Good Mornin’ birdies! Let’s get started with an interview of Charles Booker on Medhi Hassan’s show.
More news, videos, tweets, etc in the comments. Sure happy it’s Thursday!
Good Mornin’ birdies! Let’s get started with an interview of Charles Booker on Medhi Hassan’s show.
More news, videos, tweets, etc in the comments. Sure happy it’s Thursday!
Good day, mates!
Just a place to hang your hat and for me to save some videos I’m listening to right now.
.@drvandanashiva speaks about #BillGates's book, the colonisation of land and #food production, however she provides us with hopeful and powerful words of advice that might help us challenge these Tech Giants and monopolies.@rustyrockets #Agriculturehttps://t.co/4a37uCVIMI
— A Voice For Choice Advocacy (@avoiceforchoice) April 14, 2021
I love Vandana’s relentless fight with a heart against the global corporatization of the earth.
many other things he says in that recent interview that the media not only could not give less of a shit about but will destroy anyone else over, like the cover-up of OPCW whistleblowers, dismissing russiagate, and the genocidal nature of biden's sanctionshttps://t.co/eTdcf9HNQN
— ☀️👀 (@zei_squirrel) April 14, 2021
Noam is always a gem, and I’m glad he’s calling out Biden on foreign policy.
See you down below.
Robert Reich knows a thing or two about federal budgets, and the economist who has served in three presidential administrations says there is something wrong with Joe Biden’s plan to increase Pentagon spending above the levels proposed by former President Trump.
“The Pentagon already spends: $740,000,000,000 every year, $2,000,000,000 every day, $1,000,000 every minute,” says the former secretary of labor. “The last thing we need is a bigger military budget.”
Unfortunately, that’s what the president is seeking. This has led Reich to announce that he is “frankly disappointed that Biden’s proposing $715 billion for the Pentagon—an increase over Trump’s $704 billion defense budget—instead of moving back toward Obama-Biden era levels of defense spending, or less.”
How Antidiscrimination Law Fails Black Mothers
“Or less” is the right direction, especially at a moment when Republican deficit hawks are circling in preparation for attacks on domestic spending that is essential for working families who have been battered by the coronavirus pandemic.
Biden’s $1.5 trillion budget plan has much to recommend it. The president is seeking significant increases in funding for education and proposing to invest in criminal justice and police reform, combating gun violence, and other worthy efforts. “However, despite the positive investments in these programs,” says Representative Barbara Lee, “I was incredibly disappointed at the significant increase in Pentagon spending to even higher levels than the Trump administration. With so many people across the country struggling to make ends meet, the last thing we need to do is increase investment in wasteful Pentagon spending.” Noting that “this budget adds twelve billion new dollars for weapons of war,” the longtime critic of endless wars asks us to “just think how that same amount could be used to invest in jobs, health care and fighting inequality—especially as we fight back a once in a century public health and economic crisis.”
Lee was once a lonely voice on behalf of cutting Pentagon spending. But the California Democrat now has allies in powerful places. “I have serious concerns,” says Senate Budget Committee chair Bernie Sanders (I-Vt.), “about the proposed $753 billion budget request for the bloated Pentagon—a $12.3 billion increase compared to the last year of the Trump Administration. At a time when the U.S. already spends more on the military than the next 12 nations combined, it is time for us to take a serious look at the massive cost over-runs, the waste and fraud that currently exists at the Pentagon.”
Congressional Progressive Caucus chair Pramila Jayapal (D-Wash.) is blunter: “We’re in the midst of a crisis that has left millions of families unable to afford food, rent, and bills. But at the same time, we’re dumping billions of dollars into a bloated Pentagon budget. Don’t increase defense spending. Cut it—and invest that money into our communities.”
That’s not a radical response. When Data for Progress surveyed voters nationwide last year about budget priorities, 56 percent supported cutting the Pentagon budget by 10 percent to pay for fighting the coronavirus pandemic and funding education, health care, and housing. Sixty-nine percent of Democrats expressed enthusiasm for the proposed cut, which was striking. Even more striking was the 51 percent support it got from Republicans.
