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A Good Day for American Deplomacy

by Brian T. Lynch, MSW

Diplomats are our solders for peace. They should be treated like the great patriots and heroes that they are. For too long they have been put on the shelf or forgotten. President Obama set them to work again for America, for all of us.

Today Iran released the American journalists and others that it held hostage in Iran for months. And now the NY Times says Iran has dismantled major parts of its nuclear program, paving the way for sanctions to be lifted. The UN Nuclear Agency is reporting that Iran has met all of its commitments in the Landmark nuclear deal with six world powers. This appears to be a major triumph of American diplomacy and for world deplomacy. Let’s celebrate and see who cares to joins in the celebration!!!

Un-Taxing the Rich is the Root Cause of the Public Pension Crisis

by Brian T. Lynch, MSW

What follows is a letter I wrote to New Jersey’s principal newspaper, which is constantly trying to convince us that the huge pension deficits created by bad public policy decisions (or perhaps by intentional public union busting strategies) can’t be fixed without dismantling the whole system and starting over. All options to do this create great sacrifices by hard working servants of the people who were promised pensions in exchange for lower lifetime wages than the private sector would be paid for comparable work.

What makes this relevant beyond New Jersey’s boarders is that public employee pension systems are under similar financial assaults in nearly every state. It is a pattern so powerful that it has to be part of a bigger plan.

Dear editor:

“Taxing the rich won’t solve pension problems” claims the Star-Ledger in its editorial. Their point is that the “millionaire’s tax” vetoed by Gov. Christie wouldn’t plug the current pension gap.

This is true, but the larger point is that the “un-taxing” of the rich and the wealthiest companies in New Jersey is the real reason we have a crisis. Stack up all the tax money not collected due to corporate tax breaks and tax cuts given away since the Whitman administration until now and it would tower over the cash it would have taken to pay pension obligations from the beginning.

Money is fungible. Whenever tax revenue is deleted from the budget, someone’s ox has to be gored. For decades that ox belonged to State employees. Their pensions is part their wage package and the reason their overall compensation is roughly parallel with the private sector. Not funding it was a deliberate choice.

Another fact hidden in plain view is that revenue deleted from the budget doesn’t have a line item to remind us of what’s missing. We end up blindly subsidizing profitable corporations instead of properly compensating ordinary folks who work for us.

It’s disingenuous for politicians (or the Star-Ledger) to speak of pension reform without also discussing the massive tax breaks that created this crisis. If tax cuts for businesses and people who don’t need it were rescinded, there would be plenty of revenue to fund the pensions.

BLOG NOTE: If this is happening in your state, of if you are from New Jersey and want to do something about the pension mess, feel free to use this as a template for your own letter to the editor or to your representatives in government.

Is Obamacare Helping Anyone Stay Healthy?

by Brian T. Lynch, MSW

Let’s say you really want to know if Obamacare has had a positive effects on keeping people healthy. Partisan politics makes it difficult to get any concrete or objective answers to this or any questions regarding the Affordable Care Act (ACA). So how would you go about finding the answer?

You could find out by designing your own study. You might start by looking at diseases that are silent killers because these have permanently damaging effects long before there are physical symptoms.

Diabetes is just such a disease. According to medical sources, as many as one person in four have diabetes and don’t know it. The longer it goes undetected the more it damages your internal organs, yet a simple blood test and doctors visit is all it takes to uncover and control this disease.

Now imagine that you have results of 400,000 diabetes blood tests nationwide from which you could pull out all the newly diagnosed cases. First you sort the new case in 2013, before any Medicaid expansion, from the 2014 cases after the expansion. Next you sort the new diabetes cases from each period by the 26 states that expanded Medicaid from the 24 states that refused. A concrete measure of an improved healthcare outcome would be finding that there was an increased rate of diabetes detection in the expansion states over the non-expansion states.

