The Republican Strategy To Repeal Dodd-Frank

By Simon Johnson

On January 7, 2015, Day 2 of the new Congress, the House Republicans put their cards on the table with regard to the 2010 Dodd-Frank financial reforms. The Republicans will chip away along all possible dimensions, using a combination of legislation and pressure on regulators – with the ultimate goal of relaxing the restrictions that have been placed on the activities of very large banks (such as Citigroup and JP Morgan Chase).

The initial target is the Volcker Rule, which limits the ability of megabanks to place very large proprietary bets – and their ability to incur massive losses, with big negative consequences for the rest of us. But we should expect the House Republican strategy to be applied more broadly, including all kinds of measures that will reduce capital requirements (i.e., make it easier for the largest banks to fund themselves with relatively more debt and less equity, taking more risk while remaining Too Big To Fail and thus benefiting from larger implicit government subsidies.)

New GOP Congress Fires Shot At Social Security On Day One

ByDylan Scott, Published January 6, 2015, 5:34 PM EST

With a little-noticed proposal, Republicans took aim at Social Security on the very first day of the 114th Congress.

The incoming GOP majority approved late Tuesday a new rule that experts say could provoke an unprecedented crisis that conservatives could use as leverage in upcoming debates over entitlement reform.

The largely overlooked change puts a new restriction on the routine transfer of tax revenues between the traditional Social Security retirement trust fund and the Social Security disability program. The transfers, known as reallocation, had historically been routine; the liberal Center for Budget and Policy Priorities said Tuesday that they had been made 11 times. The CBPP added that the disability insurance program "isn't broken," but the program has been strained by demographic trends that the reallocations are intended to address.

Greg Palast: Greece Is a Crime Scene, and Vulture Funds Are to Blame

By Michael Nevradakis, Truthout | Interview

Investigative reporter and bestselling author Greg Palast discusses with Truthout the results of his investigation into the actions of so-called vulture funds and their role in the destruction of the Greek economy. He also examines the eurozone and alternative examples of economic development available.

Michael Nevradakis: In light of the upcoming elections, Greece at the present time has unemployment that has surpassed 27 percent, youth unemployment at around 60 percent, hundreds of thousands of Greeks who have migrated abroad, a social state in shambles, and a government in the process of selling off key state industries, public lands and utilities. What is your take on the current economic situation in Greece?

Greg Palast: Well, it's fascinating, because if you read the Western press, Greece is now a "success story." By success meaning you're paying off your creditors; your stock market has recovered and the bond market has recovered somewhat. So as far as most of the press is concerned, everything is fine in Greece. The fact that people are unemployed, that people are still losing their homes and livelihoods, doesn't mean much to the press, because all that matters is the stock market and your creditors.

House GOP's New Rule Allows Republicans to Hide Tax Cuts

By Crystal Shepeard, Care2 | Report

On Tuesday, the 114th Congress’ term officially began with Republicans holding the majority in both chambers for the first time in eight years. After the photo ops of swearing in ceremonies with the Vice President and congressional members’ families, Congress wasted no time to get to work (something that wasn’t done much in the previous session). Most of the day was about finding co-sponsors and votes for bills that would make great press releases for constituents back home. In the House of Representatives, however, a very important new rule was passed that will change how legislation is evaluated.

The Congressional Budget Office (CBO) provides nonpartisan economic analysis on the costs for any budgets or legislation proposed by Congress. When changes in taxation are involved, the nonpartisan Joint Committee On Taxation (JCT) issues reports regarding the revenue side. These two departments work together to create projections highlighting how a change in current policy would play out in certain scenarios.

Dean Baker: Congress Starts the New Year Off By Kicking the Disabled

Tens of millions of people made New Year's resolutions last week, but few were as creative as the one pushed through Congress yesterday. Apparently, the new Congress decided that its first order of business should be to go after workers who are no longer able to hold jobs due to injury or illness.

