  Mr. Paul Ryan earned $174,000 last year plus (excellent, might I add) health benefits and a (quite robust, I would say) retirement plan.  He reimbursed his staff $858,000 including $138,780 for his Chief of Staff, some Andy guy, that lucky turd.  And Ryan is a frugal member!

• The salary of rank-and-file members of Congress: $174,000 plus benefits (health insurance and retirement)
• The government ships off $223,500 to that sad sap Boehner and $193,400 for party leaders
• Ron Johnson earns $174,000 and paid his staff nearly a million bucks and what'd he do.  
• Herb Kohl?

Aren't these guys already millionaires?  What do they need more money for?  I thought they were in the service of their country not that the country was serving them.

Just imagine if the PTP included real cuts. The kind of cuts I think the American people could really appreciate.  
To congressional pay: Average wages in the federal elected workforce ($183,000 in 2010) far eclipse the $49,777 median wages in private industry. This Budget will repair that. Each Member of Congress will receive wages commensurate to the average wage according to the Average Wage Index (AWI).  According to the AWI, the average wage in America in 2011 was about $49,777.  These reductions would enable the government to cut $75 million dollars from the payroll.  In addition, Chiefs of Staff would also have a reduction of pay ensuring an additional 45-53 million dollars of savings.

Now wouldn't that be a budget we could trust?  Maybe not, but it would make a good start.

In the end Paul Ryan saves American from the foreign dictator Obama yet the American people face greater suffering than at any previous time since the Great Depression ravaged their country.  Poverty explodes and the rich fat cats buy spacecrafts to enter orbit. The PTP is the new Atlas Shrugged.

                                                                                                                                   

For further reading check out these sites:

National Wage Average according to the Social Security Administration:
https://www.socialsecurity.gov/OACT/COLA/AWI.html

The Medicare Program is the second-largest social insurance program in the U.S., with 47.5 million beneficiaries and total expenditures of $523 billion in 2010.
http://www.cms.gov/reportstrustfunds/


For more information about congressional salaries see:
http://www.senate.gov/reference/resources/pdf/97-1011.pdf
http://www.legistorm.com/salaries.html

http://motherjones.com/politics/2011/03/denial-science-chris-mooney

http://www.childrensdefense.org/child-research-data-publications/data/state-of-americas-children-2010-report-key-facts.pdf

http://www.aypf.org/publications/WhateverItTakes/WIT_nineseconds.pdf

http://classes.dma.ucla.edu/Winter05/154B/anti_violence.pdf

http://www.publicpolicypolling.com/main/wisconsin/

http://archive.aflcio.org/corporatewatch/paywatch/ceou/database.cfm

Throw Out the Money Changers

http://www.truthdig.com

By Chris Hedges
These are remarks Chris Hedges made in Union Square in New York City last Friday during a protest outside a branch office of the Bank of America.

We stand today before the gates of one of our temples of finance. It is a temple where greed and profit are the highest good, where self-worth is determined by the ability to amass wealth and power at the expense of others, where laws are manipulated, rewritten and broken, where the endless treadmill of consumption defines human progress, where fraud and crimes are the tools of business.

The two most destructive forces of human nature—greed and envy—drive the financiers, the bankers, the corporate mandarins and the leaders of our two major political parties, all of whom profit from this system. They place themselves at the center of creation. They disdain or ignore the cries of those below them. They take from us our rights, our dignity and thwart our capacity for resistance. They seek to make us prisoners in our own land. They view human beings and the natural world as mere commodities to exploit until exhaustion or collapse. Human suffering, wars, climate change, poverty, it is all the price of business.

Nothing is sacred. The Lord of Profit is the Lord of Death.

The pharisees of high finance who can see us this morning from their cubicles and corner officers mock virtue. Life for them is solely about self-gain. The suffering of the poor is not their concern. The 6 million families thrown out of their homes are not their concern. The tens of millions of pensioners whose retirement savings were wiped out because of the fraud and dishonesty of Wall Street are not their concern. The failure to halt carbon emissions is not their concern. Justice is not their concern. Truth is not their concern. A hungry child is not their concern.

Fyodor Dostoyevsky in "Crime and Punishment" understood the radical evil behind the human yearning not to be ordinary but to be extraordinary, the desire that allows men and women to serve systems of self-glorification and naked greed. Raskolnikov in the novel believes—like those in this temple—that humankind can be divided into two groups. The first is composed of ordinary people. These ordinary people are meek and submissive. They do little more than reproduce other human beings in their own likeness, grow old and die. And Raskolnikov is dismissive of these lesser forms of human life.

