AMA Supports Health System Reform (HSR)

AMA supports the achievement of meaningful health system reform, which follows six key concepts:

1. Expanded coverage
2. Improve quality
3. Reform government programs
4. Reduce costs
5. Increased focus on wellness/prevention
6. Payment and delivery reforms

To learn more about the AMA’s position Click Here

Republicans are using the T-word – taxes – to attack the Obama healthcare program. It’s a strategy based in a lie.

A very small niche of America’s uber-wealthy have pulled off what may well be the biggest con job in the history of our republic, and they did it in a startlingly brief 30 or so years. True, they spent over three billion dollars to make it happen, but the reward to them was in the hundreds of billions – and will continue to be.

As my friend and colleague Cenk Uygur of The Young Turks pointed out in a Daily Kosblog recently, billionaire Rupert Murdoch loses $50 million a year on the NY Post, billionaire Richard Mellon Scaife loses $2 to $3 million a year on the Pittsburgh Tribune-Review, billionaire Philip Anschutz loses around $5 million a year on The Weekly Standard, and billionaire Sun Myung Moon has lost $2 to $3 billion on The Washington Times.

Why are these guys willing to lose so much money funding “conservative” media? Why do they bulk-buy every right-wing book that comes out to throw it to the top of the NY Times Bestseller list and then give away the copies to “subscribers” to their websites and publications? Why do they fund to the tune of hundreds of millions of dollars a year money-hole “think tanks” like Heritage and Cato?

The answer is pretty straightforward. They do it because it buys them respectability, and gets their con job out there. Even though William Kristol’s publication is a money-losing joke (with only 85,000 subscribers!), his association with the Standard was enough to get him on TV talk shows whenever he wants, and a column with The New York Times. The Washington Times catapulted Tony Blankley to stardom.

“Fellowships” and other forms of indirect sponsorship of right-wing talk show hosts have made otherwise-marginal shows and their hosts ubiquitous, and such sponsorships of groups like Norquist’s anti-tax “Americans for Tax Reform” regularly get people like him front-and-center in any debate on taxation in the United States.

All so they could run a tax con on the American people, thus keeping Moon and Murdoch and Scaife and Anschutz (and others) richer than you or I could ever even imagine.

All of this money was spent – invested, really, since it’s been more than saved back in low income tax rates on millionaires and billionaires – to convince Americans that up is down and black is white when it comes to income taxes. Here’s how it works:

Rich Person’s Tax Effect

If a person earns so much money that he doesn’t or can’t spend it all each year, then when his taxes go down your income after taxes goes up. This is largely because there’s little to no relationship between what he “needs to live on” and what he’s “earning.”

Somebody living on a million dollars a year but earning five million after taxes, can sock away four million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only three million a year, he’s still living on a million a year, and only socks away two million in the Swiss bank. His “disposable” income goes down when his taxes go up, and vice-versa. (Technically, the word is “discretionary” income for after-tax, after-living-expenses income, but “disposable” income has become so widely used as a phrase to describe discretionary income I’ll use it here.)

The Rich Person’s Tax Effect is the one that virtually all Americans understand – and, oddly, most working class people think applies to them, too (this is the truly amazing part of the con job referred to earlier).

But it doesn’t.

Working Person’s Tax Effect – version one

Most working people spend pretty much all of what they earn – their “disposable/discretionary” income is close to zero. Savings rates in the US among working people typically are small – one to five percent – and during the last few years of the W. Bush administration actually went negative. So the take-home pay that people have after taxes – regardless of what the taxes may be – is pretty much what they live on.

As economist David Ricardo pointed out in 1817 in the “On Wages” chapter of his book “On the Principles of Political Economy and Taxation,” take home pay is also generally “what a person will work for.” Employers know this: Ricardo’s “Iron Law of Wages” is rooted in the notion that there is a “market” for labor, driven in part by supply and demand. So if a worker is earning, for example, a gross salary of $75,000, his 2008 federal income tax would be about $15,000 ($802.50 on first $8,025 of income;$3,687.75 on income from $8,025 to $32,550; $10,612.50 on income from $32,550 to $75,000), leaving him a take-home pay of $60,000.

Both he and his employer know that he’ll do the job he’s doing for around $60,000 a year in take-home pay.