Just such a study was done and published this week (March 21, 2015) by Qwest Diagnostics, a national medical laboratory. What their analysis discovered was a 23% increase of newly diagnosed cases of diabetes in the states that expanded Medicaid in 2014. There was only a 0.4% increase in new diabetes cases from states that did not expand Medicaid. What’s more, they were able to see a trend towards earlier detection of diabetes in the expansion states. Earlier detection means fewer heart attacks, strokes, kidney transplants, amputations, blindness and premature deaths. This, in turn, means a healthier population and lower health care costs over time.

Thousands of people will now lead healthier lives and live to their full potent in those 26 states that expanded Medicaid under the ACA. The number of people who could have been covered by the expansion roughly equals the number who got coverage in 2014. This means an almost equal number of people will likely experience needlessly declining health due to undiagnosed diabetes. The states that don’t expand Medicaid will have higher healthcare costs in the future resulting from a less healthy population.

The news isn’t all bleak for the poor or elderly in states that didn’t expand Medicaid. A report by the Avalere Health organization recently found that there are 550,000 new enrollees in standard Medicaid in 15 states that have not expanded Medicaid. They attribute this rise in enrollment to the “woodwork effect,” caused by increased public awareness and publicity surrounding Obamacare. These are individuals who were eligible for standard Medicaid but hadn’t applied. It is safe to presume that some of them will benefit from the early detection of diabetes.

From this one Quest diagnostics study alone the answer is clear. The Affordable Care Act is having a positive effect on the health and well-being of citizens in those states that expanded Medicaid. There are other silent killers that can easily be detected early while treatments and cures are still possible, such as high blood pressure and many types of cancer. If earlier detection of these diseases are also resulting from Medicaid expansion, this would be overwhelming evidence that the ACA is improving health outcomes.

Expanding Medicaid doesn’t cost the states any additional revenue for the first few years. After that there is significant reimbursements from the Federal Government. Refusing Medicaid expansion actually costs states millions of dollars in uncompensated care right now. Doing this on ideological grounds is not a principled position, not when it clearly results in a less healthy population and increased medical expenses for the foreseeable future.

I close with a quote from the actual Quest Diagnostics study findings:

Actual Study Findings:

“We identified 215,398 and 218,890 patients who met our definition of newly diagnosed diabetes within the first 6 months of 2013 (control period) and 2014 (study period), respectively (a 1.6% increase). We identified 26,237 Medicaid enrolled patients with new diabetes in the control period vs. 29,673 in the study period: an increase of 13%. The number of Medicaid-enrolled patients with newly identified diabetes increased by 23% (14,625 vs. 18,020 patients) in the 26 states (and District of Columbia) that expanded Medicaid compared with an increase of 0.4% (11,612 vs. 11,653 patients) in the 24 states that did not expand Medicaid during this period. Similar differences were observed in younger and older adults and for both men and women.”

————————————————————————————————–

Quest Diagnostics Diabetes Study: http://care.diabetesjournals.org/content/early/2015/03/19/dc14-2334.full.pdf+html

Avalere Health Report: http://avalere.com/expertise/managed-care/insights/avalere-analysis-medicaid-non-expansion-states-experience-up-to-10-enrollme

What Do We Know About Police Homicides?

I’ve started the following petition:

“Barack Obama and Harry Reid and John Boehner: Pass a law mandating that law enforcement must file a report with the FBI every time a police shooting results in the death of a citizen.”   I am asking for your help to get this petition off the ground.

Will you take 30 seconds to sign it right now? Here’s the link:

http://www.change.org/p/barack-obama-and-harry-reid-and-john-boehner-pass-a-law-mandating-that-law-enforcement-must-file-a-report-with-the-fbi-every-time-a-police-shooting-results-in-the-death-of-a-citizen

Here’s why it’s important:

Do you know how many people are shot and killed by law enforcement every year? No? Well neither does anybody else. Records aren’t collected for what is called police homicides, which includes justifiable shootings.

There are 17,000 law enforcement agencies in the United States, including local municipal police, but no national database to track police killings of civilians. The FBI maintains a partial data based of reports submit on a voluntary basis. Only 750 law enforcement agencies, just 44% of all agencies, volunteer to submit police shooting data. What the FBI  collects and reports are only those cases in which police homicides were considered justified by the departments reporting them.  There is no auditing or review process either. And some law enforcement agencies, such as the US Border Patrol, don’t even have to report people they shoot and kill to their command.