The second group, he believes, is extraordinary. These are, according to Raskolnikov, the Napoleons of the world, those who flout law and custom, those who shred conventions and traditions to create a finer, more glorious future. Raskolnikov argues that, although we live in the world, we can free ourselves from the consequences of living with others, consequences that will not always be in our favor. The Raskolnikovs of the world place unbridled and total faith in the human intellect. They disdain the attributes of compassion, empathy, beauty, justice and truth. And this demented vision of human existence leads Raskolnikov to murder a pawnbroker and steal her money.

The priests in these corporate temples, in the name of profit, kill with even more ruthlessness, finesse and cunning than Raskolnikov. Corporations let 50,000 people die last year because they could not pay them for proper medical care. They have killed hundreds of thousands of Iraqis and Afghanis, Palestinians and Pakistanis, and gleefully watched as the stock price of weapons contractors quadrupled. They have turned cancer into an epidemic in the coal fields of West Virginia where families breathe polluted air, drink poisoned water and watch the Appalachian Mountains blasted into a desolate wasteland while coal companies can make billions. And after looting the U.S. treasury these corporations demand, in the name of austerity, that we abolish food programs for children, heating assistance and medical care for our elderly, and good public education. They demand that we tolerate a permanent underclass that will leave one in six workers without jobs, that condemns tens of millions of Americans to poverty and tosses our mentally ill onto heating grates. Those without power, those whom these corporations deem to be ordinary, are cast aside like human refuse. It is what the god of the market demands.

When Dante enters the “city of woes” in the Inferno he hears the cries of “those whose lives earned neither honor nor bad fame,” those rejected by Heaven and Hell, those who dedicated their lives solely to the pursuit of happiness. These are all the “good” people, the ones who never made a fuss, who filled their lives with vain and empty pursuits, harmless perhaps, to amuse themselves, who never took a stand for anything, never risked anything, who went along. They never looked hard at their lives, never felt the need, never wanted to look.

Those who chase the glittering rainbows of the consumer society, who buy into the perverted ideology of consumer culture, become, as Dante knew, moral cowards. They are indoctrinated by our corporate systems of information and remain passive as our legislative, executive and judicial branches of government—tools of the corporate state—strip us of the capacity to resist. Democrat or Republican. Liberal or conservative. It makes no difference. Barack Obama serves corporate interests as assiduously as did George W. Bush. And to place our faith in any party or established institution as a mechanism for reform is to be entranced by the celluloid shadows on the wall of Plato’s cave.

We must defy the cant of consumer culture and recover the primacy in our lives of mercy and justice. And this requires courage, not just physical courage but the harder moral courage of listening to our conscience. If we are to save our country, and our planet, we must turn from exalting the self, to subsuming of the self for our neighbor. Self-sacrifice defies the sickness of corporate ideology. Self-sacrifice mocks opportunities for advancement, money and power. Self-sacrifice smashes the idols of greed and envy. Self-sacrifice demands that we rise up against the abuse, injury and injustice forced upon us by the mandarins of corporate power. There is a profound truth in the biblical admonition "He who loves his life will lose it."

Life is not only about us. We can never have justice until our neighbor has justice. And we can never recover our freedom until we are willing to sacrifice our comfort for open rebellion. The president has failed us. The Congress has failed us. The courts have failed us. The press has failed us. The universities have failed us. Our process of electoral democracy has failed us. There are no structures or institutions left that have not been contaminated or destroyed by corporations. And this means it is up to us. Civil disobedience, which will entail hardship and suffering, which will be long and difficult, which at its core means self-sacrifice, is the only mechanism left.

The bankers and hedge fund managers, the corporate and governmental elites, are the modern version of the misguided Israelites who prostrated themselves before the golden calf. The sparkle of wealth glitters before them, spurring them faster and faster on the treadmill towards destruction. And they seek to make us worship at their altar. As long as greed inspires us, greed keeps us complicit and silent. But once we defy the religion of unfettered capitalism, once we demand that a society serve the needs of citizens and the ecosystem that sustains life, rather than the needs of the marketplace, once we learn to speak with a new humility and live with a new simplicity, once we love our neighbor as ourself, we break our chains and make hope visible.

Chris Hedges is a senior fellow at The Nation Institute and a weekly columnist for Truthdig. His latest books are "Death of the Liberal Class" and "The World as It Is: Dispatches on the Myth of Human Progress."

Wall Street rating agencies' corrupt system

Friday, August 19, 2011

By Al Franken

"Let's hope we are all wealthy and retired by the time this house of cards falters."

This quote, taken from an e-mail sent by a Standard & Poor's official in 2006, says it all.

Just two years after it was written, the house of cards that S&P helped build collapsed and roiled the global economy. And while I welcome the news that the Justice Department has launched an investigation into S&P, I imagine it will conclude what a lot of us have long known: S&P made record profits by knowingly handing out sterling credit ratings to complete junk.

It was the incompetence and corruption by S&P and its peers, Fitch and Moody's, that played a pivotal role in our financial meltdown that cost Americans $3.4 trillion in retirement savings, triggered the Great Recession with its massive business failure and job losses, and consequently caused the explosion of our national debt.

The root of this corruption? The flawed "issuer pays" model on which the entire credit rating industry is based.

The Big Three rating agencies were paid a fortune by Wall Street to hand out pristine AAA ratings to the subprime mortgage-backed securities the banks issued -- securities that turned out to be junk. No AAA rating? The issuer would take its business -- and its hefty fees -- elsewhere.

And then when Wall Street ran out of subprime mortgages to securitize, it created another market by securitizing bets on those securities, which the Big Three also obediently gave their top rating. The rest is history.

Sell-off goes global
The rating agencies' complicity bred the kind of incompetence that was on full display the day S&P downgraded our government's credit rating this month. Within minutes, Treasury Department analysts identified a $2 trillion dollar error in S&P's calculations. But instead of admitting its error, S&P simply came up with other reasons to justify its downgrade.

Why? Well, the rating agencies have an enormous stake in intimidating the federal government. As Jeffrey Manns, associate professor of law at George Washington University, recently wrote in The New York Times:
"The credit rating agencies are taking advantage of the country's financial problems to increase their own political power. ... The Dodd-Frank Wall Street reform law, enacted a year ago but not fully implemented yet, threatened to introduce unprecedented oversight and regulation."

The greatest such threat is the bipartisan Franken/Wicker provision (introduced with Sen. Roger Wicker, R-Mississippi) in the Dodd-Frank Wall Street reform bill. If our provision is implemented in full, it would end the credit rating agencies' gravy train by rooting out the conflicts of interest from the "issuer pays" model.

Our provision directs the Securities and Exchange Commission to create an independent self-regulatory organization that would assign the initial credit ratings of securities to one agency. The assignments could be based on agencies' capacity, expertise, and, after time, their track record.

Our approach would incentivize and reward excellence. The current pay-for-play model -- with its inherent conflict of interest -- would be replaced by a pay-for-performance model. This improved market would finally allow smaller ratings agencies to break the Big Three's oligopoly.

The independent board would be comprised mainly of institutional investors, who have the greatest stake in the reliability of credit ratings, along with representatives from the credit rating and banking industries.

Lest you think that this is some kind of big government regulation of the free market, please understand that my colleague, Wicker of Mississippi, is one of the Senate's most conservative members. And it passed the Senate with a large majority, including 11 Republican votes, because it's not a progressive or a conservative idea -- it's a commonsense idea.

Our proposal encountered resistance from the Big Three rating agencies at every step. They defeated a similar provision in the House of Representatives, lobbied against it during the Senate debate on the bill and ultimately succeeded in "downgrading" the provision to a study in the final legislation. Still, the final language requires that the SEC implement our provision, or a similar alternative, if its study reveals that the conflicts of interest continue to put investors and the public at risk.

The Big Three are well aware that their fates rest, in part, on the outcome of this SEC study, due out next year. And the S&P's recent downgrade may well have been the industry's shot across the bow, an attempt to intimidate SEC regulators. It appears that the rating agencies have essentially gone from being recipients of bribery to the perpetrators of extortion.

When the Big Three's house of cards finally collapsed, the rest of America paid the price. Until we rein in the corruption of the credit rating agency industry, we are just asking for it to happen all over again.

Statement by Sen. Bernie Sanders on Social Security

August 25, 2011

Sometimes we all tend to take things for granted and we forget that Social Security is the most successful government program in our nation's history.  Let's be clear.  For more than 75 years, Social Security has, in good times and bad, paid out every nickel owed to every eligible American.  Social Security has succeeded in keeping millions of senior citizens, widows and orphans and the disabled out of extreme poverty.  Before Social Security was developed, about half of our seniors lived in poverty.  Today, fewer than 10 percent live in poverty and all of that is done with minimum administrative costs.  In America right now more than 53 million Americans, including over 120,000 Vermonters, receive Social Security benefits.  In our state Social Security benefits total over $1.5 billion per year, an amount equivalent to 6 percent of the state's annual GDP.

Today, Social Security is facing an unprecedented attack from those who either want to privatize it completely or who want to make substantial cuts.   In the coming months, a so-called super-committee in Congress made up of 6 Republicans and 6 Democrats will be making decisions to cut the national debt by some $1.5 trillion over the next decade.  Social Security is on the table and could be cut by that committee.