So what happens if his taxes go up, cutting his take-home pay to $55,000 a year (even though his gross is still $75,000)? Over time (typically one to three years) his wages will rise enough to compensate for the lost income.

Alan Greenspan used to be hysterical about this effect – he called it “wage inflation” – and The Wall Street Journal and other publications would often reference it, although the average working person has no idea that if his taxes go up, his wages will eventually go up. Similarly, when working-class people’s taxes go down, their gross wages will, over time, go down so their inflation-adjusted take-home pay remains the same. We’ve seen both happen over the past eighty years, over and over again.

When I was in Denmark last year doing my radio show from the Danish Radio offices for a week and interviewing many of that nation’s leading politicians, economists, energy experts, and newspaper publishers, one of my guests made a comment that dropped the scales from my own eyes.

We’d been discussing taxes on the air, what the Danes get for their average 52% tax rate (free college education, free health care, 4 weeks of vacation, being the world’s “happiest” country according to research reported on CBS’s “60 Minutes” TV show, etc.). I asked him why people didn’t revolt at such high tax rates, and he smiled and just pointed out to me that the average Dane is very well paid with a minimum wage that equals about $18 US (depending on the exchange rate from day to day).

Off the air, he made the comment to me that was so enlightening. “You Americans are such suckers,” he said, as I recall. “You think that the rules for taxes that apply to rich people also apply to working people. But they don’t. When working peoples’ taxes go up, their pay goes up. When their taxes go down, their pay goes down. It may take a year or two or three to all even out, but it always works this way – look at any country in Europe. And it’s the opposite of how it works for rich people!”

Working Person’s Tax Effect – Version Two

The other point about taxes – which Obama leveraged with his “no tax increases on people earning under $250,000 a year” pledge – has to do with the fact that our tax structure in the US is progressive.

Here’s how it breaks out for a single person from the 2008 federal tax tables:

10% on income between $0 and $8,025

15% on the income between $8,025 and $32,550;

25% on the income between $32,550 and $78,850;

28% on the income between $78,850 and $164,550;

33% on the income between $164,550 and $357,700;

35% on the income over $357,700.

Note that our $75,000/year worker has two full tax brackets above him, which, if they go up, will not affect him at all. (This is also true, of course, for the median-wage and average-wage American workers who earn in the low to mid-$40,000/year range.)

The top tax rate that a person pays is referred to as their “marginal tax rate” (in our worker’s case 28%). So what happens if the top marginal tax rate on people making over $357,700 goes up from its current 35% to, for example, the Eisenhower-era 91%?

For over 120 million American workers who don’t earn over $357,700/year, it won’t mean a thing. But for the tiny handful of millionaires and billionaires who have promoted The Great Tax Con, it will bite hard. And that’s why they spend millions to make average working people freak out about increases in the top tax rates.

Income taxes as the “Great Stabilizer”

Beyond fairness and holding back the Landed Gentry the Founders worried about (America had no billionaires in today’s money until after the Civil War, with John D. Rockefeller being our first), there’s an important reason to increase to top marginal tax rate, and to do so now.

Novelist Larry Beinhart was the first to bring this to my attention. He looked over the history of tax cuts and economic bubbles, and found a clear relationship between the two. High top marginal tax rates (generally well above 60%) on rich people actually stabilize the economy, prevent economic bubbles from forming, prevent economic crashes, and lead to steady and sustained economic growth (and steady and sustained wage growth for working people).

On the other hand, when top marginal rates drop below 50 percent, the opposite happens. As Beinhart noted in a November 17, 2008 post on the Huffington Post, the massive Republican tax cuts of the 1920s (from 73% to 25%) led directly to the Roaring ’20s stock market bubble, temporary boom, and then the crash and Republican Great Depression of 1929.

Rates on the very rich went back up into the 70-90% range from the 1930s to the 1980s. As a result, the economy grew steadily; for the first time in the history of our nation we went 50 years without a crash or major bank failure; and working people’s wages increased enough to produce the strongest middle class this nation has ever seen.

Then came Reaganomics.

Reagan cut top marginal rates on millionaires and billionaires from 74% down to 38% and there was an immediate surge in the markets – followed by the worst crash since the Great Depression and the failure of virtually the entire nation’s savings and loan banking system.

