While the Neoliberal, free market hacks (like Robert J. Samuelson and John Kass) continue to harp on "entitlements" - and the Tea Bagger terrorists holding the gov't up to ransom have made it clear Social Security and Medicare cuts are on their chopping blocks too (along with the ACA) it appears none of them realize what would happen if granted their wishes. That is, if they get their cuts we could see a progressive reversal of economic growth leading to another recession, or even depression.
How so? First, know that we remain in a parlous, low aggregate demand economic environment which means too little spending to support the financial flows, markets and overall economic vitality. This was made clear in a new report published by the AARP Public Policy Institute and appearing in The AARP Bulletin ('Social Security's Impact', Oct., p. 34).
The report notes that contrary to some myths circulating, seniors receiving Social Security aren't hoarding their money or saving for a rainy day. Instead, they're spending it on goods and services- which means pumping it right back into an ailing economy. They're buying groceries, prescription drugs, paying the 20 percent for medical treatments that Medicare won't, purchasing the dental care that Medicare won't, buying airline tickets for vacations, as well as booking hotel rooms - and helping put grand kids through college. If they have enough left over, they also remodel assorted rooms in their homes, like kitchens or bathrooms (as we just got done doing).
Given this, businesses then use this influx of income to purchase more goods and services, and to hire more employees. These employees, in turn, spend their wages on more goods and services which creates more aggregate demand by more and more people. In other words, Social Security money doesn't just terminate its effect at an elderly person's bank, it has a multiplier effect with ramifications throughout the whole economy.
How much of an effect? The AARP report found that for every dollar in Social Security benefits paid out, roughly $2 in output is generated for the whole economy. In hard numbers, that translates to roughly $1.5 trillion in economic output (adding in the derivative spending by businesses.) This in turn supports more than 9 million jobs in the national economy, with 4 million of them created in ten industries with the major impact accruing to: food services, real estate, health care, and retail industries.
As the author of the AARP piece notes, given Social Security inputs also helped 21.4 million Americans including 1.1 million children, and 5.8 million adults under 65, it means lawmakers in D.C. can't look at the program through a narrow lens of "spending cuts". Indeed, even imposing something as seemingly benign as a chained CPI could have devastating corrosive effects down the road. Major cuts or privatization, meanwhile, would likely usher in a new recession or depression.
Are any of our "patriotic" legislators aware of these stats? Do they even care? Will the Tea Baggers, who purport to be so very concerned about the economy process them? We will have to wait and see.
Showing posts with label Robert J. Samuelson. Show all posts
Showing posts with label Robert J. Samuelson. Show all posts
Tuesday, October 8, 2013
Saturday, October 5, 2013
We're Enmeshed in the "Spoils" Society? Think Instead of the LOW Grade Oil & Debt Society!
WaPo Neoliberal hack Robert J. Samuelson is at it again, this time condemning what he calls a "spoils society" approach ('Here Comes the Spoils Society'), which takes from the poor widdo rich 0.1 percenters to slightly lessen some of the nation's gross inequality. According to Samuelson:
"We are, I fear, slowly moving from “the affluent society” toward a “spoils society.” In 1958, Harvard economist John Kenneth Galbraith published his bestseller, “The Affluent Society,” which profoundly influenced national thinking for decades. To the Great Depression’s survivors, post-World War II prosperity dazzled. Suburbia offered a quiet alternative to crowded and noisy cities. New technologies impressed — television, frozen foods, automatic washers and dryers. Never, it seemed, had so much been enjoyed by so many."
Unstated by Samuelson is how Galbraith deplored the excesses of a consumptive society and in particular the pernicious influence of the advertising complex which confused wants and needs. As Galbraith put it, the basis for this complex was purely to make Americans confused over what was really a need, and the luxuries (large or small) they desired. Meanwhile, the objective of Madison Avenue was to brainwash the hoi polloi into believing luxuries were really essential needs that they were obligated to satisfy via purchase. In this way, the energy depletion of resources took on a new head of steam and now, some 60 years later, we find ourselves mired in 'stuff' (55 million square feet thus far devoted to storage mods, according to a recent Denver Post piece) and having to dredge up ever more degraded forms of energy to support our unsustainable consumption.
So, let's not hesitate to note Samuelson is already off base in his adulation of 'Murica's cornucopia of goods, especially, and that Galbraith in any way extolled or endorsed it as a permanent feature. Galbreath, in fact, evinced a basic distrust of the advertising complex and its pathological ability to persuade people to spend beyond their means. As he wrote (p. 147):
"In a society where virtuosity in persuasion must keep pace with virtuosity in production, one is tempted to wonder whether the first can ever keep ahead of the second. For while production does not clearly contain within itself the seeds of its own disintegration, persuasion may."
But, knowing Samuelson, it isn't surprising he distorts it like he did JFK's deficit spending in the early 60s. Samuelson writes:
"This explosive abundance, Galbraith argued, meant the country could afford both private wants and public needs. It could devote more to schools, roads, parks and pollution control. Economic growth became the holy grail of government policy. Production was paramount. It muted social conflict."
In fact, Galbreath implicitly questioned the excess materialism of the country in terms of producing consumer items that weren't genuinely needed and which could be projected to add to debt, if people purchased items they couldn't afford. As he observes (p. 146):
"...we should expect that every increase in consumption will bring a further increase - possibly a more than proportional one, in consumer debt. The evidence is already impressive. ......From 1952 to 1956, total consumer debt increased from $27.4 billion to $42,5 billion or over 55%....although those were prosperous years, disposable income of individuals increased by only 21 percent."
And what, pray tell, is the consumer debt picture today? According to the site nerdwallet.com it stands at a total of $11.13 TRILLION or orders of magnitude larger than Galbreath cited by 1956. In other words, what he foresaw as the metastasizing cancer of wants converted to needs by clever advertising has come to pass. Indeed, $898.4 billion of that debt is in credit card debt while some $7.81 trillion is in home mortgages. Most of the latter owing to the American penchant to purchase way too much home, far beyond what they can afford.
Hitherto uncited, but vastly worse than the era of Galbreath's mere "21 percent increase in individual disposable income", is the fact that incomes in the U.S. have remained stagnant since 1973. This, in tandem with Americans' over-consumption (buying what they don't need), has incepted the massive debt load. It also begs the question of how any serious writer or Neoliberal hack could complain of WHY there exists a "spoils society".
Samuelson writes, on the heels of his claim that production was paramount earlier:
The “spoils society” reverses this logic. It de-emphasizes production and fuels conflict. Here’s why: There are two ways to become richer. One is to provide more goods and services; that’s economic growth. The other is to snatch someone else’s wealth or income; that’s the spoils society. In a spoils society, economic success increasingly depends on who wins countless distributional contests — not who creates wealth but who controls it. This can be contentious. Winners celebrate; losers fume.
He then complains that the country "is losing ground to predatory behavior (grabbing existing wealth and income)" and that what was once 3% growth per year (since 1950) is now projected to be 2% or less. And this degradation of growth heralds smaller gains, so that "more people will fight over existing income and wealth, because — as has been said — that’s where the money is. "
Samuelson, oblivious as he is to the energy factor underlying production, has no clue, not one, that the degradation of economic growth is inextricably tied to the decreasing energy return on energy invested (EROEI) of fuel sources. In other words, our energy-dependent civilization is becoming ever more impoverished as the efficiency of the energy to run it diminishes over time. As it becomes more impoverished, production becomes more costly as well as inefficient and energy-intensive at all levels. As a result, growth decreases while debt increases except for high end rentiers and labor expropriators - who prosper (and hence deserve to have their wealth redistributed). All of this was explained in detail in my earlier blog post: http://brane-space.blogspot.com/2013/09/44-trillion-in-deficits-by-2024-minus.html
As I noted therein, essentially, a nation which had become addicted to energy delivering 20 to 30 or even 40 times as much energy as it costs to extract, now faces a future with energy return 5 to 8 times less. This spells monetary-economic disaster because at the end of the day it is energy which determines wealth of nations, money is only the medium to represent it. Dilute the energy sources and money's value must be diluted also, what the wonks call "debasing the currency". The alteration of the EROEI fuel projections also translates to less growth. If Samuelson really knew about this fundamental underpinning of economics he wouldn't be so mystified as to why growth must diminish as high EROEI fuel sources do. He also would be less surprised that we have now entered more into a redistributive society.