When the idea was raised in Congress in July of 2020, 93 members of the House of Representatives voted for a 10 percent cut, as did 23 senators. That wasn’t a win, obviously, but it was a groundbreaking show of support for reduced spending on the military-industrial complex.
Can congressional progressives build on that base of support to alter priorities in the Biden budget? It won’t be easy. Centrist Democrats will be cautious about cuts, and Republicans can be expected to demagogue the issue. But progressive caucus members have had success in pushing the new administration to abandon some of the worst Pentagon initiatives of the Trump years. For instance, a new letter signed by 70 House members commends Biden for “[his] first steps toward ending U.S. support for the war in Yemen, including announcing an end to U.S. military participation in offensive Saudi actions; a review of weapons sales to Saudi Arabia for use in its six-year air war in Yemen; and a revocation of President Trump’s terrorism designation against the Houthis, with the express purpose of averting a hunger crisis.” (The letter urges the president to go further and “use all available U.S. leverage with the Saudi regime to demand an immediate and unconditional end to its blockade, which threatens 16 million malnourished Yemenis living on the brink of famine.”)
One of the key movers in the fight to end US support for the war in Yemen, Representative Mark Pocan (D-Wis.), thinks the time is right to push the administration and Congress for a broader rethink of spending priorities.
“A proposed increase of $13 billion in defense spending is far too much given [the Pentagon budget’s] already rapid growth at a time of relative peace,” says the Wisconsin Democrat who with Lee cochairs the Defense Spending Reduction Caucus. “We cannot best build back better if the Pentagon’s budget is larger than it was under Donald Trump.”
Pocan has ideas for where to make cuts. For instance, he says “we must stop funding for former President Trump’s excessive $1.5 trillion nuclear modernization plan and complete a new nuclear posture review as each of the last three presidents have done. The United States has far more nuclear weapons than are needed for our security, so let’s stop funding the waste.” In addition to arguing for “no new spending on nuclear weapons,” Pocan points to the need to audit Pentagon waste and accountability measures to eliminate slush funds.
That’s a message that will resonate with the American people, says Representative Ilhan Omar (D-Minn.), who maintains that there is a growing awareness that “it is simply inexcusable to continue to shower weapons manufacturers with hundreds of billions of dollars in Pentagon waste.”
Advocacy groups share the view that this is precisely the right time for members of Congress to make the case for tightening the bloated Pentagon budget. “Following a year of deadly proof that throwing money at the Pentagon does not keep us safe from modern day threats, it is unconscionable to not only extend Trump’s spending spree, but to add to it,” says Win Without War’s Erica Fein. “Deadly pandemics, climate crisis, desperate inequality—the greatest threats to global security do not have military solutions. Yet while we’re repeatedly asked how we will afford to address these truly existential threats, the same question is never asked of adding to the Pentagon’s already-overstuffed coffers. Let’s be clear: continuing to funnel near-limitless resources into the pockets of arms manufacturers while underfunding public goods only undermines the safety of people in the United States and around the world.”
More news, tweets, videos, etc in the comments section.
Today is the 40th Anniversary of the launch of STS-1, the first Space Shuttle. 🚀 😊 I was there. It was awesome, just simply awesome. Reagan had gotten elected the previous November, but his destructive curse hadn’t started—yet. I still felt hopeful and proud of my country, though a premonition had put me on a wary alert. And, we got some much-needed rain here yesterday. The Nest is swept and Open. 🚀☮️🪐
Let’s get started with an interview with Stephanie Kelton on MSNBC last Night:
Speaking of, Prof Kelton is on Barron’s Top 100 Women in US Finance list.
“There is a very fundamental rethink happening in the way lawmakers are approaching the federal budget-making process,” Stephanie Kelton, 51, tells Barron’s. “They used to start from the premise that every bill should be deficit neutral. That’s changing.”
That’s a consequence, in no small part, of the persistent advocacy of Kelton, a professor of economics and public policy at Stony Brook University and the author of The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy, published in 2020. Her goal is to “replace a fake financial constraint with a real inflation constraint” in the minds of policy makers.
She seems to be making progress. When Congress swiftly passed the $1.9 trillion American Rescue Plan in March, just a few months after passing a $900 billion pandemic relief package at the end of December, there was little debate about the impact on the debt. Instead, the arguments focused on whether the economy would “overheat” in response to the extra money, leading to excessive inflation.
