No, This Fiscal Scam Won’t Be Different Than 2011. Stop Deluding Yourselves

(10 am. – promoted by ek hornbeck)

Of course that can be easy to do with corporate media hacks parading around as “journalists” basically working to preserve the corrupt machine they feed off of. They’re feeding people revisionist nonsense about the so called fiscal cliff; nonsense like how because of the President was reelected he has more leverage this time. As if Democrats ever use leverage after they win elections like how they kept funding the Iraq war in 2006 after their opposition to the war gave them those mid term victories. Nancy Pelosi also took impeachment of the war criminal GWB off the table so future war crimes could be committed.

And then in 2008 after winning an unprecedented majority in both Houses of Congress, higher than at anytime leading up to that point on the GOP’s end, we were told we didn’t have a mandate for progressive polices despite the fact that the right’s neoconservative Laissez-faire ideology had been fully discredited.

The Mandate Manipulation Machine Enters Stage Right

As I predicted a while back, the Partisan-Industrial Complex in Washington, D.C. has deployed its quadrennial Mandate Manipulation Machine to make sure that the 65 million Americans who voted for Barack Obama remember that America giving more than 340 electoral votes to an African American billed as a Islamic Marxist terrorist means there is no mandate for real change in this, a country obviously more conservative than ever.

A cursory glance at the newspapers today shows the media teeming with stories quoting incoming Obama administration officials, Democratic Party leaders and spokespeople for corporate front groups insisting that actually, no real change can be made, and what small-bore changes can happen, will have to happen in the very distant future, not soon. My favorite was the one-two punch from Senate Majority Leader Harry Reid (D-NV) and Democratic National Committee chair Howard Dean. Upon hearing of his bigger senate majority, Reid said on Tuesday, “This is not a mandate for a political party or an ideology.

And of course we now know that was Democrats’ way of telling us they would waste the crisis that elected them, keep TBTF, not prosecute anyone who caused the crash, dump the EFCA, enact Dolecare instead of a public option or Medicare Buy In, and go half ass on all qualitative legislation. This is what actually led up to the mid term losses in 2010. And keep in mind this 2012 election victory doesn’t even compare to the victory in 2008.

And yet they tell us we will see a new reinvigorated President and Congress. They tell us they are confident this time. They tell us that this time Democrats know they have a mandate for progress so things will be different than when the debt ceiling debacle made fools of them all. No, this is actually what the White House is telling us; the same thing as after the 2008 election victory now in 2012.

Axelrod: Talk of mandate ‘foolish, generally untrue’

Obama senior campaign adviser David Axelrod downplayed talk of an election mandate on the “fiscal cliff” on Thursday.

Axelrod said presidents always talk after an election about a mandate, but he called such talk “foolish.” President Obama and congressional Republicans are bracing for talks on tax hikes and spending cuts that are now set to be implemented in January.

“Everyone’s going to have to come to the table in the spirit of getting things done, but on this issue of particularly the fiscal cliff – presidents always say, ‘I have a mandate’; that’s a foolish word and generally untrue,” Axelrod told MSNBC’s “Morning Joe” on Thursday.

Whoah, now that just screams confidence and leverage. I’m “sorry” I ever doubted this, except for the fact that they’re telling us there is no mandate and things actually are not that different. It’s the same delusional or complicit in neoliberal evil mask of bipartisan-shit. On a practical level Einstein or Benjamin Franklin’s definition of insanity via trying the same thing and expecting different results, assuming Democrats want different results which could be a theatrical production, equals INSANITY.

As I have laid out clearly and predicted way ahead of time in 2010 leading up to now, most people with credibility on politics, history, economics, reading comprehension(many who ignored my 2nd paragraph are not included) know that in 2010 and 2011 the Democratic Party Platform was sold out. I was referring to raising the Medicare age to 67 which is unacceptable under any circumstances and on the table, but also there is only so much more you can cut from providers until they refuse to take Medicare patients at all.

There are some good things in the White House’s opening bid like they were in their opening bid in 2011, but none of that has much chance to see the light of day. Also if lowering prescription drugs were really a priority it would have been done instead of making a deal with Big Pharma at the beginning of the ACA negotiations. So basically there is no reason for Medicare or Medicaid to be on the table at all. Not only that many of these Medicare reforms to “strengthen the program” were implemented in 1997 as I have laid out before.

The word Medi-Scare comes from the 90s which is why it’s appropriate to use it now. We were told back then that Medicare needed austerity and that would improve its performance, even by Democrats which reminds me of why I am writing this diary. Funny story, putting Medicare on the table actually made our problems worse.

It led to the BBA of 1997 and then Medicare Advantage which is 9% more expensive, not to mention the huge consolidation of big pharma that was also part the Medicare Modernization Act.