Since assets must remain basically fixed as high EROEI energy stores plummet, it means that a fixed resource 'pie' is all we have to divide, and there is no "adding" to it. We have entered what we call a "zero sum" economy. If the richest have more resources, then we must redistribute their excess resources and wealth to ensure all citizens are able to meet their basic life needs. It's as simple as that. Samuelson can squawk all he wants about taking spoils, but all the foot stomping in the world will not repeal the diminishing energy future with which we are faced. At least the guy is honest about one thing, when he admits: "The promise of economic growth was oversold."
As for those who may be mesmerized by the recent report that the U.S. is now "the greatest oil producer in the world" (on account of oil shale) don't make me laugh. If you really, truly believe that low EROEI shale oil (kerogen) provides a way out of the debt, low growth and lower production morass (and hence 'spoils society') then I have five acres of choice beach land in Barbados to sell you for a song.
As Richard Heinberg notes (Snake Oil: How Fracking's False Promise Imperils Our Future', page 110 ):
"Kerogen is not oil. It is better thought of as an oil precursor that was insufficiently cooked by geologic processes. If we want to turn it into oil, we have to finish the process nature started: that involves heating the kerogen to a high temperature for a long time. And that in turn takes energy- lots of it, whether supplied by hydroelectricity, nuclear power plants, natural gas, or the kerogen itself. Therefore the EROEI in processing oil shale is bound to be pitifully low. According to the best study to date, by Cutler Cleveland and Peter O'Connor, the EROEI for oil shale production would be about 2:1. That tells us that oil from kerogen will be far more expensive than regular crude oil."
And oh, btw, if more expensive it is not going to solve either our lower growth problem, or our higher debt problem. As for fracking, that's no savior either. As Heinberg puts it (p. 116):
"No evidence suggests that the technology of fracking has actually raised the EROEI for natural gas production. It temporarily lowered prices but only by glutting the market."
In other words, like it or not, we are indeed enmeshed in a veritable "spoils society"- but not out of spite or envy of those who have the "most toys" - as Samuelson asserts. But rather on account of a declining energy base for us all. And unless Neoliberals like Samuelson know where we can find another Earth to populate with plenty of resources and energy (and the least energy intensive way to get there), or know how we can downsize our current system to accommodate lower energy sources - he better just shut up and learn to like it. Meanwhile, we need progressive and even socialist thinkers to conceive of improved ways of resource re-distribution from the hyper-rich to the struggling citizens who can now barely feed their families because of the sequester and government shutdown.
"We are, I fear, slowly moving from “the affluent society” toward a “spoils society.” In 1958, Harvard economist John Kenneth Galbraith published his bestseller, “The Affluent Society,” which profoundly influenced national thinking for decades. To the Great Depression’s survivors, post-World War II prosperity dazzled. Suburbia offered a quiet alternative to crowded and noisy cities. New technologies impressed — television, frozen foods, automatic washers and dryers. Never, it seemed, had so much been enjoyed by so many."
Unstated by Samuelson is how Galbraith deplored the excesses of a consumptive society and in particular the pernicious influence of the advertising complex which confused wants and needs. As Galbraith put it, the basis for this complex was purely to make Americans confused over what was really a need, and the luxuries (large or small) they desired. Meanwhile, the objective of Madison Avenue was to brainwash the hoi polloi into believing luxuries were really essential needs that they were obligated to satisfy via purchase. In this way, the energy depletion of resources took on a new head of steam and now, some 60 years later, we find ourselves mired in 'stuff' (55 million square feet thus far devoted to storage mods, according to a recent Denver Post piece) and having to dredge up ever more degraded forms of energy to support our unsustainable consumption.
So, let's not hesitate to note Samuelson is already off base in his adulation of 'Murica's cornucopia of goods, especially, and that Galbraith in any way extolled or endorsed it as a permanent feature. Galbreath, in fact, evinced a basic distrust of the advertising complex and its pathological ability to persuade people to spend beyond their means. As he wrote (p. 147):
"In a society where virtuosity in persuasion must keep pace with virtuosity in production, one is tempted to wonder whether the first can ever keep ahead of the second. For while production does not clearly contain within itself the seeds of its own disintegration, persuasion may."
But, knowing Samuelson, it isn't surprising he distorts it like he did JFK's deficit spending in the early 60s. Samuelson writes:
"This explosive abundance, Galbraith argued, meant the country could afford both private wants and public needs. It could devote more to schools, roads, parks and pollution control. Economic growth became the holy grail of government policy. Production was paramount. It muted social conflict."
In fact, Galbreath implicitly questioned the excess materialism of the country in terms of producing consumer items that weren't genuinely needed and which could be projected to add to debt, if people purchased items they couldn't afford. As he observes (p. 146):
"...we should expect that every increase in consumption will bring a further increase - possibly a more than proportional one, in consumer debt. The evidence is already impressive. ......From 1952 to 1956, total consumer debt increased from $27.4 billion to $42,5 billion or over 55%....although those were prosperous years, disposable income of individuals increased by only 21 percent."
And what, pray tell, is the consumer debt picture today? According to the site nerdwallet.com it stands at a total of $11.13 TRILLION or orders of magnitude larger than Galbreath cited by 1956. In other words, what he foresaw as the metastasizing cancer of wants converted to needs by clever advertising has come to pass. Indeed, $898.4 billion of that debt is in credit card debt while some $7.81 trillion is in home mortgages. Most of the latter owing to the American penchant to purchase way too much home, far beyond what they can afford.
Hitherto uncited, but vastly worse than the era of Galbreath's mere "21 percent increase in individual disposable income", is the fact that incomes in the U.S. have remained stagnant since 1973. This, in tandem with Americans' over-consumption (buying what they don't need), has incepted the massive debt load. It also begs the question of how any serious writer or Neoliberal hack could complain of WHY there exists a "spoils society".
Samuelson writes, on the heels of his claim that production was paramount earlier:
The “spoils society” reverses this logic. It de-emphasizes production and fuels conflict. Here’s why: There are two ways to become richer. One is to provide more goods and services; that’s economic growth. The other is to snatch someone else’s wealth or income; that’s the spoils society. In a spoils society, economic success increasingly depends on who wins countless distributional contests — not who creates wealth but who controls it. This can be contentious. Winners celebrate; losers fume.
He then complains that the country "is losing ground to predatory behavior (grabbing existing wealth and income)" and that what was once 3% growth per year (since 1950) is now projected to be 2% or less. And this degradation of growth heralds smaller gains, so that "more people will fight over existing income and wealth, because — as has been said — that’s where the money is. "
Samuelson, oblivious as he is to the energy factor underlying production, has no clue, not one, that the degradation of economic growth is inextricably tied to the decreasing energy return on energy invested (EROEI) of fuel sources. In other words, our energy-dependent civilization is becoming ever more impoverished as the efficiency of the energy to run it diminishes over time. As it becomes more impoverished, production becomes more costly as well as inefficient and energy-intensive at all levels. As a result, growth decreases while debt increases except for high end rentiers and labor expropriators - who prosper (and hence deserve to have their wealth redistributed). All of this was explained in detail in my earlier blog post: http://brane-space.blogspot.com/2013/09/44-trillion-in-deficits-by-2024-minus.html
As I noted therein, essentially, a nation which had become addicted to energy delivering 20 to 30 or even 40 times as much energy as it costs to extract, now faces a future with energy return 5 to 8 times less. This spells monetary-economic disaster because at the end of the day it is energy which determines wealth of nations, money is only the medium to represent it. Dilute the energy sources and money's value must be diluted also, what the wonks call "debasing the currency". The alteration of the EROEI fuel projections also translates to less growth. If Samuelson really knew about this fundamental underpinning of economics he wouldn't be so mystified as to why growth must diminish as high EROEI fuel sources do. He also would be less surprised that we have now entered more into a redistributive society.
