Tag Archives: Barak Obama

Obama “expands” the Social Security Conversation

President Obama’s statement last week that he supports expanding Social Security was indeed a watershed in the discussion of the program’s future. What happens next is not clear, however, not least because “expand” can mean so many things to people of different political persuasions.

We should be strengthening Social Security,” the president declared during an economic speech in Elkhart Indiana. “Not only do we need to strengthen it, it is time we finally made Social Security more generous and increase the benefits so that today’s retirees and future generations get the dignified retirement that they have earned.” Expansion, he said, should be financed by “asking the wealthiest Americans to contribute a little bit more.”

The location was important: Elkhart was the first city Obama visited after assuming the presidency, in the midst of the worst economic downturn since the Depression. Last week’s speech itself was meant to highlight the progress the economy has made since then. In staking out his new position on Social Security, “Obama is getting on board a movement that’s been brewing within the Democratic party for a while now,” write Nancy Altman and Eric Kingson, co-directors of the advocacy group Social Security Works, noting that a host of prominent figures including this year’s presidential candidates Bernie Sanders and Martin O’Malley and even Hillary Clinton (somewhat guardedly) have endorsed the idea and that Sanders and Elizabeth Warren, among others, have proposed action in Congress to expand benefits and pay for them by extending payroll tax to cover higher incomes. Continue reading Obama “expands” the Social Security Conversation

Why Hillary Clinton Is Beyond the Pale

This is a bit off-topic for this blog, but it has to be said: By her calculated failure to take a stand on the Trans-Pacific Partnership, the former secretary of state has made herself absolutely unacceptable as a presidential candidate for working Americans.

It’s crunch time for the Trans-Pacific Partnership (TPP), the most sweeping multilateral trade agreement since NAFTA. Fast-track authority for the president, gussied up with some face-saving amendments to make it look like Congress will have a real debate when Obama submits the deal to lawmakers later this year, has passed out of committee in both the House and Senate. That means fast-track will be decided upon in a matter of days or weeks.

Continue reading Why Hillary Clinton Is Beyond the Pale

The Origins of Pension Privatization: A New Perspective

Starting in the 1970s, governments authorized and promoted individual retirement accounts of various sorts. The commonly accepted explanation was that public pensions were no longer affordable and had to be supplemented or replaced by private saving. The truth, according to a revealing new paper, is that stock exchanges in developed countries promoted tax-advantaged private accounts as a quick way to build up domestic capital markets at a time of increasing global competition. The result has been an underfunded public sector—including cash-starved public pensions—and overfunded capital markets feeding unproductive financial speculation.

A wise person who had observed the private pension industry for many years once told me to remember that none of its structures—public pensions, employer-sponsored pensions, 401(k) plans, and every variation on these themes—are set up for the good of working people. They are products, designed to make money for the bank or insurance or mutual fund company that set it up and collects fees for managing and investing it.

That sensible, “follow the money” approach to understanding pensions informs an excellent new academic paper, “Feed the Beast: Finance Capitalism and the Spread of Pension Privatisation in Europe.” The authors, Marek Naczyk of Oxford University and Bruno Palier of the Centre d’Etudes Européenes at Sciences Po Paris, who first presented it at a conference last July, connect the dots to explain why the financial services industry in Europe first started pushing for pension privatization and why political leaders in these countries went along with the idea.  Continue reading The Origins of Pension Privatization: A New Perspective

What I Didn’t Hear in the President’s SOTU

Democrats of both progressive and center-right stripe generally gave President Obama high marks for his State of the Union address Tuesday night. When it comes to Social Security, however, he disappointed; merely refraining from supporting cuts to the program isn’t good enough anymore at a time when progressives should be demanding their president back measures to improve it.

“Obama in campaign mode, pushes middle class agenda,” declared Bill Galston, the Brookings Institution’s leading center-right commentator on the economy and fiscal policy. The Wall Street Journal agreed the president’s State of the Union address was a “middle-class pitch.”

Progressives mostly liked the president’s speech as well, except, of course, for his in-your-face demand for fast-track authority to pass another slew of corporate-backed trade deals. “Obama gets some of his swagger back,” Robert Borosage of the Campaign for America’s Future wrote.

There were things in the speech for people to like who were looking for signs that Washington cares about working people Continue reading What I Didn’t Hear in the President’s SOTU

Mario Cuomo was not a “liberal beacon”

The former New York governor, who was laid to rest yesterday, is being mourned as a “forceful defender of liberalism.” In reality, he was a creator of the Democratic center-right and consistent supporter of anti-entitlement crusades.

For anyone who’s followed American politics closely for the past 40 years or so, the headlines following his death were enough to set your teeth on edge: “Mario Cuomo, Ex-New York Governor and Liberal Beacon” (New York Times); “Three-Time Governor; Liberal Leader” (Wall Street Journal). This image of the late politician is even enshrined in Wikipedia: “Cuomo was known for his liberal views and public speeches.”

