8 Things People Shouldn't Know

This is awesome. I'm simply quoting in full:

There are a number things the public "knows" as we head into the election that are just false. If people elect leaders based on false information, the things those leaders do in office will not be what the public expects or needs.

Here are eight of the biggest myths that are out there:

1) President Obama tripled the deficit.
Reality: Bush's last budget had a $1.416 trillion deficit. Obama's first reduced that to $1.29 trillion.

2) President Obama raised taxes, which hurt the economy.
Reality: Obama cut taxes. 40% of the "stimulus" was wasted on tax cuts which only create debt, which is why it was so much less effective than it could have been.

3) President Obama bailed out the banks.
Reality: While many people conflate the "stimulus" with the bank bailouts, the bank bailouts were requested by President Bush and his Treasury Secretary, former Goldman Sachs CEO Henry Paulson. (Paulson also wanted the bailouts to be "non-reviewable by any court or any agency.") The bailouts passed and beganbefore the 2008 election of President Obama.

4) The stimulus didn't work.
Reality: The stimulus worked, but was not enough. In fact, according to the Congressional Budget Office, the stimulus raised employment by between 1.4 million and 3.3 million jobs.

5) Businesses will hire if they get tax cuts.
Reality: A business hires the right number of employees to meet demand. Having extra cash does not cause a business to hire, but a business that has a demand for what it does will find the money to hire. Businesses want customers, not tax cuts.

6) Health care reform costs $1 trillion.
Reality: The health care reform reduces government deficits by $138 billion.

7) Social Security is a Ponzi scheme, is "going broke," people live longer, fewer workers per retiree, etc.
Reality: Social Security has run a surplus since it began, has a trust fund in the trillions, is completely sound for at least 25 more years and cannot legally borrow so cannot contribute to the deficit (compare that to the military budget!) Life expectancy is only longer because fewer babies die; people who reach 65 live about the same number of years as they used to.

8) Government spending takes money out of the economy.
Reality: Government is We, the People and the money it spends is on We, the People. Many people do not know that it is government that builds the roads, airports, ports, courts, schools and other things that are the soil in which business thrives. Many people think that all government spending is on "welfare" and "foreign aid" when that is only a small part of the government's budget.

This stuff really matters.

If the public votes in a new Congress because a majority of voters think this one tripled the deficit, and as a result the new people follow the policies that actually tripled the deficit, the country could go broke.

If the public votes in a new Congress that rejects the idea of helping to create demand in the economy because they think it didn't work, then the new Congress could do things that cause a depression.

If the public votes in a new Congress because they think the health care reform will increase the deficit when it is actually projected to reduce the deficit, then the new Congress could repeal health care reform and thereby make the deficit worse. And on it goes.

GOP Blows Up the Deficit

From the GOP's Pledge to America: "We offer a plan to stop out-of-control spending and reduce the size of the government."

You can read their unimpeachable methodology here.

Student Loan Reform

Upon request, I've just spent 15 minutes trying to look into competing CBO scores for the Student Loan Reform that was passed in the HCR reconciliation package, following the assertion that after making the scoring process more "fair" the reform actually ended up costing us money.  It turns out, of course, that this once again provides an example of the right wing simply lying to their poor, trusting voters.

Of course, with all of these large bills, there has been an open and gradual revision process, generating CBO scores all along the way.  After all, now that a Democrat is in the White House everyone cares about CBO scores and actually, you know, paying for things.  Go figure.  In this case, the CBO originally scored the reform at saving $62 billion over 10 years.  After some revisions were made to make the score better conform with reality, the figure was revised to $40 billion in savings.  This is where the dishonesty starts.

I wont link to them, but here's the relevant part of the story my friend saw:

Moreover, the debate on savings has overshadowed the fact that the planned reforms still add to the deficit. As the CBO explains,

“Whereas on average over the 2010-2020 period a representative loan issues in the direct loan program has a negative subsidy rate of 9 percent under FCRA (meaning that it reduces the deficit), the same loan has a positive subsidy rate of 12 percent on a fair value basis.”

So while the reform may reduce the deficit compared to the current broken system of a private-public hybrid, that is not the same thing as saying it will actually end up in the black.