Since assets must remain basically fixed as high EROEI energy stores plummet, it means that a fixed resource 'pie' is all we have to divide, and there is no "adding" to it. We have entered what we call a "zero sum" economy. If the richest have more resources, then we must redistribute their excess resources and wealth to ensure all citizens are able to meet their basic life needs. It's as simple as that. Samuelson can squawk all he wants about taking spoils, but all the foot stomping in the world will not repeal the diminishing energy future with which we are faced. At least the guy is honest about one thing, when he admits: "The promise of economic growth was oversold."
As for those who may be mesmerized by the recent report that the U.S. is now "the greatest oil producer in the world" (on account of oil shale) don't make me laugh. If you really, truly believe that low EROEI shale oil (kerogen) provides a way out of the debt, low growth and lower production morass (and hence 'spoils society') then I have five acres of choice beach land in Barbados to sell you for a song.
As Richard Heinberg notes (Snake Oil: How Fracking's False Promise Imperils Our Future', page 110 ):
"Kerogen is not oil. It is better thought of as an oil precursor that was insufficiently cooked by geologic processes. If we want to turn it into oil, we have to finish the process nature started: that involves heating the kerogen to a high temperature for a long time. And that in turn takes energy- lots of it, whether supplied by hydroelectricity, nuclear power plants, natural gas, or the kerogen itself. Therefore the EROEI in processing oil shale is bound to be pitifully low. According to the best study to date, by Cutler Cleveland and Peter O'Connor, the EROEI for oil shale production would be about 2:1. That tells us that oil from kerogen will be far more expensive than regular crude oil."
And oh, btw, if more expensive it is not going to solve either our lower growth problem, or our higher debt problem. As for fracking, that's no savior either. As Heinberg puts it (p. 116):
"No evidence suggests that the technology of fracking has actually raised the EROEI for natural gas production. It temporarily lowered prices but only by glutting the market."
In other words, like it or not, we are indeed enmeshed in a veritable "spoils society"- but not out of spite or envy of those who have the "most toys" - as Samuelson asserts. But rather on account of a declining energy base for us all. And unless Neoliberals like Samuelson know where we can find another Earth to populate with plenty of resources and energy (and the least energy intensive way to get there), or know how we can downsize our current system to accommodate lower energy sources - he better just shut up and learn to like it. Meanwhile, we need progressive and even socialist thinkers to conceive of improved ways of resource re-distribution from the hyper-rich to the struggling citizens who can now barely feed their families because of the sequester and government shutdown.
Tuesday, July 2, 2013
Robert J. Samuelson Wants to "Repeal" the Internet - It's Too Dangerous!
Robert J. Samuelson, resident Neoliberal hack at the WaPo, usually blabbers on to defend the Neoliberal, free market imperative in his columns. You know the usual line: we need to cut "entitlements" because too many old people are already too rich and - hey!- if they run out of $ they can move in with their kids, the military merits no cuts or minor spending cuts compared to Social Security, Medicare, and those who need money either need to work longer or invest better.
Anyway, seems like Samuelson has developed a new shtick in his most recent column, which is that the internet has become "too dangerous". He writes (7/1):
"If I could, I would repeal the Internet. It is the technological marvel of the age, but it is not — as most people imagine — a symbol of progress. Just the opposite. We would be better off without it. I grant its astonishing capabilities: the instant access to vast amounts of information, the pleasures of YouTube and iTunes, the convenience of GPS and much more. But the Internet’s benefits are relatively modest compared with previous transformative technologies, and it brings with it a terrifying danger: cyberwar."
Samuelson then goes on to terrify the more weak kneed sort by raising all kinds of possible horrific outcomes and catastophes, including the "capacity of groups" (he doesn't name them) to "attack, disrupt and possibly destroy the institutions and networks that underpin everyday life". He warns us these could well be "power grids, pipelines, communication and financial systems, business record-keeping and supply-chain operations, railroads and airlines, databases of all types (from hospitals to government agencies)."
Wow! I'm losing sleep already and I haven't even finished this blog post! But as one goes further the natural reaction is to inquire as to exactly where the purported threats are emanating from? He doesn't give any hard examples or cites and merely babbles on about how it's "unclear how 'infrastructure' systems (electricity grids and the like) have been penetrated and, on command, might be compromised." In other words, we can't really discriminate as to whether the threats he raises are any worse than those from a central meridian CME (coronal mass ejection), e.g. http://www.brane-space.blogspot.com/2012/06/cme-that-you-dont-want-to-see.html
But then one must remember this is Samuelson, who already has raised so many bollocks-inundated stories it's hard to take him seriously anymore - but some in high places might, like they do Bob Woodward. I mean, who can forget how he tried to blame the current trend to accept deficits and go into parlous debt on JFK! See: http://brane-space.blogspot.com/2012/07/thats-right-now-blame-60s-jfk-for.html
When Samuelson at last gets to the nitty gritty it's what one could call anticlimactic. He casually references “malware” that infected an estimated 30,000 computers of Aramco, Saudi Arabia’s oil company and noted "business operations suffered, but oil production and delivery continued." Then, only in passing does he cite Stuxnet: "More powerful was the Stuxnet virus, reportedly developed by the United States and Israel to disrupt Iran’s nuclear program. "
Only here, at this point, does he come close to indicating the real threat, and which I discussed in an earlier blog, http://brane-space.blogspot.com/2012/03/stupidity-of-stuxnet.html citing Sean McGurk - former head of cyber defense at The Department of Homeland Security- who when asked by '60 Minutes' Steve Kroft asked if it sounded "a little bit like Pandora's box." replied:
"Yes! They opened up the box. They demonstrated the capability. They showed the ability and the desire to do so. And it's not something that can be put back."
That "they' btw, is the U.S. gov't as in NSA and its Israeli allies, not any al Qaeda operatives. In other words, this worm they created had the capability for full unintended consequences of biting the original dispatchers on the ass as well as the rest of us. Kroft then surmised in that 60 Minutes segment that one such "unintended consequence" is that the same code might be "re-purposed" and used to attack us. Perhaps against nuclear power plants or the power grid.
Again, McGurk responded:"Yes", labeling the possible retributive cyber attack worm, "Son of Stuxnet".
So, again, if we are fair and judicious we need to acknowledge that the worst cyber attacks, if they do manifest, will likely have emerged from the verminous code our own alleged "protectors" developed to thwart Iranian nuclear power initiatives. We also call that ominous potential "blowback". Will we ever learn? I doubt it! We are too hubristic a nation now, believing we're above the law, given "might makes right" and we are the only superpower after all. Ask the Germans who just discovered NSA was also bugging their offices in New York and in Belgium! The NSA response: "Hey, everyone does it! Besides, you guys aren't covered under the 4th amendment."
Actually, this bozo needs to read the Constitution again, because the writers directed its inherent rights to cover ALL people not just U.S. persons, citizens. At least that is what we were taught in American History back in the 60s at Monsignor Pace High - but maybe they no longer teach that.
Anyway, Samuelson did get one thing right when he cited a James Andrew Lewis, an Internet expert at the Center for Strategic and International Studies. Lewis believes if the U.S. was so virulently stupid to attack Iran's nuclear facilities, "it would retaliate with cyberattacks against banks and electricity networks. Press stories report that Iran has already increased its attacks. There’s a race between cyber offense and defense."
Yes, yes, Mr. Samuelson! But that doesn't ipso facto make the internet something to fear in and of itself- only those who would try to exploit it in dastardly ways to try to harm or corrupt other nations and their people's systems - inviting them to do the same to us!
Anyway, seems like Samuelson has developed a new shtick in his most recent column, which is that the internet has become "too dangerous". He writes (7/1):
"If I could, I would repeal the Internet. It is the technological marvel of the age, but it is not — as most people imagine — a symbol of progress. Just the opposite. We would be better off without it. I grant its astonishing capabilities: the instant access to vast amounts of information, the pleasures of YouTube and iTunes, the convenience of GPS and much more. But the Internet’s benefits are relatively modest compared with previous transformative technologies, and it brings with it a terrifying danger: cyberwar."
