Budgets

Calling the Problem Early

dlindorff — Fri, 03 Oct 2008 09:28:33 -0400

By Dave Lindorff

Both Joe Biden and Sarah Palin tried to claim Thursday evening that
their presidential-candidate runniing mates, Barack Obama and John
McCain had been prescient about spotting the looming financial disaster
facing the US--Biden saying Obama had warned Treasury Secretary Hank
Paulson and Fed Chairman Ben Bernanke several years ago that subprime
mortgages would become a serious problem, and Palin saying McCain had
called for reform of mortgage backing firms Fannie Mae and Freddie Mac
(he actually simply co-sponsored reform legislation by Sen. Chuck
Hagel).

But there is someone who called this crisis much earlier, explaining it in astonishing clarity. Here's what he wrote:

"In a system...where the entire continuity of the...process
rests upon credit, a crisis must obviously occur -- a tremendous rush
for means of payment -- when credit suddenly ceases and only cash
payments have validity. At first glance, therefore, the whole crisis
seems to be merely a credit and money crisis. And in fact it is only a
question of the convertibility of bills of exchange into money. But the
majority of these bills represent actual sales and purchases, whose
extension far beyond the needs of society is, after all, the basis of
the whole crisis. At the same time, an enormous quantity of these bills
of exchange represents plain swindle, which now reaches the light of
day and collapses; furthermore, unsuccessful speculation with the
capital of other people; finally, commodity-capital which has
depreciated or is completely unsaleable, or returns that can never more
be realized again. The entire artificial system of forced expansion of
the [ecomony] cannot, of course, be remedied by having some bank, like
the [Federal Reserve], give to all the swindlers the deficient capital
by means of its paper and having it buy up all the depreciated
commodities at their old nominal values. Incidentally, everything here
appears distorted, since in this paper world, the real price and its
real basis appear nowhere, but only bullion, metal coin, notes, bills
of exchange, securities. Particularly in centers where the entire money
business of the country is concentrated, like London [or New
York]...the entire process becomes incomprehensible."

Note: Except for my updated insertion of the term Federal Reserve
for the original reference to the Bank of England, this is a verbatim
quote.

(Thanks to writer, trade union activist and Marx scholar Bert Schultz of Philadelphia, who found this passage in Karl Marx's Capital, Volume 3, Chapter 30, "Money-Capital and Real Capital")
__________________

DAVE LINDORFF is a Philadelphia-based journalist and columnist. His
latest book is "The Case for Impeachment" (St. Martin's Press, 2006 and
now available in paperback). His work is available at

What Nobody's Saying: The Bailout Will Kill the Dollar

dlindorff — Mon, 22 Sep 2008 15:05:01 -0400

By Dave Lindorff

What nobody in the corporate media is mentioning amid all the
blather about the $700-billion Paulson bailout proposal is the impact
it will have on the US dollar.

We are told that this huge gift to the financial sector—the
assumption, at top dollar, of all the bad debt they’ve piled up--will
be at taxpayer expense, but that’s only the half of it. (Really only
the quarter of it because since the US government is technically
bankrupt already, spending more than it takes in each year, all that
money will be borrowed, and will be added to the national debt, meaning
that just as the real cost of the $500-billion Iraq War is closer to $2
trillion, the real cost of the $700 billion bailout will be more like
$1.5-2.5 trillion.)

But besides the direct bill handed to taxpayers for this gigantic
con, there is the fact that adding that much to the national debt is
also going to drive the dollar down precipitously against foreign
currencies. We’re already seeing that happen, even while they’re just
talking about the bailout. The dollar is falling against all major
currencies—the Euro, the Yen, the Renminbi and the British pound. And
it will continue to fall as the details of the bailout come out.

This will add to already powerful pressures in countries like Saudi
Arabia and China, which hold huge quantities of US dollars and US
dollar-denominated debt, to shift out of dollars and into other
currencies—particularly the Euro and the Yen. Last week, an article in
China’s People’s Daily, which like Pravda in the old Soviet Union, is
the official voice of the leadership in China, called for just such a
move. Russia is also calling for an end to the dollar as the
underpinning of the global economy.

For some years now, many economists have been predicting an end to
the dollar as the world’s reserve currency, but this latest plan by the
US Treasury will push such a shift forward from “some day” to “now.”

As long as the dollar has been the reserve currency—the currency in
which key commodities like gold or oil were priced, and the currency
that exporting nations stocked in their treasuries as a store of value
– it was protected against collapse. But once it loses that status,
there will be nothing to prop it up any longer, and it will quickly
slide to a value that it deserves. We got an inkling of what is going to happen today, as crude oil
prices leapt in the course of one hour by 25%, the biggest jump in the
history of the oil market. This was purely a move caused by loss of
confidence in the dollar. There was no oil supply disruption. In fact,
demand for oil has been sinking as the economic crisis grows. Oil
producers and traders simply realized that the dollar is going poof, so
they radically jacked up the cost of oil in dollars.

If you want to see what where the dollar is headed,, look to the
currencies of the debtor nations—countries like Mexico or perhaps
Mozambique. A nation that makes almost nothing, and that imports most
of its needs, cannot have a strong currency.

This might not matter much if we had a functioning domestic
economy, where people could find the goods and services they needed
without turning to sources from abroad. A big country like the US could
simply turn inward and function on by its own domestic economic
standards.

I remember back when the former Soviet Union was in a state of
economic and political free fall in the early and mid 1990s, the
currencies of the constituent countries, like Russia, Ukraine and
Belarus had had collapsed to virtual worthlessness on the international
market. A Byelorussian friend, an engineering professor from Minsk,
living and working near me in China at the time, explained that
although when he traveled the world, he felt like a pauper, things
weren’t so bad back home Belarus, where he and his family would go in
the summer. “My apartment only costs a few dollars a month to rent,” he
explained, “and our food is bought on the local market using rubles, so
it is very affordable.” The same was true for other needs, like
clothing and books for school, he explained. The only problem was
buying gas for his Russian Volga. “Gas,” he explained, “is priced as an
international commodity, so it takes me one month’s wages in Belarus to
buy the gas to drive once to and from our country dacha.”

You can start to see the problem. Since agriculture has been killed
off in most of the US, in favor of giant agribusiness enterprises
situated in the western part of the country and some parts of the
Midwest, most people elsewhere will not have local produce available,
and the cost of transporting food from California to places like New
York or Pennsylvania will be prohibitive once the dollar collapses,
since oil is priced internationally. Meanwhile, goods like TV sets,
computers, phones, cars (or at least the key components of cars),
clothing, etc., are no longer even made in the US, and will thus be
completely unaffordable. As for the service jobs that are supposed to
have replaced our old manufacturing sector, no one will be interested
in buying what they’re offering, because they’ll be scrimping just to
buy the key staples they need to survive, so of course joblessness will
soar.

Eventually, of course, entrepreneurially minded people will begin
establishing local farms again where they once flourished generations
ago, and small factories will be built to provide key essentials, but
all this will take time, and will have to cater to a market of people
operating at a much lower standard of living.

The banking sector, meanwhile, which is the proximate cause of this
monumental disaster, won’t mind any of this, for it will continue
operating on the international stage, shifting its focus to lending
money (no longer dollars, though), to growing economies in Asia and
Latin America and eastern Europe. And this is what, in truth, the
“rescue” of Wall Street is all about.

It’s not about saving Main Street, as Paulson claims. Main Street,
under the bailout, is toast. It’s about helping the banks and
investment banks and insurance companies that brought on this crisis to
ride it out in style, their astronomical losses bankrolled or absorbed
by the American public, so that they can shift their operations
overseas and continue with their rape and pillage of the global economy.

The US will be left behind, a smoking ruin, with Americans, like
Weimar Germans before them, going shopping with wheelbarrows full of
worthless green paper to exchange for a few days’ groceries.
_____________

DAVE LINDORFF is a Philadelphia-based journalist and columnist.
His latest book is "The Case for Impeachment" (St. Martin's Press, 2006
and now available in paperback edition). His work is available at www.thiscantbehappening.net

"No Blank Check" or "No %$#!*@ Check"

davidswanson — Mon, 22 Sep 2008 07:35:24 -0400

By David Swanson

The last time the Democrats all started bleating "No blank check - No blank check" it meant only one thing. They were signing a check and scribbling a bunch of nonsense in the memo line.

If history is any guide, we can expect a bill to come out of Congress requiring that the Secretary of the Treasury make a report to Congress within three months on all areas covered by the legislation, with the exception of those he chooses not to report on.

In particular, he will be required, if he chooses, to report on the progress being made toward compelling families that have lost their homes to pay for their own foreclosures. Fair is fair, and the Iraqis are going to start paying for their own occupation someday very soon.

The Treasury Secretary will be required to report, if he chooses, on key benchmarks, including equitable sharing among all plutocrats of our Social Security savings. This is a question of fair and equitable distribution of resources and might serve as a model for the still badly needed Iraq hydro-carbon law, which is also purely about fairness. The same goes for Medicare and the money raised from selling off our schools.

At least that's the pessimistic prediction. On the other hand, there is an important variable that has been altered in this case. We are talking about throwing a trillion dollars of our grandchildren's money at people who do not need it, but this time we're proposing to do it for something other than war. There are no flags waving or war music playing for this one. As a result, it's possible to see things like an article on CNN that begins:

"NEW YORK (CNNMoney.com) -- 'NO NO NO. Not just no, but HELL NO,' writes Richard, a reader from Anchorage, Alaska. 'This is robbery pure and simple,' Anna from Denver posted on CNNMoney.com's TalkBack blog this weekend. 'It's our money! Let these companies die,' added Claudio from Plainville, Conn."

Similar comments on wars are simply not published by CNN in the heat of an invasion. Will our so-called representatives notice the difference? I wouldn't count on it. The smart investment right now is in a moving van pointed toward Canada.

