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President Obama to Face a 'Beast' of a Problem in 2011

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NEWS ANALYSIS

Special to the NNPA from TheDefendersOnline.com

By George E. Curry –

Republicans in the House and Senate, borrowing a page from Ronald Reagan, plan to stifle President Barack Obama’s domestic agenda by using recently-enacted tax cuts as an excuse to reduce federal spending.

There is even a name for it – Starve the Beast.

“This idea that cutting taxes will lead to a reduction in government spending is often referred to as the ‘starve the beast’ hypothesis: the most effective way to shrink the size of government is to reduce the revenues that feed it,” Christina and David Romer wrote in a 2009 scholarly paper titled “Do Tax Cuts Starve the Beast? The Effect of Tax Changes on Government Spending.”

In a 1981 speech, President Reagan put it in simpler terms: “Well, you know, we can lecture our children about extravagance until we run out of voice and breath. Or we can cure their extravagance by simply reducing their allowance.”

Republicans have made it clear that they plan to reduce the “allowance,” perhaps by as much as $100 billion a year. A sampling of the Sunday, November 7 talk shows suggests that they are reading from the same script:

· Senate Minority Leader Mich McConnell (R-KY) on CBS’ Face the Nation: “We don’t have a revenue problem. We have a spending problem.”

· House Minority Leader Eric Cantor (R-VA) on Fox News Sunday: “The election result reflected the fact that people get Washington does not have a revenue problem. It’s got a spending problem.”

· Senator Rand Paul (R-KY) on ABC’s This Week: “Well, I think it’s not a revenue problem. It’s a spending problem.”

· Rep. Paul Ryan (R-WI) on Fox News Sunday: “We do not have a revenue problem. We have a spending problem.”

In truth, the federal government has both a revenue and a spending problem. And, the revenue problem was exacerbated by a compromise between President Barack Obama and Republicans to extend the George W. Bush tax cuts, the only U.S. tax cuts adopted during wartime, for another two years.

Obama campaigned on a pledge to extend the 2001 and the 2003 Bush tax cuts only for individuals earning less than $200,000 a year and couples making no more than $250,000 annually – 98 percent of all taxpayers. However, Republicans insisted on an extension for the top 2 percent at a cost of $81.5 billion during the next two years. The price tag for extending all the cuts during that period will be almost $545 billion.

Raising the individual estate tax exemption from $3.5 million to $5 million (from $7 million to $10 million for couples) will provide another $25 billion in tax reductions during the next two years to the top 1 percent of estates, according to the Urban Institute-Brookings Institution Tax Policy Center.

Republicans fought for a tax cut for the wealthy at a time when the gap between rich and poor is the largest on record.

In an interview on 60 Minutes, former Reagan Budget Director David Stockman observed, “In 1985, the top five percent of the households, wealthiest five percent, had net worth of eight trillion dollars, which is a lot. Today, after serial bubble after serial bubble, the top five percent have net worth of 40 trillion.”

Just as Republicans fought for the wealthy, Obama fought equally as hard for extending tax breaks for the middle class, which is not as beleaguered by taxes as the president has depicted.

According to the Tax Policy Center, Americans are paying federal taxes at one of the lowest rates in history. In 2000, the year before the first Bush tax cut went into effect, the medium-income family of four paid eight percent of its income in federal taxes. That figure has dropped to 4.6 percent, the second-lowest percentage in the past 50 years.

Overall, U.S. citizens pay the third-lowest rate of combined taxes – local, state and federal – than all but two of the world’s 27 industrialized nations, according to the Organization for Economic Cooperation and Development (OECD). Only Turkey and Mexico have lower rates, which are measured as a percentage of the gross domestic product (GDP).

Corporate tax rates in the U.S. are lower than all developed countries except Austria, Iceland, Germany, and Turkey.

Still, Republicans and Democrats are lobbying to make some or all of the Bush tax cuts permanent.

David Stockman said elected officials know that the U.S. is in no fiscal position to extend any of the cuts.

“It’s rank demagoguery,” he said in the 60 Minutes interview. “We should call it for what it is. If these people were all put into a room on penalty of death to come up with how much they could cut, they couldn’t come up with $50 billion, when the problem is $1.3 trillion. So, to stand before the public and rub raw this anti-tax sentiment, the Republican Party, as much as it pains me to say this, should be ashamed of themselves.”

But they are not. Many in the GOP, who now profess to be so concerned about federal spending, did not express any outrage when George W. Bush was racking up record deficits.

Bush inherited a $236 billion surplus from Clinton. But, the deficit rose under Bush to $1.4 trillion in 2009.