Samuelson then goes on to terrify the more weak kneed sort by raising all kinds of possible horrific outcomes and catastophes, including the "capacity of groups" (he doesn't name them) to "attack, disrupt and possibly destroy the institutions and networks that underpin everyday life". He warns us these could well be "power grids, pipelines, communication and financial systems, business record-keeping and supply-chain operations, railroads and airlines, databases of all types (from hospitals to government agencies)."
Wow! I'm losing sleep already and I haven't even finished this blog post! But as one goes further the natural reaction is to inquire as to exactly where the purported threats are emanating from? He doesn't give any hard examples or cites and merely babbles on about how it's "unclear how 'infrastructure' systems (electricity grids and the like) have been penetrated and, on command, might be compromised." In other words, we can't really discriminate as to whether the threats he raises are any worse than those from a central meridian CME (coronal mass ejection), e.g. http://www.brane-space.blogspot.com/2012/06/cme-that-you-dont-want-to-see.html
But then one must remember this is Samuelson, who already has raised so many bollocks-inundated stories it's hard to take him seriously anymore - but some in high places might, like they do Bob Woodward. I mean, who can forget how he tried to blame the current trend to accept deficits and go into parlous debt on JFK! See: http://brane-space.blogspot.com/2012/07/thats-right-now-blame-60s-jfk-for.html
When Samuelson at last gets to the nitty gritty it's what one could call anticlimactic. He casually references “malware” that infected an estimated 30,000 computers of Aramco, Saudi Arabia’s oil company and noted "business operations suffered, but oil production and delivery continued." Then, only in passing does he cite Stuxnet: "More powerful was the Stuxnet virus, reportedly developed by the United States and Israel to disrupt Iran’s nuclear program. "
Only here, at this point, does he come close to indicating the real threat, and which I discussed in an earlier blog, http://brane-space.blogspot.com/2012/03/stupidity-of-stuxnet.html citing Sean McGurk - former head of cyber defense at The Department of Homeland Security- who when asked by '60 Minutes' Steve Kroft asked if it sounded "a little bit like Pandora's box." replied:
"Yes! They opened up the box. They demonstrated the capability. They showed the ability and the desire to do so. And it's not something that can be put back."
That "they' btw, is the U.S. gov't as in NSA and its Israeli allies, not any al Qaeda operatives. In other words, this worm they created had the capability for full unintended consequences of biting the original dispatchers on the ass as well as the rest of us. Kroft then surmised in that 60 Minutes segment that one such "unintended consequence" is that the same code might be "re-purposed" and used to attack us. Perhaps against nuclear power plants or the power grid.
Again, McGurk responded:"Yes", labeling the possible retributive cyber attack worm, "Son of Stuxnet".
So, again, if we are fair and judicious we need to acknowledge that the worst cyber attacks, if they do manifest, will likely have emerged from the verminous code our own alleged "protectors" developed to thwart Iranian nuclear power initiatives. We also call that ominous potential "blowback". Will we ever learn? I doubt it! We are too hubristic a nation now, believing we're above the law, given "might makes right" and we are the only superpower after all. Ask the Germans who just discovered NSA was also bugging their offices in New York and in Belgium! The NSA response: "Hey, everyone does it! Besides, you guys aren't covered under the 4th amendment."
Actually, this bozo needs to read the Constitution again, because the writers directed its inherent rights to cover ALL people not just U.S. persons, citizens. At least that is what we were taught in American History back in the 60s at Monsignor Pace High - but maybe they no longer teach that.
Anyway, Samuelson did get one thing right when he cited a James Andrew Lewis, an Internet expert at the Center for Strategic and International Studies. Lewis believes if the U.S. was so virulently stupid to attack Iran's nuclear facilities, "it would retaliate with cyberattacks against banks and electricity networks. Press stories report that Iran has already increased its attacks. There’s a race between cyber offense and defense."
Yes, yes, Mr. Samuelson! But that doesn't ipso facto make the internet something to fear in and of itself- only those who would try to exploit it in dastardly ways to try to harm or corrupt other nations and their people's systems - inviting them to do the same to us!
Monday, August 20, 2012
Samuelson at it again: Mixing Medicare Advantage with Ryan's Medicare Vouchers
Leave it to Neoliberal hack Robert Samuelson, in his yen to sell the Neoliberal prescription for our economic problems, to once more dip into his confusion and conflation barrel and muddy waters! This time about the vouchers (called "premium support") proposed by the Romney -Ryan ticket, and Medicare Advantage plans currently implemented by private insurance groups like Kaiser-Permanente.
In his latest piece ('Why Ryan Plan Might be Right', in The Sunday Denver Post. Aug. 17, p. 2K) Samuelson claims to cite a "just published study in the Journal of the American Medical Association suggesting that....well, Ryan might be right".
Really?
He goes on to write:
"The study finds a voucher -type system might noticeably reduce costs compared to traditional 'fee for service' Medicare. Three Harvard economists did the study including one prominent supporter of President Barack Obama's health overhaul".
Samuelson goes on to claim that the study "compared the costs of traditional Medicare with Medicare Advantage, a voucher-like program that now enrolls about 25% of beneficiaries."
This is the first hint of dishonesty in using the term "voucher-like" to describe Medicare Advantage plans when they bear no resemblance to the absolute voucher plans proposed by Ryan. For reference, let's understand that for seniors who choose to enroll in a Medicare Advantage plan, Medicare pays the private health plan a set amount every month for each member. Members may have to pay a monthly premium in addition to the Medicare Part B premium, but many companies offering Medicare Advantage plans make them available for a $0 monthly premium in addition to the Medicare Part B premium, which the member pays directly to Medicare.
Under traditional Medicare the coinsurance is pegged at 20%, but the actual amount out of pocket can be higher since specialists generally charge more for services. This is not the case for the private Medicare Advantage plans for which the payout limits are often under 20% for special services, because the premiums from standard Medicare beneficiaries are used to subsidize higher specialist and other costs.
This is exactly why, in previous reports, the GAO has reported that the cost -burden of Medicare Advantage plans has added up to $12 BILLION a year to the cost for traditional Medicare and why the latter's headed toward insolvency. Of course! Because the Advantage plans are like parasites bleeding it down! Does Samuelson mention any of this? Of course not!
The point is the Advantage plans are required to offer a benefit “package” that is at least as good as Medicare's and cover everything Medicare covers, but usually they offer much more! Plans that require higher out-of-pocket costs than Medicare for some benefits, like skilled nursing facility care, can balance their benefits package by offering lower copayments for doctor visits, plus use some of the excess payments they receive from the government for each enrollee to offer supplemental benefits.
But this in NO way is similar to Ryan's voucher ("premium support") plan which would offer a single fixed voucher in a designated amount (e.g. $10,000) - from the government - to have to go out and actively snag a private plan (hoping it will accept the senior) and the limits of the voucher to cover future costs of visits, care over the year. By contrast, once a senior chooses a private plan in the sphere of Medicare Advantage there are no 'ifs, ands, or buts' - he will be allocated a private plan and can't be denied for pre-existing conditions or any other balderdash. The private insurers also know it's a good deal for them since they're assured of regular monthly payments from the gov't which have the potential of increasing each year! No fixed, one time, voucher pays!
Another goodie for the Medicare Advantage senior: Advantage plans typically do not contain deductibles, thereby giving members "first-dollar" coverage. (Original Medicare has a potentially recurring (more than once per calendar year) deductible for Part A and an annual deductible for Part B.) Ryan's plan by contrast will likely see private health insurers attaching massive deductibles, on the order of $3,000 -$5,000 or more, for the simple reason that the insurers will be having to take chances (with no regularly promised gov't subsidies, only the single voucher payment) with a person in a putative high risk health pool! It doesn't take a genius to see that with such deductibles in play, and assuming the private insurer even accepts the senior, much of the voucher will be eaten up before the first real care is even delivered.