Bush I cut taxes, and the nation fell into a severe recession while debt soared and wages for working people fell.

Things stabilized somewhat when Clinton slightly raised taxes on the very rich, but W. Bush dropped them again – including taking taxes on unearned income (interest and dividends – the “income” that people like W. born with a trust fund “earn” as they sit around the pool waiting for the dividend check to arrive in the mail) down to a top rate of 15%. (That’s right – trust fund babies like Bush and Scaife pay a MAXIMUM 15% federal income tax on their dividend and interest income, thanks to the second Bush tax cut.) The result of this surge in easy money for the wealthy, combined with deregulation in the financial markets, was the “froth” Greenspan worried about and led us straight into the Second Republican Great Depression, ongoing today.

The math is really pretty simple. When the uber-rich are heavily taxed, economies prosper and wages for working people steadily rise. When taxes are cut for the rich, working people suffer and economies turn into casinos.

Roll Back The Reagan Tax Cuts

While there’s much discussion about letting the Bush tax cuts expire, if we really want our country to recover its financial footing we must do something altogether different. We need to roll back the Reagan tax cuts that took the top marginal rate from above 70% down into the 30% range.

First, though, we have to help Americans realize that “no new taxes” is a mantra that is meaningful to the very rich, but largely irrelevant to average working people.

Only when the current generation re-learns the economic and tax lessons well known by the generation (now dying off) that came of age in the 30s through the 60s, will this become politically possible. Americans need to learn what Europeans know about taxes – they only matter to the rich.

Thus today the uber-rich are spending hundreds of millions to make sure words like “burden” are always associated with the word “tax,” and to convince average working people that they should throw out of office any politicians who are willing to raise taxes on the rich.

We have a lot of education to do…and as long as the Right Wing Machine of the uber-rich continues to “lose” (e.g. “invest”) millions of dollars a year in their ongoing disinformation campaign, it’s going to require all of us reciting the mantra, “Roll back the Reagan tax cuts!”

No reason not to do it.

According to a pair of Capitol Hill sources, preliminary estimates from the Congressional Budget Office suggest that a strong public option–the kind that the House of Representatives is putting in its reform bill–should net somewhere in the neighborhood of $150 billion in savings over ten years.

The sources cautioned that these were only the preliminary estimates, based on previous discussions–that CBO had not yet issued final scoring on language in the actual bill. But the sources felt the final estimate would likely be close.

For those who think it’s a bad idea, I just say – look at what you are trying to defend. Our health insurance industry CEO’s are the Robber Barons of modern times. They make more money when they raise premiums and reject claims, while not covering pre-existing conditions. Any individual can make as much money as they want, but we are responsible for telling them how much of ours they can have. It’s time to pull the plug on their windfall.

U.S. House Repeals Provision Prohibiting Washington, D.C. from Enacting Medical Marijuana; Nation’s Capital Could Soon Join 13 States That Have Legalized Marijuana for Medical Use
1998 Provision of Federal Law Overturned Voter-Passed Medical Marijuana Law and Banned the City from Ever Lowering Penalties for Marijuana
The Congressional Action on Medical Marijuana is Latest in Rapidly Increasing Momentum to Change U.S. Marijuana Laws

WASHINGTON – July 17 -

The U.S. House of Representatives passed legislation today removing a federal provision that bars the nation’s capital from legalizing marijuana for medical use. The provision, nicknamed the Barr Amendment after its author, former Republican Congressman Bob Barr, who now supports repealing the amendment, was passed in 1998 in response to a medical marijuana initiative approved by 69% of Washington, D.C. voters. The Barr Amendment overturned the medical marijuana law and prohibited the city from ever reducing penalties for marijuana or other Schedule I drugs – even for medical use. The provision is so broad that legal experts believe it even prohibits the city from passing treatment-instead-of-incarceration legislation diverting people arrested for marijuana, heroin or other Schedule I drugs to drug treatment instead of jail.

“D.C. residents voted for medical marijuana, cancer and AIDS patients deserve access to medicine, and it’s a disgrace that Congress ever passed the Barr Amendment,” said Bill Piper, director of national affairs for the Drug Policy Alliance. “Congress can bring some sanity to federal marijuana laws and support the will of D.C. voters by overturning this undemocratic law.”