How stupid does this author think we are?  Of course the student loan program costs the government money! We're not trying to run a profit on educating our future generations!  The government is not a business!  The question is not whether the entire program will be in the black, the question is whether the reform that just passed made things better or worse.  The answer?  On every front, it made things better - more loans will be given, more Americans will be educated, and the whole thing will end up saving us tens of billions of dollars over the status quo ante.  "The reforms still add to the deficit."  No they don't, you twit.  The Program adds to the deficit.  The Reforms reduce the deficit.

I guess this author might not have been intentionally dishonest.  The "Are they Stupid or Dishonest" question is an evergreen topic.

47% of People Pay No Income Tax

Why is that, exactly? Here are the answers:

http://keithhennessey.com/2010/04/15/off-the-rolls/

http://taxvox.taxpolicycenter.org/blog/_archives/2010/4/15/4506088.html

Short version: Both parties have instituted policies that have raised the percentage of people that pay no income tax. Generally, these policies are to incentivize work.  Finally, the Stimulus Act has temporarily raised the number from 38%, and those provisions expire this year.  Next year, we'll be back at that more moderate number of 38%.

And always remember that those people who pay no income tax still pay an effective tax rate of 15-20% on money they make. That's lower than the effective rate paid by many millionaires.

Job Loss and Creation

Good news, everyone!

Don't you just love the color-coding? Bush months in red, Obama in blue, of course.

GOP Alternative Budget - Tax Cuts for the Rich and (Almost) No Safety Net

Ryan's Budget - the GOP alternative - is an atrocious, Randian document. If you believe that the market allocates income morally by definition, then I guess this sort of thing makes sense, but some of us remember the history of revolutions on this planet.

Here's the nonpartisan takedown of Ryan's response to his budget problems:

We are quite disappointed that, in responding to our analysis of his budget plan, Rep. Paul Ryan accuses the Center on Budget and Policy Priorities of “partisan demagoguery” as well as “factual errors and misleading statements.” Quite the contrary, we applied the same rigorous analytical process to Rep. Ryan’s Roadmap for America’s Future that we do to every issue we study. We worked for more than a month on our analysis, and we believe that, if anything, we bent over backwards to make sure we were fair to the Congressman and his plan. Frankly, based on the attack on our analysis that Rep. Ryan issued yesterday, we took his plan far more seriously than he took our analysis of it.

Rep. Ryan accuses us of partisanship, but we relied on the best nonpartisan sources available. The Tax Policy Center, on whose revenue estimates we relied heavily, is a highly respected, nonpartisan institution whose codirector, Rosanne Altshuler, was senior economist for President George W. Bush’s Advisory Panel on Federal Tax Reform in 2005. Our other key sources of information included the nonpartisan Congressional Budget Office and the Chief Actuary of the Social Security Administration. Rep. Ryan says that we made errors and misleading statements, but it is he — not we — who has done so. He ignores what we wrote and accuses us of writing things that we did not. In fact, he even selectively deletes words from a sentence that he quotes from one of our earlier reports to change the clear meaning of what we wrote. He also inaccurately represents some important aspects of CBO’s analysis of his plan.

As outlined below, we examined every one of Rep. Ryan’s complaints about our work, and not a single one withstands scrutiny.

It's all great. They nail him.

Redirecting the TeaBaggers

Hey, Teabaggers... want to do something useful? Look through this nifty map of the Federal Budget and tell us what to cut!

Aside: isn't it funny that the Tax Protesters were nowhere to be found during the Bush Presidency?  And they main thing they're protesting - the "socialist" bailouts - were began under Bush!  Remember, you never heard that Bush was anything but a Conservative Lion until late 2006, when it was clear the Republicans were going to get obliterated in the midterm elections because of their lockstep ties to the former President.  What this says about the real motivation behind the protests is not pretty.

Europe doesn't hate Obama?

I thought I had heard that Europe thinks Obama is taking America "to hell" with his stimulus plans and regulatory ideas?  Well, apparently not.  But I thought I heard that over and over again on talk radio and Fox News.  Do you think they didn't check their sources?  They wouldn't run with a story that wasn less than the truth just to make Obama look bad, would they?

Reporting from Los Angeles and London -- The G-20 leaders will pour at least $1 trillion into the global economy in an effort to stimulate recovery from a worldwide downturn and will push for greater regulation of the financial industry, officials said this morning.