Compounding these issues were substantial reductions in Medicare and Medicaid provider payments from the Balanced Budget Act of 1997 (BBA). The goal of the BBA was to control Medicare spending growth and offer Medicare beneficiaries more health care plan options and access. The BBA significantly reduced hospital financial performance starting in 1998 and beyond. In 1997, hospitals’ total Medicare payment to cost ratio was approximately 103.6%.32 The BBA froze Medicare inpatient care rates for 1998 and reduced the annual increases for subsequent years compared to previous years’ updates.

The BBA also included payment reductions for skilled nursing, home health, and outpatient services as well as other changes that reduced overall Medicare payment levels relative to costs. According to the Medicare Payment Advisory Commission (MedPAC), by 2001, hospital total Medicare payments again fell below cost.33 The Medicare reimbursement changes caused hospital margins to decline and created the need to hold the line with private payers.

By the late 1990s, managed care contracts represented a larger proportion of hospital revenue. Hospitals began to find that the deep discounts negotiated earlier with the now larger managed care companies were unsustainable, particularly in the post-BBA environment. By 1997, hospital consolidations continued, although at a significantly slower pace.

This consolidation and monopolistic system stems to hospitals, equipment manufacturers and whole sections of hospitals devoted just for administering paperwork in association with dialing up insurance companies to approve procedures. If you read  defenses of our for profit industry they all say fee for service is the main problem. They ignore how insurance companies operate as they have the same perverse market incentives that goes into building consolidated gigantic expensive hospitals accommodate them.

The defenders of this system claim this has nothing to do with it and it’s all fee for service and that’s it. Problem is in the 80s and early 90s, managed care was actually a big part of our system and it still couldn’t buck the perverse symbiotic relationship our for monopolistic profit system operates on. Costs continued to rise anyway and were double by the late 90’s.

You see, none of the focus on these reductions was helpful enough and we’re still hearing about the fake Mediscare crisis this time even 2 years later after the reforms to it in the ACA. That’s part of why you know nothing good can come of it being on the table in these negotiations. You see, even though I have little problem with some of what was done with Medicare in the ACA, the real waste is the overall private system which wasn’t done away with at all.

If that concept can’t be part of the discussion, which it can’t, then we don’t even need to even go there. A few years later we still hear politicians screeching about a fake Medicare crisis every 10-15 years in tandem with the fake deficit crisis while poverty and real unemployment is not taken into account and some of you defend this?

You see? Now you know those pretending this is a serious point of argument right now know nothing. Anyone making scare monger claims about Medicare going bankrupt or the federal government going bankrupt is not serious.  Democrats need to get their head out of the 90s because none of those psuedo reforms are worth looking back on now and they are a distraction.  The surpluses fueled the .com bubble and housing bubble. Talking about the deficit right now shows where this administration and Congress’s priorities are. This whole thing is a joke, and putting this as priority number one without the facts as this White House and Congress are doing shows nothing but contempt for the people they claim to represent.

Speaking of that contempt, the giveaway of the debt ceiling to Speaker Boehner was what was most damaging aspect of both sellouts leading to now from 2010-2011 and now. So much of the fake “progressive” media doesn’t get this. They think an opening bid from the White House is magic and that once the full faith and credit becomes a bargaining chip, some magical legislation within it is going to make it go away because high end tax cuts will expire. Nope.

Sorry to burst the bubble, but if the debt ceiling is not raised that’s going to be as bad or worse than a Lehman brothers recessionary event. That’s more leverage. It’s like this; picture the ring as the debt ceiling held hostage and Elrond as Geithner and his proposal.

Now we have everyone saying, “Oh John Boehner will just give the ring back.” WRONG. It’s not that simple. Once Pandora’s Box is opened up it can’t go back so easily. We are not in a better position, at all. Period.

Geithner’s offer will not be taken seriously specifically because it has a debt ceiling proposal in it. Republicans will milk that for all it is worth and really it’s too late to try to do something legislatively about the hostage Obama gave the Republicans in 2010, even a 2/3rds override that is in Geithner’s proposal that won’t pass. You have to challenge the debt ceiling in the SCOTUS as James K. Galbraith said even if the President decides to go over the fake cliff which remains to be seen if he means it.

Corporate GE hack pundits like David Corn whom the real Mother Jones would be shamed of are apparently unaware that this even happened or the prospects within. He’s getting that Hardball money so why should he care about working people and people that rely on SS, Medicare, or Medicaid? He doesn’t or he wouldn’t spin like this.

The Myth of the Obama Cave-In

Obama didn’t surrender in 2010. He turned a face-off over the Bush tax cuts into an opportunity to enact a second stimulus that he otherwise could not get past Senate Republicans.

Maybe he has a point that Obama didn’t surrender since we know what Obama put on the table and harsh austerity was something he was willing to enact to get a deal so it’s Obama doing what Obama wants to do. However, besides that point, David Corn doesn’t get it. You can’t remind someone of something when the party line’s rhetoric he draws his paycheck from like the rest of MSNBC now depends on him not remembering it.

For instance, the definition of “impossible to get past Senate Republicans” means unemployment benefits passing about a year before it became “impossible” in 2010. Definitions seem to change with the dollar signs of the pundit class times.

GOP Folds On Unemployment Benefits Fight: 14-Week Extension Passes

Funny how it works like it did when SCHIP was extended by Republicans, but I’m sure it will be deemed impossible soon depending on whatever future program this administration and Congress plan to give away. Next they’ll tout the payroll tax cut, that’s right, a tax cut as impossible to pass unless more of the New Deal and Great Society is put on the platter. Even though it’s regressive, irrelevant to being able to fund SS, and I hope we can get rid of it someday along with deficit stupidity and deficit terrorism; we didn’t need to extend the Obama/Bush tax cuts to pass it.

Another hack named Matthew Yglesias(the dude that thinks the Fed has magical powers at the zero bound and even had a whole panel about it at NN12) also recently tried to spin the Obama/Bush tax cut sellout as a political win on this point. Despite my MMT disagreements in general with him, James Kwak has a great title in this good piece on the political fail of this in 2010.

Rewriting History

That certainly wasn’t the line the administration was taking at the time. Remember Austan Goolsbee’s YouTube video? Or the “we got more than they did” slide that the White House was passing out to anyone who would listen? The administration was busily arguing that, in the race to see who got more of “their” tax cuts, the Democrats had won.

But this cleverly ignores the fact that Republicans like all tax cuts. Sure, they like to cut capital gains taxes for the rich more than the like child tax credits for the poor-but still, it was George W. Bush who expanded those child tax credits! As I said at the time:

“If you’re Grover Norquist and what you want more than anything else is lower tax revenue, you should be celebrating like it’s Christmas and your birthday at the same time. We had an argument where one side wanted tax cuts A, the other side wanted tax cuts B, and they compromised by adding tax cuts C?”

Yep apparently what George W. Bush did by passing the child tax credit through a Republican Congress was somehow impossible. And now when one is trying to spin a sellout deal as David Corn is we are supposed to indulge him in a legislative historical game of make believe. Apparently what’s also impossible these days is for enough people excusing that deal to learn that The Earned Income Tax Credit is also a Republican idea. Impossible? No, only putting a limits on all of this cognitive dissonance and expecting some serious journalism apparently.

You see, the fact that we are here right now and this whole debate is going on shows that all of Washington is stuck on stupid or pretending that way when it comes to how our fiscal and monetary systems work. However, Republicans know it’s only Democrats who foolishly take deficit reduction seriously. David Corn and other hacks are very unaware of the history David Johnson lays out in this piece I wrote during these sellout proceedings.

In this case, the deficits from the Bush tax cut extension amounts to the same  political weapons of mass destruction Reagan used to tear down our infrastructure and safety net. It’s a shame because in the absence of full employment deficits are beneficial and harmless. However, because of the nonsense we hear from Washington on all sides about being out of the money, money we easily create to pay our bills, trickle down tax policies that raise the deficit will be used along with the ignorance of Democrats stuck in a Clinton 90s bubble mindset to slash our safety net as they did in the past.

This happens because Democrats take seriously the scare monger children’s fairy tales of a “fiscal crisis.” Deficits can be dangerous political tools when no one demands that Democrats learn the truth about budgetary matters and our fiscal and monetary system in tandem with mindlessly cheering their ignorance on but that is all nothing more.

James K. Galbraith clearly explains why the fiscal cliff is a scam and any offer to raise the Medicare age to 67 is de facto privatization as well as a cut. It’s not worth passing middle class tax cuts and seniors will die. No excuses will fly. Just listen and pay attention and be thankful Professor Galbraith took the time to explain this so that maybe seniors don’t die so that lies to prop up neoliberal fantasies about balanced budgets and the 90s can live.

Why the Fiscal Cliff is a Scam

Why the Fiscal Cliff is a Scam (part 2)

As Yves said, you should share this with all your friends. This passage caught my eye:

[GALBRAITH:] If, for example, [incompr.] suggestion which has been in the news, you raise the eligibility age for Medicare, then what you’re doing is privatizing it in part. What you’re saying is that people who have employer-based insurance or other forms of private insurance have to hang on to that when they’re 66 and into, say, 67 [incompr.] they hit the age when they can shrug it off and get onto Medicare. That’s privatization. That’s what it is. And I think that should also be off the table.

I like how Galbraith frames raising the Medicare eligibility age as a form of stealth privatization, which also has the great merit of being true.

I’m hoping D.C actually learns this stuff someday before they destroy everything and with thundering applause depending on which party does it.  


  1. He and Tweety need to STFU and go away.

Comments have been disabled.