In many ways this is analogous to the sort of private insurance plans I was offered, at age 63 - before going onto Medicare. In nearly all cases, I'd have had to cough up a mammoth deductible, $5,000, and then the premiums themselves were sky high - like $600- $700 a month. And that was BEFORE I'd learned I had prostate cancer(this year). Now, if I had to go cap in hand with a $10-15k Ryan-voucher to try to snag an insurance company to pay for my care, I'd likely be laughed out of their offices! They'd probably think I was some kind of comedian out to try his new shtick.
No wonder, given all the above, Samuelson can make the bald and devious claim that "Medicare Advantage has cost less for identical coverage. From 2006 to 2009 the gap averaged 11 percent between traditional Medicare and voucher plans similar to that under the proposal by Ryan, ..would serve as a price benchmark"
Of course, as I already showed above, the "voucher" plan of Ryan is NOT the same as the Medicare Advantage private plan! Hence, Samuelson's use of the phrase "voucher plans" in the context is misleading, and egregious. As for that "11 percent gap between the traditional Medicare and Medicare Advantage" that price gap comes to almost exactly $12 billion, or the total amount the Advantage plans bleed away from the traditional Medicare to support their higher level of "penthouse" caliber choices, perks each year. The same 11% difference bleeding the original Medicare into insolvency!
If anyone, any senior, believes the Ryan plan vouchers will deliver to him or her a Medicare deal even remotely comparable to the existing Medicare Advantage plans, he or she needs to be escorted to an Alzheimers' ward.
In his latest piece ('Why Ryan Plan Might be Right', in The Sunday Denver Post. Aug. 17, p. 2K) Samuelson claims to cite a "just published study in the Journal of the American Medical Association suggesting that....well, Ryan might be right".
Really?
He goes on to write:
"The study finds a voucher -type system might noticeably reduce costs compared to traditional 'fee for service' Medicare. Three Harvard economists did the study including one prominent supporter of President Barack Obama's health overhaul".
Samuelson goes on to claim that the study "compared the costs of traditional Medicare with Medicare Advantage, a voucher-like program that now enrolls about 25% of beneficiaries."
This is the first hint of dishonesty in using the term "voucher-like" to describe Medicare Advantage plans when they bear no resemblance to the absolute voucher plans proposed by Ryan. For reference, let's understand that for seniors who choose to enroll in a Medicare Advantage plan, Medicare pays the private health plan a set amount every month for each member. Members may have to pay a monthly premium in addition to the Medicare Part B premium, but many companies offering Medicare Advantage plans make them available for a $0 monthly premium in addition to the Medicare Part B premium, which the member pays directly to Medicare.
Under traditional Medicare the coinsurance is pegged at 20%, but the actual amount out of pocket can be higher since specialists generally charge more for services. This is not the case for the private Medicare Advantage plans for which the payout limits are often under 20% for special services, because the premiums from standard Medicare beneficiaries are used to subsidize higher specialist and other costs.
This is exactly why, in previous reports, the GAO has reported that the cost -burden of Medicare Advantage plans has added up to $12 BILLION a year to the cost for traditional Medicare and why the latter's headed toward insolvency. Of course! Because the Advantage plans are like parasites bleeding it down! Does Samuelson mention any of this? Of course not!
The point is the Advantage plans are required to offer a benefit “package” that is at least as good as Medicare's and cover everything Medicare covers, but usually they offer much more! Plans that require higher out-of-pocket costs than Medicare for some benefits, like skilled nursing facility care, can balance their benefits package by offering lower copayments for doctor visits, plus use some of the excess payments they receive from the government for each enrollee to offer supplemental benefits.
But this in NO way is similar to Ryan's voucher ("premium support") plan which would offer a single fixed voucher in a designated amount (e.g. $10,000) - from the government - to have to go out and actively snag a private plan (hoping it will accept the senior) and the limits of the voucher to cover future costs of visits, care over the year. By contrast, once a senior chooses a private plan in the sphere of Medicare Advantage there are no 'ifs, ands, or buts' - he will be allocated a private plan and can't be denied for pre-existing conditions or any other balderdash. The private insurers also know it's a good deal for them since they're assured of regular monthly payments from the gov't which have the potential of increasing each year! No fixed, one time, voucher pays!
Another goodie for the Medicare Advantage senior: Advantage plans typically do not contain deductibles, thereby giving members "first-dollar" coverage. (Original Medicare has a potentially recurring (more than once per calendar year) deductible for Part A and an annual deductible for Part B.) Ryan's plan by contrast will likely see private health insurers attaching massive deductibles, on the order of $3,000 -$5,000 or more, for the simple reason that the insurers will be having to take chances (with no regularly promised gov't subsidies, only the single voucher payment) with a person in a putative high risk health pool! It doesn't take a genius to see that with such deductibles in play, and assuming the private insurer even accepts the senior, much of the voucher will be eaten up before the first real care is even delivered.
In many ways this is analogous to the sort of private insurance plans I was offered, at age 63 - before going onto Medicare. In nearly all cases, I'd have had to cough up a mammoth deductible, $5,000, and then the premiums themselves were sky high - like $600- $700 a month. And that was BEFORE I'd learned I had prostate cancer(this year). Now, if I had to go cap in hand with a $10-15k Ryan-voucher to try to snag an insurance company to pay for my care, I'd likely be laughed out of their offices! They'd probably think I was some kind of comedian out to try his new shtick.
No wonder, given all the above, Samuelson can make the bald and devious claim that "Medicare Advantage has cost less for identical coverage. From 2006 to 2009 the gap averaged 11 percent between traditional Medicare and voucher plans similar to that under the proposal by Ryan, ..would serve as a price benchmark"
Of course, as I already showed above, the "voucher" plan of Ryan is NOT the same as the Medicare Advantage private plan! Hence, Samuelson's use of the phrase "voucher plans" in the context is misleading, and egregious. As for that "11 percent gap between the traditional Medicare and Medicare Advantage" that price gap comes to almost exactly $12 billion, or the total amount the Advantage plans bleed away from the traditional Medicare to support their higher level of "penthouse" caliber choices, perks each year. The same 11% difference bleeding the original Medicare into insolvency!
If anyone, any senior, believes the Ryan plan vouchers will deliver to him or her a Medicare deal even remotely comparable to the existing Medicare Advantage plans, he or she needs to be escorted to an Alzheimers' ward.
Sunday, October 30, 2011
"Throw Grandma Over the Cliff! - But Don't Touch Defense $$$$!"
"A nation that continues year after year to spend more money on military defense than on programs of social uplift is approaching spiritual death." -Rev. Martin Luther King Jr.
So (paraphrasing) says Neoliberal hack Robert Samuelson in his latest defense of the indefensible ('Defending Our Defense Budget!') , in this case the monstrous, malignant U.S. defense budget. He compares any form of significant cutting to the bloated Pentagon tab to "a dangerous, slow motion disarmament" - which might fly for anyone not aware that the U.S. spends more on defense than the next 25 nations together,
As usual, similar to this PR hack's other specious columns to try to justify slicing social spending, various half-truths are employed as well as outright distortions and twisting of statistics to serve his purpose as a Pentagon bandwagoneer. This time he uses the ruse of "three bogus arguments" which he insists are made by those who would dare make such cuts (obviously, trying to steer the unconstitutional "super committee" away from such a direction!)
Let's go through his prefatory canards before dealing with his attempts to take down the three "bogus arguments" against his precious military- industrial complex.
First, he claims there has been a "downsizing of military personnel" from the late 1980s, to 2010, with "the U.S. Armed Forces dropping from 2.1 milion to 1.4 million" germinating what he calls a "Peace dividend". As he delivers these numbers, he doesn't mention that the latter ten years have seen more military intervention in the form of the occupations in Iraq and Afghanistan which have required multiple deployments of National Guardsmen (not listed among the official recruited armed forces, e.g. in the Navy, Army, Marines, AF) at a cost of literally trillions in messed up lives, and undelivered domestic services those Guardsmen could have provided. Neither does he reference the sundry hundreds of higher tech weapons used to assist and supply these occupation troops, or how much has been squandered in puffed up contracts to Halliburton, Bechtel etc.
He then avers that from 2001 through 2011 the Congressional Budget Office claims the two occupations - "wars" in Iraq and Afghanistan "cost only $1.3 trillion, or 4.4 percent of total federal spending over those years." But he doesn't mention that this figure omits the projected future costs due to: a)medical treatments, such as for the severe brain injuries personnel have experienced from IEDs (an estimated 500,000) and b) the costs of medical care in toto for these returned vets. Adding those figures on, one gets another $3 trillion, which would make the total cost projected (since Samuelson is so fond of also projecting "future liabilities" in Social security, etc.) $4.3 trillion, and that's not factoring in current medical inflation rates. Hence, factoring in those costs with medical inflation rates one will arrive at a more realistic total of nearly 20% of total federal spending, easily through 2020 and probably 30% through 2025.
He then compounds his distortion further, by referencing the year 2011 and that "these costs were $159 billion or about 12% of the deficit" but leaves out the total amount of Pentagon money allocated beyond the occupations and budget supplementals ($790b) which then show the total military costs come to nearly 58 cents of each dollar, or 58% of the deficit! Indeed, this has been more than double the total percentage since 9/11. Clearly, that event was used as justification to more than double the military's piece of the pie. (Former defense analyst Chuck Spinney noted in 2004, the percent of the GDP was effectively doubled, to 4.4% setting the stage for a 'war between defense spending and Medicare spending')
Samuelson then attempts to directly rebut three main arguments for defense cuts:
1) That we can't afford today's military:
Samuelson asserts we can and must afford it - though he does agree that how much we do spend is a "political decision". Indeed it is, and it is also a "political decision" as economist G.P. Brockway once noted (The End of Economic Man, 1991), how much is allocated to the poor or dispossessed, vulnerable, and how much to lobbyists, speculators and weapons. Brockway correctly notes that such decisions inform and decide what manner of nation we are to be. Whether one attuned to the basest human instincts and lowest common denominator, or one that aspires to set an example for others.
He then uses more funny statistics in his response, saying that in the 1950s-60s "we used 40-50% of the federal budget routinely for defense, representing 8% -10% of our national income". This is true, but the total deficit as recently as 1961 was only $8 billion! This is compared to $15 trillion today, of which more than half has been directly or indirectly from defense spending since Reagan came in, as of 1981. Moreover, that large percent of the national yearly budget allocated for defense was made during a Cold War against another superpower, the former Soviet Union - which had itself matched our consumption dollar for dollar. It was not against a gaggle of robed, stateless lunatics that seek to set off a "dirty bomb" or two or maybe attack a jetliner. The USSR had more than 12,500 nuclear weapons - the least of which was some 50 megatons - deliverable by nearly 8,000 ICBMS.
So this fool is comparing apples and oranges. Thus, when he avers that "by 2010 only 20 percent of national income was devoted to the military" he is playing the fool. I mean, comparing some 40-50% consumed militarily of an annual billion dollar budget is not in the same class as consuming 20% of an annual $3 trillion budget.
2) We spend so much more than anyone else that cutback won't make us vulnerable.
Samuelson, hack that he is, has a rebuttal for this too. He does admit that the total U.S. defense spending in 2009 was "six times China's" and "13 times Russia's" but argues that we can't take these too seriously because "U.S. salaries and procurement costs are orders of magnitude higher". In fact, relative to the respective standards of living, soldier salaries in the U.S. are not that much different, and indeed, Chinese, Russian soldiers reap benefits that the U.S. counterparts do not. In fact, they have less to worry about on returning from service in terms of jobs, benefits, while U.S. service person may well find his job long gone on his return, being in a capitalist "every man for himself" society. No wonder the suicide rate has tripled in the last decade.
As for "procurement" costs, well Samuelson is indeed correct, but 80% or more of these are plain waste, harkening back to the Reagan era of $5,000 toilets, and $75 hammers! Thus, it has been found nearly all defense contracts have been "padded" ever since that era. Analyst Chuck Spinney has even (in a 2001 PBS NOW appearance with Bill Moyers) pointed out one of the most egregious paddings of all, dated from ca. 1999, of the Pentagon "misplacing" $1.1 TRILLION. No one dares mention or disclose on paper, that this was more than likely padding under the table for defense contracts issued since the 1991 Gulf War!
3) The Pentagon has so much inefficiency and waste that sizable cuts won't jeopardize our fighting capability.
Samuelson here agrees "of course there's waste and inefficiency" but argues that "these are being targeted in the $450 billion of additional cuts over ten years that President Barack Obama and congress agreed to earlier this year".
But if more than $1.1 trillion of such waste accrued during the 1990s, according to Chuck Spinney's estimates, then may we not conclude at least that much accrued during the past ten years of occupations in Iraq and Afghanistan. (Especially thanks to Halliburton in the former.) That means that a cut of $450 billion over ten years is not adequate, and ought to be at least doubled to $900 billion, and that is to remove waste alone!
Samuelson then lists several other programs cuts, e.g. to the F-22 stealth fighter, and possible cuts to Tricare - the veterans' medical counterpart to Medicare, but says "it's a myth that all waste can be surgically removed".
But no one is demanding a "surgical" removal, only a judicious use of limited budget resources. In this sense, Samuelson doesn't mention the proposed new expenditures on programs, weapons systems such as the 3,000 planned F-35 bombers, more appropriate for conventional warfare. So why squander nearly $1 trillion on this white elephant when defense contract padding and cost overruns are factored in? That money could better be applied to Tricare as opposed to cutting needed medical assistance for our vets there! There are also dozens of other programs of dubious utility and great cost, including the continued construction and use of these drone weapons.
Samuelson argues that "demands on the military are expansive and murky" but for sure this will always be the case in a so-called era of "terror wars". But being smarter, and applying more rigorous methods to procurement operations (especially cutting the defense corporations and their lobbyists out of making, writing budget proposals) would cut this down significantly. That is still no justification for not wielding the budget axe to the Pentagon to possibly force them to be more judicious as opposed to expecting year after year of growing Pentagon pieces of pie while ordinary Americans continue to suffer home foreclosures, joblessness, 1 in 6 frequency of child malnutrition and a whole generation of young people in debt slavery.
Lastly, Samuelson argues that:
"Defense spending is unlike any other spending because protecting the nation is government's first job. It's in the Constitution. Highways, school lunches and Social Security are not."
He seems to forget or doesn't process, that NO where in that document is a massive, formalized military establishment - corporate manufacturing nexus approved, which links industry and arms manufacture as ends in themselves - the "military -industrial complex" Dwight D. Eisenhower warned us about in his January, 1961 farewell address.
Nor does Samuelson process two other items in the Constitution:
1) The clear statement in the Preamble that the government is "to PROMOTE THE GENERAL WELFARE"
That is, not corporate or military welfare, but the GENERAL welfare! That indeed includes, to any normal brain- functioning person, "school lunches, highways and Social Security". As well as affordable health care and free education through college, such as democratic socialist nations like Barbados allow.
2) The inherent unstated RIGHTS implicit in the Ninth Amendment to the Bill of Rights.
Such rights can include the rights to affordable health care, and to social insurance!
As Prof. Garry Wills has noted in his landmark book, A Necessary Evil-A History Of American Distrust Of Government, Simon & Schuster, 1999:
"What the Ninth says is that the rights enumerated as protected by The Constitution do not exhaust all rights inherent in a people. The states can retain powers, though not rights."
In other words, while rights to health care, Social security etc. and even school lunches may not be found explicitly written down in the Consitution, they were accounted for as possible future unenumerated rights by our wise Founders, who realized at the time of authorship they couldn't conceive of every possible right.
Maybe Wall Street's favorite hack needs to go back to school and take a degree in American Government and the Constitution as opposed to Punditry and Hackery!
Let's go through his prefatory canards before dealing with his attempts to take down the three "bogus arguments" against his precious military- industrial complex.