When government law enforcement officers kill civilians it is our right to know about it. We are all ultimately responsible for the actions of our government. The first logical step is to require that a record be kept and available for public inspection.

So, what does the current, ver very limited information on police homicides show right now?

There are about 400 justified police homicides per year. Every week in this country there are two incidents like the one in Ferguson, Missouri, involving a white police officer shooting a black citizen. About half of all police homicides involve black citizens, and among the population of folks 21 years old or younger, the police homicide rate for blacks is 18%, twice the rate for white citizens (8.7%).

Again, these numbers are based on voluntary self-report from less than half of all law enforcement agencies nation wide.  It seems evident from what we know and don’t know that collecting better, more complete information about police homicides is important.

You can sign my petition by clicking here.

Thanks!
Brain Lynch

Our Chronic Wage Stagnation, Symptoms and Treatments

by Brian T. Lynch, MSW

Decades of frozen wages relative to our expanding wealth is the root cause of many economic problems. More people falling into poverty, a shrinking middle class, declining retirement savings, increased welfare spending, higher unemployment, more aid to working families, declining government tax revenues, diminished funding for Social Security and Medicare, a sluggish economy (despite a record high stock market), slow job growth and heighten social tensions along the traditional fault lines of race, ethnicity and gender are among the many issues influenced by decades of wage stagnation.

Beginning in the late1970’s most American workers received only cost of living adjustments in their paychecks while their real earnings gradually diminished each year. Employers increased hourly wages to keep pace with inflation, but they suddenly stopped raising wages to reward workers for their productivity. Earned income has declined for most Americans as a percentage of our gross domestic product (GDP) This amounts to a dramatic and intentional redistribution of new wealth over the last 40 years. Nearly all this new wealth has gone to the rich and powerful.

The visual evidence of wage stagnation relative to hourly GDP is apparent in one powerful graph (below). You may have this it before.

hourly GDP vs Wage graph

 

SYMPTOMS

The effects of wage stagnation on our economy have been gradual and cumulative. Its impacts don’t raise red flags from one year to the next, but the cumulative effects are obvious. The trending rise in income inequality, for example, was missed entirely for 25 years, and then it still took another decade for it to catch the public’s attention.

According to USDA data on the real historical GDP and growth rates[i], the U.S. economy grew by $368 trillion between 1976 and 2013. That is a 109.4% rise in national wealth, more than a doubling of the national economy. Almost none of that wealth was shared with wage earners. If hourly wages continued to grow in proportion to hourly GDP, as it had for decades prior to the mid-70’s, the current median family income today would be close to $100,000 a year instead of the current $51,017 per year.[ii]

Think about that for a moment, and about all the implications for wage based taxes and payroll deductions. For simplicity sake, let’s say wages would have double if the workforce received productivity raises. That would significantly reduce the number of families currently eligible for taxpayer subsidies such as SNAP (food stamps), housing assistance, daycare and the like. At the same time the workforce would be generating much more income tax revenue.

Consider next the impact wage stagnation has had on payroll deductions. Social Security and Medicare premiums have not financially benefited from the growing economy. Double current wages and you double current revenues for these programs as well. Moreover, the economy has grown at an annual rate of 2.9% since 1976. If Social Security and Medicare had benefited from this new annual wealth, the effect on current revenue projections would be profound. We would not be looking at a projected shortfall any time in the future.

The impact of wage stagnation on consumer spending is perhaps the most insidious problem. While worker wages have stagnated, the production of goods and services has grown. How is that possible? Some of this production is sold in foreign markets, but domestic markets are still primary. And it is here where economic theories have done a disservice.

A generation of economists and business leaders have treated consumers and workers as if they were not one and the same. This has fractured how we look at the economy and given rise to the notion that labor is just another business commodity. It disguises the fact that labors wages fuel consumer spending. Wages help drive the whole economy while wage stagnation reduces consumption over time.

