Showing posts with label national debt. Show all posts
Showing posts with label national debt. Show all posts

Saturday, September 25, 2010

Crabby, Constipated Congressman Jeff Flake Calls These Generous, Patriotic Alabama Schoolchildren "A Bunch of Little Jerks"


Congressman Jeff Flake's perverted values were on full display in yesterday's New York Times, in an article on how patriotic Americans like the Montgomery, Alabama, sixth-graders above, are donating to help pay down the national debt:
PARKERSBURG, W.Va. — In a fifth-floor cubicle in a federal office building here is a wire-frame basket labeled “Gifts.”

Every few days, an envelope arrives, and a Treasury Department employee opens it. Inside, usually, is a check, often with a letter explaining why the sender wants to do his or her part to help reduce the federal debt of the United States.

A very small part, to be sure.

Last year, the Bureau of the Public Debt recorded $3.1 million in gifts, more than has been usual since the government began accepting such donations in 1961. At that rate, it would take millions of years to retire the $13.4 trillion the country owes its creditors, foreign and domestic.

While concerns about the economy, especially taxes and spending, have dominated the midterm election, it is hard to find officials who have made voluntary contributions to improve the nation’s balance sheet.

Treasury Secretary Timothy F. Geithner has not pulled out his checkbook, and fiscal conservatives, for whom the record debt is a rallying cry, have hardly mentioned the idea of giving.

Since the program began, Americans have given about $80 million. Recent donors include a class of Alabama sixth graders who raised $324.50 by selling cookies; a Maryland man who learned of the program in an evening accounting class; and Margaret E. Taylor, 98, of Findlay, Ohio, who died in 2006 and bequeathed $1.1 million to the cause.

“I get mixed reactions,” said John W. Krupansky, 56, a software developer in Midtown Manhattan who started reading about economics during the dot-com crash a decade ago, and has blogged about his tax deductible gifts, nine so far, of $25 each. “Some people are annoyed; they think the right thing to do is complain about the debt, not actually do something about it. Other people are amused that anyone would waste their time to do such a thing.”

This fiscal year, through July, the bureau has logged $2.7 million, about 9 percent less than at the same point last year.

Donors can send in a check or money order, or give online using a credit or debit card. The government does not advertise the program, and officials avoid drawing attention to it. The program tends to come up, they said, only when journalists ask about it.

Van Zeck, the commissioner of the bureau, oversees sales of Treasury securities and savings bonds; accounts for the debt to the penny; and ensures that the debt does not exceed the statutory limit, which Congress raised in February to $14.3 trillion.

Asked why the program was little known, he said soliciting donations might “seem straightforward and benign” but could rub taxpayers the wrong way.

“Whether to advocate that people do more financially to help the government than they already do — that’s not the kind of question that’s mine to answer,” he said.

The program was the idea of Representative Charles E. Bennett, a Florida Democrat who served 44 years in the House. Mr. Bennett, who died in 2003 at age 92, also wrote the law requiring that currency bear the motto “In God We Trust.”

He was known for public spiritedness. A World War II veteran, he returned his military disability and Social Security checks to the government. When he retired, he gave most of his campaign funds to charity and the Treasury.

Mr. Bennett’s law helped clarify the government’s authority to accept gifts dedicated to debt reduction.

While the White House believed that “such authority almost certainly already exists,” the legislation was “intended to encourage such gifts” and to create a way to accept them, according to a 1961 memorandum, now in the John F. Kennedy Presidential Library and Museum in Boston.

But although the memorandum confirms that the gifts are counted toward debt reduction, the amount of giving has no real impact on government spending and borrowing.

“There does not appear to be any intention to put control of the actual level of the debt in private hands, although those who make such gifts may be under the impression that they are exercising such control,” Phillip S. Hughes, an assistant budget director, wrote in advising President Kennedy to sign the bill.

For some people, that makes the program toothless.

“It’s just good money after bad,” said Representative Jeff Flake, who with Senator John McCain, a fellow Arizona Republican, has introduced legislation that would let taxpayers designate up to 10 percent of their federal income tax for debt reduction and require Congress to come up with an equal amount in spending cuts.

Mr. Flake said he had only a “vague recollection” of the gifts program, but that he did not support it. “I don’t think taxpayers should be on the hook more,” he said. “We already pay enough.”

But contributors have argued that shared sacrifice is what is most needed to revive the economy.

Teri Gisi, a teacher at Dalraida Elementary School in Montgomery, Ala., who coordinated the bake sale that sixth graders held last year after learning about the debt in class, said the recession was on their minds.

“We’ve had some students who’ve had to move in with their grandparents, students who’ve lost their homes to foreclosure,” she said. “Some of them didn’t even have new shoes for the start of school.”

Despite hardships, the students made debt reduction their cause. “Three hundred dollars to them is a large amount,” Ms. Gisi said. Even when a math teacher explained how large the debt was — “he showed them all the zeros,” she said — “they didn’t get discouraged.”


