Some politicians and others have decided to distort the facts, re-write history, and claim that we are now a socialist country, getting more socialist all the time, and that everything would be better if we would just return to our capitalist roots, you know, the way it was in the "Good Old Days," and eliminate Social Security, Medicare, Medicaid, Public Schools, Interstate Highways, Food and Drug Administration, Environmental Protection Agency, Federal Aviation Administration, US Department of Education...you get the idea. (A few people who support this rollback plan tell the truth, they know things were much worse in the "Good Old Days" but still think we should return to those days for some unfathomable reason). These people talk about "taking our country back." It is a little unclear who they want to take it back from, but I can only assume they want to take it back from our democratically elected representatives.
I thought I would let you know what things were like in the US in 1930, you know, before Social Security, Medicare, and most of the programs that define who we are in the year 2009 were created, before the systems and programs we have inplace in 2009 that make us the greatest country in history were implemented. I picked 1930 to be fair, since the Great Depression had not taken hold, and, in fact, the economic boom of the "Roaring 1920's" when there was little or no regulation had peaked.
Trust me, those "Good Old Days" were not all that good. Just a few facts:
Per Capita Income (IN 2009 DOLLARS, in other words, CORRECTED FOR INFLATION)
1930 $11,338 2009 $46,381
Life Expectancy
1930 54.2 years 2009 78.1 years
Miles of Paved Highway in the US
1930 387,000 miles (it took 13 days to drive from New York to LA)
2009 2,734,102 miles; including the Interstate Highway System (you can now drive from New York to LA in 2 days (42 hours total))
Did You Know That:
In 1952 there were 58,000 cases of polio in the US (I went to elementary school with a polio victim, so it wasn't that long ago, or I am getting old, or both).
Due to Public Health and Government sponsored vaccinations, there hasn't been a case of polio in the US since 1979.
From 1958-1961 there were tens of thousands of babies born with severe birth defects around the world due to mothers taking a drug called thalidomide.
There were virtually no thalidomide victims in the US because the FDA wouldn't approve its use without further testing.
In summary, there is a small, but very noisy, group of people and political candidates in the US today who are championing a false history and promoting a false vision for the US. They talk about "Good Old Days" that never existed. The "Good Old Days" are now. Sure we have some problems to be solved that will require serious, even painful, solutions. But the solution is not to go back to a time when personal income was 1/4 of what it is today, when our life expectancy was 24 years less than it is today, when it took longer to drive from New York to Los Angeles than it does for an astronaut today to fly to the moon and back. Somehow, the "Socialist/Marxist" fiction that these people claim our country has become since 1935 when Social Security was passed and 1965 when Medicare was passed, that country, not the distortion they have invented, has managed to grow unimaginable wealth, invent unbelievable things, cure many diseases, and create a nation that is the envy of the world. We don't have walled cities guarded by soldiers surrounded by seas of poverty and despair. We have a land where you can drive from Key West, Florida to Eastport, Maine; from Norfolk, Virginia to Arcata, California and know every minute you are in the greatest country in history. Just remember, while all these wonderful accomplishments have taken place, Social Security, Medicare, and all the agencies regulating finance, safety, and health in this country were firmly established. The false timeline being promoted by the Far Right, is just that...false. Use your brain, don't give in to their cliches', don't be manipulated by their repetitive slogans or their tens of millions of dollars in media advertising, think for yourself! The facts in this Note took me two hours to gather and compute. I challenge each of you to put two hours into thinking about our future.
I don't think you will decide to return to the "Bad Old Days!"
Sunday, October 17, 2010
Saturday, October 9, 2010
Republicans Would Rather Kill Jobs Than Do the Right Thing
Just look at who is killing jobs now
Republicans like to denounce President Obama and congressional Democrats for what they describe as "job-killing" policies. But in those red-hot rhetorical terms, congressional Republicans are guilty of mass murder when it comes to job creation.