I just read Thomas Frank's "The Wrecking Crew," and his central point is a timely one. When neocons wreck government they consider it a victory. Scandalous earmarks on bills are a good thing because they make people hate government, which is the higher purpose of all governmental malfeasance. When FEMA proves incompetent, success has been achieved, because the goal is to convince everyone that government is incompetent, that corporations are where all skill and responsibility can be found.

"People being pissed off at government is the very ore of right-wing discontent," Frank writes. "Corrupt earmarks, inserted by conservatives, lead to conservative victory. But, you protest, nobody really falls for this. Everyone knows that the guy who got the 'Bridge to Nowhere' earmark was a conservative Republican. People know where the blame belongs, and they punish the malefactor.

"Maybe so. But remember the long-term effects of Watergate. While the immediate consequences of Nixon's outrageous behavior were jail sentences for several conservative Republicans and the election of a bumper crop of liberals to Congress in 1974, Watergate permanently poisoned public attitudes toward government and stirred up the wave that swept Ronald Reagan into office six years later -- and made antigovernment cynicism the default American political sentiment."

All of which puts a different perspective on a government proposal to hand governmental levels of funding over to Wall Street. If the proposal goes through and the companies survive, the credit goes to Wall Street and the crushing debt requiring slashing of useful services goes to government. If the proposal fails, it also succeeds, by turning people against big government spending and interference in the Marketplace. After all, this proposal is "socialism," and if you oppose it, then you certainly must oppose such identical horrors as "socialized medicine."

For neocons, this was an easy decision. When you control the media, and your opponents are Democrats, there's almost no way for you to lose. So why wouldn't you propose borrowing a trillion dollars to hand out to your friends?

Of course, in theory, the Democrats could stop saying "No blank check" and start saying "No +&*^%!# check!" but I'm not going to hold my breath until they do.

Paul Krugman and Blindness About the War and the Economy

dlindorff — Tue, 08 Jul 2008 13:36:00 -0400

By Dave Lindorff

In a New York Times column on Monday (“Behind the Bush
Bust”), economics columnist Paul Krugman mused on whether President
George Bush could be blamed for the nation’s economic crisis. His
conclusion was that, yes, to some extent the crisis was Bush’s fault,
but he largely lets the current administration off the hook, instead
blaming Republican policies dating back 10-15 years.

Oddly, Krugman does say that a key cause of economic problems has
been rising energy prices, but he then attributes these to “growing
demand from China and other emerging economies,” and suggests that
prices might have been at least a bit lower had the US, after 9/11,
adopted “higher gas taxes and fuel efficiency standards,” a failing he
attributes to Bush.

The gaping hole in Krugman’s logic is the Iraq War, which the
columnist, incredibly, doesn’t even mention. Yet clearly, the invasion
and subsequent war and occupation of Iraq which was purely the result
of Bush/Cheney machinations, has been a major, if not the major cause
of oil price increases.

By destroying Iraq’s oil production, and by hindering much of
Iran’s production (Iran, seen as an enemy by the US, has been frozen
out of capital markets, blocking it from being able to modernize and
even maintain its own huge oil infrastructure), and putting even
Kuwait’s and Saudi Arabia’s production at risk, the US war in Iraq has
jeopardized about one-third of the world’s oil capacity—a fact not lost
on oil speculators. Every rumor of a longer occupation or a wider war
in the Middle East—especially a possible attack by the US on Iran--has
pushed up oil prices further, as has every attack on a pipeline.

It is no secret why crude oil, over the course of five years, has
soared four or five times in price. Demand has certainly not gone up by
that amount. It hasn’t even doubled. What has happened is that the
Middle East has been thoroughly destabilized by American military
action.

The rise in oil prices has been the major cause of the US dollar’s
stunning collapse, which in turn has limited the hand of the Federal
Reserve, which cannot risk lowering interest rates as much as it would
like to stimulate economic growth, for fear of further undermining the
dollar. This in turn has allowed the mortgage crisis to fester and grow
worse.

At the same time, the massive amount of industrial production that
has gone into the war effort—the building of planes, tanks, armored
cars, etc.—while perhaps producing some jobs, has been wholly
inflationary in its effect, since this is production that cannot add to
available goods and services in the civilian economy. That means that
there are more people with wages and salaries, chasing the same number
of things to buy—a sure-fire recipe for higher prices. Add to that the
huge war budget, all funded by debt, and you have even more downward
pressure on the dollar.

Bush’s and Cheney’s war in Iraq has been, it should be clear, a
huge catastrophe for the US economy, and yet somehow Prof. Krugman
managed to miss it completely. You could read his column and not even
know that the country is and has been, for the past seven years, at war.

I’m not sure what to make of this oversight on Krugman’s part. Is
he trying to downplay the war, figuring it’s soon to become a
Democratic venture? Is he unfamiliar with the argument that war is bad
for economies?

One thing is clear: You cannot look at a nation at war and analyze
its economy without considering the impact of the war, which is what
the usually astute Krugman has done here.

But let’s make the point crystal clear, even if Krugman doesn’t see
it or doesn’t want to see it: The slumping US economy, and the crashing
US dollar, which is heading towards Peso status as a trash currency,
are clearly the direct result of Bush/Cheney policies, aided and
abetted by both Democrats and Republicans in Congress, who have bought
the story line that war is good.

We will all be paying for this imperialist misadventure for years to come.
_______________
DAVE LINDORFF is a Philadelphia-based journalist and columnist. His
latest book is “The Case for Impeachment” (St. Martin’s Press, 2006 and
now in paperback). His work is available at www.thiscantbehappening.net

Oil, Israel, Iran, America and the High Cost of a Single War-Like Remark

dlindorff — Sat, 07 Jun 2008 12:15:54 -0400

By Dave Lindorff

One remark by a minor Israeli cabinet officer hinting at a possible US or Israeli attack on Iran has sent oil prices up by a record $11/barrel to a record $139 per barrel Friday. That should tell us what would happen if the Bush administration were crazy enough to attack Iran, or to let its vassal state of Israel do it.

Most analysts say an actual attack on Iran would send oil almost immediately to past $300 per barrel—a level that would strangle economies worldwide and send the world into an economic collapse not since the Smoot-Hawley Tariffs kicked off the Great Depression.
The repercussions of that would be staggering.

America, which runs on oil, would grind to a halt. Gasoline and home heating oil would double or triple in price, leading to desperation in the coming winter for those living north of the Mason-Dixon line, and to a mass exodus of the elderly from Florida and Arizona, where air-conditioning would no longer be affordable.

In China, an economy almost wholly dependent upon the manufacture of goods for sale to American consumers, hundreds of millions of workers would suddenly find themselves unemployed. With their remittances to their peasant relatives halted, half the country would be kicked back to the pre-capitalist era, only without guaranteed wages, homes, food and healthcare. It is likely that unrest unprecedented since the Cultural Revolution would erupt.

The Middle East would explode.

In Iraq, Shia fighters would rise up in solidarity with their Shia neighbor, Iran, and begin attacking American forces in Iraq in earnest, probably making the Tet Offensive in 1968 Vietnam look like a picnic. Where the US had half a million troops in Vietnam in that offensive, the military is already stretched to the breaking point in Iraq, with supply lines barely defended.

It makes you wonder what is going on in the higher reaches of the US bureaucracy. Defense Secretary Robert Gates, who has in the past intimated that he’s no fan of war with Iran, just sacked the two top men in the Airforce—the most gung-ho of the service branches in terms of Iran war mongering. The unprecedent surprise firing of Air Force Secretary Michael Wynne and the Air Force’s top officer, Gen. T Michael “Buzz” Moseley, was officially blamed on their poor handling of the nation’s nuclear weapons arsenal, in the wake of last year’s unauthorized and improper removal from storage and cross-country aerial transfer of six nuclear-armed cruise missiles in launch position on a B-52 Stratofortress, and the discovery this year of an earlier “inadvertent” shipment of ICBM missile warhead nuclear triggers to Taiwan. While it is possible that those two incidents were the cause of the firings, there remain serious unanswered questions about both incidents, and particularly about the cruise missile flight.

As I reported earlier on this site and in Counterpunch magazine and American Conservative magazine, there were a half dozen unexplained deaths of US airmen, including two suicides, which occurred just before and after that flight last August 30, none of which were investigated at least publicly by the Pentagon or the FBI according to local prosecutors and medical examiners contacted. A number of experts in nuclear weapons handling have said that it would be “impossible” for the six warheads to have been removed from guarded bunkers at Minot AFB in North Dakota, mounted on cruise missiles, loaded onto launch pylons under the wing of a B-52, and flown to Barksdale AFB in Louisiana, all as a “mistake.”

This leads inexorably to the question: What was being planned for those warheads, if they were not being removed from storage by mistake, and if they were being moved without the knowledge of the top brass, including Gates, at the Pentagon? Recall that the only reason anyone learned about the incident was that it was reported outside the military chain of command to a reporter at Military Times newspaper by several Air Force whistle-blowers upset by what they were seeing.

We already witnessed the sudden resignation from the post of CentCom Command of Adm. William Fallon, whose outspoken opposition to the Bush/Cheney administration’s talk of attacking Iran led to his being pushed aside in favor of the more pliant Gen. David Petraeus. Fallon was pushed out by Iran war hawks because of his opposition to an attack. Were the Air Force Secretary and Chief of Staff forced out by Gates because of their pro-attack position?

Plenty to ponder here, but the concerns of oil speculators, who have driven up the price of oil by 8.6 percent (and the stock market down by 3.2 percent) in a single day, in large part on war rumors, should have us all concerned.

It’s not just about the price of gasoline.
___________________
DAVE LINDORFF is a Philadelphia-based journalist and columnist. His latest book is “The Case for Impeachment” (St. Martin’s Press, 2006 and now available in paperback edition). His work is available at www.thiscantbehappening.net

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No Tax Rebate's Going to Fix This Mess

dlindorff — Fri, 18 Jan 2008 17:34:44 -0500

By Dave Lindorff

When you hear a number like $100 billion (the amount Bush is proposing to give back to people in the form of tax rebates, at about $800 per adult family member) or $145 billion (that $100 billion, plus another $45 billion in business tax breaks—mostly accelerated deductions for capital investment) bounced around, it sounds like a lot of dough, and you might think it would be a good shot in the arm for an economy that is falling into a dead faint.