If adopted by both branches of Congress, D.C. will be free to once again enact medical marijuana legislation. Already 13 states have legalized marijuana for medical use. The congressional action on medical marijuana is only the latest in growing momentum in favor of reforming U.S. marijuana laws. Rhode Island legislators expanded their state’s medical marijuana law earlier this year, establishing compassion centers to distribute marijuana directly to patients. The New Jersey Assembly passed medical marijuana legislation earlier this year and the state’s Senate will take up the issue later this year. Minnesota and New Hampshire legislatures recently passed legislation legalizing marijuana for medical use, but the bills were vetoed by each state’s governor.
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DPA Network is the nation’s leading organization working to end the war on drugs. We envision new drug policies based on science, compassion, health and human rights and a just society in which the fears, prejudices and punitive prohibitions of today are no more.

Quote: “We will not be driven by fear into an age of unreason if we dig deep in our history and remember that we are not descended from fearful men, not from men who feared to write, to speak, to associate and to defend causes which were for the moment unpopular.” – Edward R. Murrow, 1954.

On the Checking Out of Nice Asses

Early this morning, I received an email with this picture….

My initial thought was, “How funny! Cool, he’s human.” And I posted it to facebook. A while later, a friend posted a comment that said the picture wasn’t entirely accurate, and referenced this video, which shows the few seconds before and after.

Well, it looks like President Obama was being the gentleman, helping another woman down the steps, while Sarkozy was, indeed, checking out the girl’s ass!

Either way, big deal. As long as they didn’t touch….

Banning Dreams and Hope

Under FBI guidance, federal officials at the Florence, Colo. supermax prison have rejected an inmate’s request to read two books by President Obama, citing material “potentially detrimental to national security.” Ahmed Omar Abu Ali, a U.S. citizen serving a 30-year sentence for joining al-Qaeda and plotting to assassinate then-president Bush, asked for “Dreams from My Father” and “The Audacity of Hope.”

There are three important stories in the news about the Bush administration. The New York Times is reporting the FBI, State Department and the Red Cross all wanted to look into an alleged 2001 mass killing of Taliban prisoners by the militia of an American backed warlord. Warlord General Abdul Rashid Dostum was on the payroll of the CIA at the time of the killings. US-based Physicians for Human Rights called for a probe last Friday. This group claims it has documents that show up to 2000 Taliban fighters were suffocated in container trucks by Dostum’s forces and buried the the Dasht-e-Leili desert in November of 2001.

Democratic senators have called for an investigation into reports that Dick Cheney ordered the Central Intelligence Agency not to tell Congress about a secret “counter-terrorism” program. Dianne Feinstein, chairman of the Senate intelligence committee, told Fox News on Sunday that Congress “should have been told” about the CIA program and that the vice-president should not be above the law. There are many speculating about this so-called “counter-terrorism” program. Was Former Vice President Dick Cheney developing a list with over 8 million names on a watch list with plans around that or was the CIA hiding Cheney’s “Executive Assassination Ring”? The New Yorker’s Seymour Hersh, after earlier reporting from the New York Times, mentioned the possibility that a ring existed in a March 2009 discussion sponsored by the University of Minnesota. Are either of these the secret program?

FInally, a Justice Department official has said that even in the in the face of opposition from the White House Attorney General Eric Holder may move forward with an investigation of the harsh interrogation practices applied to suspected terrorists. Holder will decide in the next few weeks whether to appoint a prosecutor.

I for one, and many citizens of this country, find it difficult to move on to the future without dealing with the 8 years of hell this country was put through by the Bush administration. Over-reaching secrecy, torture, the loss of privacy, a war of choice, and an economic meltdown only rivaled by the 1929 depression: this country needs accountability in order to move forward.

Gerald Ford’s pardon of Richard Nixon set a terrible precedent of ignoring presidential crimes. That precedent was repeated by Bill Clinton when he stopped all investigations and prosecutions for Iran/Contra. Together, these decisions have created an atmosphere of kingly power around the presidency – exactly what the Founders wanted to prevent.

President Obama has an opportunity now to shatter these terrible precedents by holding his predecessor accountable for this and his cronies crimes. And if he fails to, Congress must. Never again should the citizens of this nation fear lawlessness from the holders of the highest office in the land.
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