Even so, the Biden administration’s recent proposal to pay for a temporary boost in infrastructure spending with a permanent increase in corporate profit taxes suggests that Kelton still has her work cut out for her.
More videos, tweets, news, analysis in the comments section.
Housing is a universal need, and it’s so tied up with personal wealth building, economic health (see the financial crisis), inequality, transportation, and even climate that it quickly turns into a divisive subject. In reporting Chain of Title and the plight of foreclosure victims, I saw how much personal investment we have in our homes, how we use them to mark time and measure up in society. People were scraping by to stay current on their mortgages before their medical bills or utilities; they’d rather have a house than the heat in that house.
What I’m trying to say is that the totemic value placed on housing, particularly in the United States, makes housing policy divisive. That’s not necessarily going to change with federal investment. And that’s the context for one of the more tantalizing policy strands in the American Jobs Plan, which is one of the rare throwbacks to the 2009 Obama stimulus.
The Biden plan vows to “eliminate exclusionary zoning and harmful land use policies” though a “competitive grant program that awards flexible and attractive funding to jurisdictions that take concrete steps to eliminate such needless barriers to producing affordable housing.” The grants will reportedly be at least $5 billion.
The policy idea here is that local control of zoning has led to things like mandatory parking and height limits and single-family requirements that have depressed the supply of housing, particularly in expensive cities on the coasts, and that addressing the shortage would keep up with demand and make these areas more affordable (or at least not completely outpriced). The response from opponents is that this tears down the character of neighborhoods and leads to gentrification and congestion and doesn’t reduce the cost of housing or the displacement of lower-income residents, because the replacement housing serves luxury markets. The response to that response is that those luxury units still comply with the laws of supply and demand, and the housing vacated by those snapping up gentrified replacements is lower-cost, and you can solve congestion in other ways, like through transit-oriented development. And then it just keeps going.
The policy arguments are even more entrenched than most debates, for the sentimental reasons explained above. For this piece I want to talk about the politics of the Biden administration entering into this argument at the federal level. Because the model for this is something called Race to the Top.
About the only thing more important to people than their homes is their kids, and in the late-aughts there was a separate fierce debate on the center-left around “failing schools” and the need for education reform. One side said that bad teachers had to be fired and testing had to measure student achievement and nontraditional setups like charter schooling had to be encouraged. The other said that teaching to a test wasn’t teaching and charters cherry-picked their own students and testing didn’t correlate to teaching and poverty and other factors played into learning. And it just kept going.
The Obama administration got into the middle of that debate with Race to the Top. Part of the 2009 stimulus and also priced in the range of $5 billion, it was a competitive grant program that gave states money if they changed their K-12 rules to conform to the ed reform agenda. This included supporting charters and evaluating teachers stringently and turning around underperforming schools and developing more tests and assessments. Nineteen states were eventually awarded grants, and many standards were changed to acquire them.
At the time, states were cash-strapped from the recession, and the Obama administration was exploiting that to make the education reform changes it wanted. Today, cities are more cash-strapped than states (and really everyone’s in better shape now that the American Rescue Plan’s fiscal aid is in process), and the money dangled would come in handy, if land use were changed.
It’s what happened after Race to the Top that’s more notable. School districts opted out of the reforms, and eventually so did several states. Backlash to low pay rallied the nation to the cause of teachers, including in red states. And education reformers rather rapidly lost their advantage within the Democratic coalition. During the 2020 presidential campaign, every Democratic candidate distanced themselves from the charter school movement. Biden’s education secretary marked a real shift from the Obama years too. And when the Biden team initially added a competitive grant for pandemic resources for schools in the American Rescue Plan, the pushback of it as “Race to the Top 2.0” was so furious that it was quietly removed.
Part of this is because teachers are such a large and powerful constituency within the Democratic Party that deliberately antagonizing them wasn’t going to work. But the model of a Democratic administration taking sides in an intra-party debate and using federal dollars to boost their desires led to their side of the debate being completely walked out of the party. Is it better for Democratic education reformers that they got a handful of states to change their education policies, some temporarily, if in the exchange they gave up practically all of their influence within the party?