But let’s think about it on a micro level.

What would my wife and I do with an extra $1600?

Well, to be honest, that’s not quite one month’s mortgage payment.

If we were smart, we’d probably use it to pay down some principle on our credit line, which would over time get us out from under on that dreaded monthly bill a lot sooner. But if we did what most people are likely to do--pay off some bills with it, or one month's mortgage, chances are, given how hard we're all working just to keep going, that we'd then slack off somewhere else just to catch a little break--maybe turn down one assignment, or if we're on an hourly job, turn down some overtime and catch a little more shuteye--and in the end, we wouldn't be adding anything to the economy at all.

But then there are the cars. They both need servicing. The Volvo, a 1993, is suffering from a case of electronic lock collapse syndrome: the right rear door can no longer be opened. It’s frozen in the locked position. The lock button on the driver’s door came unconnected from the latch mechanism inside the door too, so that door has to be locked and unlocked from the outside with the key. And I figure it’s only a matter of time before some of the other doors get frozen in locked position, which could get really ugly when I need to drive with more than one passenger. So I could use probably $1000 of that rebate to get that mess fixed. That would leave $600 for two alignments, two tune-ups and some new tires.

If I were to do all that, I suppose that would be a little boost to the economy, but not much. It certainly would be nice for the auto electric shop guy, but it’s not going to do much for Detroit. Trust me—that extra $1600 is not enough to tempt me to go out and buy a new car. Heck, it’s only about a down payment and two monthly payments on some piece of junk from the bottom of the Chevy or Ford line-up, and after that I’m stuck with payments for four more years. No, I’ll be staying with my old Volvo and the 2001 Honda Civic.

I suspect most Americans are in the same boat. If you have to worry about the future of your job—in my case a continued flow of assignments from various magazines that keep me afloat—you’re not going to go out and buy some big-ticket consumer item just because you got an unexpected $1600 check from Uncle George in Washington.

Economic theory, regarding the "velocity of money" and all that, says that if I do get the Volvo door problem fixed, and if I do buy those new tires and get the cars tuned up and aligned, that money I spend will flow through the economy, making everything hum a little better (not the tires though, since they're probably made overseas so the extra dollars just get lost to the US economy). That’s probably true to a point. The auto electric guy is likely to get a little pick-up in business—mine and other people with door and light problems they’ve been living with for a while. But will it be enough to convince him to go out and hire another employee? I doubt it. Will he invest in new equipment? Nah. I doubt he’d do that, and even if he did, it most likely would be imported too, meaning an end to the stimulus chain. More likely, he’d take his extra dough and go get his pick-up repaired. It’s belching a bit of smoke these days, and looks like it could use some engine work. But again, I doubt that he’ll be ordering a new F-150. And any parts he buys for his vehicle are likely to be imported too, thanks to globalization. That’ll be good for Mexico’s or China’s economy, but not for ours.

Besides, the thing is, we all know that those IRS rebates are a one-off thing. It’s not like they’re going to make this a regular yearly surprise. So you’d have to be an idiot to take the money and pump up your life-style.

And then there’s another problem. By adding another $145 billion to the budget deficit, the government is contributing significantly to inflationary pressures, and when those gnomes in Zurich, London, Tokyo and Hong Kong see that, they’ll bid down the value of the dollar even more. Our once mighty currency, now worth only half a pound Sterling in Britain, or just over 100 Yen in Japan, is shrinking faster than the polar icecap. And that means that all the products we depend on—our tools, our dishware, our clothes, much of the food we eat, and of course our oil—will get more expensive.

I don’t know about you, but my wife and I spend basically every penny we earn each year, in order to make ends meet. Now some of that is for stuff like mortgage payments, tuition payments, etc., but I’d guess that, counting oil and energy bills, probably half our income goes to buy things that are imported, and that’s probably roughly true for most American families. After all, almost nothing is actually made in the US anymore, and we even buy a lot of raw materials—iron, oil, etc.—from overseas. So if for sake of argument and easy math, we’re making $100,000, that’s $50,000 being spent on imported stuff. Now here’s where things get a little speculative. But suppose that having the government add another $145 billion in red ink to the federal budget leads to an extra 3 percent decline in the value of the dollar against foreign currencies—a not unreasonable scenario. Why, that would mean that the $50,000 I spend on foreign goods in a year would cost me an extra $1500—just about the same amount as that $1600 Bush is proposing to lay on me.

But…that weakened dollar will continue into next year and beyond, while the $1600 rebate is a one-time thing.

So what do we get out of this rebate thing?

Worse than nothing.

There is, unfortunately, no free lunch.
]
In fact, it’s worse than that. To the extent that the extra decline in the dollar puts pressure on the Federal Reserve to take some action to prop the Greenback up, we will see interest rates rise. Now at the moment, we’re in hock to the tune of about $25,000 on a home equity credit line—a result of living beyond our means that is the typical American family’s response to incomes that have failed to keep pace with inflation. While my mortgage is fixed-rate, my credit line is not. So if the fed raises interest rates by .25 percent to prop up the dollar from the effects of that one-off tax rebate, I’m going to be paying an extra $650 annually in interest on my credit line balance.

In other words, this rebate is putting me into the hole right from the get-go!

Thanks a lot George!

So how about we just forget this whole stinking rebate idea. It ain’t gonna work, folks. It might sound good in an election year, but if you look at it closely, you can see it’s really just smoke and mirrors.

There is a solution, though. How about if they end the war in Iraq and bring all the troops home. The government will save several hundred billion dollars a year that’s being spent overseas blowing things up—and that is helping to depress the dollar and raise our tax bills. Some of that saved money can help reduce the deficit. Other chunks of it could be invested in America’s badly decaying infrastructure—repairing bridges, building new schools, etc., maybe building some major levees to protect our coastal cities from the next Katrina or from the global warming flood that we know is coming. And all that will mean jobs for people who need them.

We might also try to do something about reducing that massive outflow of dollars that’s making our currency do a disappearing act. An easy way to do that would be to slap higher taxes on gasoline and to tax cars based on how bad their gas mileage is. Before long, most Americans would be driving less and buying smaller, fuel-efficient cars, and we could significantly reduce the single biggest item on our import bill: oil.

Don’t get me wrong. I’ll be happy to get that $1600 check George Bush is calling for. I’m certainly not going to return it to the Treasury! But let’s not be pretending that it’s going to jump-start the sick economy.

It might even end up making things worse.

_________________________________________
Dave Lindorff is a Philadelphia-based journalist and columnist. His latest book is "The Cast for Impeachment" (St. Martin's Press, 2006 and now available in paperback). His work is available at www.thiscantbehappening.net

How the Bush Administration Is Turning the USA into a Subprime Borrower

Heather Wokusch — Mon, 27 Aug 2007 12:47:01 -0400

"Our enemies are innovative and resourceful, and so are we. They never stop thinking about new ways to harm our country and our people, and neither do we." - George W Bush

Much in the same way that US investors were “steered” into rip-off mortgage loans, the entire country has been “steered” into an economic crisis. The question is how to get out of it.

In the subprime loan scandal, unscrupulous brokers conned home buyers with poor credit histories into deals designed to profit lenders and bleed borrowers. Contract “teasers” hid ballooning monthly payments while a lack of regulation allowed the scam to continue unabated. Millions more Americans now face losing their homes.

The Bush administration similarly used promises of cakewalks and increased security to con the US public into wars with Iraq and Afghanistan. US taxpayers have spent over $450 billion on Iraq alone, while Bush/Cheney cronies continue making a killing from military contracts. Meanwhile, global security has degenerated and over 4,100 US service members have died in Iraq and Afghanistan, along with an untold number of coalition troops, contractors and civilians.

Bush’s military adventurism, not to mention his administration’s exorbitant tax cuts for the wealthy, gutted the surplus of $128 billion Clinton handed him in 2001 into a deficit of well over $200 billion today. And Bush has simultaneously increased the national debt by over $3 trillion (to roughly $9 trillion), effectively nailing each and every US citizen with a bill for almost $30,000.

While heavy borrowing from Asia has mopped up some stateside red ink, there’s an inherent threat: China, for example, has an estimated $900 billion in US bonds and can increasingly call the shots on the US economy and foreign policy.

Just weeks ago, Beijing warned that if the Bush administration pushed for a revaluation of the Chinese currency, then Beijing would sell dollars, thereby threatening the greenback’s reserve currency status. Washington backed down. It had little other option.

In other words, the US itself has become as vulnerable to its lenders as any other subprime borrower.

Overall, the US debt situation looks so dire that the non-partisan Government Accountability Office Comptroller recently warned, America is on a path toward an explosion of debt. And that indebtedness threatens our country’s, our children’s, and our grandchildren’s futures. With the looming retirement of the baby boomers, spiraling health care costs, plummeting savings rates, and increasing reliance on foreign lenders, we face unprecedented fiscal risks.”

Financial analysts say credit markets are facing a Minsky moment – the inevitable downward spiral when over-leveraged investors have to sell valued assets just to pay back their loans. Some analysts have even coined a new term, suggesting we are in a “Minsky meltdown” – the prelude to a wider market crash.

But it looks more like a “Minsky massacre,” not an unavoidable economic downturn but rather a coldly-calculated hit, with the intention of transferring wealth from the lower and middle classes to an unaccountable few at the top.

Bottom line, this economic downturn isn’t hurting everyone. Select brokers and lenders made a fortune off the backs of subprime borrowers, and now that the related hedge funds are collapsing, well-leveraged private equity firms can buy assets at fire-sale prices.