To overcome this effect we have seen the need for mother’s to enter the workforce in mass, and for banks to invent credit cards to bolster consumer spending. These and other creative measures can no longer forestall the decline in worker spending. So while the financial markets ride the tide of America’s growing wealth, the fortunes of those who have been cut off from that new wealth continue to slip beneath the waves.

As for social tensions among different racial, ethnic and gender groups, the effect of stagnant wages relative to the nation’s growing wealth creates a lifeboat mentality and zero sum thinking. For the first time in many generations parents are worried that their children will have less in life than they had. When the whole pie is shrinking a bigger slice by one person means a smaller piece for others. This thinking exists because for over 95% of wage earners the economic pie hasn’t grown in 40 years.

TREATMENTS

You may not be ready to accept chronic wage stagnation as “the syndrome” underlying our economic woes, but it’s also true from my experience that having solutions (or “treatment options”) at hand often makes it easier to identifying the problems they resolve. With that in mind, I want to offer some solutions to America’s low wage conundrum.

One direct approach to raising worker wages is the one currently being discussed in the public dialogue, raising the minimum wage. This benefits the lowest paid workers and also puts pressure on employers to increase pay for other lower wage earners. The current target of $10.10 per hour would still leave many families at or below the poverty line. Workers making the new minimum wage would still be eligible for some public assistance for the working poor. While passing a minimum wage law is at least possible, this option is not a systemic solution to wage stagnation. Even index the minimum wage to inflation would not compensate for declining wages relative to GDP growth.

Another direct approach to ending wage stagnation is to pass a living wage law. This would set the minimum wage at a level that would allow everyone working full-time to be financial independent from government assistance, including subsidized health care. A living wage law could be indexed to the local cost of living where a person is employed. This is idea because it takes into account local economic conditions which are determined by market forces rather than government edict. But passing a living wage law in the current political climate is unlikely.

There are other ways of encouraging wage growth that don’t involve direct wage regulation. One idea would require the federal government to recoup, through business income tax rebates, the cost of taxpayer supported aid to working families from profitable businesses that pay employees less than a living wage. Employee wages are easily identified through individual tax returns. Eligibility for taxpayer supported subsidies are relatively easy to estimate as well, so recouping public funding to support a company’s workforce is a practical possibility. A portion of the recovered money could be paid into Social Security and Medicare to make up for lost revenue due to substandard wages.

A welfare cost recovery plan could gain popular support given the growing public resentment towards taxpayer funded social programs. At least 40% of all full-time employees in America currently require some form of taxpayer assistance to financially survive. More importantly, this plan places the burden of supporting the workforce back on profitable businesses where the responsibility lies.

Another solution has been suggested by former US Labor Secretary, Robert Reich, and others. They support proposed legislation, SB 1372, that sets corporate taxes according to the ratio of CEO pay to the pay of the company’s typical worker. Corporations with low pay ratios get a tax break. Those with high ratios get a tax increase. This would effectively index worker wages to CEO compensation in a carrot and stick approach to corporate taxes. The details and merits of this approach is outlined elsewhere.[iii]

Do U.S. businesses have the financial capacity to offer higher wages to their workers? I would like to answer that question with another graph that you may also have seen before.

Credit: Blue Point Trading http://www.blue-point-trading.com/blue-point-trading-market-view-june-07-2012

There is a clock ticking somewhere in the background on this issue. There is a point somewhere in the future where it will be too late to fix wage stagnation through the normal democratic processes. History has proven this to be true. We are not at that point now, but we are past the point treating wage stagnation earnestly.