First, he claims there has been a "downsizing of military personnel" from the late 1980s, to 2010, with "the U.S. Armed Forces dropping from 2.1 milion to 1.4 million" germinating what he calls a "Peace dividend". As he delivers these numbers, he doesn't mention that the latter ten years have seen more military intervention in the form of the occupations in Iraq and Afghanistan which have required multiple deployments of National Guardsmen (not listed among the official recruited armed forces, e.g. in the Navy, Army, Marines, AF) at a cost of literally trillions in messed up lives, and undelivered domestic services those Guardsmen could have provided. Neither does he reference the sundry hundreds of higher tech weapons used to assist and supply these occupation troops, or how much has been squandered in puffed up contracts to Halliburton, Bechtel etc.
He then avers that from 2001 through 2011 the Congressional Budget Office claims the two occupations - "wars" in Iraq and Afghanistan "cost only $1.3 trillion, or 4.4 percent of total federal spending over those years." But he doesn't mention that this figure omits the projected future costs due to: a)medical treatments, such as for the severe brain injuries personnel have experienced from IEDs (an estimated 500,000) and b) the costs of medical care in toto for these returned vets. Adding those figures on, one gets another $3 trillion, which would make the total cost projected (since Samuelson is so fond of also projecting "future liabilities" in Social security, etc.) $4.3 trillion, and that's not factoring in current medical inflation rates. Hence, factoring in those costs with medical inflation rates one will arrive at a more realistic total of nearly 20% of total federal spending, easily through 2020 and probably 30% through 2025.
He then compounds his distortion further, by referencing the year 2011 and that "these costs were $159 billion or about 12% of the deficit" but leaves out the total amount of Pentagon money allocated beyond the occupations and budget supplementals ($790b) which then show the total military costs come to nearly 58 cents of each dollar, or 58% of the deficit! Indeed, this has been more than double the total percentage since 9/11. Clearly, that event was used as justification to more than double the military's piece of the pie. (Former defense analyst Chuck Spinney noted in 2004, the percent of the GDP was effectively doubled, to 4.4% setting the stage for a 'war between defense spending and Medicare spending')
Samuelson then attempts to directly rebut three main arguments for defense cuts:
1) That we can't afford today's military:
Samuelson asserts we can and must afford it - though he does agree that how much we do spend is a "political decision". Indeed it is, and it is also a "political decision" as economist G.P. Brockway once noted (The End of Economic Man, 1991), how much is allocated to the poor or dispossessed, vulnerable, and how much to lobbyists, speculators and weapons. Brockway correctly notes that such decisions inform and decide what manner of nation we are to be. Whether one attuned to the basest human instincts and lowest common denominator, or one that aspires to set an example for others.
He then uses more funny statistics in his response, saying that in the 1950s-60s "we used 40-50% of the federal budget routinely for defense, representing 8% -10% of our national income". This is true, but the total deficit as recently as 1961 was only $8 billion! This is compared to $15 trillion today, of which more than half has been directly or indirectly from defense spending since Reagan came in, as of 1981. Moreover, that large percent of the national yearly budget allocated for defense was made during a Cold War against another superpower, the former Soviet Union - which had itself matched our consumption dollar for dollar. It was not against a gaggle of robed, stateless lunatics that seek to set off a "dirty bomb" or two or maybe attack a jetliner. The USSR had more than 12,500 nuclear weapons - the least of which was some 50 megatons - deliverable by nearly 8,000 ICBMS.
So this fool is comparing apples and oranges. Thus, when he avers that "by 2010 only 20 percent of national income was devoted to the military" he is playing the fool. I mean, comparing some 40-50% consumed militarily of an annual billion dollar budget is not in the same class as consuming 20% of an annual $3 trillion budget.
2) We spend so much more than anyone else that cutback won't make us vulnerable.
Samuelson, hack that he is, has a rebuttal for this too. He does admit that the total U.S. defense spending in 2009 was "six times China's" and "13 times Russia's" but argues that we can't take these too seriously because "U.S. salaries and procurement costs are orders of magnitude higher". In fact, relative to the respective standards of living, soldier salaries in the U.S. are not that much different, and indeed, Chinese, Russian soldiers reap benefits that the U.S. counterparts do not. In fact, they have less to worry about on returning from service in terms of jobs, benefits, while U.S. service person may well find his job long gone on his return, being in a capitalist "every man for himself" society. No wonder the suicide rate has tripled in the last decade.
As for "procurement" costs, well Samuelson is indeed correct, but 80% or more of these are plain waste, harkening back to the Reagan era of $5,000 toilets, and $75 hammers! Thus, it has been found nearly all defense contracts have been "padded" ever since that era. Analyst Chuck Spinney has even (in a 2001 PBS NOW appearance with Bill Moyers) pointed out one of the most egregious paddings of all, dated from ca. 1999, of the Pentagon "misplacing" $1.1 TRILLION. No one dares mention or disclose on paper, that this was more than likely padding under the table for defense contracts issued since the 1991 Gulf War!
3) The Pentagon has so much inefficiency and waste that sizable cuts won't jeopardize our fighting capability.
Samuelson here agrees "of course there's waste and inefficiency" but argues that "these are being targeted in the $450 billion of additional cuts over ten years that President Barack Obama and congress agreed to earlier this year".
But if more than $1.1 trillion of such waste accrued during the 1990s, according to Chuck Spinney's estimates, then may we not conclude at least that much accrued during the past ten years of occupations in Iraq and Afghanistan. (Especially thanks to Halliburton in the former.) That means that a cut of $450 billion over ten years is not adequate, and ought to be at least doubled to $900 billion, and that is to remove waste alone!
Samuelson then lists several other programs cuts, e.g. to the F-22 stealth fighter, and possible cuts to Tricare - the veterans' medical counterpart to Medicare, but says "it's a myth that all waste can be surgically removed".
But no one is demanding a "surgical" removal, only a judicious use of limited budget resources. In this sense, Samuelson doesn't mention the proposed new expenditures on programs, weapons systems such as the 3,000 planned F-35 bombers, more appropriate for conventional warfare. So why squander nearly $1 trillion on this white elephant when defense contract padding and cost overruns are factored in? That money could better be applied to Tricare as opposed to cutting needed medical assistance for our vets there! There are also dozens of other programs of dubious utility and great cost, including the continued construction and use of these drone weapons.
Samuelson argues that "demands on the military are expansive and murky" but for sure this will always be the case in a so-called era of "terror wars". But being smarter, and applying more rigorous methods to procurement operations (especially cutting the defense corporations and their lobbyists out of making, writing budget proposals) would cut this down significantly. That is still no justification for not wielding the budget axe to the Pentagon to possibly force them to be more judicious as opposed to expecting year after year of growing Pentagon pieces of pie while ordinary Americans continue to suffer home foreclosures, joblessness, 1 in 6 frequency of child malnutrition and a whole generation of young people in debt slavery.
Lastly, Samuelson argues that:
"Defense spending is unlike any other spending because protecting the nation is government's first job. It's in the Constitution. Highways, school lunches and Social Security are not."
He seems to forget or doesn't process, that NO where in that document is a massive, formalized military establishment - corporate manufacturing nexus approved, which links industry and arms manufacture as ends in themselves - the "military -industrial complex" Dwight D. Eisenhower warned us about in his January, 1961 farewell address.
Nor does Samuelson process two other items in the Constitution:
1) The clear statement in the Preamble that the government is "to PROMOTE THE GENERAL WELFARE"
That is, not corporate or military welfare, but the GENERAL welfare! That indeed includes, to any normal brain- functioning person, "school lunches, highways and Social Security". As well as affordable health care and free education through college, such as democratic socialist nations like Barbados allow.
2) The inherent unstated RIGHTS implicit in the Ninth Amendment to the Bill of Rights.
Such rights can include the rights to affordable health care, and to social insurance!
As Prof. Garry Wills has noted in his landmark book, A Necessary Evil-A History Of American Distrust Of Government, Simon & Schuster, 1999:
"What the Ninth says is that the rights enumerated as protected by The Constitution do not exhaust all rights inherent in a people. The states can retain powers, though not rights."
In other words, while rights to health care, Social security etc. and even school lunches may not be found explicitly written down in the Consitution, they were accounted for as possible future unenumerated rights by our wise Founders, who realized at the time of authorship they couldn't conceive of every possible right.