To deal with the mounting deficit, Republicans want to “starve the beast.”

But the research paper by Christina D. Romer, who served until recently as chair of President Obama’s Council of Economic Advisers, and David H. Romer, her husband and former MIT classmate, concluded: “The results provide no support for the hypothesis that tax cuts restrain government spending.” Instead, the couple argues, “Tax cuts may increase spending.” They explained, “The results also indicate that the main effect of tax cuts on the government budget is to induce subsequent legislated tax increases.”

The problem with most Republicans trying to starve the beast is that they want to exempt big-ticket items such as defense, homeland security, and Medicare.

“If you look at a pie chart of federal outlays, discretionary spending being red, non-discretionary being the blue, the blue is already over half way mark and it’s growing in double digits,” Republican Minnesota Gov. Tim Pawlenty said in an interview on MSNBC. “Anybody who comes in here and tells you they’re not going to cut anything other than waste, fraud, and abuse, they’re not going to touch entitlements – they’re lying to you. If you want to deal with the spending issue, in terms of federal outlays, you got to deal with interest on the national debt, Social Security, Medicare, Medicaid…”

Pawlenty is correct.

It is important to remember that the federal budget is divided into two basic categories: mandatory and discretionary spending. Mandatory spending, which comprise 59.3 percent of the budget, is spending that does not require Congress to act each year. That category includes Social Security and Medicare. Discretionary spending represents 35.2 percent of the budget and includes programs or federal agencies whose funding must be re-appropriated by Congress each year. Another 5.3 percent of the budget goes toward paying the interest on the national debt.

With that 35.2 percent that Congress has to work with each year, the Defense Department receives 20.3 percent, leaving approximately 15 percent of the budget from which to make all those cuts. That remaining 15 percent covers such items as veterans’ health, which is the largest non-defense discretionary program; education, transportation, airport security, and the environment.

According to an analysis of Congressman Boehner’s budget proposal by the Center on Budget and Policy Priorities, “The plan would require immediate cuts of $101 billion – or 21 percent – in funding for discretionary programs other than those funded by the defense, homeland security, and military construction and veterans appropriations bills … This would represent the deepest cut in funding for these programs from one year to the next in recent U.S. history.” A 21-percent cut in K-12 education funding would mean a reduction of $8 billion, the center figured.

In the past, providing tax cuts has done nothing to strengthen the nation’s economy.

According to an article by Michael Linden and Michael Ettlinger of the Center for American Progress, “The Bush tax cuts have directly added $2.5 trillion to the national debt in the full 10 years that they have been law.”

Conversely, Bill Clinton created many more jobs than Bush while raising taxes.

Linden and Ettlinger explained, “President Clinton, after raising taxes in 1993, oversaw an economy that went from 111 million jobs in August of that year (the month Clinton’s budget plan passed, including the increase in taxes) to 129 million jobs six years later – an increase of 16.2 percent, and more than three times better than under the Bush tax cuts. ”

In many respects, President Obama may find himself in situation similar to the one Bill Clinton was in after Democrats lost both houses of Congress in 1994.

Robert Reich, who served as Clinton’s Secretary of Labor, recalled: “The price [Federal Reserve Board Chairman Alan] Greenspan exacted from Clinton – and a resurgent Republican Congress demanded – was a balanced budget. As a result, Clinton had to give up much of his ‘investment agenda’ in education, infrastructure, and other long-neglected means of building the productivity of average working Americans.”

Rep. Jesse Jackson, Jr. (D-IL), one of Obama’s presidential co-chairs in 2008, worries about a resurgence of Reaganomics, a term used to refer to the economic policies of Ronald Reagan that featured low taxes, low spending on social services, high military spending, decreased federal regulations, and the trickle down-theory.

In a statement issued just before Congress voted to extend the Bush tax breaks, Jackson said, “If we recklessly cut taxes for the wealthiest 2 percent, then Obamanomics will look an awful lot like Reaganomics.”

'Favorite President' Funneled Millions to French Politicans

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Special to the NNPA from the Global Information Network –

A newly-released WikiLeaks cable portrays the late president of Gabon, Omar Bongo, sharing millions in stolen funds with French Presidents Jacque Chirac and Nicolas Sarkozy.

In the U.S. embassy cable, published in the Spanish newspaper El Pais, a U.S. diplomat said he was informed by a senior official at the Bank of Central African States of Bongo’s “brazen” defrauding of the bank, which holds the pooled reserves of six central African countries, including Gabon, Cameroon, and the Democratic Republic of Congo.