And could this happen with these competitive grants for land use? Not everything is the same, of course, and the exclusionary zoning/housing supply charges have arguably more support among Democrats than education reformers did. But though conservatives pay more lip service to it, the stirrings of local control are ever-present, and tensions run as high in housing as they do in education. The potential for a backlash is definitely present, and the politics of housing are volatile. Supply-side reformers might want to be careful what they wish for.
Granted, there’s eight times as much money, about $40 billion, in the Biden plan for public housing investment, though a lot of this will go to fixes of the existing dilapidated stock rather than supply. An investment in social housing, which would start by repealing the Faircloth Amendment that literally makes it illegal to build new public housing without bulldozing old units, would do much to balance the scales on this. Faircloth repeal, authored by AOC, passed the House in their infrastructure bill last year; I’d imagine it will pop up again in the Democratic version of the Biden package.
More news, analysis, tweets, videos in the comments. See you there!
Last week, President Biden introduced a $2.2 trillion infrastructure plan, calling it “a once-in-a-generation investment in America.” In a speech, he outlined many of the package’s details, including how to “pay for” it. A close look at those so-called pay-fors, however, shows Democrats are thinking about fiscal responsibility the wrong way. They could be on the verge of sparking some unpleasant short-term overheating of the economy, in which price increases accelerate and the purchasing power of our dollars falls somewhat. And if the final legislation were to grow much larger — toward the $10 trillion level many progressives in Congress are pushing — it could send such inflation soaring.
In an interview on MSNBC last week, Representative Alexandria Ocasio-Cortez of New York explained her mixed feelings about the president’s proposal, saying she has “serious concerns that it’s not enough to realize the very inspiring vision that Mr. Biden has advanced.” Rather than spending roughly $2 trillion over eight years, Ms. Ocasio Cortez and many of her Progressive Caucus colleagues would prefer “to go way higher” and on a shorter timeline.
She’s right that it is possible for Congress and the Biden administration to go bigger, faster — but only by shifting to a completely different budgeting framework: Instead of passing legislation that leans on taxing corporations and the rich to keep spending from increasing the deficit, they would have to develop a robust plan with a focus on containing inflationary pressures as that heightened government spending hits the real economy.
The president called his plan “fiscally responsible” during his speech simply because it will raise more revenue than what he’s proposing to spend. On paper, and according to conventional wisdom, this a balanced policy. It may satisfy the scorekeepers at the Congressional Budget Office or even earn high marks from deficit hawks. But because these proposed hikes fall exclusively on corporations and more affluent Americans — who have a relatively high marginal propensity to save rather than spend — the taxes may not diminish enough private sector spending to prevent the government’s own increased outlays from igniting some inflationary overheating, especially if Congress does “go way higher.”
The key to responsibly spending vast sums of money lies in carefully managing the economy’s real productive limitations. Just as my son’s Lego projects are limited by the amount of bricks we have bought for him, we can’t squeeze more goods and services out of our economy once we’ve made use of all available resources.
It’s easy to ramp up spending when there are millions of unemployed people who can be hired and plenty of domestic companies eager to supply the government with solar panels and electric vehicles. But what happens when it gets harder to find the idle things and people — construction workers, architects, machinery, raw materials and so on — needed to keep pace with an enormous revamp of our nation’s infrastructure? With the U.S. economy now improving, it would be irresponsible not to develop a rollout plan for those contingencies.
Many of Mr. Biden’s proposed tax increases should be defended, and even lauded, for they will promote greater fairness and curb inequality somewhat, but it must be recognized that they will do relatively little to offset spending pressures.
Depending on how big Congress ultimately decides to go on infrastructure, and how quickly, it may need to unleash a whole suite of inflation-dampening policies along the way — all of it unrelated to deficit neutrality.
These nontax inflation offsets could include industrial policies, like much more aggressively increasing our domestic manufacturing capacity by steering investment back to U.S. shores, using even more “carrot” incentives like direct federal procurement, grants and loans, as well as more “sticks” like levying new taxes to discourage the offshoring of plants. Reforming trade policies is another option: Repealing tariffs would make it easier and cheaper for American businesses to buy supplies manufactured abroad and easier for consumers to spend more of their income on products made outside of our borders, draining off some domestic demand pressures.