Treasury officials said they were prohibited from identifying donors. But in Parkersburg, a few employees shared stories.

A widow turned over the estate of her late husband, who had made regular gifts to express patriotism. Naturalized citizens, thankful for the opportunities afforded immigrants, have contributed. A man sent in a trove of rare coins, which were auctioned for far more than their face value.

Many taxpayers have simply signed over and mailed in their rebate checks, including members of Amish and Mennonite communities who have explained that their religious beliefs do not permit them to accept government assistance.

The bureau tries to make donors feel appreciated. Anyone who mails a check receives a thank-you form letter from Sherlyn West, a manager here.

“Your contribution will help ensure that we do not burden future generations with a huge debt,” it says.

As a little boy, I remember hearing a dispute between my millionaire grandfather - my father's father - and my millionaire great-grandfather, my mother's mother's father. They were bragging about who paid the most taxes and which one thus gave more support to the country they both loved.

They would have honored the Alabama schoolkids and spit in Congressman Jeff Flake's smug, self-satisfed, selfish face.

Jeff Flake is so un-American and has such crabbed, constipated values, he thinks he has nothing to give to his country. But he takes plenty, living the high life of a millionaire in Washington on his Congressional salary. He's selfish, just like most of you voters in the district who grew up learning how to be morons like Jeff Flake. That's why Nate Silver's blog Five Thirty Eight lists Jeff Flake as having a 100% chance for election.

America would be better off if there were more members of Congress who were Alabama sixth-graders than comfortable, I'm-all-right-Jack jerks like Jeff Flake.

Sunday, August 1, 2010

How the Republican Party of Jeff Flake Destroyed the American Economy: Lies and Damn Lies About the Federal Deficit Exposed by David Stockman


Free-market laissez-faire fanatics like Jeff Flake worship the free market. No taxes are always better than any taxes, no regulation is always better than any regulation, and so what if the rich keep getting much, much richer and the rest of us are losing ground? Republicans more hateful than Flake blame the immigrants and ethnic minorities for taking the jobs of Tea Party conservatives who would otherwise be getting hired as cleaning women and janitors, gardeners and laborers, bus boys and restaurant takeout delivery girls. (In Arizona, most white Republicans don't have college educations as most people we know do.)

For the few people in the East Valley with a modicum of intelligence, we're reprinting some of today's important New York Times op-ed on Republicans and the national debt written by David Stockman, Ronald Reagan's first budget director and a former Michigan congressman who always a little too intelligent to be a party to what his party has wrought:
IF there were such a thing as Chapter 11 for politicians, the Republican push to extend the unaffordable Bush tax cuts would amount to a bankruptcy filing. The nation’s public debt — if honestly reckoned to include municipal bonds and the $7 trillion of new deficits baked into the cake through 2015 — will soon reach $18 trillion. That’s a Greece-scale 120 percent of gross domestic product, and fairly screams out for austerity and sacrifice. It is therefore unseemly for the Senate minority leader, Mitch McConnell, to insist that the nation’s wealthiest taxpayers be spared even a three-percentage-point rate increase.

More fundamentally, Mr. McConnell’s stand puts the lie to the Republican pretense that its new monetarist and supply-side doctrines are rooted in its traditional financial philosophy. Republicans used to believe that prosperity depended upon the regular balancing of accounts — in government, in international trade, on the ledgers of central banks and in the financial affairs of private households and businesses, too. But the new catechism, as practiced by Republican policymakers for decades now, has amounted to little more than money printing and deficit finance — vulgar Keynesianism robed in the ideological vestments of the prosperous classes.

This approach has not simply made a mockery of traditional party ideals. It has also led to the serial financial bubbles and Wall Street depredations that have crippled our economy. More specifically, the new policy doctrines have caused four great deformations of the national economy, and modern Republicans have turned a blind eye to each one.

The first of these started when the Nixon administration defaulted on American obligations under the 1944 Bretton Woods agreement to balance our accounts with the world. Now, since we have lived beyond our means as a nation for nearly 40 years, our cumulative current-account deficit — the combined shortfall on our trade in goods, services and income — has reached nearly $8 trillion. That’s borrowed prosperity on an epic scale.

It is also an outcome that Milton Friedman said could never happen when, in 1971, he persuaded President Nixon to unleash on the world paper dollars no longer redeemable in gold or other fixed monetary reserves. Just let the free market set currency exchange rates, he said, and trade deficits will self-correct.

It may be true that governments, because they intervene in foreign exchange markets, have never completely allowed their currencies to float freely. But that does not absolve Friedman’s $8 trillion error. Once relieved of the discipline of defending a fixed value for their currencies, politicians the world over were free to cheapen their money and disregard their neighbors.