______________________________________________________

[i] Link: Real Historical Gross Domestic Product (GDP)

[ii] As of 2013 the median family income of $51,017 x GDP growth of 109.4% = $104,796 per year

[iii]  Link: Raising Taxes on Corporations that Pay Their CEOs Royally and Treat Their Workers Like Serfs

Government of the People Is Gone- Here’s Proof

by Brian T. Lynch

 

Martin Gilens of Princeton University, and Benjamin I. Page of Northwestern University , conducted a multivariate analysis of 1,779 policy issues in the United States, the results of which confirmed that the United States is no longer a Majoritarian Electoral Democracy.oligarchy

 

In other words, we have lost majority rule. The United States has become an oligarchy. Business interests and the interests of the wealthy elite have overwhelming dominance in influencing United States policy and laws. You can read their conclusions below and read this newly published study in full at this URL:

http://www.princeton.edu/~mgilens/Gilens%20homepage%20materials/Gilens%20and%20Page/Gilens%20and%20Page%202014-Testing%20Theories%203-7-14.pdf

According to the authors, “Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence. The results provide substantial support for theories of Economic Elite Domination and for theories of Biased Pluralism, but not for theories of Majoritarian Electoral Democracy or Majoritarian Pluralism.”

Of course, anyone paying attention to government policies versus the popular will of the electorate would already have drawn this conclusion. I recently posted a two part piece on this very subject a few months ago:  http://j.mp/1bz7aO5

The Gilens and Page study opens by asking a critical question, who really rules? Are we, the people, the sovereigns of our nation, or have we become “largely powerless?”  He begins to answer this by summarizing four different theoretical traditions recognized by scholars who study democratic governance.

The first of these theoretical traditions discussed is the Majoritarian Electoral Democracy, which is best “… encapsulated in Abraham Lincoln’s reference to government “of the people, by the people, for the people.” This tradition holds that laws and policies should reflect the views of the average voter, and that the positions of politicians seeking election should converge towards the center of the normal range of voter opinion.  It is this view of democracy most often presented by major media outlets when covering our politics. More importantly, this is these are the outcomes most of us expect from our democracy.

The second tradition is the Economic Elite Domination tradition in which US policy making is dominated by those with high levels of wealth or income.  Some scholars also include social status or position as part of this tradition. The economic elites often exercise their influence through foundations, think-tanks and “opinion shaping apparatus,” as well as to the lobbyists and politicians they finance.

Majoritarian pluralism is the third theoretical tradition that Gilens and Page discusse. This tradition analyzes politics through the lens of competing interest groups within the population. These groups may include political parties, organized interest groups, business firms or industry sector organizations.  All things being equal, the struggle between diverse factions within the population should also produce policy outcomes that are at least compatible with civil majority opinions.  But all things are not necessarily equal, leading to the fourth, related tradition called Biased Pluralism.

Biased pluralism entails policy outcomes that result from contending, but unrepresentative organized interest groups. These unrepresentative interest groups are generally made up of upper-class citizens with the power and influence to tilt policy towards the wishes of corporations, businesses and professional associations.So, after statistically comparing almost 2,000 policy outcomes against these four models of political influence in our democracy, what did the researchers find?  In their own words:

“By directly pitting the predictions of ideal-type theories against each other within a single statistical model …  we have been able to produce some striking findings. One is the nearly total failure of “median voter” and other Majoritarian Electoral Democracy theories. When the preferences of economic elites and the stands of organized interest groups are controlled for, the preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.” 

“Nor do organized interest groups substitute for direct citizen influence [snip]… Over-all, net interest group alignments are not significantly related to the preferences of average citizens.” The net alignments of the most influential, business oriented groups are negatively related to the average citizen’s wishes.” 

“Furthermore, the preferences of economic elites…  have far more independent impact upon policy change than the preferences of average citizens do. 

What then has become of our democracy? It has been usurped by billionaires who directly fund candidates for public office, directly influence policy through lobbying and heavily fund public marketing campaigns to influence public opinion for their own advantage.

GildedAge2

We have seen this before during the “Gilded Age” at the turn of the last Century.  We found our voice a hundred years ago and we took back our democracy from the wealthy elite. Today they are smarter, richer and have more control over the media and government than they did back then, so the challenges we face to save civil democracy and regain majority rule won’t be easy. But history tells us that power is ultimately with the people.  We must start by recognizing our situation and begin organizing ourselves to collectively act in our own best interest. We need to become, once again, a nation of citizens, not a nation of businesses and the rich.