None of this has much to do with the truth, or Cuomo’s place in history. Indeed, the notion that he was any kind of liberal stems almost entirely from a single speech he delivered at the Democratic National Convention in 1984. The substance of his career tells a different story. So let’s look at the facts.

Continue reading Mario Cuomo was not a “liberal beacon”

Brookings, Social Security, and the welfare state

We’ve had the evidence before us for a long time: Social Security is the most effective—and cost-effective—US anti-poverty program, both for adults and children. So why do recent writings by scholars at the Brookings Institution ignore it?

“Evidence-based decision-making” may be the most popular catch phrase in Washington. The Big Data revolution has convinced The Village—OK, and lots of other strongholds of mainstream consensus thinking—that everything can now be measured, and that the metrics can yield smart, “actionable” decisions. “Evidence” appears to center-right Democrats as the talisman that will bridge the partisan divide and coax Republicans to play nicely with them.

I’m not writing this to step all over the need to measure program effectiveness—like every other secular religion of the past 200-some years, it’s probably true to some extent, just not as true as the true believers often think. What puzzles me, however, is why some evidence grabs the spotlight and some doesn’t.

Continue reading Brookings, Social Security, and the welfare state

GOP to block Dem nominee to protest troubles with GOP program

That’s right: Republican senators are upset about delays and cost overruns on a new computer system at the Social Security Administration—so upset, they want to block the president’s nominee for commissioner. The only the trouble is, the new computer system was planned and ordered up by the prior commissioner—a Bush appointee.

The 11 Republican members of the Senate Finance Committee were in high dudgeon last week when they released a letter to Carolyn Colvin, acting commissioner of Social Security and President Obama’s nominee for a six-year slot as commissioner, regarding the troubled implementation of a new computer system for processing disability benefit claims.

We have received information from whistleblowers that the ongoing investigation [of the computer system] has centered around the activities of certain members of your immediate office, including several high-level agency officials. Therefore, it is essential to address your role with respect to this inquiry before each of us can make an informed decision on how to vote for your nomination once it reaches the full Senate for consideration.

A lot of this is simply hyperventilating. It’s not clear that the GOP senators “received information from whistleblowers,” as they claim. What happened for sure was that Continue reading GOP to block Dem nominee to protest troubles with GOP program

The Real Meaning of Chained CPI

Switching to a stingier method of adjusting Social Security benefits is supposed to be OK because we can just “substitute” an equivalent good for one that’s become too costly. But what if that substitution becomes permanent? The chained CPI is perhaps the first—at least the most blatant—attempt to write the acceptance of downward mobility into the rules of economic management.

A lot has already been written about President Obama’s proposal to switch to the chained CPI for annual adjustments to Social Security (and many other) benefits. I hope you haven’t reached your limit on the subject, because I want to urge to read just one more, from last month. It’s FDL blogger Masaccio’s vital and bluntly titled piece, “Chained CPI Means You Can’t Have Nice Things.”

Masaccio, who’s been writing valuable economic commentary for years that all us non-professionals can easily understand, starts with a closer examination of the “substitution” concept behind the chained CPI, and then makes some provocative suggestions about what this all means—specifically, the end of the consumer-driven economy and the managing-down of the American standard of living.

Let’s start with the first point. As has been noted endlessly, proponents of the chained CPI assert that the standard Consumer Price Index has been getting it wrong all these years because Continue reading The Real Meaning of Chained CPI

Why is “entitlement” such a nasty word?

Since his reelection, President Obama has been talking about “reforming entitlements” every chance he gets –or at least when he’s talking to Republicans. But why – and when – did “entitlement” become such a nasty word?

Since his reelection, the president has been trying hard to have it both ways when it comes to Social Security and Medicare. According to the Huffington Post’s Sabrina Siddiqui, Obama on March 14 assured House Democrats that he won’t “slash” the two programs – moments after a meeting with Senate Republicans at which he reaffirmed his commitment to “reforming” entitlements, including adopting the chained CPI for calculating Social Security and Medicare.

Knowing it was poison to his constituency, Obama had more or less avoided the subject on the campaign trail last year. And as Continue reading Why is “entitlement” such a nasty word?

It’s All About the Taxes

It’s a simple question that progressive types – and many non-Washingtonians, for that matter –ask themselves all the time: If Social Security needs more money in coming decades, why not just raise the payroll tax? It’s how we’ve done it in the past, why can’t we just do it again? The reason is that the far right and the center-right – Washington’s Very Serious People – have agreed that the low-tax regime they’ve collaborated on putting in place for the affluent is here to stay, along with the income inequality it’s helped to spawn.  There will be no further increases, even in a comparatively un-progressive levy like the payroll tax, they insist.

It’s not news that you can’t mention the words “tax increase” in Washington without someone attaching an epithet like “job-killing” or “politically unpopular” to them as a matter of reflex. This goes for the payroll taxes that fund Social Security as for any other tax. House Budget Committee chair Paul Ryan says Continue reading It’s All About the Taxes