A Plan to Heal America: The Main Street Contract for the American People

During last night's Lamorinda Democratic Club meeting, California Nurses Association/National Nurses United Director of Public Policy for California Michael Lighty shared information about the Main Street Contract for America.

The Main Street Contact seeks to promote policies that will ensure:

  • Jobs at living wages, reinvesting in America.
  • Equal access to quality, public education.
  • Guaranteed healthcare for all.
  • A secure retirement, with the ability to retire in dignity.
  • Good housing and protection from hunger.
  • A safe, clean, and healthy environment.
  • A just taxation system where corporations and the wealthy pay their fair share.

The LDC's Issues and Endorsements Committee will be reviewing a resolution of support for the effort for possible consideration by the club at a future meeting.

At the end of his presentation, Lighty shared the following video which highlights the New Face of America, one where the interests of Wall Street have overtaken those of Main Street.

And Who Are Standard and Poor’s to Talk?

Given Standard and Poor's decision to downgrade the United States' sovereign debt rating, this may be a good time to remind ourselves of just how culpable this company is for the financial and economic crises our nation continues to face.

As Alain Sherter explains:

‎"In the years leading up to the housing bust, Moody’s, S&P and Fitch passed out AAA ratings like candy bars at Halloween. In mid-2007 and early 2008, with the real estate market in free-fall and mortgage delinquencies soaring, they suddenly started downgrading scads of formerly top-rated securities. In January of ‘08, for instance, S&P lowered ratings on more than 6,300 and 1,900 CDOs — in a single day…"

Oops. And, as Richard B. Margolies reported:

"Prior to the bursting of the housing bubble, Moody’s, S&P and Fitch each consistently provided positive credit grades on mortgage-backed securities despite the fact that they were extremely risky products. Much of the criticism of the credit rating agencies relates to the fact that these firms are paid by the issuers they rate and therefore have a conflict of interest."

I guess the taxpayers should have paid a commission.

If there were any justice, these people would have lost their jobs well before those harmed by their malfeasance the past few years.

How Republicans Squandered Trillions of Surpluses

With Republican politicians and the Tea Party movement pretending that all budget matters began the day President Obama was inaugurated, Paul Begala takes the time to set the record straight about how the GOP's policies have driven our nation into the fiscal ground.

As he reminds us, President Clinton presided over the first balanced budgets in decades. When he left office, there was black ink projected for years to come. The chairman of the Federal Reserve was even worried about what would happen when the nation had no bonds left to sell. As Begala notes:

Indeed, experts projected surpluses as far as the eye could see. $5.7 trillion in surpluses, to be exact. The surpluses were so strong that deep into the future—in 2009—the entire national debt was going to be zero. For the first time since Andy Jackson was president, the United States of America would not owe a dime.

It didn't quite work out that way, did it? As Washington seems paralyzed, our economy stagnates, and America's full faith and credit is on the brink, it is useful to recall how we got here. This was not an act of nature. There was no unforeseen earthquake, no tsunami, no hurricane that wiped out our surplus. It was instead a Republican House, a Republican Senate, and a Republican president who squandered the surplus. In full possession of the federal government for the first time since Eisenhower, the GOP—with, to be fair, some help from some very foolish Democrats—systematically dismantled the economic and fiscal policies that produced the strongest economy and largest budget surplus in our history.

As Begala notes, I can understand why Republicans and Tea Partiers would want to erase these inconvenient facts from history. To make things clear, Begala explains how the Republicans did it:

Specifically, they did four things: cut taxes (with a heavy tilt toward the rich), waged two wars on the national credit card (one of which was against a country that had nothing to do with 9/11 and posed no serious threat to America), passed a prescription drug benefit with no pay-for (the first entitlement in American history without a revenue source), and deregulated Wall Street (which helped turn the American economy into a casino and touched off the Great Recession).

No, it makes no sense for everyone to pretend the GOP has nothing to do with the fiscal situation they hypocritically condemn today.

Former Congresswoman Ellen Tauscher Wins Battle With Cancer

Our former Congresswoman, Ellen Tauscher, talks to Contra Costa Times Political Editor Lisa Vorderbrueggen about beating cancer and her work as Undersecretary for Arms Control and International Security.
 

Where California’s Tax Dollars Go

The California Budget Project has released an informative report explaining how California's tax dollars are spent. As the brief explains, the state budget is really a local budget:

More than 70 cents out of every dollar spent through the state budget goes to local communities, health care providers, and individuals.

That's right: only about 29 cents of every state tax dollar actually support what normally would be considered "state operations."

More than 50 cents of every state dollar goes to education, nearly 30 cents to health and human services, more than 10 cents goes to corrections, leaving only nine cents left to support other key services and institutions. Meanwhile, only corrections spending has grown significantly faster than overall spending since 1980-81, with K-12 education spending slightly ahead of the average spending growth.

Far too many Californians do not understand these facts. That is one of the reasons our state budget debates are so dysfunctional. Cuts to the state actually mean cuts in our neighborhoods. To read this important budget brief, please click here to see the report in pdf format.