The Biden team could also consider loosening its legal-immigration policies, so that even once America nears full employment there would still be an adequate labor pool to meet the increased demand for workers. Putting aside the obvious climate benefits of tightening environmental regulations, banning fracking on federal lands and offshore drilling in federal waters could free up people and materials for other activities. Health care reform could have a role too. (Significantly lowering the Medicare eligibility age would sharply reduce aggregate spending in the health care industry, a major source of price pressures in the economy.)
Over time, the Biden plan’s investments in our physical and human infrastructure will enhance our economy’s productive capacity, leaving us with a better educated and more productive work force, more efficient railways, less congested roadways, improved technologies and much else. But this can’t happen overnight. It will take years, and it might mean that we start to run out of available capacity as we go — especially if the House Progressive Caucus wins the addition of trillions more dollars. No one can predict exactly when, or across which industries, serious bottlenecks and other shortages might emerge.
That’s why to avoid short-run constraints like supply bottlenecks, the U.S. government can look elsewhere for capacity. American businesses can make use of depressed conditions abroad, buying from countries with economies that might be struggling to fully recover from the economic downturn and that will be more than happy to mutually benefit from our boom. There will be no lack of eager foreign producers if we need to relieve some demand pressure on the domestic front.
So it was unfortunate that in his long-awaited infrastructure speech, President Biden promised “not a contract will go out, that I control” that isn’t for “a company that is an American company with American products, all the way down the line, and American workers.”
This “buy American” philosophy is well intentioned but could lead to counterproductive trouble, particularly since the president has promised that “no one making under $400,000 will see their federal taxes go up” — a pledge that takes raising taxes on the middle class, which has a higher marginal propensity to spend, off the table as a potential inflation offset.
A Biden-led plan that is overly protectionist is a much greater inflation threat than a plan that isn’t paid for in the traditional deficit-neutral budgetary sense. This framework — based on the principles of Modern Monetary Theory — redefines fiscal responsibility by flipping the age-old question “How will you pay for it?” The real challenge is “How will you resource it?”
Senator Bernie Sanders of Vermont recently hinted at this approach when he told Politico: “You don’t start off by coming up with a sum and working down. You start out by looking at the needs that need to be addressed and adding them up.” The next step is to figure out how to budget your available real resources to deliver on those priorities.
Modern Monetary Theory is not alone here. For a historical outlook, we can revisit what John Maynard Keynes proposed in “How to Pay for the War: A Radical Plan for the Chancellor of the Exchequer,” a lesser-known work of his. To the contemporary ear, the title suggests that Keynes was trying to figure out how to come up with the money to finance World War II spending. He wasn’t.
Keynes understood that the British government, which controlled its national currency, could create all the money needed. The purpose of the book was to show the government how to scale up and sustain higher levels of spending while containing inflationary pressures along the way. It noted the soldiers, bombers, tanks, combat gear and more that would be needed to prosecute the war and how the entire economy would need to be reoriented, quickly, to supply those things.
We’ve all grown accustomed to thinking about taxes as an important source of revenue for the federal government. That’s in part because it’s easy to think of the federal government as being like state and local governments, which without sufficient revenue — from income taxes, property taxes, sales taxes and more — could not finance their operations. Yet these entities don’t have the federal government’s currency-issuing powers, which greatly changes the spending capacity of government.
In 1945, a man named Beardsley Ruml delivered a fiery speech before the American Bar Association titled “Taxes for Revenue Are Obsolete.” He wasn’t a crank. He was the chairman of the New York Federal Reserve Bank. As Mr. Ruml explained in that speech, taxes first and foremost help to avoid a situation where too much money chases after too few goods: “The dollars the government spends become purchasing power in the hands of the people who have received them,” he said, while “the dollars the government takes by taxes cannot be spent by the people.”
More recently, economists like L. Randall Wray and Yeva Nersisyan have begun to think about how to pay for a Green New Deal using Keynes’s earlier “radical” framework. And even if one were to accept the terms of the old deficit-oriented budgeting currently favored in Washington, going even bigger on infrastructure, if executed carefully, is still doable: Larry Summers, the former Obama White House senior economist, admitted in 2014 that “public infrastructure investments can pay for themselves” and that “by increasing the economy’s capacity, infrastructure investment increases the ability to handle any given level of debt.”
