They’re still trying to break the middle class—even with a national election approaching

They’re still trying to break the middle class—even with a national election approaching

Update and round-up: The project to break the middle class continues.

 

Boehner: tax hikes are 'off the table'

But first, the good news:

+Last week, the National Institute on Retirement Security (NIRS) issued a report showing that pension plans provide better for retirement than do 401(k)s. The report, A Better Bang for New York City’s Buck, compares New York City’s defined benefit pension plans to the defined contribution 401(k)-type individual account. Unsurprisingly, talented and qualified pension planners deliver a better return, and at 40 percent lower cost, than does a mélange of Wall Street traders.

1929

The NIRS statement identifies savings from three sources:

  • Superior investment returns. The pooled nature of assets in a defined benefit plan result in higher investment returns, partly based on the lower fees that stem from economies of scale, but also because the assets are professionally—not individually—managed. The City plans’ enhanced investment returns save from 21 percent to 22 percent, according to the report.
  • “Better management of longevity risk. Because pensions pool the longevity risks of a large number of individuals and can determine and plan for mortality on an actuarial basis, New York City’s defined benefit plans save between 10 percent and 13 percent compared to a typical defined contribution plan.
  • “Portfolio diversification. Unlike defined contribution plans, pension assets can be invested for optimal returns. Individuals using 401(k)s, by comparison, are advised to rebalance their investments, downshifting into less risky and lower-returning assets as they age. This ability to maintain portfolio diversity in the City’s defined benefit plans saves from 4 percent to 5 percent.”

 

Note: We do not read much good news about pension funds in our corporate media outlets. Pension funds tend not to be well covered, let alone favorably covered—somewhat ironically, considering that strong pensions would relieve much of the burden on Social Security that we hear so much about. (Good retirement health benefits would similarly lighten the load on Medicare.) The public gets little in-depth reporting on the assaults on pension funds, state-by-state or larger. Indeed, little is being reported on the extensive damage done to pension funds by the subprime mortgage-derivatives debacle.

Socializing the risk

But moving on to other good news—

+The GOP effort to keep Senate Bill 5 (SB 5) in Ohio is flagging. The bill sharply restricts collective bargaining by public sector employees in Ohio, including firefighters and teachers. As of now, opinion polling shows the legislation unpopular across the board and under siege.

Protesting Ohio SB 5

 

 

Among groups working effectively against the legislation is the Ohio AFL-CIO. (btw HuffPost is also advertising itself as working collaboratively against the bill, parading a labor-friendly stance presumably to sweeten itself after stiffing labor, i.e. writers, in the AOL deal. Arianna Huffington’s office has yet to respond to my questions about the sale of HuffPost to AOL, the transaction that netted Huffington herself a few hundred million and her contributing bloggers nothing for the millions in value they created for the web site.)

The perception that SB 5 is in trouble is shared by our friends on the right. This missive,arrived last week from Matt Kibbe of the rightwing lobbying group ‘FreedomWorks’:

“Two weeks from today, Ohio voters will cast a critical referendum on the policies of the Obama administration.

Ballot Issue 2 is a referendum on Governor Kasich’s landmark legislation limiting the monopoly bargaining powers of public sector unions. The unions are trying to repeal the critical legislation, which protects Ohio taxpayers from the union bosses’ budget-busting demands. A “YES” vote defends taxpayers and curbs union power.

Ballot Issue 3–the Healthcare Freedom Amendment–amends the Ohio Constitution to block the “individual mandate” of Obamacare. This would strike a HUGE BLOW to Obama’s disastrous government takeover of health care with important national ramifications. A “YES” vote on Issue 3 supports individual freedom and rejects Obamacare.

FreedomWorks has been supporting these issues on the ground with a massive campaign e ducate the public and mobilize support for these critical Ballot Issues. . .

In the two remaining weeks before the Tuesday, November 8th vote, FreedomWorks will continue to distribute materials across Ohio to maximize support for Issues 2 and 3. But it’s a tall order.

Research and polling show that it will take massive turnout (upwards of 85%, even) in certain core communities to succeed in this effort. That’s why we have a massive final push planned–including more yard signs, door-hangers, neighborhood canvasses, and phone calls–but we can only execute this plan if we have the necessary resources. . .

If the unions and leftists are able to defeat these limited government measures in Ohio, their issue campaigns will sweep across the nation. Fiscally conservative legislation will fall like dominoes.

[emphasis added]

You heard it here first.