Uncertainty Hurts Only Sometimes

Tweet observation of the day from the Center for American Progress' Jared Bernstein (I've expanded it below to remove the abbreviated text tweets sometimes require):

You need strong facial muscles to say with a straight face Republican claim that uncertainty hurts economy YET we should increase the debt limit in not 1 but 2 steps.

Almost makes one think there's something disingenuous about that "uncertainty" talking point.

Bush Tax Cuts and Our Fiscal Crisis

Former Reagan and Bush 41 economic advisor Bruce Bartlett points out that the Bush tax cuts have played a significant role in creating the federal budget deficit.

The reason, of course, is that taxes were cut in 2001, 2002, 2003, 2004 and 2006.

It would have been one thing if the Bush tax cuts had at least bought the country a higher rate of economic growth, even temporarily. They did not. Real G.D.P. growth peaked at just 3.6 percent in 2004 before fading rapidly. Even before the crisis hit, real G.D.P. was growing less than 2 percent a year.

By contrast, after the 1982 and 1993 tax increases, growth was much more robust. Real G.D.P. rose 7.2 percent in 1984 and continued to rise at more than 3 percent a year for the balance of the 1980s.

Of course, as Bartlett points out in the article, this has not stopped Republicans from claiming there is no evidence the Bush tax cuts reduced revenue because of the strong economy they created.

The Bush tax cuts did not improve the economy and certainly did not prevent the great recession. The only thing they did do was prevent budget surpluses from reducing the national debt, which actually was a policy goal.

On Debt Ceiling, Ronald Reagan Too Liberal for Today’s Republicans

Here's another example showing that Ronald Reagan would be too liberal for today's Republican Party: he didn't think fooling around with a national debt default was responsible.

On November 16, 1983, President Reagan sent a letter to the Senate (link here to pdf) in which he warned:

The full consequences of a default — or even the serious prospect of default — by the United States are impossible to predict and awesome to contemplate. Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and the value of the dollar in exchange markets. The Nation can ill afford to allow such a result. The risks, the costs, the disruptions, and the incalculable damage lead me to but one conclusion: the Senate must pass this legislation before the Congress adjourns.

The Nation can ill afford to allow such a result. Indeed.

That wasn't the only time President Reagan issued such a warning. On September 26, 1987, Reagan made a similar argument in his weekly national radio address:

Unfortunately, Congress consistently brings the Government to the edge of default before facing its responsibility. This brinkmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits. Interest rates would skyrocket, instability would occur in financial markets, and the Federal deficit would soar. The United States has a special responsibility to itself and the world to meet its obligations. It means we have a well-earned reputation for reliability and credibility — two things that set us apart from much of the world.

That's also pretty clear. And could be said, word for word, today.

Rachel Maddow did an excellent segment on this subject. It's well worth your time to watch.

Visit msnbc.com for breaking news, world news, and news about the economy

Internet Voting In California?

Lamorinda Democratic Club member Jim Soper has an article on the California Progress Report today about efforts in which he is involved to stop the passage of SB 908, a bill to allow limited absentee voting by email.

While the Lamorinda Democratic Club has not taken a position on the bill, I thought readers of this blog may be interested to read a story written by one of our members.

The Dangerous Intermingling of the Press and Politics

The Telegraph's Peter Oborne has a must-read analysis about how Rupert Murdoch's media empire created an alternative system of government over the past few decades in England, under both Labor and Conservative governments.

Since this crisis appears headed our direction, seeing what has happened there is incredibly useful. And scary.

When I went to work in the House of Commons as a lobby correspondent nearly 20 years ago, I assumed that the British constitution worked along the lines we had been taught in textbooks at school and university. Which is to say: Britain was a representative democracy; the police were reasonably honest; and the country was governed under the rule of law. I naively expected MPs to be honest and driven by a sense of duty, and ministers to be public-spirited.

During my first few years at Westminster, I came to appreciate that most of my assumptions were hardly true. In particular, it became clear that power had seeped away from the Commons, which had lost many of its traditional functions. It rarely held ministers to account, and ministers no longer made their announcements to the House, as Erskine May, the rulebook of Parliament, insisted they should; instead they were leaked out through journalists.

What was the impact of this? Pleasing Murdoch was at the top of the agenda.

The effect on government policy was wretched. Decisions were determined by consideration of the following day’s headlines rather than sound analysis. Furthermore, private favours were dispensed; Blair when prime minister spoke to his Italian counterpart Silvio Berlusconi about one of Murdoch’s business deals in Italy. Of course it was all kept secret, though details did sometimes leak out. All recent prime ministers have insisted that their meetings with Murdoch were confidential and did not need to be disclosed, as if they were somehow private affairs. Mercifully, Cameron – who has partially emerged from the sewer thanks to his Commons statement – has put an end to this concealment.

Can we doubt the same, if at a lower level, has happened here?

They say sunlight is the best disinfectant. The muck under these rocks have not seen the sun in far too long.