Maybe Wall Street's favorite hack needs to go back to school and take a degree in American Government and the Constitution as opposed to Punditry and Hackery!
Sunday, October 16, 2011
More Foolishness from Robert Samuelson
Nattering nabob Robert J. Samuelson is nothing if not predictable. Once again, in his WaPo latest column ('Downward Mobility Squeezes the Future'), he uses the tactic of identifying a clear and serious problem - the overall downward mobility of working Americans - but pins its cause to a red herring.
Yes, we know downward mobility is upon us: incomes have stagnated for the average working American since 1973 with inflation factored in, and the median wage for workers of all types (other than the top 1%) has actually decreased a full 7% since 2000. Meanwhile the wealthiest have seen their incomes and percentage of national wealth soar.
Why has this happened? Samuelson, not one to miss a beat with his favorite hobby horses, blames a lowered productivity, i.e.:
"Without higher productivity, broad living standards won't rise..."
But he also incites generational war by blaming older demographics as imposing an ongoing burden both on the economy, and the young, i.e.
"Productivity improvement have already been committed to demographic trends we can't alter (aging)"
and:
"The squeeze will continue. In 1990, there were 32 million Americans age 65 and over; by 2040 that's reckoned at 80 million. Rising costs for Social Security and Medicare have created a new political dynamic: if benefits for the elderly aren't cut, burdens on the young will go up.."
As usual, it's time to set the record straight.
First, as regards productivity, it's the highest it's ever been. Indeed, higher than any other nation, say even in the Eurozone. The reason is simple: corporations have achieved this vast increase in productivity at the cost of more than 5 million American jobs - either downsized (with the remaining work done by half or less of the people left), or technology (e.g. replacing human hands with robots, or ..in the case of grocery cashiers...replacing them without automated checkout scanners).
Thus, this complaint is bogus. Further the argument that "productivity improvements have already been committed to demographic trends" is also bogus! No, they are not being used to subsidize an elder population but rather to support and subsidize the largest, most cancerous military-industrial state in the whole world - which spends more on "defense" than the next 25 nations combined. Last year, for example, the Pentagon budget sucked up $796 billion! That is nearly 60 cents of every dollar.
Even the much talked about looming "cuts" to defense are a joke, barely $350 billion over ten years, which is chicken feed!
Want to know why our younger generation will likely be poorer than their parents? Look no further at the future being stolen from them by the malignant military industrial complex, which seems to grow ever bigger- driven in part by the insane "war on terror" meme. Let's face it, this meme's satiation point will never be reached until nearly every dollar is spent for nothing other than military weapons (like the F-35 of which 2,443 are planned at over a half billion bucks) and more security including spying technology.
Corporations already have spy monitors located in their restrooms, as well as computer technology that can count keystrokes on any employee or even see what he's doing any minute. Imagine that power multiplied by the Pentagon, once they set to work making their special $1 million artificial "insects" - actually spying robots able to fly over civil protests and report back to HQ.
Now, what if...instead of pumping billions into such bullshit, we used it to repair roads, bridges, water mains, etc. and put people to work?
What if, instead of rewarding corporations for repatriating jobs back from China or India we fined (or higher taxed) their asses for sending them off in the first place? Over 3 million dispatched the past four years, with some companies (e.g. G.E., Cisco) now sporting more than 4 times the jobs outside the country than in! (According to a WSJ article from 3 days ago, p. B1) Where were fuck were the powers that be when this was going on? Who was minding the store?
It is this erosion of wealth in our midst - resulting from over productivity in priding ourselves on job cutting, military spending beyond anything necessary to ward off attacks, and sending jobs overseas...that has gutted our national wealth and squeezed the future for us all. Meanwhile, the fat cat fuckers sit on billions, hell trillions, and do nothing but buy luxuries, go to mllion dollar resort villas for "rose wine wraps" and foie de Gras, or short stocks and commodities for the rest of us, sending prices of everything from fuel to food spiking.
But does Samuelson mention any of this? Fuck no!
The man would rather raise the specter of inter-generational warfare and further divide this nation than tell the fucking truth. But then, what can you expect from a Neo-liberal hack who is himself brainwashed (or maybe "greenback-washed') by the corporate state. Who, let's be frank, would rather have us at each other's throats than going after their jugulars!
Yes, we know downward mobility is upon us: incomes have stagnated for the average working American since 1973 with inflation factored in, and the median wage for workers of all types (other than the top 1%) has actually decreased a full 7% since 2000. Meanwhile the wealthiest have seen their incomes and percentage of national wealth soar.
Why has this happened? Samuelson, not one to miss a beat with his favorite hobby horses, blames a lowered productivity, i.e.:
"Without higher productivity, broad living standards won't rise..."
But he also incites generational war by blaming older demographics as imposing an ongoing burden both on the economy, and the young, i.e.
"Productivity improvement have already been committed to demographic trends we can't alter (aging)"
and:
"The squeeze will continue. In 1990, there were 32 million Americans age 65 and over; by 2040 that's reckoned at 80 million. Rising costs for Social Security and Medicare have created a new political dynamic: if benefits for the elderly aren't cut, burdens on the young will go up.."
As usual, it's time to set the record straight.
First, as regards productivity, it's the highest it's ever been. Indeed, higher than any other nation, say even in the Eurozone. The reason is simple: corporations have achieved this vast increase in productivity at the cost of more than 5 million American jobs - either downsized (with the remaining work done by half or less of the people left), or technology (e.g. replacing human hands with robots, or ..in the case of grocery cashiers...replacing them without automated checkout scanners).
Thus, this complaint is bogus. Further the argument that "productivity improvements have already been committed to demographic trends" is also bogus! No, they are not being used to subsidize an elder population but rather to support and subsidize the largest, most cancerous military-industrial state in the whole world - which spends more on "defense" than the next 25 nations combined. Last year, for example, the Pentagon budget sucked up $796 billion! That is nearly 60 cents of every dollar.
Even the much talked about looming "cuts" to defense are a joke, barely $350 billion over ten years, which is chicken feed!
Want to know why our younger generation will likely be poorer than their parents? Look no further at the future being stolen from them by the malignant military industrial complex, which seems to grow ever bigger- driven in part by the insane "war on terror" meme. Let's face it, this meme's satiation point will never be reached until nearly every dollar is spent for nothing other than military weapons (like the F-35 of which 2,443 are planned at over a half billion bucks) and more security including spying technology.
Corporations already have spy monitors located in their restrooms, as well as computer technology that can count keystrokes on any employee or even see what he's doing any minute. Imagine that power multiplied by the Pentagon, once they set to work making their special $1 million artificial "insects" - actually spying robots able to fly over civil protests and report back to HQ.
Now, what if...instead of pumping billions into such bullshit, we used it to repair roads, bridges, water mains, etc. and put people to work?
What if, instead of rewarding corporations for repatriating jobs back from China or India we fined (or higher taxed) their asses for sending them off in the first place? Over 3 million dispatched the past four years, with some companies (e.g. G.E., Cisco) now sporting more than 4 times the jobs outside the country than in! (According to a WSJ article from 3 days ago, p. B1) Where were fuck were the powers that be when this was going on? Who was minding the store?
It is this erosion of wealth in our midst - resulting from over productivity in priding ourselves on job cutting, military spending beyond anything necessary to ward off attacks, and sending jobs overseas...that has gutted our national wealth and squeezed the future for us all. Meanwhile, the fat cat fuckers sit on billions, hell trillions, and do nothing but buy luxuries, go to mllion dollar resort villas for "rose wine wraps" and foie de Gras, or short stocks and commodities for the rest of us, sending prices of everything from fuel to food spiking.
But does Samuelson mention any of this? Fuck no!
The man would rather raise the specter of inter-generational warfare and further divide this nation than tell the fucking truth. But then, what can you expect from a Neo-liberal hack who is himself brainwashed (or maybe "greenback-washed') by the corporate state. Who, let's be frank, would rather have us at each other's throats than going after their jugulars!
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