The bank source said: “Gabonese officials used the proceeds for their own enrichment and, at Bongo’s direction, funneled funds to French political parties, including in support of French President Nicolas Sarkozy… Bongo was France’s favorite president in Africa,’ and ‘this is classic Françafrique.’

Bongo, who came to power in 1967 with French help, was the world’s longest-ruling head of state, apart from the British and Thai monarchies. He was succeeded last year by his son Ali, who was said by the cable to also have “benefited from the embezzlement”.

The Bongo family faces an inquiry into the use of state funds to acquire vast assets in France, Riviera villas and fleets of luxury cars. Transparency International, an anti-corruption watchdog has launched the probe into shadowy relations between French leaders and African rulers. The practice is called “Francafrique.” The Bongo family has denied any wrongdoing.

Former Ivory Coast President Likely to End Political Stalemate

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Special to the NNPA from the Global Information Network –

Bowing to international pressure and the threat of a regional war, embattled Ivory Coast President Laurent Gbagbo has stepped back from a hardline position defending his contested re-election, reports from the region say.

West African mediators said President Gbagbo agreed to negotiate a "peaceful end" to the crisis without preconditions and lift the blockade around the hotel where his rival, Alassane Dramane Ouattara, has been stationed for weeks.

Mediators from ECOWAS, the African Union and the United Nations all recognize results showing Ouattara as the winner of a November poll and have urged Mr. Gbagbo to step down.

Complicating the battle between presidential rivals is the division of the country into power bases – a northern one which backs Mr. Ouattara, and a southern one which backs the government. In recent years, ethnic rivalries fueled government-tolerated sweeps of marketplaces and slums in the principal city Abidjan that caused hundreds of northern and non-Ivorian residents to be dispossessed.

In a recent interview on the DemocracyNow news program, Ivory Coast political analyst Gnaka Lagoke of the website AfricanDiplomacy warned of the risks of military intervention to settle the crisis.

“It is a very bad idea,” he said. “Ivory Coast is a microcosm of a united Africa with 26 percent of the population from (neighboring) countries. In a typical Ivorian family, one parent comes from a traditional ethnic group and the other parent comes from a foreign country. So if you attack Ivory Coast, you’re not just destroying or killing people from (President) Gbagbo’s tribe, but you’re destroying a microcosm of the united Africa.”

Syracuse Professor Horace Campbell, on the same show, responded: “I agree that the question of the Ivory Coast is not about Gbagbo or Ouattara. (But) the question is whether all citizens of the Ivory Coast will have the right to participate in the political system. What is at stake here is the long challenge that people from the north who are considered from Islamic background, whose parents migrated to the Ivory Coast, whether they can participate in the political process and become leaders of the country.“

Nigerian Paper Taps Wikileaks Founder as 'Man of the Year'

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Special to the NNPA from the Global Information Network –

Julian Assange, founder of the whistleblowing WikiLeaks website, was named Man of the Year by The Guardian newspaper of Nigeria.

“Assange is in the eyes of the ordinary man across boundaries more of a hero than villain, more of a champion than a pest, an achiever and flag-bearer for the open society ideal, not an anarchist, but a progressive,” wrote Reuben Abati, chairman of paper’s editorial board.

“His heroism in this regard raises those pertinent issues that can no longer be ignored, notably the role and method of the whistleblower, the challenge of transparency and accountability in governance and the responsibility of both the media and governments. “

Founded in 2006, WikiLeaks defines itself as a non-profit media organization that enables independent sources around the world to reveal suppressed and censored injustices “of ethical, political and historical significance” while remaining anonymous.

'By his actions… Mr. Assange seems to have raised the bar for public accountability among nations, and probably within individual governments,' The Guardian's Editor-in-Chief and Managing Director, Eluem Emeka Izeze, wrote.

"Officials now know that in an information age driven by technology, their opinions and decisions may sooner rather than later surface in the public space," he added.

"These are momentous developments which are stripping governments of their exclusive preserves, and handing to citizens the function of determining the nature and scope of government activities," Izeze observed.

NAACP, LUCAC Say State Board of Education Violated Constitutional, Civil Rights

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By Imani Evans, Special to the NNPA from The Dallas Examiner –

Continuing a fight that began almost a year ago, a coalition of civil rights groups - that includes the Texas National Association for the Advancement of Colored People (NAACP) and Texas League of United Latin American Citizens - has publically released a complaint filed at the U.S. Department of Education asking the agency to review changes to the social studies curriculum standards pushed through by the Texas State Board of Education last spring as part of a broader review of state educational practices.

In a letter to the department's Civil Rights Division, the civil rights groups accused Texas of allowing a number of systemic practices that negatively impact the educational aspirations of minority students, and more specifically with violating Title VI of the Civil Rights Act of 1964, as well as the 13th and 14th Amendments to the U.S. Constitution.

Attached to the letter were approximately 150 pages of supporting documentation, including an outline of the NAACP's basic argument, as well as more analysis and statements of support by a number of prominent academicians including sociologist Joe R. Feagin, of Texas A&M University, and Dr. Anthony L. Brown, of the University of Texas. The complaint addresses the following issues:

• The State Board of Education curriculum changes

• Disparate discipline for minority students

• The use of accountability standards - i.e. standardized testing - to impose sanctions on schools with high proportions of minority students

• The underrepresentation of Blacks and Latinos in Gifted and Talented programs

After more than a year of frequently heated debates that drew nationwide attention - and scorn from more than a few educational experts - the Texas State Board of Education voted last May to approve new social studies standards for elementary, middle, and high school students. The process was dominated by a seven-member bloc of conservative Republican board members who, critics charged, were intent on refashioning the curriculum to suit their ideological preferences.

Their efforts resulted in controversial language that, for example, instructs teachers and textbooks to mention the "unintended consequences" of affirmative action and the Great Society, two programs deeply associated with the Democratic Party. Some critics, in particular the NAACP, charged the SBOE with inappropriately raising the actions of White decision-makers to a level of equal importance with those of civil rights protestors, and with elevating the role of Confederate figures such as Jefferson Davis while obscuring their ideological attachment to slavery.

"What we're asking them [the Department of Education] to do is to conduct a proactive review on a number of areas that we've complained about," said Texas NAACP president Gary L. Bledsoe. "We've complained about the offensive nature of the standards that were passed. The standards clearly require a student to (be taught) things that would be considered by them to be racially offensive - for example, if a student is being taught a standard that says there were positive aspects of slavery, this will go against everything that student might learn in their household, and be fundamentally untrue."

While mentioning the NAACP's partners, among them LULAC and the Texas Association of Black Personnel in Higher Education, Bledsoe also made a point of including two members of the Board of Education, Mavis Knight and Lawrence Allen, who fought hard against the changes.

Names of historic persons given in the standards fall into two categories, roughly: those who "must" be taught and those who "may" be taught. Students are required to learn about those in the "must" category only while those in the "may" category are given as mere suggestions. The NAACP/LULAC complaint points out that while Texas is 67 percent minority, only 17 percent of the persons listed in the "must" category are minorities.

"What the experts have said, that supports what we're saying, is that this marginalizes African Americans," said Bledsoe.

Dr. Emilio Zamora, a UTA professor specializing in Mexican American history, agrees.

"To state the obvious, such striking omissions and deletions suggest a pattern of neglect rather than happenstance or an occasional lapse of judgment," Zamora said in his statement of support.

Later in his statement Zamora adds: "Part of the explanation for the skewed representation rests in the continued predominance of White males as major figures in history books. This view of history, however, cannot be justified solely by the emphasis that we give to fields of history like government, industry, and wars… 76 percent male representation is inordinately high, especially if we consider that the study of history has expanded significantly since the early 1970s and provided greater depth and breadth from which to draw."

But the SBOE curriculum changes are only one part of a larger broadside against the Texas educational system. Also mentioned is the state's method of funding schools; unequal access to Gifted and Talented programs (according to the Texas Education Agency both Blacks and Latinos are underrepresented among gifted and talented students); underfunding of charter schools (Black students make up 33 percent of students in open-enrollment charter schools in Texas, which means any differential treatment of charters affects Blacks more dramatically); disparate discipline (Black students, while 14 percent of Texas public school students, are 33 percent of students who are suspended); and the problems posed by high-stakes testing (for instance, because of sanctions associated with low accountability rankings, schools actually find ways to remove low-performing minority students from the test rolls in order to affect the system).

Crucially, the complaint charges that these educational practices are not simply wrongheaded but discriminatory, and that the various issues raised in the complaint "were either the result of unnecessary policies that have a disparate or stigmatizing impact on African Americans and Latinos, or reflect disparate treatment or neglect." Although the complaint does not suggest a specific remedy, it is clearly an invitation for the federal government to consider taking legal action against the State of Texas.

"We were able to talk to and meet with people who are interested in what's going on in Texas and want to be kept informed," said Texas NAACP Legal Redress chair Robert Notzon, referring to a recent visit he and Bledsoe made to Washington D.C. "There's a good chance that we're going to get some hearing from people that are interested and can do something with this."

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