The argument being used to cut Social Security is that because we have a significant deficit problem and a $14 trillion national debt, we just can't afford to maintain Social Security benefits.  This argument is false.  Social Security, because it is funded by the payroll tax, not the U.S. Treasury, has not contributed on nickel to our deficit.  In fact, according to a very recent study by the Congressional Budget Office ( CBO) Social Security has a $2.5 trillion dollar surplus and can pay out every penny owed to every eligible American for the next 27 years until 2038.  At that point it has enough money to pay over 80% of promised benefits.

Unfortunately, Republicans in Congress and too many Democrats, have been discussing harmful cuts to Social Security as part of an overall scheme to balance the budget on the backs of the elderly, the sick, the children, and working families.  That is wrong, it is unconscionable, and it must not happen!

John Boehner, the Speaker of the House, and the President's Fiscal commission have both recommended raising the retirement age to 69 or 70.  That, for obvious reasons, would be a disaster.  Recently, the attack most discussed would be to reduce the cost of living adjustments (COLA) for Social Security recipients by coming up with a new formulation for COLAs called a "chained CPI."

What would these proposed cuts to COLAs mean in the real world?  For average 65 year olds living on about $16,000 a year, it would mean receiving $560 less each and every year when they turn 75 and $1,000 less a year when they reach 85.  Imagine that.  Taking $1,000 a year away from a frail and sick 85 year old woman who is living on $16,000 a year.  In my view that is not what this country is supposed to be about.
At a time when seniors, veterans, and persons with disabilities haven't received a COLA in the last two years, and at a time when the price of prescription drugs and medical care has skyrocketed, Republicans and too many Democrats believe that the formula for calculating COLAs is too generous.  That is absurd!
Instead of cutting Social Security COLAs or raising the retirement age, there is a much fairer way to make Social Security solvent for the next 75 years.

Right now, an American who makes $106,800 a year pays the same amount of money into the Social Security system as a millionaire or a billionaire.  That is because today, all income above $106,800 is exempt from the Social Security payroll tax.  As a result, 94% of Americans pay Social Security tax on all of their income, but the wealthiest 6% do not.  That is wrong and that has got to change.

That's why I will be introducing the Keeping Social Security Promises Act as soon as the Senate gets back into session.

This legislation will strengthen Social Security for the next 75 years by asking the wealthiest Americans to pay their fair share into Social Security.

Specifically, my legislation would apply all income over $250,000 a year to the Social Security payroll tax.
The Chief Actuary of the Social Security Administration has projected that doing this will ensure that Social Security can pay out all benefits for at least the next 75 years.

In fairness, I can't take credit for this legislation.  It is exactly what Barack Obama proposed to do when he campaigned for President back in 2008.

During the presidential campaign, candidate Barack Obama said: "What we need to do is to raise the cap on the payroll tax so that wealthy individuals are paying a little bit more into the system.  Right now, somebody like Warren Buffet pays a fraction of 1 percent of his income in payroll tax, whereas the majority . . . pays payroll tax on 100 percent of their income. I've said that was not fair."  The President's specific campaign proposal was to apply Social Security payroll taxes to all income above $250,000.  In other words, the proposal I will be introducing is exactly what the President campaigned on. 

Social Security is a promise to Vermonters and all Americans that when they get old, if they become disabled, or if they lose their parents, they will not live in abject poverty.  Social Security is a promise that we cannot break.  We have got to keep our word.  And, that's exactly what this legislation would do.  

Corporations pushing for job-creation tax breaks shield U.S.-vs.-abroad hiring data

Source: Washington Post
By Jia Lynn Yang

August 22, 2011

Some of the country's best-known multi­national corporations closely guard a number they don't want anyone to know: the breakdown between their jobs here and abroad.

So secretive are these companies that they hand the figure over to government statisticians on the condition that officials will release only an aggregate number. The latest data show that multinationals cut 2.9 million jobs in the United States and added 2.4 million overseas between 2000 and 2009.

Some of the same companies that do not report their jobs breakdown, including Apple and Pfizer, are pushing lawmakers to cut their tax bills in the name of job creation in the United States.

But experts say that without details on which companies are contributing to job growth and which are not, policymakers risk flying blind as they try to jump-start the hiring of American workers.

"It's an important piece of information that the American people should have," said Ron Hira, an associate professor of public policy at the Rochester Institute of Technology. "Should you listen to the kind of advice these companies have about how to grow the economy when their record and their model indicates they've cut jobs? . . . Or should we talk to people who actually do create jobs in the United States?"

As the country faces an unemployment crisis, President Obama, lawmakers and business lobbyists have all touted the country's biggest companies as critical to creating jobs.

The head of Obama's jobs council, General Electric chief executive Jeff Immelt, said during a tour of a company plant in Greensboro, S.C., that firms should be ready to answer questions from the public.

"If you want to be an admired company, you better know, you better have accountability, and you better think through where the jobs are," he said.