And as Jim Hightower recently noted, a “hands-off regulatory ideology” is complicit: “There are no less than five financial agencies at the federal level that could have protected people, yet the subprime surge was allowed to proceed .... The Federal Reserve Board, for example, has direct authority under the Home Ownership and Equity Protection Act to ‘prohibit acts or practices in connection with mortgage loans that the board finds to be unfair, deceptive or ... associated with abusive lending practices, or that are otherwise not in the interest of the borrower.’ The Fed simply ignored this law.”

The US has been down this road before. The Savings and Loan (S&L) crisis of the late 1980s was also characterized by loose lending requirements, lax regulation, obscene profits for the few - and US taxpayers left holding the bag for $125 billion.

Ironically, the Bush family was involved in that scandal too, with Bush Jr.’s brother Neil serving on the board of the disgraced Silverado Savings and Loan, which went bust and stuck US taxpayers with a $1.3 billion debt. Regulators accused Neil of "multiple conflicts of interest" but he never did jail time – thanks at least in part to the S&L bail out engineered by his father, Bush Sr., who happened to be President at the time.

Just as in the S&L crisis, the poor and middle class have borne the brunt of the current subprime disaster, an especially nasty fact given the nation’s huge wealth gap. As Inequality.org points out, “The richest one percent of U.S. households now owns 34.3 percent of the nation's private wealth, more than the combined wealth of the bottom 90 percent. The top one percent also owns 36.9 percent of all corporate stock.”

It’s probably no coincidence that terms associated with both corporate and developing country indebtedness are being used to discuss the US subprime meltdown (payment defaults, vulture funds, distressed debt, etc). Perhaps the US hasn’t reached banana republic status yet, but the increasing wealth gap, not to mention ballooning budget deficits, low capital spending and reliance on foreign capital are disturbing signs.

Doesn’t help either that the Federal Reserve stopped releasing M3 money-supply data in 2006. M3 data (covering Eurodollars, repurchase agreements and large-denomination time deposits) is critical in determining how fast the Fed is printing money, which in turn impacts inflation.

So, what further fallout from the subprime scandal can be expected? Millions more Americans will lose their homes, and as The New York Times recently reported, “for the first time since federal housing agencies began keeping statistics in 1950,” the median price of homes in the US will fall.

Ratings agencies, such as Standard & Poor's and Moody's, will take some heat for their role in the scandal, but the Bush administration will focus on bailing out predatory lenders rather than helping Americans keep their homes. Congress and most presidential candidates will protect financial services campaign donors by not pursuing true reform.

Meanwhile, Asia and Europe will continue “decoupling” from increasingly volatile US markets, threatening the dollar’s reserve currency status even more. Fresh off its recent war games with China and four Central Asian republics, Russia will more actively confront the US on the world stage. The Bush administration will move closer to a war with Iran.

Of course, these dire predictions don’t have to materialize - we can regroup and fight back. One avenue is by urging Congress members to take action, such as changing foreclosure rules to protect homeowners and supporting Rep. Barney Frank’s (D-MA) National Affordable Housing Trust Fund Act (H.R. 2895). Rep. Ron Paul’s (R-TX) push to have the Fed start releasing M3 data again (H.R.4892 ) is also urgent.

At the very least, we must frame the Bush administration’s war-making as a direct threat to the US economy, not to mention national security, and just like maxed out home buyers, confront our nation’s culture of debt.

Action Tips:

1. For online videos about the subprime issue and “Money as Debt,” visit Brasscheck TV (www.brasschecktv.com/page/135.html)
2. Check out two groups working on affordable US housing: the Community Land Trust (www.iceclt.org/clt/) and the National Housing Trust Fund (www.housingmatters.net)
3. Learn more about “America’s growing economic divide” Inequality.org (www.demos.org/inequality/index.cfm)
4. Concerned about predatory lending? So is The Center for Responsible Lending (www.responsiblelending.org/).

Heather Wokusch is the author of The Progressives’ Handbook series (www.progressiveshandbook.com)

How's the Progressive Caucus Progressing?

davidswanson — Tue, 27 Mar 2007 22:00:45 -0400

By David Swanson

Seventy-one members of Congress, all Democrats, most House Members, two Senators, belong to the Congressional Progressive Caucus. For a couple of years now, the CPC has had a staff person. More recently it created a website http://cpc.lee.house.gov

Since most of the positions generally labeled progressive are backed by either a majority or a large minority of Americans, it certainly seems useful to have at least a small minority in Congress pushing for them. If anything good is ever to come out of Congress, this seems a likely source for it.

The CPC operates from within the Democratic Party, and that party is now in the majority. So, the question arises: what influence does the CPC have with the rest of its party or with Republicans, and what goals will it attempt to achieve?

During the leadup to the recent vote on the "supplemental" war spending bill, the CPC publicly took a position in support of using the power of the purse to end the war in 6 months: http://tinyurl.com/yqlf5x This statement, combined with the 71-person membership, forced an antiwar position into the corporate media. However, the position was arrived at by the majority vote of only those CPC members who attended a particular meeting.

The two Co-Chairs of the CPC, Lynn Woolsey and Barbara Lee, are among the most progressive of congress members. Lee proposed in the House Rules Committee an amendment that would have restricted the war spending bill to funding a withdrawal by the end of 2007, but her party's leadership refused to allow a floor vote on that amendment.

In keeping with the position of the CPC, Lee and Woolsey voted against House Speaker Pelosi's war spending bill, as did CPC members Dennis Kucinich, John Lewis, Diane Watson, and Maxine Waters. Four other Congress Members, two from each party, voted against the bill because they opposed funding the war.

But 61 CPC members voted for the war money. And Woolsey, Lee, Watson, and Waters (who chairs the newly formed Out of Iraq Caucus) told their caucus members they should feel free to vote for Pelosi's bill.

During the days leading up to the war vote, Pelosi and her allies made various changes to their bill, but all of them for the worse. They removed a provision requiring the President to come to Congress before attacking Iran. They included a requirement that Iraq allow foreign corporations to steal the bulk of its oil profits.

As CPC members committed, one by one, to voting for the bill, the bill remained the same or worsened. The only thing the CPC may have gained from the process was a commitment to hold a separate vote on the question of Iran, but that vote has yet to be held and may not be held before Bush and Cheney get their hands on the money that could fund an attack.

Just prior to the vote, two CPC members, John Lewis and Pete Stark, made strong statements in favor of voting No. An activist group called the Backbone Campaign gave Lewis a backbone award for his statement. We probably should have given one to Stark as well. Lewis voted No, but Stark voted Present.

Kucinich began many months ago and lobbied nonstop, up to the last minute, in favor of a No vote. He urged Americans to lobby their Congress Members to vote No. As always, Kucinich set the standard, but he failed to bring many of his colleagues with him.

Many of the CPC members who voted for the Pelosi bill explained that they were doing so because, while they favored something like Lee's amendment, it wasn't practical/feasible/realistic right now. If that were true, however, CPC members would be signed on as cosponsors of bills that parallel Lee's amendment. Lynn Woolsey's bill, HR 508, does not have 69 cosponsors. But it does have 49, and 44 of them are CPC members. Jim McGovern's similar bill has 26 cosponsors. Jerrold Nadler's similar bill has 13. Kucinich's similar bill has 2. Senator Feingold's similar bill (he is not a CPC member) has 3. So, the Progressive Caucus may not have a perfect record, but it has clearly accomplished something by organizing 44 members to back the bill promoted by its co-chairs.

But can the Progressive Caucus add another 169 cosponsors to Woolsey's bill, or add Pelosi to it and persuade her to badger the rest of the Democrats to get on board? Or, if Bush vetoes Pelosi's war bill, can the Progressive Caucus persuade Pelosi to draft a better bill on attempt number two? After all, Woolsey's bill avoids two of the things most heavily criticized in Pelosi's bill by the White House and Republicans in Congress: it doesn't micromanage the war, and it doesn't fund spinach, peanuts, and the rest of the pet projects. If Woolsey's bill were passed and vetoed, the veto would be a clear statement against ending the war. The veto would also, effectively, end the war. Pelosi would be able to declare victory whether the bill was vetoed or not. And if Pelosi pushed for Woolsey's bill and couldn't get the votes to pass it, at least she would have moved the Democratic Party in the direction of public opinion, exposed those who oppose it, and – again – ended the war.

Of course Bush is more likely to (illegally) signing-statement the bill than to veto it, and the Democratic leadership is already proposing to strip requirements out of the bill so that Bush doesn't even have to do that: http://www.afterdowningstreet.org/?q=node/20532

Other than struggling to end the war, what can we hope for from the Progressive Caucus? What does it stand for? The broad goals are laid out in a one-page document called The Progressive Promise: http://tinyurl.com/yxj4j9

The economic goals include health care, Social Security, jobs, affordable housing, the right to organize, and a restored and indexed minimum wage. But single-payer health care is not specified, the jobs to be created include jobs to accomplish the fascist-sounding task of "improving homeland security," and another nationalistic goal is "to export more American products and not more American jobs." The House has recently passed the Employee Free Choice Act, which would effectively restore the right to organize unions, assuming that it passes the Senate and Bush doesn't veto it, as Cheney has already promised he will. In fact, it's a fairly safe bet that Bush will either veto or (illegally) signing statement any bills aimed at most of the CPC's goals.

The civil rights and civil liberties goals of the Progressive Caucus include changing the PATRIOT Act, though not repealing it; protecting the privacy of Americans; extending the Voting Rights Act; reforming the electoral process; and opposing corporate consolidation of the media. These are all good goals, though rather vague, but if you wanted to protect Americans' privacy, and the president was openly violating both it and the Foreign Intelligence Surveillance Act, wouldn't placing the White House under the rule of law through the process of impeachment be a high priority?

Peace and security goals include bringing U. S. troops home from Iraq as soon as possible; rebuilding U.S. alliances around the world; constructive engagement in the United Nations and other multilateral organizations; combating hunger and the scourge of HIV/AIDS, tuberculosis, malaria, and other infectious diseases; and "encouraging" debt relief for poor countries.