In a televised news conference from London, British Prime Minister Gordon Brown announced the key elements of the plan, including an additional $500 billion for the International Monetary Fund, $250 billion in IMF Special Drawing Rights and $250 billion to boost trade.

The leaders of the major economies also pledged to work on such regulatory issues as pay and bonuses for executives and bringing financial instruments such as hedge funds into tighter government control. Many blame the new investment instruments, including derivatives and credit swaps, for the economic contraction around the world.

"This is the day that the world came together to fight back against the global recession," Brown told reporters.

"Our message today is clear and certain. We believe that in this new global age, our prosperity is indivisible,' he said. "We believe that growth, to be sustained, must be shared, and that trade must once again become an engine of growth. The old Washington consensus is over; today we have reached a new consensus."

"There are no quick fixes. But with the six pledges that we make today, we can shorten the recession and save jobs."

The six pledges may not have been everything Obama said he wanted, but it is excellent nonetheless.  And when you're dealing with someone like Obama, a cautious poker player, it's difficult to say that his "Ask" wasn't merely a strategic opening, leading to the outcome he originally desired.  A trillion dollars is no slouch, and the work to strengthen regulations is key to establishing a healthy period of real economic growth.

The Republicans really need to learn how to set expectations.  They've turned this trip from an impending disaster, where the EU rebukes Obama harshly, into a remarkable accomplishment, with Obama brokering deals and closing the breach between American and the rest of the world.

"Light Switch Tax" Lies

Unsurprisingly, the Republicans are lying about Cap and Trade when they say it will cost every family $3,128 per year.

It's a pattern they've followed before.  Simply take a study done by a Democratic policy advocate, misunderstand or willfully ignore the obvious preconditions for the study, then apply the study in a dishonest way to the current debate.  They did it first with the Stimulus Bill, claiming their package would create twice as many jobs for half the cost.  Of course, the study they referenced was regarding the efficacy of taxcuts in a time of economic expansion - the polar opposite of our current situation.  It goes beyond the normal political games of selective emphasis - it is dishonesty.

For Cap and Trade, they're citing researcher John Reilly's study.  Here's what he has to say about their take on his work:

"It's just wrong," said John Reilly, an energy, environmental and agricultural economist at M.I.T. and one of the authors of the report [cited by congressional Republicans]. "It's wrong in so many ways it's hard to begin." [...]

The tax might push the price of carbon-based fuels up a bit, but other results of a cap-and-trade program, such as increased conservation and more competition from other fuel sources, would put downward pressure on prices. Moreover, consumers would get some of the tax back from the government in some form.

The report did include an estimate of the net cost to individuals, called the "welfare" cost. It would be $30.89 per person in 2015, or $79 per family if you use the same average household size the Republicans used of 2.56 people.

The cost would grow over time as the program ramps up, but the average annual cost over time in today's dollars -- that is, the "average annual net present value cost" -- is still just $85 per person, Reilly said. That would be $215.05 per household.

A far cry from $3,128. And that isn't the only inaccuracy in the claim.

PolitiFact called it a Pants-on-Fire level of lying, a special honor.

The GOP's Clown Budget

Perhaps you've seen this graph floating around.  It was produced by the House Republican Staff.  Interestingly, CBO budget projections only go out to 2019, which means the Republicans are "inferring" the data points after that.

Isn't it interesting how, shortly after they start inferring, the numbers for the Democrats start going crazy?  Convenient for those Republicans, that.

More hilariously, the GOP Budget is a GOP Budget, so it must include certain things.  First, there are the obligatory tax-cuts for the rich, hacking the top marginal rate from 35% to 25%.  Second, there is the across-the-board spending freeze, with Defense spending on a different board, of course.

Where it takes the fork to crazy town is that it makes the tax changes optional.  It would be up to individual taxpayers to decide if they wanted to use the Bush-era tax code, or the new GOP-Budget tax code with it's 10% lower rates.  This raises the question - which tax code should the GOP use to compute the revenue going forward?  The answer: use the Bush-era, higher marginal rates to calculate the tax revenue to the Feds!  Cuz obviously, it's the patriotic thing to pay more, right?  Isn't that the argument the Republicans made during the election?