In fact, since chronic current-account deficits result from a nation spending more than it earns, stringent domestic belt-tightening is the only cure. When the dollar was tied to fixed exchange rates, politicians were willing to administer the needed castor oil, because the alternative was to make up for the trade shortfall by paying out reserves, and this would cause immediate economic pain — from high interest rates, for example. But now there is no discipline, only global monetary chaos as foreign central banks run their own printing presses at ever faster speeds to sop up the tidal wave of dollars coming from the Federal Reserve.

The second unhappy change in the American economy has been the extraordinary growth of our public debt. In 1970 it was just 40 percent of gross domestic product, or about $425 billion. When it reaches $18 trillion, it will be 40 times greater than in 1970. This debt explosion has resulted not from big spending by the Democrats, but instead the Republican Party’s embrace, about three decades ago, of the insidious doctrine that deficits don’t matter if they result from tax cuts.

In 1981, traditional Republicans supported tax cuts, matched by spending cuts, to offset the way inflation was pushing many taxpayers into higher brackets and to spur investment. The Reagan administration’s hastily prepared fiscal blueprint, however, was no match for the primordial forces — the welfare state and the warfare state — that drive the federal spending machine.

Soon, the neocons were pushing the military budget skyward. And the Republicans on Capitol Hill who were supposed to cut spending exempted from the knife most of the domestic budget — entitlements, farm subsidies, education, water projects. But in the end it was a new cadre of ideological tax-cutters who killed the Republicans’ fiscal religion.

Through the 1984 election, the old guard earnestly tried to control the deficit, rolling back about 40 percent of the original Reagan tax cuts. But when, in the following years, the Federal Reserve chairman, Paul Volcker, finally crushed inflation, enabling a solid economic rebound, the new tax-cutters not only claimed victory for their supply-side strategy but hooked Republicans for good on the delusion that the economy will outgrow the deficit if plied with enough tax cuts.

By fiscal year 2009, the tax-cutters had reduced federal revenues to 15 percent of gross domestic product, lower than they had been since the 1940s. Then, after rarely vetoing a budget bill and engaging in two unfinanced foreign military adventures, George W. Bush surrendered on domestic spending cuts, too — signing into law $420 billion in non-defense appropriations, a 65 percent gain from the $260 billion he had inherited eight years earlier. Republicans thus joined the Democrats in a shameless embrace of a free-lunch fiscal policy.

The third ominous change in the American economy has been the vast, unproductive expansion of our financial sector. Here, Republicans have been oblivious to the grave danger of flooding financial markets with freely printed money and, at the same time, removing traditional restrictions on leverage and speculation. As a result, the combined assets of conventional banks and the so-called shadow banking system (including investment banks and finance companies) grew from a mere $500 billion in 1970 to $30 trillion by September 2008.

But the trillion-dollar conglomerates that inhabit this new financial world are not free enterprises. They are rather wards of the state, extracting billions from the economy with a lot of pointless speculation in stocks, bonds, commodities and derivatives. They could never have survived, much less thrived, if their deposits had not been government-guaranteed and if they hadn’t been able to obtain virtually free money from the Fed’s discount window to cover their bad bets.

The fourth destructive change has been the hollowing out of the larger American economy. Having lived beyond our means for decades by borrowing heavily from abroad, we have steadily sent jobs and production offshore. In the past decade, the number of high-value jobs in goods production and in service categories like trade, transportation, information technology and the professions has shrunk by 12 percent, to 68 million from 77 million. The only reason we have not experienced a severe reduction in nonfarm payrolls since 2000 is that there has been a gain in low-paying, often part-time positions in places like bars, hotels and nursing homes.

It is not surprising, then, that during the last bubble (from 2002 to 2006) the top 1 percent of Americans — paid mainly from the Wall Street casino — received two-thirds of the gain in national income, while the bottom 90 percent — mainly dependent on Main Street’s shrinking economy — got only 12 percent. This growing wealth gap is not the market’s fault. It’s the decaying fruit of bad economic policy.

The day of national reckoning has arrived. We will not have a conventional business recovery now, but rather a long hangover of debt liquidation and downsizing — as suggested by last week’s news that the national economy grew at an anemic annual rate of 2.4 percent in the second quarter. Under these circumstances, it’s a pity that the modern Republican Party offers the American people an irrelevant platform of recycled Keynesianism when the old approach — balanced budgets, sound money and financial discipline — is needed more than ever.

We'd love to hear a Jeff Flake response to any of this. But his is a mind that isn't open to new ideas that conflict with the ideology he worships as a God. He knows his constituents are too stupid to understand how he's fucked them over. And he's right.

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Our friend from our 2004 race for Congress in North Florida, Rep. Corrine Brown (D-Jacksonville) said this week on the floor of Congress in relation to legislation supported by our creep of a congressman, "If it's Flake, it's bad." (Hat tip to the hardworking Pennsylvania Federation, Brotherhood of Maintenance of Way Employes Division, International Brotherhood of Teamsters.)