And, finally, environmental goals include freeing ourselves and our economy from dependence upon imported oil and shifting to growing reliance upon renewable energy supplies and technologies, eliminating the environmental threat posed by global warming; and expanding energy-efficient transportation.

It's a good list, but what about specifics? The CPC website has those too, in the form of key bills sponsored by CPC members: http://tinyurl.com/2383rp Here you'll find John Conyers' bill for single-payer health care (62 cosponsors); Barbara Lee's bill for no permanent military bases in Iraq (38 cosponsors); and numerous others. Some of them are bills from the last Congress, and the site needs to be updated.

The focus of the Progressive Caucus right now, however, is the fiscal year 2008 federal budget, on which the CPC has released this position statement:

"…we reject the misleading and grossly unfair budget for FY08 and succeeding years that President Bush has submitted to Congress. While seeking to spend an additional $200 billion in Iraq in just the next two years [that's on top of the $100 billion that 65 members of the CPC just voted for outside the budget] and to make permanent his tax cuts that favor the very wealthiest of Americans, President Bush seeks to impose even greater financial hardship and debt on hard-working American families and our country’s most vulnerable and impoverished people. Enough is enough. WE WILL NOT SUPPORT a budget plan that continues to redistribute income upward and further concentrate our nation’s wealth, as has been federal policy for the past six years. [Emphasis added.]

"Whereas the Bush budget requests $392 billion in FY08 for domestic, non-military discretionary spending – a level below the rate of inflation in the coming fiscal year and frozen thereafter, we favor providing at least $450 billion – the FY05 spending level adjusted for inflation. Furthermore, we favor reducing the exorbitant Bush request of $481.4 billion by $68.7 billion to a defense spending level of $412.7 billion in FY08. [Remember, this does not include all of the extra hundreds of billions for war. Nor does it include non-Pentagon military spending.]

"More specifically, we favor a budget plan that would:
• Save from $420 - $623 billion over the next 10 years by bringing our troops home and achieving U.S. military disengagement from Iraq;
• Save at least $68.7 billion in Pentagon spending by eliminating mostly Cold War weaponry and implementing GAO recommendations to eliminate DOD waste, fraud, and abuse;
• Repeal Bush tax cuts for at least the top 1% on taxpayers, thus raising at least $348 billion;
• Raise tens of billions of dollars in increased revenue by curbing corporate welfare and collecting underreported and delinquent taxes;
• Boost some non-military security funding to enhance homeland security and fight root causes of terrorism; and
• Increase funding for non-military peace and security spending at home and abroad, Hurricane Katrina recovery, renewable energy development, education, health care, veterans’ health care, community development and policing, housing, food and nutrition programs, and child care.

"With these urgent fiscal priorities in mind, we want a fairer, more humane, and responsible federal budget plan for FY08 and ensuing years that truly addresses the needs and hopes of all the American people."

That's a beautiful statement, especially the commitment not to support a budget that distributes money upward.

On Monday, Woolsey introduced the "Peace and Security Budget", a $2.8 trillion alternative budget proposal shaped by the above goals. Woolsey's proposal, if followed for years, would balance the federal budget sooner than Bush's plan or the plans of other Democrats, and it would do so while providing more financial support to health care, education, and renewable energy. It would manage this by trimming little corners of the mammoth military budget and repealing tax cuts for the very wealthiest. This budget would not just eliminate some of the Pentagon's waste, but would also fund efforts that could make us safer, including nuclear nonproliferation, diplomacy, and development assistance.

The Progressive Caucus is where Pelosi should be looking for direction. We've all heard the line: "That would make us look weak on national security." That line is supposed to be based on public opinion, not just the opinions of media corporations and pundits working for Pentagon-funded think tanks. That line is supposed to have something to do with the general American public. But it does not. Take a look at this survey from spring of 2005 by the Program on International Policy Attitudes (University of Maryland): http://tinyurl.com/8jzp5

According to this data, the largest cut by far that most Americans would make in federal discretionary spending is in the military budget, which they would cut by nearly a third. In particular, majorities favor reducing spending on the capacity for conducting large-scale nuclear and conventional wars. Next on the list of cuts after the "defense" budget? The wars in Iraq and Afghanistan. Most Americans believe that spending on economic and humanitarian aid is much higher than it is, and yet they want it increased significantly. Most Americans favor multilateral approaches to security. So does the Progressive Caucus.

Let's hope they mean to stand by this approach.

_____________

MORE INFORMATION FROM THE CONGRESSIONAL PROGRESSIVE CAUCUS:

National defense (050)
The Progressive Caucus Budget will be the only budget alternative offered in this debate that will actually cut even one penny from the Pentagon budget below the full amount that President Bush requested for Fiscal Year 2008 -- an 11% boost over last year.

Unified Security Budget
If Congress fully funds President Bush’s military budget request of $623 billion (including Iraq and Afghanistan operations) for next fiscal year, our nation will spend more on our armed forces next year than at any time since World War II. As Bush Administration officials defend their latest defense spending request before congressional committees, they and their supporters are also arguing for a substantial increase above this amount in future years, even as they disingenuously project spending on the current operations in Iraq and Afghanistan to go down. A consistent theme of these presentations is that military spending currently represents a relatively low percentage of our national Gross Domestic Product. We should spend more, according to this argument, because we can.

This (arguable) idea that we can begs the question of whether we should. As our country seeks to extricate itself from a disastrous attempt to remake the Middle East by means of military force, this is the time for a serious and overdue debate on the long-term direction of our foreign policy. The Bush Administration’s national security doctrine of pre-emptive warfare, drawn up before the current wars were launched, prescribes an expansive, global role for the U.S. military, one that even current levels of spending and manpower don’t come close to covering. After five years of failed tests, it’s time to ask: do the Bush doctrine of preemptive warfare and its costs make sense? Does it make us safer and more secure?

According to current polling, majorities of Americans beyond the Washington, D.C. Beltway believe that our current aggressive, unilateral foreign policy has eroded our standing around the world and made terrorist attacks more likely. They support a different course—a less militarized, less unilateral approach. The Iraq Study Group pointed in this direction by recommending a path out of the current Iraqi quagmire that shifts the emphasis of our national security strategy from military forces to diplomacy.

Meanwhile, the armed service chiefs and civilian Pentagon leadership of the Bush Administration are laying the groundwork to fund the expansive, global military role with a permanently expanded Pentagon budget. This is an urgently-needed policy debate, to put it mildly, worth having. This is one of the principal reasons why we are offering this Progressive Caucus Budget Alternative. We are not serving the American people and American taxpayers well by glossing over this new 21st century budget challenge.

One useful, currently missing tool to ground and better inform the federal budget debate, we argue, would be a Unified Security Budget (USB). It would pull together in one place U.S. spending on all of its security tools: tools of offense (military forces), defense (homeland security) and prevention (non-military international engagement.) A unified Security Budget would make it much easier for Congress to consider overall security spending priorities and the best allocation of them.

It would, for example, enable consideration of security trade-offs like the following: the F-22 fighter jet, one of the most troubled and strategically questionable programs in the arsenal, is set to receive an increase in FY 2008 of $600 million.

• Finding: Foregoing this increase could allow the U.S. to triple the amount it plans to spend on canceling the debt that is crippling development in the poorest countries in the world. Or it could increase by 50 percent U.S. contributions to international peacekeeping operations. Or it could more than triple the amount allocated in FY 2007 for domestic rail and transit security programs.

• Or consider: The cost of one day’s military operations in Iraq—approximately $350 million—would cover the entire requested budget for the State Department’s Office of Reconstruction and Stabilization for a year. This corps of civilian experts in post-conflict rebuilding, envisioned for Iraq and other locations such as Haiti and Sudan, has been an unfunded political football since it was proposed in 2003. The Pentagon supports it. “If you don’t fund this, put more money in the defense budget for ammunition—because I’m going to need it,” one Marine general recently said.

Since 2004, a Unified Security Budget Task Force made up of some of our nation’s leading national security and military strategists has produced an annual report sketching the outlines of a Unified Security Budget. Their expertise spans all three security domains—offense, defense and prevention. We recommend reading their report to all of our colleagues. It lays out the spending levels and relative proportions allocated by President Bush’s FY 2008 budget request to each of them. Let me highlight a few key findings:

• Finding: While cutting most of the rest of the discretionary budget, the Bush request increases real spending in all three security categories. The defense and prevention categories actually get larger increases, as a proportion of their total budgets, than does offense. But in absolute terms, of course, military spending increases the most. And comparatively, defense and prevention remain vastly overshadowed by spending on offense. Foreign policy by military force is underwritten at 21 times the level allocated to all non-military forms of engagement with the world; it receives 14 times the amount devoted to protecting the homeland; it will outspend both defense and prevention put together -- that is, all forms of non-military security spending -- by a factor of 9 to 1. In other words, President Bush wants to devote 90 percent of our foreign and security policy resources to engaging the world through military force.

One of the drivers of this gaping Bush disparity between military and non-military security spending is the federal commitment to a set of dazzlingly complex weapons systems whose capabilities have more to do with pork barrel inertia than strategic sense, and whose future costs are set to grow even larger as many of them move from development to production phases. In making its case for a rebalanced security portfolio, our Progressive Caucus budget identifies cuts in these programs and explains why they can be made with no sacrifice to U.S. national security. And it identifies a nearly equivalent amount for increased investment in activities and programs that engage the world by non-military means—including diplomacy, non-proliferation, and economic development—and that strengthen our homeland defenses.

• Finding: The shift recommended in the Progressive Caucus budget away from spending on offense and additional spending on defense and prevention—would roughly convert a highly militarized security ratio of 9 to 1 into a better balance of 5 to 1.

The hard part will be getting this done on Capitol Hill. A congressional budget process working through “stove piped” committees that rarely talk to each other makes this difficult.

But rebalancing security spending to reflect post 9/11 realities and needs is not a task that can wait. The latest BBC World Service poll shows that U.S. standing in the world has deteriorated substantially in the last year alone. And valuable time is being wasted on key security priorities, such as the one that President Bush has identified as Number One --- preventing nuclear terrorism.