But because we don't live in Bizzaro World, where Republicans just love paying taxes, we should get a sense of what the real world tax revenues would be with the 25% top marginal rate.  The answer: subtract $300 billion in federal revenue, resulting in structural deficits that never go below $800 billion a year by the Republicans' own numbers.  This is their fiscal discipline.

What clowns.  Is this any better than their "budget with no numbers" from last week?

Contracts Only Matter When they Belong to WS?

Isn't it encouraging to see so much criticism of Barack Obama from the Left?  I love seeing accountability, even for the supposed "Chosen One" we think of as our God.

The latest round of attacks on Obama from the Left is contained in this headline (In the context of the AIG Bonuses outrage):  Obama forces Wagoner Out..Contracts only matter when they belong to WS.

I beg to differ.

First, in the case of Rick Wagoner being forced out as CEO of GM, you're talking about one person.  A single person can be prevailed upon to behave a certain way for the good of the company, but getting 60 individuals to all agree to forgo their bonuses is an impossible task -  there will be intransigent outliers, if only for the purpose of sticking it to the government.  In any 60 people there's bound to be one Joe the Plumber, right?  So, if even one refuses to give up the bonus willingly, then you're in a situation requiring the abrogation of contracts.  Since they don't have the legal powers to do that, they don't try.  If you haven't noticed, Obama's a cautious guy.  The Administration does not attempt things they aren't very sure they're going to accomplish.

The alternative would be a name and shame technique, putting pressure on the individuals refusing to forgo the bonuses, but it would be seen as sicking violence on the poor Bankers.  The mood out there is a little ugly, after all.  It would be inappropriate for the government to direct it's power at individual citizens in this way. 

Furthermore, they could easily be co-opted by the Republican Opposition.  The Bankers are a smart, typically Republican demographic, and might well come up with the idea themselves.  If a few of them simply refused, they could make the President look impotent.  There could be a Joe the Plumber amongst them, as I said.  It would be a drag, and it wouldn't recover the money from the real assholes anyway without abrogation of the contracts.

That's why these are different situations.  The Left's criticism is unconvincing.

That said, I am a little nervous about Cognitive Regulatory Capture - the fact that our economic team (Summers and Geitner) comes from wall street predisposes them to wall street-centric solutions.  We need to be vigilant on this issue to make sure they are doing the people's work, and not Goldman's.

Limbaugh Makes a Career of Lyinig

I'm glad Media Matters caught this for me.  I heard Limbaugh raging furiously on the air the other day, and this was the centerpiece of the segment:

LIMBAUGH: It's in the stimulus package that they get the bonuses. That's what they're now going to go in and try to change. "AIG stands for Arrogance, Incompetence, and Greed" -- yeah, and you people bailed them out. And let's remember one thing, folks, while we go forward: Not one Republican voted for this bailout. Remember way back in the fall, not one Republican voted for the TARP bailout? And this was why.

And let's never forget what we were told back then: If we didn't do this, the country was finished. If we didn't pass this law and bail out these banks, it was over. We didn't have a day to make this decision. We didn't have a half-day. We didn't have 24 hours. Not one Republican voted for it the first time around. This is why.

Of course, that's not close to true. 65 House Republicans voted for it the first time, and 91 did the second time.

Obama Presidency a Success!

According to the guys at CNBC and the WSJ, that is, since NASDAQ is now above where it was when Obama became President:

What a stupid way to look at a Presidency.

Stewart Immolates CNBC, and Teaches Cramer

Wow. Stewart does the journalist's job again:

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Interview Outtake Pt. 1

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

.

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Interview Outtake Pt. 2

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

.

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Interview Outtake Pt. 3

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

Wowza. It'll be interesting to see how Cramer deals with this. It might actually have taught him something - providing a more visceral connection with the perspective of the non-financial class.

Public Hated Jindal's Response

I don't actually have polling numbers to back that title up as I do in the parallel post below, but if the Fox News guys had this reaction, then you know how it played in the country at large:

BRIT HUME: It read better than it sounded… this was not Bobby Jindal’s greatest rhetorical moment.

NINA EASTON: The delivery was not terrific.

CHARLES KRAUTHAMMER: Jindal didn’t have a chance.

JUAN WILLIAMS: Childish.