We face enormous intersecting crises: a climate crisis, jobs crisis, health crisis and housing crisis, among others. It is going to require a lot of money to do what is necessary. As Kate Aronoff recently wrote in The New Republic, “To meet the emissions targets outlined in the Paris Agreement, experts estimate the United States government will need to spend at least $1 trillion annually.” And the White House’s infrastructure proposal, while historically ambitious, still falls far short of the scale of the problem.
Ms. Ocasio-Cortez pointed out, for instance, that Mr. Biden’s plan has a $40 billion investment in public housing for the entire nation but New York alone may have that level of need.
By focusing on how much revenue they think they can raise from a broad array of tax increases on the well-off, Democrats risk allowing the scope of their ambitions to be governed by the dated framework of fiscal responsibility in Washington and the political appetite for tax increases, rather than what is truly possible based on logistics in the real economy.
The Bureau of Labor Statistics, the Federal Reserve, the Treasury Department and other agencies that track labor force participation, price increases and supply shortages can be tasked with developing a specific dashboard of blinkers and warnings to alert to problems.
If Congress and the White House want to be responsible stewards of both society and the U.S. dollar’s value, then rather than focusing on taxation of the rich, they should prioritize and supply exactly what it would take, in terms of real resources, to electrify the nation’s power grid, repair every deficient bridge, give caretakers a living wage, upgrade our railways, and deliver clean drinking water and high-speed broadband to every home. How many people will it take to do all of that work? How much steel, concrete and fiber optic cable? How many tower cranes and other kinds of building equipment will be needed? The list goes on.
These are the questions we should ask our leaders, and the ones they should be asking themselves — not “How will we pay for it?”
In case you were wondering, Prof Stephanie Kelton penned that op-ed.
More news, tweets, analysis, videos, etc in the comments. Sure Happy It’s Thursday!
What the NY State Budget Means, according to the NY Times:
|On Tuesday, New York State’s leaders announced that they had reached a deal on a $212 billion budget.|
|The agreement, which came nearly a week after the April 1 budget deadline, is packed with proposals long favored by Democratic legislators, like raising taxes on the rich.|
|Much of the budget — which includes aid for renters, undocumented immigrants and business owners — is intended to fuel New York’s recovery from an economically devastating pandemi|
|The budget still needs to pass the Legislature and be approved by the governor. Here are three key elements in the state’s budget, explained:|
Tax hikes for the wealthy and corporations
|Despite Gov. Andrew M. Cuomo’s longtime stance against raising taxes on the rich, Democrats managed to include a personal income tax rate increase on individuals making over $1 million and couples earning more than $2 million, and two new tax brackets for incomes over $5 million and $25 million.|
|The changes are expected to raise more than $4 billion in additional revenue each year, though Republicans have warned that tax hikes could drive wealthy residents out of the state.|
|If these changes in the budget pass, New York City’s wealthiest residents would face the highest combined state and local personal income tax rates in the country.|
The $2.1 billion fund for undocumented workers
|The budget will provide one-time payments for undocumented workers who did not qualify for federal stimulus checks or unemployment benefits. Applicants for the fund would have to provide documents to verify their identity, residency and eligibility.|
|Many undocumented immigrants work essential jobs in restaurants, at construction sites and in food delivery. Activists and workers have recently held protests in New York City calling for lawmakers to include the aid in the budget.|
|Some Democrats argued against the fund, fearing blowback from moderate suburban voters in 2022. The state Republican Party chairman, Nick Langworthy, slammed the fund, calling it “woke insanity.”|
Relief programs for renters and homeowners
|The budget carves out $2.3 billion in federal funds for tenants who are behind on rent and at risk of eviction.|
|The proposed rent relief program would help cover up to 12 months of past rent and utilities costs and three months of future rent for those eligible.|
|The deal dedicates additional funds to combat housing issues worsened by the pandemic. It includes $250 million for New York City’s public housing authority and $100 million to convert hotels and vacant property into affordable housing.|
What it REALLY Means according to me: