Tag Archives: 2010 Midterm Elections


Straight Talk on Balancing the Budget

The federal budget deficit is like the weather. Everybody talks about it; except for Bill Clinton, no one ever does anything about it.

President Obama’s bipartisan Fiscal Debt Commission has released a draft report that starts out with a big problem: even talking about reducing spending is insane when you’re in the midst of a Depression. The real unemployment is over 20 percent. Creating jobs ought to be the feds’ top—perhaps sole—priority.

Let the insanity commence.

Triumphant Republicans say they want to balance the budget. So does Obama. Are they serious? Of course not.

Still, theoretical budget-balancing exercises help enlighten us about where our taxdollars really go. So let’s roll up our sleeves and start some back-of-the-envelope slashing.

The 2010 federal budget shows $3.6 trillion in spending and $2.4 trillion in revenues. Net deficit: $1.2 trillion. It’s a doozy, too. It nearly 13 percent of GDP. It’s the highest since 1943, during World War II.

The goal, then, is to close a $1.2 trillion budget gap. Can we find at least $1.2 trillion in budget cuts? News flash: getting rid of the National Endowment for the Arts ($161 million in 2010, or about 0.01 percent of the deficit), ain’t gonna do the trick.

Any serious budget cutter has to start with defense. The reason is simple: it accounts for 54 percent of discretionary (i.e., optional) federal spending. It’s the biggest piece of the pie by far.

(Mainstream news reports usually state that defense accounts for 20 percent of federal outlays. But they’re fudging the facts in order to pretty up the military-industrial complex. For example, they include budget items like Social Security that no one can do anything about—they’re in a trust fund.)

Of that 54 percent, 18 percent is debt service on old wars. There’s nothing we can do about that—though that number should probably give us pause the next time a president wants to invade Panama or Grenada.

Anyway, that leaves 36 percent, or $1.3 trillion to play with. $200 billion a year goes to Afghanistan and Iraq.

Let’s pull out. We’re losing anyway.

New Deficit: $1.0 trillion.

In 2007 Chalmers Johnson wrote a book about the staggering costs of American imperialism. “The worldwide total of U.S. military personnel in 2005, including those based domestically, was 1,840,062 supported by an additional 473,306 Defense Department civil service employees and 203,328 local hires,” he wrote. “Its overseas bases, according to the Pentagon, contained 32,327 barracks, hangars, hospitals, and other buildings, which it owns, and 16,527 more that it leased. The size of these holdings was recorded in the inventory as covering 687,347 acres overseas and 29,819,492 acres worldwide, making the Pentagon easily one of the world’s largest landlords.”

We’re broke. It’s time to bring those 2.3 million men and women home. At an average cost of $140,000 per employee—crazy but true—we could save $322 billion annually.

New Deficit: $676 billion.

After Defense, the other big costs are Social Security, Medicare and Medicaid.

The obvious place to start slashing is wealthy recipients. Why should Bill Gates, worth $58 billion, get Social Security or Medicare benefits? Dean Baker sums up the traditional liberal argument in favor of giving tax money to people who don’t need it: “Social Security enjoys enormous bipartisan support because all workers pay into it and expect to benefit from it in retirement. Taking away the benefits that better-off workers earned would undoubtedly undermine their support for the program. This could set up a situation in which the program could be more easily attacked in the future.”

Yeah, well, whatever. We. Are. Broke. “Means testing”—for example, eliminating benefits for the approximately one percent of families over age 65 who earn over $100,000 a year—could save $150 billion a year.

New deficit: $526 billion.

Now let’s talk about the other side of the equation: income. How can the U.S. government scare up some extra cash?

Allowing the Bush tax cuts for the richest three percent of Americans to expire on schedule would bring in $70 billion a year. Seems like a no-brainer: anyone earning over $250,000 a year is doing awesome. Moreover, if Democrats don’t insist on the expiration of at least some of those “temporary” tax cuts, what’s the point of the deal they cut with the GOP back in 2001?

New deficit: $456 billion.

When it comes to revenues, you have to go where the money is: the wealthy. The rich have gotten richer, which is a big part of the reason we’re in a Depression again. They’re hogging all the goodies. The rest of us can’t spend.

Despite the miserable economy, there are still 2 million American households earning a whopping $250,000 or more per year. (Their average income is $435,000.) If we were to increase these super-rich Americans’ marginal income tax rate from 35 to 50 percent—the same it was during the early 1980s under Reagan—we’d bring in an extra $131 billion a year. If we raised it back to 91 percent—the top rate during the boom years between 1950 to 1963—the Treasury would collect $487 billion.

Budget SURPLUS: $31 billion.

And we haven’t started on corporate taxes.

(Ted Rall is the author of “The Anti-American Manifesto.” His website is tedrall.com.)


SYNDICATED COLUMN: The Obama Postmortem

An Autopsy of a Political Suicide

It’s the day after the Republican sweep we all knew was coming. If Obama had any dignity, if he was honest with himself and with us, he would resign. It’s abundantly clear that he isn’t up to the job.

