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<DIV style="FONT: 10pt arial">----- Original Message -----
<DIV style="BACKGROUND: #e4e4e4; font-color: black"><B>From:</B> <A
title=davidjohnson1451@comcast.net
href="mailto:davidjohnson1451@comcast.net">David Johnson</A> </DIV>
<DIV><B>To:</B> <A title=davidjohnson1451@comcast.net
href="mailto:davidjohnson1451@comcast.net">David Johnson</A> </DIV>
<DIV><B>Sent:</B> Tuesday, April 23, 2013 5:01 PM</DIV>
<DIV><B>Subject:</B> Social SEcurity Article</DIV></DIV>
<DIV><BR></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman"><B>Obama Does
Social Security and Medicare</B><BR></FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">With Barack
Obama putting his plan to cut Social Security and Medicare expenditures into
writing in his Federal budget proposal the ability of those who voted for him to
credibly deny his years of publicly stating he would do so disappeared. The
pathetic pleas from liberals and progressives who only a few short months ago
were assuring the unwashed masses Mr. Obama was on the cusp of a ‘liberal’
renaissance if only doubters would join them in granting him another term are
today as empty as their assurances were then.</FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">The difference
between the rich (Mr. Obama) voluntarily giving up a fraction of their yacht
allowance versus millions of seniors choosing between eating and living indoors
is fundamental.<BR><BR>Those whose politics begin and end with rolling off the
couch every few years to vote could in theory be forgiven for perceiving a
yawning chasm between the Republican and Democrat candidates. Marketing firms
were paid a lot of money to create that illusion. And Mr. Obama almost certainly
has the political calculus correct that the bourgeois liberals will whimper in
protest for a few days, weeks at most, before falling in line for Hillary or
whatever militaristic, corporatist abomination the Democrats put forward in the
next Presidential election. Early reports even have liberal pundits sticking
with the line Mr. Obama is only posturing with the proposals, despite his near
decade prior explaining why he believes Social Security and Medicare must be cut
to be ‘saved.’ </FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">However, this
is truly a ‘let them eat cake’ moment. Mr. Obama’s policies will needlessly, and
in economic terms gratuitously, hurt a lot of people—overwhelmingly those who
self-identify as the Democrats’ political ‘base.’ And lest there be confusion
over the matter, in his first term Mr. Obama fully restored the fortunes of
America’s ruling class at several trillion dollars of public expense before
proposing these cuts.<BR><BR>The faux official hand wringing over Social
Security is a result of the bi-partisan (‘Washington’) consensus that produced
the trajectory of catastrophic public policy over the last thirty years.
Radically skewed income distribution has seen lower and middle-income wages
stagnate with all economic gains delivered up to a tiny plutocracy. This has
lowered the proportion of total income paid into Social Security because above
the current $113,700 cap income is excluded from contribution to the program.
Raising the cap would have some effect in reducing expected future shortfalls.
</FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">The real
solution—where the real money is, lies in shifting economic gains back toward
lower and middle class wages. Doing this would raise the proportion of income
paid into Social Security. And this leaves aside the fact the Federal Reserve
created several trillion dollars ‘out of thin air’ to restore the fortunes of a
dysfunctional financial system and its beneficiaries in the plutocracy and could
more productively do so to fund the nation’s social insurance programs.
</FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">In short, the
‘crisis’ facing Social Security and Medicare is one of skewed income
distribution resulting from bad public policy and is readily solvable without
cutting benefits.<BR><BR>To the argument proposed tax increases on the rich
balance ‘sacrifice’ across economic classes, what makes Mr. Obama’s self-imposed
wage cut so ludicrous is how radically it understates the degree to which a
large and growing proportion of the population has been economically
marginalized. The rich benefit from public expenditure in far greater proportion
than the rest of us. </FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">About one-third
of retirees exist entirely on Social Security payments that are already at bare
subsistence levels. These payments constitute the bulk of monthly income for two
out of three retirees. Cutting benefits for people who lack other options for
obtaining income isn’t ‘sacrifice,’ shared or otherwise—it is immiseration. And
Social Security belongs to those who paid into the program throughout their
working lives—it is only through radically anti-democratic governance Mr. Obama
and Congressional Republicans have say in the matter.<BR><BR> The
resurrection of Wall Street, including paychecks and bonuses, took place
entirely on the public dime. And a significant proportion of the rise in
corporate earnings used to justify grotesquely disproportionate executive
compensation came from cutting wages to labor. The ability of executives to cut
wages derives from government policies specifically designed to reduce the power
of labor unions and from tax breaks and incentives to shift production to low
wage countries. These are no more ‘market’ forces than the bank bailouts
were.<BR><BR>Mr. Obama’s delivery of several trillion dollars of public wealth
to the banks in ongoing bailouts was sold as a way to ‘get banks lending again.
But wholly reviving insolvent banks has no legitimacy in any economic theory.
This is why the bailouts were, and still are, framed as liquidity provision when
they are in fact solvency provision. And again, private debt has the
political-economic consequence of concentrating wealth and political power in
the hands of lenders (Wall Street). </FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">To coin a
Clintonism, it’s the class warfare stupid!<BR>Having now saved a parasitic and
dysfunctional Wall Street at public expense, fiscal conservatives in the U.S.,
led by Barack Obama, seek to cut public expenditures to pay for the
privilege.<BR><BR>If cutting the inflation assumption for Social Security would
‘save’ the program, the purported rationale or doing so, then reversing policies
designed to concentrate income and wealth would do far more. But cutting the
inflation assumption isn’t intended to ‘save’ the program; it is intended to cut
Federal spending in which Social Security plays only an indirect role (why else
include it in budget ‘negotiations’?) because it is funded through a dedicated
tax, not through Federal spending. </FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">And the context
is public expenditures are being cut to pay for the Wall Street bailout and the
economic calamity Wall Street caused. Put another way, if there is no public
debt ‘crisis’ (there isn’t) and the temporary increase in public debt was to
save Wall Street and undo the damage it did to the economy, why not get the
money from Wall Street?<BR><BR>But in fact the money is still going in the other
direction. And across Europe the story is remarkably similar—through assuming
bank liabilities directly (Ireland), shifting public resources to the banks to
‘save’ them.</FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">To be clear,
fiscal issues the European periphery faces came from delivering public resources
to Wall Street alone. </FONT></FONT></DIV>
<DIV><FONT size=2 face=Arial><FONT size=3 face="Times New Roman">Wall Street now
includes large European banks.<BR><BR>For the uninitiated, the endgame appears
nigh. The seizure of bank deposits in Cyprus to pay for bank losses simply
removed the ‘middle men,’ the European Central Bank and the political powers
that be in Europe, from transferring wealth from the citizens of Cyprus to
Cypriot bankers (and to European banks and U.S. hedge funds). The capitalist
media storyline promoted by gullible liberals that ‘Russian mafia’ money was
seized is nonsense. By reports European banks and rich Russians had little
trouble getting their money out of Cyprus. The deposits being seized are in
precise inverse relation to the political-economic power the depositors wield.
And across the West policies of economic austerity are being imposed in similar
fashion.<BR><BR>But if you think this is it, that the worst is over, I humbly
suggest that was your view when Mr. Obama won his second term. To those paying
attention, the Dodd-Frank legislation being sold as a way to ‘reign-in’ bailed
out banks contains ‘Cyprus’ clauses that leave banks (or their creditors,
beginning with derivatives counter-parties) no alternative than to seize insured
deposits when they need their next inevitable bailout. On the plus side, this
will eliminate the time-consuming theater of austerity ‘debates.’ On the minus
side, Mr. Obama is exponentially increasing the misery of society’s most
vulnerable. But I’m confident he appreciates your support for his
policies.</FONT><BR></DIV></FONT></BODY></HTML>