They left town for their pre-election recess having blocked the extension of a successful jobs program, praised by conservatives from Mississippi Gov. Haley Barbour to economist Kevin Hassett of the American Enterprise Institute, that provided 250,000 jobs for low-income parents and youths. A $2.5 billion version of the extension passed the House, twice. The Senate whittled it back to $1.5 billion but still could not dislodge Republican opposition even though the cost would have been fully paid for. The program was a sliver of the giant stimulus measure, but one of the most effective in terms of job creation. And it sounded as if it came straight out of the GOP playbook. The money was used overwhelmingly for private-sector jobs. It went to employers, to subsidize - depending on the state - all or part of wages for newly hired workers who would otherwise have been on unemployment rolls or receiving welfare. It was a particular boon to small business, helping them expand at a time when they would not have otherwise had the financial leeway to do so. The stimulus included a $5 billion pot of money to help states with welfare programs stretched by the recession. One of the permitted uses was for job subsidies, and ultimately 37 states and the District of Columbia ended up launching such efforts. Barbour, for example, used the federal money to create a program called Mississippi STEPS (Subsidized Transitional Employment Program and Services) that subsidized wages for new employees; the subsidy diminished over six months. Barbour described it as "much-needed aid during this recession by enabling businesses to hire new workers, thus enhancing the economic engines of our local communities." Hassett, an economic adviser to the campaigns of George W. Bush and John McCain, urged that the program be significantly expanded. "After all, a worker participating in the program gets a job," he testified in February. "A firm gets an extended period of production from the worker at a heavily subsidized cost. This low cost input should increase the firm's profits, and increase the chances that they will lift their capital investments. It is like an indirect tax cut from the perspective of the firm." Did I hear tax cut? Republicans should have been leaping on this opportunity. Except that the program was part of the stimulus plan, the American Recovery and Reinvestment Act (ARRA). And ARRA is a four-letter word to Republicans, who - like the church dealing with Galileo - refuse to acknowledge that it had any positive effect on job creation. Job subsidies aren't a perfect answer. Some firms may use the money for jobs they would have filled anyway, but that risk is offset by the fact that the subsidy is targeted to people in greatest need of work. There is no guarantee that the jobs will continue once the subsidy is withdrawn, but even so, there is a benefit from having worked. As Hassett explained, "The literature is clear. Someone separated from the labor force runs the real risk of permanently separating from the normal economy. It is crucial that we reconnect as many people as possible before it is too late." That would be now. There's a slim chance the program could be revived in a lame-duck session. Otherwise, Republicans can pontificate, as in the Pledge to America, about how "joblessness is the single most important challenge facing America today" and extol the "pride and dignity that comes with an honest day's work and a steady paycheck." But laid-off workers forced onto welfare because of unthinking obstructionism will know better.
Republicans like to denounce President Obama and congressional Democrats for what they describe as "job-killing" policies. But in those red-hot rhetorical terms, congressional Republicans are guilty of mass murder when it comes to job creation.
They left town for their pre-election recess having blocked the extension of a successful jobs program, praised by conservatives from Mississippi Gov. Haley Barbour to economist Kevin Hassett of the American Enterprise Institute, that provided 250,000 jobs for low-income parents and youths. A $2.5 billion version of the extension passed the House, twice. The Senate whittled it back to $1.5 billion but still could not dislodge Republican opposition even though the cost would have been fully paid for. The program was a sliver of the giant stimulus measure, but one of the most effective in terms of job creation. And it sounded as if it came straight out of the GOP playbook. The money was used overwhelmingly for private-sector jobs. It went to employers, to subsidize - depending on the state - all or part of wages for newly hired workers who would otherwise have been on unemployment rolls or receiving welfare. It was a particular boon to small business, helping them expand at a time when they would not have otherwise had the financial leeway to do so. The stimulus included a $5 billion pot of money to help states with welfare programs stretched by the recession. One of the permitted uses was for job subsidies, and ultimately 37 states and the District of Columbia ended up launching such efforts. Barbour, for example, used the federal money to create a program called Mississippi STEPS (Subsidized Transitional Employment Program and Services) that subsidized wages for new employees; the subsidy diminished over six months. Barbour described it as "much-needed aid during this recession by enabling businesses to hire new workers, thus enhancing the economic engines of our local communities." Hassett, an economic adviser to the campaigns of George W. Bush and John McCain, urged that the program be significantly expanded. "After all, a worker participating in the program gets a job," he testified in February. "A firm gets an extended period of production from the worker at a heavily subsidized cost. This low cost input should increase the firm's profits, and increase the chances that they will lift their capital investments. It is like an indirect tax cut from the perspective of the firm." Did I hear tax cut? Republicans should have been leaping on this opportunity. Except that the program was part of the stimulus plan, the American Recovery and Reinvestment Act (ARRA). And ARRA is a four-letter word to Republicans, who - like the church dealing with Galileo - refuse to acknowledge that it had any positive effect on job creation. Job subsidies aren't a perfect answer. Some firms may use the money for jobs they would have filled anyway, but that risk is offset by the fact that the subsidy is targeted to people in greatest need of work. There is no guarantee that the jobs will continue once the subsidy is withdrawn, but even so, there is a benefit from having worked. As Hassett explained, "The literature is clear. Someone separated from the labor force runs the real risk of permanently separating from the normal economy. It is crucial that we reconnect as many people as possible before it is too late." That would be now. There's a slim chance the program could be revived in a lame-duck session. Otherwise, Republicans can pontificate, as in the Pledge to America, about how "joblessness is the single most important challenge facing America today" and extol the "pride and dignity that comes with an honest day's work and a steady paycheck." But laid-off workers forced onto welfare because of unthinking obstructionism will know better.