If it had been in the ballpark of a close decision, they would have spun it as a great victory for Jindal and the GOP.

Or how about David Brooks, one of those "Washington Conservative Intellectuals" that Rush Limbaugh hates so much:

JIM LEHRER: Now that, of course, was Gov. Bobby Jindal, the governor of Louisiana, making the Republican response. David, how well do you think he did?

DAVID BROOKS: Uh, not so well. You know, I think Bobby Jindal is a very promising politician, and I oppose the stimulus because I thought it was poorly drafted. But to come up at this moment in history with a stale "government is the problem," "we can't trust the federal government" - it's just a disaster for the Republican Party. The country is in a panic right now. They may not like the way the Democrats have passed the stimulus bill, but that idea that we're just gonna - that government is going to have no role, the federal government has no role in this, that - In a moment when only the federal government is actually big enough to do stuff, to just ignore all that and just say "government is the problem, corruption, earmarks, wasteful spending," it's just a form of nihilism. It's just not where the country is, it's not where the future of the country is. There's an intra-Republican debate. Some people say the Republican Party lost its way because they got too moderate. Some people say they got too weird or too conservative. He thinks they got too moderate, and so he's making that case. I think it's insane, and I just think it's a disaster for the party. I just think it's unfortunate right now.

That'll make for fun Rush listening tomorrow.  I can't wait.

I don't know what to do with so much positive emotion.  I'm still a little out of sorts with this change that's finally come to our nation's politics.

Update: Here's the longest Jindal video I can find, and it is truly a trainwreck:

Public Loved the Semi-SotU

CBS insta-poll on Obama's Semi-SotU

Stimulus is going to help me?

Before:

• 62%
  

After:

• 79%
  

And from CNN:

85% said the speech made them feel more optimistic about the direction the country is headed in (though granted, feeling more optimistic than before might be a low bar), and only 11% said it made them more negative.

And 82% say they support Obama's economic plans as outlined in the speech, with only 17% against.

An ORC poll found that 92% were somewhat or very positive about the speech.  Wow.

It was a perfectly crafted address, striking the balance between sober honesty, hope for the future, and rebuttal of Republican dishonesty. We'll turn this crisis into opportunity, let there be no doubt. I love this guy.

FDR Did More than Worsen the Great Depression...

... he started it. So says Rep. Austria, Republican from Ohio:

"When (President Franklin) Roosevelt did this, he put our country into a Great Depression," Austria said. "He tried to borrow and spend, he tried to use the Keynesian approach, and our country ended up in a Great Depression. That's just history."

Some will remember that the Depression started in 1929, while FDR wasn't President until 1933. Oy. Your Republican Party at work!

And for those that think FDR worsened the Depression, or that the New Deal didn't work, eat chart, suckers:

Or how about unemployment?

Yeah, cuz 15% unemployment is no better than 25%.

The New Deal Made the Great Depression Worse?

Really? Really?



I didn't think so. Charts and graphs are so useful, aren't they?

Obama Learns his Lessons

Obama on Bipartisanship:

They were pleasantly surprised and complimentary about the tax cut that were presented in that framework. Those tax cuts are still in there. I mean, I suppose what I could have done is started off with no tax cuts, knowing that I was going to want some and then let them take credit for all of them. And maybe that’s the lesson I learned.

That's what we've been saying, but Obama is too damned sincere in his desire to change Washington. Making a deal with the Republicans for votes in exchange for 35-40% tax cuts would have been a better political tactic, but it also would have been closer to business-as-usual in Washington. Obama, to his credit, started out with something that "pleasantly surprised" the Republicans.

I think he'll continue in this vein, continuing to burnish his bipartisan cred with the public, and only thwack Republicans over the head when he's in a commanding enough position.  He's not good on the attack - he's good on the counter-attack.

The Maddow Era: Stimulus

It's about time we had a truly liberal voice on TV - not that I agree with a lot of classical liberalism, but the deafening silence from the Left on TV has been unhealthy. Some might cite Olbermann, but he's truly just a reaction to Bush's unprecedented awfulness. I don't see him as pushing a Liberal Agenda. Maddow, however, is a pusher, and she does it with style.

Here she is on the Stimulus Plan:

Visit msnbc.com for Breaking News, World News, and News about the Economy

She's great.