GE breaks out its employment numbers in company filings to the Securities and Exchange Commission. In 2010, about 46 percent of GE's 287,000 employees worked in the United States, compared with 54 percent in 2000.

But many firms, including some whose executives have counseled Obama on the economy, do not put their number of U.S. workers in their annual reports.

IBM chief executive Sam Palmisano has met a number of times with the president, most recently in July at a lunch with other executives to talk about jobs and the economy. IBM stopped giving its U.S. head count in 2009.

"We just made a policy that we would only break out global head count," said company spokesman Doug Shelton.

Data from before 2009 showed IBM rapidly shifting workers to India. Dave Finegold, dean of the Rutgers School of Management and Labor Relations, estimates that 2009, when the company stopped sharing its U.S. employment figure, also marked the first time the company had more employees in India than the United States. Finegold based his number on reports from the media, third-party groups and former employees who have tried to track the number.

"IBM can do as it wishes, and the rest of us have to guess," said Lee Conrad, national coordinator for Alliance@IBM, a group trying to unionize IBM workers.

You won't find Procter & Gamble's U.S. head count in its filings, either. When initially asked for the number, company spokesman Paul Fox wrote in an e-mail: "We do not track nor report U.S.-specific jobs numbers vs. jobs overseas." After it was pointed out that P&G's chief executive, Bob McDonald, had cited such figures in a Cincinnati Enquirer op-ed piece, Fox acknowledged the company did track that data. The number of U.S. employees is 35,000 out of 127,000 total, or 28 percent.

Other companies that do not reveal their job breakdowns include Hewlett-Packard, AT&T, Apple and Pfizer, which stopped reporting the number in its SEC filings in 2000.

The latter two are part of a coalition of companies pushing for Congress to give them a tax break on money they have parked overseas, saying that any money brought back to this country would spur hiring.

There is no law requiring companies to reveal publicly where their employees are based. Companies can choose to include the breakdown of jobs here and abroad in their SEC filings for the benefit of shareholders. But they are required by law to report the numbers to the Commerce Department, which compiles a yearly report on total employment by U.S. multinationals.

Ray Mataloni, a staff researcher at the U.S. Bureau of Economic Analysis, said the government gets the numbers only with the agreement that it will not disclose firm-level data. "I don't think it's a question of companies feeling like they're hiding dirty laundry by not giving this information out," Mataloni said. "I don't think they really have anything to hide, but I don't really know the logic of why that's something they don't just put in their annual report."

A few companies expressed worry about their competitors knowing too much about their operations.
Scott N. Paul, executive director of the Alliance for American Manufacturing, said it's because of the politics. "Outsourcing has become a lightning rod, and the media coverage they're likely to get is unfavorable," Paul said.

For chief executives of multinational companies who are used to answering only to their shareholders, the country's jobs crisis has uncomfortably switched the political spotlight onto their decisions about who they employ and where. It has also thrown into relief the fact that when U.S. multinationals chase profits and hire workers anywhere in the world, they become less tied to any one country, including this one.

Immelt acknowledged last month that the health of a company such as GE is now less connected to the U.S. economy, but he added that companies including GE "got carried away" with outsourcing. "I'm a GE leader first and foremost," he said. "At the same time . . . I work for an American company."

Who's Government Funded?; More Shared Sacrifice: Students Bear Burden; Jury's out for Professors; Massive Debt? Thank GW Bush; Bluffing out Confessions

It's hard to tell which party represents the average workers and which party receives the average workers' votes. It's a bit mind boggling when a 57 year old disabled veteran on Social Security, receiving Veteran's Insurance, and receiving meals-on-wheels votes republican. That's called voting against one's own self-interest and it happens all of the time especially since many of the folks who benefit from government social programs don't believe that they are receiving government assistance.

Suzanne Mettler of Cornell University found precisely that. In "Reconstituting the Submerged State: The Challenges of Social Policy Reform in the Obama Era" Mettler uncovered that large percentages of people receiving government assistance actually believed it was not government assistance (e.g. the guy with the "Keep Your Government Hands Off My Medicare).  Turns out that's not so rare.

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So we're all in this together.  That's true if "together" has semantically shifted and now means the poor are screwed.  The burden of the sacrifices pushed for in Washington by the tea baggers and republicans are again targeted at a minority class who receive assistance that accounts for a negligible amount of government spending: graduate students.

Even though the Prez wants more access to higher education, he's willing to waive the nominal amounts spent by the fed on interest accrued on graduate student loans as part of the cuts in the recent debt discussions and compromise.  Even though Pres. Obama seemingly fought with little effort, these cuts are purely republican reductions.  Republicans are forced to cut to any social programs that benefit citizens because they are unwilling to raise more revenue or cut military spending.  The cuts to student aid will save the government $18 billion over the next ten years.  And it will mean graduate students will be spending a lot more time at their parents' homes.  Another very good reason why parents of graduate students should be voting against republicans.