It did this in a technical move that is likely to escape the attention of most of the public. The Republican Congress voted to ban any reallocation of Social Security tax revenue between the retirement fund, designated for retirees and survivors, and the disability fund for disabled workers. This matters because the disability fund is projected to face a shortfall some time in 2016. If no steps are taken by that point, workers suffering from cancer, heart disease or other disabling conditions will see their benefits cut by almost 20 percent.

Eliminating ACA subsidies would cause nearly 10 million to lose insurance, study finds

Eliminating government subsidies for low- and moderate-income people who purchase coverage through federally run health insurance marketplaces would sharply boost costs and reduce enrollment in the individual market by more than 9.6 million, according to a new RAND Corporation study.

Modeling the likely effects of ending subsidies in 34 states where the federal government operates insurance marketplaces for individuals, researchers found that such a move would cause individual market enrollment to drop by 70 percent among people buying policies that comply with the federal Affordable Care Act.

Richard Eskow: The Right Tries (and Fails) to Justify Its Assault on Social Security

How does the right justify the kind of action Congress took this week, when it moved to cut disability benefits for millions of people by 20 percent? Answer #1: With buzzwords and rhetorical dodges. Answer #2: Not very well.

For details on the House’s action, we pointed yesterday to a number of well-informed analyses – by Nancy Altman and Eric Kingson, Kathy Ruffing, Alan Pyke, Dean Baker, and Michael Hiltzik. Republicans moved to cut Social Security disability benefits by blocking a routine reallocation of funds. That’s bad enough, but their end game is even worse: broad Social Security cuts and the privatization of the entire program.

GOP’s new attack on Social Security: Yet another result of government for the 1 percent

Why is the GOP Congress immediately targeting Social Security? Because it's what their real constituents want

Elias Isquith

As I and many others wrote at the time, one of the few unifying characteristics of last year’s midterm elections was their paucity of greater meaning. Granted, that’s always the case with midterms, at least to some degree, when the literally hundreds of federal and state-level elections lack a presidential campaign around which to position themselves. But as I argued then and still believe today, the 2014 cycle was especially perfunctory, especially shambolic and especially tangential to the truly important issues facing the United States today. And voters seemed to agree — or at least that’s my explanation for why so few of them bothered to show up.

However, even if I still can’t quite tell you what 2014 was about, I can tell you one thing that it most certainly wasn’t about: a supposedly pressing need to make significant cuts to Social Security, which remains one of the precious few big government programs that still enjoys high levels of widespread, bipartisan support. That’s not to say Americans don’t support reforming Social Security, or that they’re not open to considering making some benefit cuts (primarily for the wealthy); they do and they are. But it is to say that no one could argue, at least not with a straight face, that cutting Social Security benefits was a major topic of the year’s many debates. And yet, according to two of the Senate’s most popular and influential liberals, that’s one of the very first things the new, GOP-controlled Congress is trying to do.

Paul Krugman: Presidents and the Economy

Suddenly, or so it seems, the U.S. economy is looking better. Things have been looking up for a while, but at this point the signs of improvement — job gains, rapidly growing G.D.P., rising public confidence — are unmistakable.

The improving economy is surely one factor in President Obama’s rising approval rating. And there’s a palpable sense of panic among Republicans, despite their victory in the midterms. They expected to run in 2016 against a record of failure; what do they do if the economy is looking pretty good?

Progressives Seek Control Of The Democratic Party

BySahil KapurPublishedJanuary 9, 2015, 6:00 AM EST

As Republicans take control of Congress for the first time since 2006, the Democrats' crushing midterm defeat and the rise of Sen. Elizabeth Warren (D-MA) have empowered the progressive wing to step up their fight for the soul of the party ahead of the 2016 presidential election.

Their message: Stop catering to big business. Listen to populists like Warren on how to rebuild the tarnished brand. Champion transformative ideas that will improve the lives of middle class Americans. If not, Democrats are toast in 2016.