• Finding: Among other cuts in spending on nonproliferation, President Bush’s FY2008 budget request would again reduce spending for Cooperative Threat Reduction, one of the key programs securing and dismantling international stockpiles of nuclear material to keep them away from terrorists. At the same time, the Bush budget would triple spending on new designs for nuclear weapons, in violation of our commitment to the Nuclear Nonproliferation Treaty (giving other countries tacit permission to follow suit.) Meanwhile, the State Department has been reduced to accepting private donations to make up the shortfall on what it views as urgent nonproliferation priorities. Five million dollars of private money recently paid for the removal of two bombs-worth of highly enriched uranium from Serbia. A former State Department official involved in this project said, “It was embarrassing [but] we needed the money.”

As this Congress struggles to find a solution to the crisis in Iraq, it must simultaneously work to strengthen a different kind of overall US presence in the world—one that emphasizes working with international partners to resolve conflicts and tackle looming human security problems like climate change, one that prevents the spread of nuclear materials by means other than regime change, and one that addresses the root causes of terrorism, while protecting the homeland against it. And the rhetoric of these intentions must be underwritten by the resources to make them real. The overall priorities set in a Unified Security Budget must be symbol as well as substance of a new, better balanced U.S. foreign policy and national security strategy.

Fully-funded, safe, orderly U.S. military disengagement from Iraq by the end of 2007.

Let’s start with what is clearly the single largest waste of U.S. taxpayers’ money and the biggest current drain on the U.S. Treasury today – sustaining more than 150,000 brave U.S. soldiers in the middle of the civil war in Iraq. Truth be told, neither President Bush’s budget request or even the budget resolution reported by the House Budget Committee comes anywhere near a complete and accurate accounting of how much of our national treasure we are squandering in the Iraq quagmire. According to the Congressional Research Service, $350 billion has already been spent in Iraq and that total is certain to top half a trillion dollars by the end of FY08, if Congress approves all of the supplemental and regular war-time appropriations President Bush has requested, including for his troop surge. It boggles the mind to contemplate how much more effectively and wisely those funds could have been invested.

No Member of this Congress can claim credibly to be fiscally responsible and not tackle head-on the soaring, unsustainable financial costs of the Iraq debacle. Accordingly, I hope our Republican and Blue Dog Democrats colleagues are listening. The Progressive Caucus budget is the most transparent and accurate when it comes to scoring the fiscal impact of on-going U.S. military operations in Iraq. We can save at least $202.3 billion in just the remainder of FY07 and all of FY08, if we end the U.S. military occupation of Iraq by this coming December 31st. Our budget will save between $420.75 billion and $623.05 billion over the next nine fiscal years based upon and extrapolating from the only CBO estimates currently available about the costs of U.S. military operations in Iraq.

Cutting outdated and unneeded weapons systems ($60 billion/year).
The Defense Department is wrought with waste, fraud, and abuse as it continues to spend in excess of $60 billion a year on holdover Cold War era weapons systems. It’s time that we bring some common sense back to the budget process and see to it that the basic human needs of all Americans come before the needs of the military industrial complex. The Progressive Caucus budget targets weapons programs that are either outdated or poorly conceived from the very beginning for elimination. Despite what a handful of giant defense contractors would have us believe, this inexcusable waste actually makes us less safe. Below is a list of weapons systems that have been identified by military experts, including Dr. Lawrence Korb, former Deputy Secretary of Defense in the Reagan Administration; Admiral Stansfield Turner- Former CIA Director; Vice Admiral John. J. Shanahan; and Brigadier General Dallas Brown, Jr.

Ballistic Missile Defense:
• It has not been realistically tested.
• Moreover, to fulfill then candidate George W. Bush’s campaign promise, the Pentagon took a number of shortcuts that put schedule ahead of performance.
• The shortcuts included insufficient ground tests of key components, a lack of specifications and standards, and a tendency to postpone the resolution of difficult issues.
• Finally, there is increasing evidence that no matter how much money is spent and no matter how long we continue to test it, the system can never work effectively.

Nuclear Arsenal:
• Reduce the number of nuclear warheads that we stockpile from 10,000 to 1,000.
• This would save us $13 billion a year and we would still allow the U.S. to maintain nuclear superiority over the rest of the world.

F/A-22 Raptor:
• The U.S. already maintains air superiority around the world with the current generation of Air Force fighters.
• Few countries have the capability of air to air fighting, which this plane is designed for.
• Originally developed to outpace Soviet MIG technology by anticipating the next generation of MIG, which were never built.
• Canceling the program now would leave the Air Force with 100 of these planes, which is more than enough to combat the any future air-to-air threat that may emerge.

DDG 1000 Zumwalt Class Destroyer:
• Navy already has ships that are focused on the same type of missions, but are more effective.

SSN-774 Virginia Class Submarines:
• Like the F/A-22, these vessels were built to outpace the next generation of Soviet submarine.
• These new vessels fail to go beyond the capabilities of submarines already in service.

V-22 Osprey
• This aircraft that takes off like a helicopter and flies like a jet, has been plagued with technical problems since its inception.
• In the past 25 years development of the V-22 has resulted in 30 deaths, and despite the expenditure of more than $20 billion, it is nearly 15 years behind schedule.

C-130J
• Of the 62 C-130J transport aircraft that have been purchased by the Pentagon, none have met commercial contract specifications. Because of this, the C-130J cannot perform its intended mission of transporting troops and equipment into combat zones and can be used only for training.

F-35 Joint Strike Fighter
• There are immense technological challenges of trying to build three fairly different planes (one for each branch of the military) from one design; the program should not be rushed. This country’s overwhelming numerical and qualitative advantage in tactical aircraft will not soon be challenged.
• As such, this program can be slowed down and done right and in the process save billions of dollars.

Space-Based Offensive Weapons
• Space-based weapons would not significantly expand U.S. military superiority.
• Our conventional and nuclear weapons are already capable of destroying any of the ground targets that space-based weapons would and they can do it at a fraction of the cost.

Future Combat System (FCS)
• While many military experts agree that these systems are useful, the funding for the research is far too aggressive at this point. $3 billion can be saved per year by scaling back this program to a more reasonable pace.

Research, Development, Test and Evaluation (R,D,T&E)
• President Bush has increased this program by more than 50% since coming into office and we are now spending more on R, D, T, &E then during the height of the Reagan build-up. Fighting terrorism hardly warrants such investment in space-based technology.
• As such, this program will be reduced by a less than 7% and save $5 billion a year.

Force Structure
• The Air Force, Navy, and Marine Corps have more than 5,000 tactical combat planes and 1,800 armed helicopters, which is an impractical number for the threat that we currently face. We would reduce the number of two active Air Force wings and one carrier battle group, which would not compromise our security, but would save $5 billion a year.

Implement GAO Reduce Waste, Fraud, and Abuse at the DOD (at least $8.7 billion a year)
Between 2001 and 2006, GAO provided the Department of Defense with 2544 recommendations for improving waste fraud and abuse in their rank. Many of these recommendations are related to improving their business practices. The Department is required to respond to each recommendation and GAO follows up on each recommendation to determine whether the Department has instituted sufficient corrective actions. To date, the Department of Defense has implemented 1014 recommendations and closed 152 recommendations without implementation. The GAO estimates that the 1014 implemented recommendations have yielded the Department of Defense a savings of $52.7 billion between fiscal years 2001 and 2006. The savings realized from the
implementation of these recommendations has been extraordinary. With this in mind, the DOD should take immediate action to implement as soon as possible the remaining 1,378 recommendations to achieve further substantial savings.

International affairs (150)

SMART Security
Weapons of mass destruction, far-flung terrorism, grinding poverty, and corrupt, oppressive nationalistic governments represent urgent threats to peace and security in the 21st Century. It is more important now than ever to address the root causes of terrorism and violent conflict to prevent future acts of terrorism from occurring. The Progressive Caucus ‘Peace and Security’ budget would rely upon what we call a Sensible, Multilateral American Response to Terrorism (SMART) Security Platform for the 21st Century. It will operationalize a more effective national security strategy than the Bush doctrine of preemptive warfare and focus more of our limited resources upon nonproliferation, conflict prevention, international diplomacy, and multilateralism. SMART security in action means:

• Working with the UN, NATO and other multilateral organizations to root out terrorist networks and cut off their funding and bases of support;
• Strengthening intelligence and law enforcement, while respecting human rights and protecting civil liberties;
• Pursuing diplomacy, enhanced inspection regimes, and regional security arrangements to reduce the proliferation of nuclear weapons;
• Ceasing the sale and transfer of weapons to regimes involved in human rights abuses and to regions of conflict;
• Increasing development aid and debt relief for the world’s poorest countries;
• Reducing dependence on foreign oil by promoting long-term energy security through greater investment in sustainable and renewable alternatives; and
• Supporting civil society programs as a critical component in the prevention and resolution of violent conflict.

The terrorist attacks of September 11th understandably have left many Americans feeling less secure and more fearful of attack at home and abroad. We have no greater responsibility in Congress than to ensure the security of the American people, but we meet that solemn duty in a smarter, more cost-effective way. The Progressive Caucus budget will enable us to do just that. While it may often be frustrating and time-consuming to engage in hard-nosed negotiations with our potential adversaries, doing so will prove far less costly and will make the world more peaceful than aggressive unilateralism.

Global Fund to Fight HIV/AIDS, Tuberculosis, and Malaria (+$1 billion):
It is also in our national security interests for America to do more to meet the world’s growing humanitarian crises. Let me cite just one example from our Progressive Caucus budget.

The Global Fund has achieved significant success in the last five years since it became operational. As of December 2006, 770,000 people are now on lifesaving AIDS treatment, 2 million people have been treated for TB and 18 million bed nets have been distributed to protect families against malaria. As a result, since its creation 1.5 million lives have been saved worldwide. Historically, the U.S. has provided nearly one-third of all funding to the Global Fund and it is critically important to maintain our strong support as we work to turn the tide against these pandemics. This increase in funding is necessary to help pay for a new round of grant funding, Phase II of existing grants, and to support the longer term renewal of grants that have completed their initial five year funding period.