In other good news—

+As everybody not living under a rock has heard, Bank of America deferred to public opinion this week and rolled back its proposed monthly $5 debit card fee. After three years of Wall-Street-funded propaganda criticizing ordinary people for not budgeting properly in advance of the subprime debacle, in other words, BofA was going to nick customers who tried to pay for purchases in cash.* This move was too much even for a longsuffering public. Bank of America suffered a richly deserved public-relations black eye in the process, especially when over 300,000 people signed Molly Katchpole’s change.org petition against the debit fee.

+Helpfully taking other big banks over the side with it, BofA indirectly galvanized support for community banks and credit unions. Bank Transfer Day occurs this Saturday, Nov. 5, 2011. Bank Transfer Day is basically a long-overdue and modest move to redress large-scale abuses by the finance sector, a grass-roots effort drawing wide popular support and participation.

 

BofA

+Speaking of long overdue–finally realizing that a GOP-dominated Congress is not going to move on improving matters for the general public, the White House is employing both the bully pulpit and executive action to get some tasks done. While one could argue cogently that this strategy should have been applied earlier, every step taken is better than necessary measures delayed even further.

+The immediate consequence—and this is what most impresses our bully-mentality political commentators–is that Obama’s standing immediately rose in public opinion polls. If only Blue Dogs around the country, and especially in Virginia, could read these tea leaves ahead of next Tuesday’s (March 8) off-year elections.

+The Occupy Wall Street movement has succeeded in inspiring local Occupy movements across the U.S. and around the globe. Thus a genuinely grass-roots movement is drawing widespread public recognition, celebrity support and considerable media attention. (There is also live coverage via the Internet.) Donated supplies flow in daily. Organized labor is also throwing its support behind the non-partisan Occupy movement. Occupy DC is linked here.

 

And last but not least—

While some people might not consider this good news, the damage to the social safety net being contemplated by the so-called ‘Super Committee’ is likewise arousing white-hot fury.

The problem: The Super Committee has let it be known that Social Security and Medicare are ‘on the table’. (A telling phrase: legislators with genuine depth would understand that the social safety net is not a bargaining chip.)

Further problem: In rightwing corpo-speak, ‘on the table’ means only cuts to benefits. It does not mean, for example, removing the income cap on contributions to Social Security and Medicare. This last omission demonstrates conclusively that cutting costs is not the desideratum. The desideratum, driven by the funded right and insufficiently defended against by some Dems, is weakening the social safety net.

The good news: Every sector of the public informed about the proposals opposes them.

Opposition is being effectively mounted by, among others, organized labor and seniors.

Howard Dean of Democracy for America puts it best:

“I’m going to get straight to the point. If the so-called Super Committee votes to increase the age of Medicare eligibility from 65 to 67, it will completely erase all the gains we made in providing healthcare to every American under President Obama.
Medicare is the only universal healthcare program that exists in the United States of America. No one who supports moving back the age of eligibility can possibly be considered an advocate for universal health insurance.
In fact, if that happens, the legacy of the Democrats for the past four years will have been to do far more harm to the healthcare system than good.
By raising the age of eligibility from 65 to 67, hard working Americans who are in their 50’s or 60’s, and cannot afford insurance under the current system will have to wait two additional years before Medicare kicks in. They would be forced to stay in the private healthcare system–if they can afford it.
I personally know people who are on crutches this year because they cannot afford the hip replacement they need until they turn 65 a year from now.
It also means that you’ll have more people putting off care for an extended period of time and entering the system as more expensive Medicare recipients. This could actually increase overall spending on Medicare–eliminating much or all of the “savings” the Super Committee may imagine they can achieve with these cuts.
This is bad policy and we have to stop it. I will personally not support any candidate for any office that attempts to cut back Medicare in this way. Democracy for America is preparing right now to run aggressive campaigns, including hard-hitting TV ads, against anyone–Republican or Democrat–who supports increasing the age of Medicare eligibility.”

Link to contribute to the DFA campaign here.

To reiterate—the current attacks on pensions, on pension funds (even), and on Medicare and Social Security are all part of the same big picture. A well-funded sector has bought over virtually all Republicans in Congress and in major statewide offices across the country, including in Virginia.

We read and hear in political commentary that their aim is to defeat President Obama. True enough, but defeating one man, the president, is not the whole picture. Their aim is to break the middle class. They are doing what they have been paid to do—paid not by their true employers, the public they are elected to serve, but by the lobbying sector behind the scenes, their future employers. This is not gridlock. It is not excess partisanship. It is not dysfunctional government. It is a concerted if sometimes loosely synchronized effort to undermine the greatest good for the greatest number.

 

*Our friends on the right are doing a lot of that kind of thing lately. Most of the immigrants they are vilifying tend to pay cash.

To be continued

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