Sunday, October 3, 2010
The Truth About TARP
TARP has become a dirty word in our nation's political discourse. Few terms elicit such anger from voters and politicians. In many ways, that's understandable. No one wanted to bail out Wall Street. No one wanted to use taxpayer dollars to rescue an industry that helped cause the worst economic crisis in a generation.
It was unfair. It was appalling. But it was necessary. We had no other choice.
Two years ago, we stood at the brink of an economic catastrophe. Ordinary American families were questioning whether their money was safe in banks. A growing financial panic threatened to sink our nation into an economic downturn that rivaled the Great Depression.
A bi-partisan majority in Congress responded by enacting the Troubled Asset Relief Program. The debate over this issue was heated. On October 3, 2008, when TARP became law, one member of Congress even went so far as to say, "I don't think it is too much of a stretch to say this may be the day America died."
Two years later, with TARP officially set to expire today, it's an appropriate time to look back and evaluate that program's effectiveness. And now that the fog of an intense financial panic has lifted, it's clear that the critics and cynics were wrong. TARP has proven remarkably successful at stabilizing the economy and laying the foundation for future growth.
Today, our economy is healing. Because of the enormity of the challenges we faced, unemployment is still unacceptably high and growth has not yet reached an acceptable pace. But we're on the path to recovery. Businesses have added jobs for eight straight months. Private investment and confidence in banks have returned. The cost of borrowing for businesses, municipalities and individuals has declined dramatically.
The TARP investments that the Bush and Obama administrations made in GM and Chrysler, as well as the hard decisions that those companies made to adapt and compete, turned those automakers around and saved at least one million jobs. Since GM and Chrysler emerged from bankruptcy, the auto industry has added 76,300 jobs - the strongest growth in 10 years - and for the first time since 2004, all of the big three American auto companies are operating profitably.
In fact, independent experts have estimated that overall, without the federal government's response to the financial crisis, including TARP, there would be nearly 8.5 million fewer jobs today and the unemployment rate would exceed 15 percent.
The question, then, is why does TARP remain unpopular, despite its success? I believe, in great part, it's because a number of myths about the program stubbornly persist.
Many people think that TARP cost $700 billion. But Treasury is now confident that the lifetime cost to taxpayers will be less than $50 billion. Repayments have continued to exceed expectations. Three-fourths of the TARP funds provided to banks have already been returned. And the exit strategy AIG announced last week puts taxpayers in a considerably stronger position to recoup our investment in that company.
Many people think that TARP funds only went to Wall Street. But more than 450 small and community banks participated in TARP, which helped them deliver credit to local small businesses and families. Additionally, more than 3.3 million struggling homeowners have had an opportunity to stay in their homes or find more affordable alternatives because of foreclosure prevention programs either financed by TARP or created as a result of TARP in the private sector.
Many people think that TARP created a precedent for future bailouts. But President Obama and Treasury Secretary Geithner worked tirelessly with Congress to enact the Dodd-Frank Act, which will ensure that the American people are never again put on the hook for the reckless acts of a few financial firms. That law gives the government new tools to shut down and dismember failing institutions rather than bail them out with taxpayer dollars.