Without Fox News, There Would Have Been No Iraq War

—By Kevin Drum | Mon Jan. 5, 2015 12:24 PM EST

Max Ehrenfreund points to an interesting tidbit this morning. A pair of researchers have released a working paper that attempts to figure out if watching Fox News makes you more conservative. They do this by exploiting the fact that channel numbers on cable systems are placed fairly randomly throughout the country, and people tend to watch channels with lower numbers. Thus, in areas where Fox has a low channel number, it gets watched a little bit more in a way that has nothing to do with whether the local viewers were more conservative in the first place.

So does randomly surfing over to Fox News tend to make you more right-wing? Yes indeed! "We estimate that Fox News increases the likelihood of voting Republican by 0.9 points among viewers induced into watching four additional minutes per week by differential channel positions." And this in turn means that we owe the Iraq War to Fox News: "We estimate that removing Fox News from cable television during the 2000 election cycle would have reduced the average county's Republican vote share by 1.6 percentage points."

One Million Americans Are About to Lose Their Food Stamp Benefits

By Cliff Weathers

One million of the nation’s poorest people will be cut from the federal Supplemental Nutrition Assistance (SNAP) program by the end of 2016 even if they're actively pursuing work, according to Center of Budget Policy and Priorities [3].

Better known by its former name, the Food Stamp program, in some areas SNAP will reinstate a three-month limit on benefits for unemployed adults between 18-50 who are not disabled or raising children. These individuals will lose SNAP even if they are unable to find jobs and not part of job training programs that meet the requirements for food assistance benefits. Many states do not have such programs.

Paul Krugman: Twin Peaks Planet

In 2014, soaring inequality in advanced nations finally received the attention it deserved, as Thomas Piketty’s “Capital in the Twenty-First Century” became a surprise (and deserving) best seller. The usual suspects are still in well-paid denial, but, to everyone else, it is now obvious that income and wealth are more concentrated at the very top than they have been since the Gilded Age — and the trend shows no sign of letting up.

But that’s a story about developments within nations, and, therefore, incomplete. You really want to supplement Piketty-style analysis with a global view, and when you do, I’d argue, you get a better sense of the good, the bad and the potentially very ugly of the world we live in.

Kansas Is Totally Screwed

Sam Brownback's tax cuts are wrecking the state's budget.

—By Patrick Caldwell | Wed Jan. 7, 2015 6:25 AM EST

In 2012, when Kansas Gov. Sam Brownback first pitched his plan to drastically slash the state's income taxes, he promised "a shot of adrenaline into the heart of the Kansas economy." Brownback brought in Arthur Laffer, Ronald Reagan's trickle-down economics guru, to help sell the idea that the cuts—which zeroed out taxes for 200,000 businesses and slashed rates for top earners—were guaranteed to boost the state's fortunes, prop up the economy, and bring in countless new jobs as businesses and individuals flocked to Kansas to escape the tyrannies of higher-tax states.

Two years later, those rosy predictions have turned to doom and gloom. Next week, when the state legislature kicks off its new session, lawmakers will face a daunting budget deficit that will require either overturning Brownback's tax cuts or shaving hundreds of millions from the state's budget. A recent string of court cases mandating increased funds for education will make that job trickier. Thanks to Brownback's efforts to transform the state into the Koch brothers' dreamland, Kansas is now mired in a fiscal disaster.

10 Rules for Dealing with Cops, By a Cop

By Neill Franklin

As a 33-year law enforcement veteran and former training commander with the Maryland State Police and Baltimore Police Department, I know how easy it is to intimidate citizens into answering incriminating questions or letting me search through their belongings. This reality might make things easier for police looking to make an easy arrest, but it doesn't always serve the interests of justice. That's why I believe all citizens should understand how to protect their constitutional rights and make smart decisions when dealing with officers of the law.
Unfortunately, this important information has remained largely unavailable to the public, despite growing concerns about police misconduct and the excesses of the war on drugs. For this reason, I agreed to serve as a technical consultant for the important new film, 10 Rules for Dealing with Police. The 40-minute docudrama aims to educate the public about basic legal and practical survival strategies for handling even the scariest police encounters. It was produced by the civil liberties group Flex Your Rights and is narrated by former federal judge and acclaimed Baltimore trial lawyer William "Billy" Murphy, Jr.

The Finance Industry Is Gorging Itself on Your Future—The Trend Lines Will Blow You Away

We have to curtail the power of high finance.

By Les Leopold / AlterNet

Increasing debt and runaway inequality are of a piece. That's because debt at compound interest rates is extremely powerful. Borrow a little today, and in time, you could be destitute. To get a feel for its power, imagine you borrowed just one nickel at 5% interest when Christ was born. You would now owe the tidy sum of $225,438,991,066,856,000,000,000,000,000,000,000,000,000 — more money than ever existed in the history of the world. Which is to say, those who wield the power of debt, wields enormous economic power.

In our society we've given that power to private financial corporations, and they've done a masterful job in pushing us to the brink of debt peonage. The problem extends far beyond the much ballyhooed federal government debt. The power of debt extends to nearly every aspect of modern life. Our homes, schools, roads, bridges, highways, utilities, corporations and virtually every product and good produced and sold depend on debt. By some estimates as much as 30 cents of every dollar we spend goes to cover interest payments on the debt accrued to make all that we buy. (For example of the $6.5 trillion of private enterprise income in 2012, 36.8% went to interest payments.)

Big money breaks out

Top 100 donors give almost as much as 4.75 million small donors combined.

By Kenneth P. Vogel | 12/29/14 5:32 AM EST

The 100 biggest campaign donors gave $323 million in 2014 — almost as much as the $356 million given by the estimated 4.75 million people who gave $200 or less, a POLITICO analysis of campaign finance filings found.

And the balance almost certainly would tip far in favor of the mega-donors were the analysis to include nonprofit groups that spent at least $219 million — and likely much more — but aren’t required to reveal their donors’ identities

Paul Krugman: The Obama Recovery

Suppose that for some reason you decided to start hitting yourself in the head, repeatedly, with a baseball bat. You’d feel pretty bad. Correspondingly, you’d probably feel a lot better if and when you finally stopped. What would that improvement in your condition tell you?

It certainly wouldn’t imply that hitting yourself in the head was a good idea. It would, however, be an indication that the pain you were experiencing wasn’t a reflection of anything fundamentally wrong with your health. Your head wasn’t hurting because you were sick; it was hurting because you kept hitting it with that baseball bat.

How Goldman Sachs May Provoke Yet Another Major Financial Crisis

The banking giant had a role in Greece's financial problems too.

By Ellen Brown

Greece and the troika (the International Monetary Fund, the EU, and the European Central Bank) are in a dangerous game of chicken. The Greeks have been threatened with a “Cyprus-Style prolonged bank holiday”if they “vote wrong.” But they have been bullied for too long and are saying “no more.”

A return to the polls was triggered in December, when the Parliament rejected Prime Minister Antonis Samaras’ pro-austerity candidate for president. In a general election, now set for January 25th, the EU-skeptic, anti-austerity, leftist Syriza party is likely to prevail. Syriza captured a 3% lead in the polls following mass public discontent over the harsh austerity measures Athens was forced to accept in return for a €240 billion bailout.

Paul Krugman: Tidings of Comfort

Maybe I’m just projecting, but Christmas seemed unusually subdued this year. The malls seemed less crowded than usual, the people glummer. There was even less Muzak in the air. And, in a way, that’s not surprising: All year Americans have been bombarded with dire news reports portraying a world out of control and a clueless government with no idea what to do.

Yet if you look back at what actually happened over the past year, you see something completely different. Amid all the derision, a number of major government policies worked just fine — and the biggest successes involved the most derided policies. You’ll never hear this on Fox News, but 2014 was a year in which the federal government, in particular, showed that it can do some important things very well if it wants to.