But you don’t become president by being honest or dignified. So now it’s wound-licking time. The President and his cronies are comforting each other. “It’s not your fault the economy sucks,” a Yes Man reassures Obama, sinking his heels into the new Oval Office carpet. “It was like that when we got here.”

Do they scratch him behind his ears? They should. It feels nice.

“It was the poor economy—not the wisdom of the Republicans’ ideas or the brilliance of their tactics—that assured they would retake control of the House,” coos MarketWatch’s Rex Nutting. Which is true. And doesn’t matter.

Democrats are taking solace in history. It’s the midterms! The party that holds the White House always loses seats in Congress. Look at Bill Clinton and Ronald Reagan. They suffered midterm defeats, then roared back to landslide reelection wins two years later. Not to worry! The voters will vote against the other party next time! Which is also true. And also doesn’t matter.

In the broken-down shambles of the excuse for a political system we have in the United States, there’s only one stage of grief: denial.

Barack Obama may well be reelected in 2012. Considering that the current GOP frontrunners are Sarah Palin and Mitt Romney, the odds favor him. But the Obama experiment is effectively dead. There will be no change, and so there is no hope.

Remember what happened to Clinton after the “Republican Revolution” sweep of 1994? He spent 1995 locked in a bizarre “co-presidency” with House Speaker Newt Gingrich before figuring out that his “partner” was more interested in obstructionist sabotage than bipartisanship.

Obama is heading down the same bloody path with John Boehner.

But Clinton did get that second term. During which he accomplished many things, such as…um…well, he did get impeached. Does that count?

I don’t understand why presidents want to get reelected. No president since FDR has gotten much done after his first term. Must be an ego thing. Either that, or it’s cool to have your own chef.

If Obama was going to shine, it was going to be during 2009. Elected by a sizable margin with an undeniable, media-backed mandate for change during a severe economic crisis he could exploit to push through his agenda, Obama also enjoyed the rare luxury of a Democratic House of Representatives and a nearly filibuster-proof Democratic Senate.

So what does he have to show for that marvelous gift? Three major items:

One: a healthcare overhaul that increases premiums and insurance company profits, and doesn’t include the public option he and everyone else said was absolutely essential. The good news is, the Republicans will probably repeal or defund this monster before it takes effect.

Two: a financial reform package no one knows about. Which is just as well, since it doesn’t crack down on the banksters.

Three: more dead Afghans.

They’re not much, but I hope Obama is proud of them. That’s as good as he’s going to get from now on.

What killed the Obama presidency? Political suicide. There were several death blows:

First and foremost, the economy. 60 percent of Democrats and 63 percent of Republicans told exit pollsters that the lack of jobs was their number-one issue. Obama never proposed a jobs program. He gave trillions of taxdollars to thieving banksters who ought to have been arrested instead, then tried to pass off this outrageous giveaway as economic stimulus. To make things worse, he stuck with an impossibly absurd argument: more people would have lost their jobs without it.

Even if the phony stimulus stopped things from getting worse—and it didn’t—people don’t care. They want the 20 percent of Americans who already lost their jobs—their friends, spouses, children and parents—to find new ones. Obama never addressed that.

He didn’t even try.

Second, he alienated his base. He didn’t even know who his base was.

Obama’s campaign was a potent mix of vague pabulum (“hope,” “change”) and, when he deigned to specify, center-right specifics (stop torture but expand the war against Afghanistan, bipartisan cooperation with the Republicans, no gay marriage, etc.). The problem was that the vagueness that helped him cobble together a winning coalition of leftist and independent voters made it impossible for him govern. Leftists got turned off when he doubled down in Afghanistan and refused to close Guantánamo; independents are notoriously fickle anyway.

If Obama’s advisors had been smart, they would have recognized two truths, one old and one new. The old truth is that the safest time to deliver to your base is the first year of a presidency; the passage of time allows the anger of the moderates to cool in time for the next election. The new truth for Obama was that his base comprised liberals who actually disagreed with much of what he stood for but had paid more attention to the “hope” and “change” posters than to his platform. He didn’t understand that.

Moreover, the world changed between September and November of 2008. Global capitalism collapsed. Millions of Americans lost their jobs and their homes during the next year. Wall Street, bankers, big business, the golden boys of the previous century, were discredited—but unpunished for their countless sins. By mid-2009 America had become a left-wing country, not in the media but among the citizenry, telling polls that their preferred economic system was socialism.

Team Obama didn’t understand that. They still don’t.

The inarticulate rage of the inchoate Tea Party caught the president by surprise. Neither Obama nor the political clones that form his center-right cabinet can see that in a binary political culture anger gravitates to the opposite pole. If Obama were Republican, the Tea Party would be identified with the left.

The takeaway is anger, not ideology. People are pissed. They hate the bailouts, but the bailouts aren’t the main point. More than anything else, the American people are angry that their government doesn’t even pretend to give a damn about them.

(Ted Rall is the author of “The Anti-American Manifesto.” His website is tedrall.com.)