NSA vs. Citizens of the World.

by Brian T. Lynch

Before Edward Snowden blew the whistle on the clandestine activity of the National Security Agency (NSA) and selectively released documents to the press, no one had any idea what the NSA was up to. This apparently included the President of the United States and the Congressional Select Committee on Intelligence that is charged with agency oversight.

The Select Committee on Intelligence initially denied the validity of Snowden’s claims because they, too, were in the dark about NSA operations. Once the Committee got a hold of Snowdon’s documents and investigated, they learned that the NSA concealed a great deal about its operations from Congress and even lied to Congress on occasions to protect its secrets. Since them more has surfaced from release of Snowden’s NSA documents. Among the revelations:

  • NSA engaged in mass surveillance of US citizens as well as the citizens of allied nations.
  • NSA collected metadata on all US domestic phone calls and subjected them to powerful meta analysis that can reveal very personal information about citizens not connected in any way with terrorism.
  • NSA collected and analyzed all, or nearly all domestic and foreign emails.
  • NSA engaged in domestic spy on human rights organizations, also not connected in any way with international. terrorism or criminal activity.
  • NSA spied on other international human rights organizations.
  • NSA breached its own protocols many times and targeted innocent civilians for scrutiny.
  • NSA tapped the personal cell phones of world leaders who are our allies.
  • NSA listened in on lawyers negotiating international trade agreements.
  • NSA spied on the UN and on the UN Children’s Fund.
  • NSA broke the encryption code that protects financial business transactions worldwide.
  • NSA has (and may still be) provided U.S. law enforcement agencies with secretly and illegally obtained evidence in domestic criminal cases, even non-violent criminal cases, without ever informing the defendant or the courts of the evidence or its source.

AND this is not a comprehensive list of the illegal, unconstitutional or questionable activities in which the NSA has engaged.

Discussion about these issues began to take place for the very first time only after Snowden brought them to light. These discussions are now taking place worldwide, because before Snowden, no one knew these things were even happening.

Here in the U.S., the investigation of Snowden’s claims has prompted Congress and the Obama Administration to being reorganizing and reforming the NSA. It’s abusive practices are being curtailed. President Obama has personally and publically apologized to world leaders for the conduct of the NSA. Other nations are now exploring the issues raised by Snowden’s revelations and considering how NSA technology in the wrong hand might threaten human rights.

These are the fact that are now out in the open. The main stream media has been far to silent and passive in covering this scandal. Most people remain unaware of the scope and significance of the NSA’s illegal activities. This agency has significantly violated our constitution and our personal civil rights. With or without the help of the national press, we have a responsibility as citizens to explore these issues and pass judgment on the activities or our government.

Here is the full video link of Edward Snowden’s testimony on April 8, 2014, before the Council of Europe hearing on Mass Surveillance and Whistle Blowing. It is compelling testimony with serious implications, and demonstrates once again, that the rest of the civilized world is having an important discussion about the threat posed by mass surveillance which is absent here in the United States. Our main stream media gave little attention to this event. The United States Government was invited to participate in these discussions, but declined.
http://clients.dbee.com/coe/webcast/index.php?id=20140408-1&lang=en

To be clear, no one disputes the fact that Mr. Snowden broke laws when he turned over classified documents to the press. What he did was clearly illegal. But his actions should be weighed against the greater good that may have resulted from these disclosures. Yes, the law is the law, but justice is our goal and mercy is our higher value. We may want to strike a balance in this case between what laws Snowden broke and the harm that would have followed if NSA abuses had not been brought to our attention. Public discussion and ultimately public opinion following civil dialogue should the final judge in this case.

With respect to prosecution, how do we proceed when government wrong doing is at the heart of the case? I believe this is very much a matter for public debate to seek a popular consensus on his fate. We, the people, should be the jury here. We would be abdicating our responsibilities as citizens to close our eyes and let the establishment laws deal with him when we are all plaintiffs and the government itself is the accused.