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Also in higher education, a new study found that socioeconomic equity in America is but a myth.  The evidence is in the pudding of elite colleges and universities.

For many years the one thing America really had going for it, one advantage over the rest of the world, was the higher education sector.  Poor, rich, minority, majority - the level playing ground was the university setting.  That is quickly evaporating.  The costs associated with higher education are rising making equity in higher education a thing of the past.

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Evidently professors are too liberal to serve as jurors and the Nevada Supreme Court agrees. 

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Thanks to Lori Montgomery for this article devoted to the causes of our current debt crisis.  If there are people you know who think Obama is responsible for the mess we're in, get them a copy of this article; it's more articulate than anything in the Wisconsin State Journal.

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Almost last but not least is this fascinating study on false confessions.  Saul Kassin and Jennifer Perillo of the John Jay College of Criminal Justice instructed a group of university students that they were taking part in a test of their reaction times.  The students were asked to press keys on a keyboard but not to push the ALT key because depressing the ALT key would cause the computer to crash and all of the data to be lost.

The computer, in fact, was designed to crash no matter which keys were pushed.  When this happened, the student was accused of pushing the illicit key.  When prodded to confess, a quarter of the students confessed to pushing the error causing button when in actuality only one student had pushed the ALT button.

"Results suggest that the phenomenology of innocence can lead innocents to confess even in response to relatively benign interrogation tactics."

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Sen. Johnson's reply

Dear Kilgore,

Thank you for taking the time to write me regarding the federal debt ceiling. The debt ceiling limits the amount of debt the federal government can incur. The United States recently reached its borrowing limit, although Treasury Department measures have pushed back the final deadline to August 2, 2011.

Our nation's fiscal situation is dire. This year alone, Washington will add $1.5 trillion to our nation's debt, which currently totals $14.3 trillion. This mountain of debt threatens the hopes and dreams of future generations. It is immoral. It has to stop. I am willing to work with anyone in Congress who is serious about addressing the number one problem facing our nation.

Unfortunately, neither the Administration nor Democrats in the Senate have offered any serious budget proposal. President Obama's budget for FY2012 would increase our already massive federal debt by $13 trillion over the next decade. This budget was defeated in the Senate by a vote of 0-97, which was a stunning repudiation of President Obama's leadership on this issue.

The Senate, which is controlled by Democrats, has not passed a budget in more than two years. This is irresponsible and puts our nation in fiscal peril. Until the President and Senate Democrats get serious, it will be very difficult to pass legislation that begins to put us on the path of fiscal responsibility.

Without a credible plan to restrain spending and grow our economy, the Administration has instead sought to force Congress into increasing the debt ceiling for the eleventh time in the last decade. Treasury Secretary Timothy Geithner recently admitted that the Administration has no contingency plan if the Congress does not vote to increase the debt ceiling to allow for more federal borrowing.

On May 25th, I wrote a letter signed by 22 of my Republican colleagues that urged the President to develop a back-up plan in case Congress does not vote to raise the debt ceiling. Businesses and families across America have contingency plans, and the federal government should have one too.

On July 15th, the House of Representatives introduced the Cut, Cap, and Balance Act (CCB), which was passed four days later and sent to the Senate. I believe CCB offers real solutions to our fiscal problems. This act would cut spending for next fiscal year, put into place hard spending caps that will put us on a path to a balanced budget, and introduce a Balanced Budget Amendment to send to the States to ratify. Unfortunately, Senate Democrats tabled CCB before it had a chance to be debated and voted on.

I agree that we need a balanced approach which includes spending controls and increased revenue. But we need to increase revenue the old fashioned way, by growing our economy. The President and the Democrats want to increase taxes, but how many jobs will those taxes create? The answer is that more than likely, it will destroy jobs. Any tax increase will do far more to harm our economy than it will to help. The number one component of the solution to our fiscal crisis is economic growth.

We are bankrupting our nation. Every morning I wake up and ask myself one question: "what can I do to stop it?" I hope that the Administration and my colleagues in the Congress will come together to seriously tackle our fiscal crisis before the Treasury Department runs out of options. However, I will not vote to increase the debt ceiling unless we adopt strong measures to rein in federal spending and balance our budget.

Thank you again for taking the time to share your concerns with me. I apologize for any delay you have experienced in receiving this reply. Since I took office in January, I've received more than 200,000 pieces of correspondence. My staff and I are working hard to respond in a timely way.

Please feel free to contact me in the future with anything important to you or your family. It is an honor to serve you and the good people of Wisconsin.

Sincerely,

Ron Johnson
United States Senator

Ron Johnson, Savior of the Universe! and Debt Arbiter

Dear Senator Johnson,

I am writing to urge you to collaborate with your fellow senators to come to a compromise with the Democrats on how to effectively raise the debt ceiling, cut spending, and, heaven forbid, raise revenue.
 

Frankly I didn't see what was wrong with the plan proposed by the "Gang of Six".  That seemed to address both cuts and raise revenue.   I see this as a great opportunity for you, a freshman Senator from Wisconsin.  You have been pretty quiet so far, laying low, biding your time.  This could be it!

I understand that the Republicans, of which you are one, are under a mandate not to cooperate with the Democrats.  That’s very funny (interesting not laughable) because I recently encountered a similar problem.  I was visiting my son’s third grade classroom – they work in groups and solve problems collectively.  They’re not competing with each other to take credit for the answer.  They strive to solve the problem together.  That immediately reminded me of congress and how convoluted our elected officials are that cooperation and collaboration have become dirty words in Washington.

One of the problems it seems is that many people in the country mistakenly believe that government ought to be run like a business.   But as you know from running your own businesses our government is not a business.   Businesses are created to earn owners and/or shareholders a profit.  Our government was created to provide for the welfare of the people - as our Constitution clearly reads (Prelude & Art. 1 Sec. 8).  Not once in the Constitution does it direct the government to turn a profit.   It is therefore a mistake to think that elected officials should be acting like CFOs in charge of a massive conglomerate.  That just isn’t how our government is supposed to function.

Even if our government were to function like a business, I think you would agree that negotiation and compromise would still be essential in order to make deals.  Businesses negotiate and deal 24 hours a day 7 days a week.   I don’t have to tell you about how to do business.  You’re doing a remarkable job that most of us should respect.  You managed to turn $8m spent on campaigning into an $8m business reimbursement.   Now that’s some slick maneuvering that we could use about now up on the Hill.  Some of that savvy could be just what is needed to break the stalemate and get legislation passed that raises the debt ceiling, makes $2.5t in cuts and raises $1.5t in revenue.    After all we need to come up with a $4t austerity package.  If anyone can do that you can.

Our country needs your leadership in Washington not the incessant bickering and whining of media driven lawmakers seeking attention by holding up legislative processes without warrant. 

I know that Republicans (of which you are one) have made a pledge not to raise taxes, but that’s your job.  Congress has the job of raising taxes and providing for the welfare of the people (see Constitution Article 1, Sections 1-10).  Many legislators would like to think that the wealthiest people are the only ones that matter because they contribute to the political coffers.  But unfortunately elected officials also have to represent the other 90% of Americans.  That may come as a disappointment to some but as a freshman Senator from Wisconsin this could be your big opportunity to make a name for yourself!

It may be that too many millionaires (of which you are one, by the way) have been elected to congress and have too much of their own interests at stake.  This could be a problem for some but elected officials, such as you, have been elected to overlook their own interests with the interests of the people as a priority.

For example, PACUR has employed many Wisconsinites (and Chinese) and provided for their well-being or directed them to available resources for health care insurance such as Badger Care (or the local clinic for factory workers – a concrete compound with a guy in a white coat who calls himself a doctor after he earned  a high school diploma from a vocational school that trains "tooth doctors").  Through your philanthropy as a business owner, you are responsible for the well-being of hundreds of workers.  Those typical American workers rely on each pay check to make ends meet.  Many have no savings.  Many are struggling to afford health insurance with a $5,000 deductible and $800/mo premium.  Many are managing this feat on less than $26,000/yr.  

But here I am rambling on about how you have contributed to society.  Someone might accuse me of being irreverent.  But I know that you don’t see it that way because you are a Senator of principle.  You have a strong belief that you were elected to make this country healthy.  And I agree.  Here’s a great way to start.  Now is your opportunity to put aside party politics and come to a cooperative deal – a compromise.  You’d stand out as the first Republican.  You’d break the deadlock.  It’d be politically advantageous – your popularity numbers would soar.   Yes, I think you’d earn points with Liberals.

Unlike many of my friends and colleagues I have faith that our elected officials can act responsibly and pass the necessary legislation that insures America is heading in the right direction.  I believe that even though we may not be on the same partisan side of the coin you share my sentiment that the people who were elected to make these decisions can come together and create equitable legislation that represents every American and especially looks after the neediest among us who cannot afford to make themselves heard. 

I trust that your leadership as a successful businessman can help congress reach bipartisan legislation that puts you, I mean Wisconsin, on the map.   

Thank you for your time and good luck - we'll need it.

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Ron Johnson really is a dick.  He posted this interview on his own website.  Would you be proud of yourself acting like a total dick on national TV?

More Out -of-control Republican Spending and General Lack of Empathy

Gov. Scott Walker has ended the early-release program in Wisconsin.  This comes at a time when Wisconsin prisons are at 120% capacity.

"This is one of those cases where we're keeping the worst of the worst in the state prisons," Eau Claire County Sheriff Ron Cramer said, the Leader-Telegram of Eau Claire reported.


Did the "worst of the worst" criminals qualify for the early-release program?  According to the bill signed in 2009, inmates who qualified were:

• Serving time for a misdemeanor or a Class F to I felony that is not a violent offense [as defined in s. 301.048 (2) (bm) 1.] may earn one day of positive adjustment time for each two days of good behavior. Disqualifying violent crimes include offenses such as homicide, sexual assault, and robbery. In addition, an inmate must not be a registered sex offender or have committed other specified serious crimes, and must not have been found ineligible for positive adjustment time
• Certain elderly and terminally ill inmates were previously allowed (2001 Wisconsin Act 109) to petition for early release. Act 28 expands eligibility to certain inmates serving life sentences, and inmates may now request early release based on an “extraordinary health condition,” defined as advanced age, infirmity, or disability or a need for medical treatment or services not available within the correctional institution. To be eligible due to age, an inmate must be at least 65 years old and have served at least 5 years in prison, or at least 60 years of age and completed at least 10 years. Another petition may not be filed within one year after ERRC denial.
• It was also possible to build up enough points for good behavior and earn early release

Total Inmate Population Projections: 2010-2020

The Department of Corrections is expected to experience an overall 16% increase in the incarcerated population over the next decade from the current population of 22,911 to the projected population of 26,675 in the year 2020 as seen in Table 1.

Table 1. Projected Inmate Populations: 2010 - 2020

Year As of July 1	Male Population	Female Population	Total Population	% Change From Prior Year
2010	22,211	1,434	23,645	1.4%
2011	22,553	1,434	23,987	1.4%
2012	22,893	1,436	24,329	1.4%
2013	23,224	1,454	24,678	1.4%
2014	23,540	1,471	25,011	1.3%
2015	23,841	1,487	25,328	1.3%
2016	24,128	1,504	25,632	1.2%
2017	24,403	1,521	25,924	1.1%
2018	24,657	1,539	26,196	1.0%
2019	24,891	1,555	26,446	1.0%
2020	25,105	1,570	26,675	.9%

Throughout history, the ability to predict human behavior, and certainly inmate populations, has presented significant challenges for correctional agencies across the country. To a significant extent, inmate population levels are influenced by unpredictable factors, including: legislative policies, such as Truth in Sentencing; crime rates; arrests and criminal prosecutions; public fears of increased victimization; and failure of offenders to successfully complete community based programs and supervision, to name a few. Conversely, once offenders enter the correctional system, whether as inmates or on probation supervision, it is realistic, in part, that prison diversion or population reduction programs, for appropriate offenders, will impact population management and the future demand for secure confinement capacity.

The human and fiscal impacts of incarceration have become staggering. In Wisconsin, incarceration is costly: the average annual incarceration cost in a maximum security facility in 2007 was $35,039 per prisoner; in a medium security facility was $26,508 per prisoner; and in a minimum security center was $30,794. The juvenile correctional institution daily rate in 2007 was $209, or $76,285 on an annual basis. These costs associated with operating institutional programs contribute to a Wisconsin Department of Corrections budget of more than $1 billion per year.

In the 1990s the Wisconsin prison population increased dramatically and had tripled by the year 2000. Drug and alcohol offenders accounted for a significant growth in the incarcerated population. In fact, drug offenders accounted for more than twenty percent of the growth from 1996 to 2006, and drug and operating while intoxicated offenders were responsible for more than sixty percent of the growth from 2001 to 2006. During that time, the state was building or opening a new prison on average, every two years. Just eight years ago, the state led the country in the number of inmates that were housed in out-of state facilities, peaking at almost 5000.

By 2005, all of the inmates had been returned to occupy newly created prison capacity and county jails in Wisconsin. In 1990, the Wisconsin year end prison population numbered 7,554; at the conclusion of 2007, the number had increased to 22,690 incarcerated adults. The inclusion of offenders on probation and parole supervision and juveniles being served in the institutions and community represented in excess of 95,000 individuals under the custody or supervision of the Department of Corrections; a trend that appears to be continuing. The sheer volume of offenders underscores the challenges facing the Department of Corrections in the next decade.

Gov. Walker and those that support this decision are wrong on incarceration.  Locking up non-violent offenders with violent offenders only exacerbates criminal behaviors hence the high recidivism rates.  Another reason for high recidivism is that when prisoners are released they have to deal with egomaniacs like Walker.