Unfortunately, the untold story of TARP's success has been lost in the heated rhetoric of today's politics.
TARP was enacted in an all-too-rare moment of bipartisan cooperation in Washington - with support from both sides of the aisle, including from Republican leaders Representative John Boehner and Senator Mitch McConnell. The Bush Administration began the implementation of TARP and the Obama Administration is finishing the job.
Now, many of those who supported TARP have decided that, politically, they need to be against it. But removed from the pressures of a November election, these individuals should be proud of the hard choices they made to help save our economy from a devastating collapse.
And perhaps someday they'll say what is now, for them, the unspeakable: TARP was a success.
It was unfair. It was appalling. But it was necessary. We had no other choice.
Two years ago, we stood at the brink of an economic catastrophe. Ordinary American families were questioning whether their money was safe in banks. A growing financial panic threatened to sink our nation into an economic downturn that rivaled the Great Depression.
A bi-partisan majority in Congress responded by enacting the Troubled Asset Relief Program. The debate over this issue was heated. On October 3, 2008, when TARP became law, one member of Congress even went so far as to say, "I don't think it is too much of a stretch to say this may be the day America died."
Two years later, with TARP officially set to expire today, it's an appropriate time to look back and evaluate that program's effectiveness. And now that the fog of an intense financial panic has lifted, it's clear that the critics and cynics were wrong. TARP has proven remarkably successful at stabilizing the economy and laying the foundation for future growth.
Today, our economy is healing. Because of the enormity of the challenges we faced, unemployment is still unacceptably high and growth has not yet reached an acceptable pace. But we're on the path to recovery. Businesses have added jobs for eight straight months. Private investment and confidence in banks have returned. The cost of borrowing for businesses, municipalities and individuals has declined dramatically.
The TARP investments that the Bush and Obama administrations made in GM and Chrysler, as well as the hard decisions that those companies made to adapt and compete, turned those automakers around and saved at least one million jobs. Since GM and Chrysler emerged from bankruptcy, the auto industry has added 76,300 jobs - the strongest growth in 10 years - and for the first time since 2004, all of the big three American auto companies are operating profitably.
In fact, independent experts have estimated that overall, without the federal government's response to the financial crisis, including TARP, there would be nearly 8.5 million fewer jobs today and the unemployment rate would exceed 15 percent.
The question, then, is why does TARP remain unpopular, despite its success? I believe, in great part, it's because a number of myths about the program stubbornly persist.
Many people think that TARP cost $700 billion. But Treasury is now confident that the lifetime cost to taxpayers will be less than $50 billion. Repayments have continued to exceed expectations. Three-fourths of the TARP funds provided to banks have already been returned. And the exit strategy AIG announced last week puts taxpayers in a considerably stronger position to recoup our investment in that company.
Many people think that TARP funds only went to Wall Street. But more than 450 small and community banks participated in TARP, which helped them deliver credit to local small businesses and families. Additionally, more than 3.3 million struggling homeowners have had an opportunity to stay in their homes or find more affordable alternatives because of foreclosure prevention programs either financed by TARP or created as a result of TARP in the private sector.
Many people think that TARP created a precedent for future bailouts. But President Obama and Treasury Secretary Geithner worked tirelessly with Congress to enact the Dodd-Frank Act, which will ensure that the American people are never again put on the hook for the reckless acts of a few financial firms. That law gives the government new tools to shut down and dismember failing institutions rather than bail them out with taxpayer dollars.
Unfortunately, the untold story of TARP's success has been lost in the heated rhetoric of today's politics.
TARP was enacted in an all-too-rare moment of bipartisan cooperation in Washington - with support from both sides of the aisle, including from Republican leaders Representative John Boehner and Senator Mitch McConnell. The Bush Administration began the implementation of TARP and the Obama Administration is finishing the job.
Now, many of those who supported TARP have decided that, politically, they need to be against it. But removed from the pressures of a November election, these individuals should be proud of the hard choices they made to help save our economy from a devastating collapse.
And perhaps someday they'll say what is now, for them, the unspeakable: TARP was a success.
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