Energy (270)

Investing in clean, renewable energy sources
If we want a more peaceful, secure world, then America must act with a sense of urgency to end our growing dependency upon imported oil and bring on line the full range of renewable energy technologies. We need a national commitment to accelerate the development and commercialization of renewable energy sources on the scale of the Manhattan Project during World War II or the moon shot of the 1960s. That is what we provide in the Progressive Caucus budget.

It calls for spending $30 billion/year for the next decade to create 3 million new, clean energy jobs to free America from foreign oil dependence. We want to reinvest in the competitiveness of American industry, rebuild our cities, create good jobs for working families, and ensure good stewardship of both our national economy and the environment we share with the rest of the world.

Community and regional development (450)

Community Development Block Grants (CDBG)
These grants are given to local governments to promote community and economic development. Community development block grants are also vital to helping our local communities (including those devastated by Hurricane Katrina) meet their needs for affordable housing including homeownership assistance, construction of housing, rehabilitation of existing housing, and energy efficiency improvements. While the President has repeated targeted this program for cuts, the Progressive Caucus Budget increases funding for this program to $4.1 billion in FY08.

Education, training, employment, and social services (500)

Fully Fund Title I of No Child Left Behind.
• No Child Left Behind has been under-funded by $70 billion since it was enacted. It is time that we make a serious commitment to the children of this nation and fully fund the most comprehensive educational policy. The CPC Budget Alternative fully funds Title I which allows an additional 4.5 million children to receive needed services. These services are essential to closing achievement gaps. In the 2005-06 school year, almost 11,000 public schools had already failed to make Adequate Yearly Progress (AYP) for two or more years under NCLB provisions, and thus faced federal sanctions. These schools and the students they serve will face even greater challenges in the coming year as testing requirements go into full effect. If a school doesn’t meet AYP, we need to help them, not deliver punitive measures. Schools need to be given flexibility and encouragement if they don’t meet AYP. In addition, we need to put more money into designing the best possible quality tests. If we are going to put all of our faith in the tests to be indicators of achievement, those tests need to be the best they can be.

Meeting the Federal Governments promise to fund IDEA
• Over six million children with disabilities between the ages of 3 and 21 receive special education services. Recognizing the importance of federal assistance in helping states and schools fund special education services, the federal government has pledged to fund 40 percent of the average nationwide per pupil expenditure to help meet the costs of educating students with disabilities. Yet, despite significant progress in the last few years, actual federal expenditures provide only 18 percent, far short of this goal. That’s why the CPC Budget fully funds our commitment to helping disabled children.

• The lack of sufficient funding to meet the needs of students with disabilities also places considerable strain on the entire school budget, as local officials are forced to increase tax revenue or cut other critical programs to provide mandated IDEA services. Inadequate special education funding impacts services to all students. Efforts to improve student achievement through implementation of higher standards, and other discretionary educational reforms, often must take a back seat to the provision of mandatory IDEA services. This is particularly true as states face mounting budget pressures and financial shortfalls, necessitating cuts in discretionary services. Meeting the federal commitment to fully fund IDEA would relieve this pressure on school districts and free up local funds for other vital education services.

Restoring cuts to job training programs
The Progressive Caucus Budget increases funding for job training to the FY02 approved level (an increase of $1.6 billion per year), which is the last year of effective funding before massive cuts began. Returning funding to the FY02 level is a down-payment on increasing our commitment to having the best trained, strongest, and most competitive workforce in the world. Increased globalization has cost many Americans the good paying jobs of their fathers. We need the ability to retrain these workers to accommodate a changing economic base and ensure that working Americans are able to adjust.

Health (550)

SCHIP
As a down payment on bringing healthcare to all Americans, the Progressive Caucus budget moves to cover all children who are eligible under the SCHIP program. Currently, the program is grossly under funded and leaving needy children with health care. This is no way for the wealthiest nation in the world to treat its neediest and most vulnerable citizens. That is why the Progressive Caucus budget invests $75 billion over the next five years and $230 billion in the next ten years in SCHIP.

Funding for HIV/AIDS Prevention and Treatment in America:
According to the Centers for Disease Control and Prevention, racial and ethnic minorities represent 71% of new AIDS cases and 64% of Americans living with AIDS. African Americans account for 50% of new AIDS cases, although only 12% of the population is black. Hispanics account for 19% of new AIDS cases, although only 14% of the population is Hispanic. Despite these trends, funding for the Minority AIDS Initiative has remained relatively flat funded over the last seven years at approximately $400 million. Additional funding will allow for increased technical assistance, capacity building, and targeted outreach in minority communities.

The Ryan White Comprehensive AIDS Resources Emergency (CARE) Act makes federal funds available to metropolitan areas and states to provide a number of health care services for AIDS patients including medical care, drug treatments, dental care, home health care, and outpatient mental health and substance abuse treatment, and also directly funds capacity building and outreach activities for community based organizations. Each year the CDC estimates that another 40,000 people become infected with HIV/AIDS. With the re-authorization of the CARE Act at the end of last year, increased funding is necessary to help provide prevention/treatment/care services in localities with emerging HIV epidemics that have been added to the CARE Act, while maintaining ongoing support for areas with mature HIV epidemics. This funding will also support increased drug treatment through the AIDS Drug Assistance Program (Title II of the CARE Act), by providing anti-retroviral therapy to an additional 17,663 clients who will be able to access services through ADAP.

The CDC funds critical surveillance and prevention programs for a range of infectious diseases. Increased funding is necessary to support prevention efforts around HIV/AIDS, Tuberculosis, Hepatitis, and other Sexually Transmitted Diseases (STD's). HIV prevention funding at the CDC has faced budget cuts totaling almost $50 million over the past four years. In those same four years 160,000 people have become infected with HIV as the number of annual new infections in the United States has steadily remained at 40,000. Funding is also necessary to combat the rise of a new extremely-drug-resistant strain of tuberculosis (XDR-TB) which has appeared as a result of HIV-TB coinfection and poor adherence to TB treatments. XDR-TB has just recently been identified by the World Health Organization in over 28 countries worldwide including the United States. Because of the lack of an effective treatment regimen and the high mortality rate of individuals diagnosed with XDR-TB, it is critical that we scale up funding for surveillance and prevention to stop this disease from spreading.

Income security (600)
Sec. 8 Housing
Decent and affordable housing should be a basic right. The ability to feel safe, sheltered from the elements, and enjoy your own privacy is of immense importance. Because of this, the CPC budget invests and additional $1.6 billion dollars a year in the Section 8 program to provide housing for those who need it (including Hurricane Katrina victims.) This amount would allow for the cost of renewing all vouchers in use this year, plus funding for 100,000 new "incremental" vouchers to address unmet need & long waiting lists.

Food Stamps and Hunger Prevention
More than ten years after enactment of the 1996 law, the resulting cuts in food stamp benefits contained in that law continue to deepen with each passing year and to affect most food stamp households, including most of the working poor and the elderly poor. Each year, food stamp households are able to purchase less food than the year before. The Progressive Caucus budget will enable the standard deduction to rise to $188 in 2008 and adjust it annually thereafter for inflation, thus restoring the standard deduction fully to its pre-1996 level for all household sizes (including Hurricane Katrina victims.) A typical household of three or fewer members will see its benefits increase by about $24 a month.

Veterans’ benefits and services (700)

Keeping our promises
The Progressive Caucus budget makes veterans’ health care a new federal entitlement. It will require the U.S. Secretary of the Treasury to make mandatory appropriations for VA health care based upon the following formula: the amount of funds available for VA medical care in FY2008 would equal 130% of the total obligations made by the VA for medical care programs in FY2005. The amounts in succeeding years would be adjusted for medical inflation and growth in the number of veterans enrolled in VA’s health care system and other non-veterans eligible for care from the VA. For the first time in our nation’s history, every one of our veterans returning from service in Iraq, Afghanistan, or elsewhere and every other U.S. veteran of other conflicts will have the peace of mind of knowing that guaranteed funding for his/her health care (including mental health benefits) will be available.

General Government (800)

Election reform, including but not limited to HAVA improvements
The Progressive Caucus budget would provide an additional $522 million yearly for FY2008-2012 for the Election Assistance Commission (EAC) to assist each state in paying for implementation of voter verification systems, improvement of security measures, related security consultation services, and improved election services/administration. $20 million will be provided yearly for FY20013-2017 for additional improvements to election administration and procedures.

Revenue

Restoring fairness to the Tax Code
The Progressive Caucus budget will restore substantial progressivity to the federal tax code. It will rescind all of the Bush 2001 and 2003 tax cuts for the top 1 % of households earning an average of more than $1 million/year. Tax breaks for the top 1% that would be rolled back include:
• Restoring top income tax bracket to 39.6%, raising at least $96 billion;
• Repealing capital gains and dividend tax breaks, raising at least $74.4 billion;
• Rolling back the estate tax break, raising at least $74.2 billion; and
• Repealing all additional tax breaks for the top 1%, raising at least $177 billion.
It will also close the tax gap by at least $9.5 billion/year. A recent analysis by the IRS estimates that the federal government collects approximately $345 billion less than is owed to it annually. Most of this tax gap results from underreporting of income and failure to collect reported tax obligations. This amounts to a 16% noncompliance rate. In addition IRS enforcement apparatus is seriously under funded, which makes it hard to collect even known tax debts, not even taking into account tax cheats. The National Treasury Employees Union estimates that $31 in lost tax revenue can be collected for every additional dollar invested in the IRA enforcement and collections apparatus. Finally, the Progressive Caucus budget will increase federal revenue by at least $17.1 billion/year for the next year by cracking down on corporate welfare. It will close some of the copious tax loopholes and special interest tax breaks every year for the next decade. Examples include:
• Elimination of corporate tax incentives for off-shoring jobs. The tax code has a number of preferences that directly or indirectly encourage U.S. companies to relocate operations and jobs overseas;
• Revaluation of LIFO inventories of large, integrated oil companies. Under current law, these companies are generally permitted to use a last-in, first-out (LIFO) method to account for their inventories, provided they use the same accounting method for other reporting purposes. Consequently, when prices are rising (as with oil prices in recent months), the LIFO Method generally reduces the business’ income and its tax liability;
• Elimination of tax deferral for American-owned foreign corporations. “Deferral” of taxes on profits that American-owned corporations claim to earn offshore is really more like an exemption for income that is styled as “foreign.” The Joint Committee on Taxation projects the cost to be $6 billion/year; and
• Elimination of percentage depletion for property from which oil and gas are derived. Percentage depletion for oil and gas properties is a particularly glaring feature of our energy tax policy. Most businesses must write off the actual costs of the property over its useful life (until it wears out.) If oil companies had to do the same, they would write off the cost of oil fields until the oil was depleted. Instead, some oil companies get to simply deduct a flat percentage of gross revenue. The percentage depletion deductions can actually exceed costs and can zero out all federal taxes for oil and gas companies. The Joint Tax Committee projects the cost to be $4.7 billion/year

Going Broke Under Bush - Returning Vets Could Cost VA Close To $700 Billion Dollars

CactusPat — Thu, 08 Feb 2007 05:38:30 -0500

More beans, another sampling of how we're all gonna go broke under Bush's multi-trillion dollar tab... Amy Goodman interviews Linda Bilmes, Havard professor whose study caused the VA and Pentagon to "re-calculate" how wounded US service personnel are counted.

Hidden Costs of War: Long-Term Price of Providing Veterans Medical Care Could Reach $660 Billion - Over 200,000 soldiers deployed to Iraq and Afghanistan have been treated at Veterans Affairs medical facilities thus far, with 900,000 still deployed on active duty. A new study from Harvard University predicts that the cost of medical care and compensation benefits for returning veterans will skyrocket once those troops return home... (more) A new study from Harvard University reports that the hidden financial costs of war in Iraq and Afghanistan will overwhelm the Department of Veterans Affairs for decades. The study, titled “Soldiers Returning from Iraq and Afghanistan: The long-term costs of providing veterans medical care and disability benefits,” finds that the Veterans Administration is both under-funded and under-equipped to deal with the current and future costs of veterans’ health care.

The study estimates that since the Global War on Terror began, 16 US soldiers have been wounded per fatality, a casualty rate that exceeds the rate of previous wars. Over 200,000 soldiers deployed to Iraq and Afghanistan have been treated at VA medical facilities thus far, with 900,000 still deployed on active duty. The study predicts that the cost of medical care and compensation benefits for returning veterans will skyrocket once those troops return home. It also estimates that the cost over the soldiers lives will amount to up to seven hundred billion dollars.

The author of this study, Professor Linda Bilmes, joins me now from Boston. Professor Bilmes is former Assistant Secretary of Commerce in the Clinton Administration, and a Lecturer at Harvard University's Kennedy School of Government. Welcome to Democracy Now!

* Linda Bilmes, lecturer in Public Policy at Harvard's Kennedy School of Government. Author of the study, “Soldiers Returning from Iraq and Afghanistan: The Long-term Costs of Providing Veterans Medical Care and Disability Benefits;" Linda Bilmes was Assistant Secretary of Commerce in the Clinton Administration. She is co-author, with Nobel laureate Joseph Stiglitz, of “The Economic Cost of the Iraq War: An Appraisal Three Years after the Beginning of the Conflict.”

RUSH TRANSCRIPT

This transcript is available free of charge. However, donations help us provide closed captioning for the deaf and hard of hearing on our TV broadcast. Thank you for your generous contribution.

AMY GOODMAN: A new study from Harvard University reports the hidden financial costs of war in Iraq and Afghanistan will overwhelm the Department of Veterans Affairs for decades. The study is called “Soldiers Returning from Iraq and Afghanistan: The Long-Term Costs of Providing Veterans Medical Care and Disabilities Benefits.” It finds the Veterans Administration is both under-funded and under-equipped to deal with the current and future costs of veterans’ healthcare.

The study estimates since the global war on terror began, sixteen US soldiers have been wounded per fatality, a casualty rate that exceeds the rate of previous wars. Over 200,000 soldiers deployed to Iraq and Afghanistan have been treated at VA medical facilities thus far, with 900,000 still deployed on active duty. The study predicts the cost of medical care and compensation benefits for returning veterans will skyrocket once those troops return home. It also estimates the cost over the soldiers lives will amount up to $700 billion.

The author of the study, Professor Linda Bilmes, joins me now from Cambridge. Professor Bilmes is former Assistant Secretary of Commerce in the Clinton administration, a lecturer at Harvard University’s Kennedy School of Government. Welcome to Democracy Now!, Professor Bilmes.

LINDA BILMES: Thank you, Amy.

AMY GOODMAN: It’s good to have you with us. Lay out what you have found, what you were most surprised by, in this study.

LINDA BILMES: Well, what I was trying to do was to understand how prepared the Veterans Administration is to cope with the large influx of soldiers who were returning from the war. And what we found was that the VA is really overwhelmed by the sheer volume of returnees on three dimensions. First of all, in terms of the disability claims, see, when soldiers come back who have been injured or down the road suffer some kind of problem or a problem was exacerbated by being over there, they can claim for a certain amount of disability payment. And right now, the Veterans Administration has a backlog of 400,000 pending claims. many of them even from previous wars. So they really are not prepared to cope with a large influx of additional claims.

Secondly, the care provided by the VA is very good, but many veterans are having to go onto long waiting lists, particularly for mental health care, because such a very large number of veterans have been seeking help for mental health conditions.

And thirdly, the cost of providing care, good quality care to the veterans will range from a minimum of $350 billion to nearly $700 billion, depending on the length of the war and the percentage of veterans who seek care through the VA. (watch/read/listen to the full interview)

in related news, Sen.'s Barack Obama and Olympia Snowe have teamed up to demand accurate causualty counts from the VA and Pentagon...

Snowe asks Pentagon to include non-combat injuries in reporting
Wednesday February 07, 2007
WASHINGTON (AP) Veterans groups and Sen. Barack Obama say government officials are obscuring the actual number of wounded in the Iraq and Afghanistan wars by leaving out of some public documents troops who suffer non-combat injuries.

From the Pentagon Web site to press materials handed out at the opening of an amputee center in Texas last week, the number of wounded in the wars often circulated publicly is around 23,000.

That number only accounts for those wounded in combat. When troops from those wars who were wounded in other ways are counted, the number more than doubles, to about 53,000.

That latter number is not heavily circulated by the Pentagon. Recently, a Defense Department official publicly criticized a researcher who used it and pressured another government agency to change a public document to report the smaller number.

``This is a clear pattern by VA and DOD to conceal the escalating human and financial costs of the two wars from Congress, the press and the public,'' said Paul Sullivan, veterans advocacy director with Veterans for America.

Obama, D-Ill., and a presidential hopeful, wants the government to be more straightforward in reporting on the wounded. He has introduced legislation with Sen. Olympia Snowe, R-Maine, to require the Veterans Affairs Department and the Defense Department to ``start keeping honest figures on our troops and the potential future costs of the war.''... (full report)

Counting Beans and Benjamins

CactusPat — Tue, 06 Feb 2007 06:40:04 -0500

There's been a lot a big numbers floated by the past few days. Let's review, first the really big one, Smirk's Three Trillion Dollar budget which includes $719 BILLION for the starving military, including almost $300 billion for ongoing war crimes in Iraq and Afghanistan. So how does he plan to pay for this obscene increase in US global military domination? By cutting the budget for Medicare, Medicaid, education, health care and children's programs. What a mean heartless little tyrant our illegitimate Dear MisLeader... (more)

Yes, that's right, pay for increased US global fascism on the backs of the elderly, the poor, the sick, and the young while making the Bush tax cut's for the rich permanent. If this proposed budget and military spending increase at the expense of the most vulnerable in our society isn't evidence of outright insanity, they'll ne'er be another.

"The president's budget is filled with debt and deception, disconnected from reality, and continues to move America in the wrong direction. This administration has the worst fiscal record in history and this budget does nothing to change that. It clings to the same misguided policies: costly tax cuts that primarily benefit the wealthiest, cuts in domestic priorities and more fiscal irresponsibility." _ Senate Budget Committee Chairman Kent Conrad, D-N.D.

On to more beans and benjamins. The CBO released an analysis that indicates Smirk didn't tell the whole truth about his escalation of the Iraq War. According to the CBO estimate, the total troop "surge", w/supporting personnel, is likely to be in the area of 48,000, not the advertised 21,500... while low-balling the projected cost, $20-27 billion for a one yr. deployment according to the CBO.

Final beans and benjamins. Bush has doubled outsourcing to private contractors from $200 billion to $400 billion a year. An unbelievable privatization of government functions. For profit... by sleazoids who've already defrauded the taxpayers repeatedly.

Washington - In June, short of people to process cases of incompetence and fraud by federal contractors, officials at the General Services Administration responded with what has become the government's reflexive answer to almost every problem.

They hired another contractor.

It did not matter that the company they chose, CACI International, had itself recently avoided a suspension from federal contracting; or that the work, delving into investigative files on other contractors, appeared to pose a conflict of interest; or that each person supplied by the company would cost taxpayers $104 an hour. Six CACI workers soon joined hundreds of other private-sector workers at the G.S.A., the government's management agency.

Without a public debate or formal policy decision, contractors have become a virtual fourth branch of government. On the rise for decades, spending on federal contracts has soared during the Bush administration, to about $400 billion last year from $207 billion in 2000... (full article)

Someone needs to impeach Bush and Cheney and remove their greedy little paws from our purse strings before we, and our great-grandchildren, end up in never-ending servitude.

Impeach, indict, imprison...