The Inadequacy of the Obama Administration

Lots to say and I’ll update this in the future but let me put down a few initial thoughts…

Earlier today I was directed to a column which suggests that Obama’s Chained CPI offer is just a ploy to show that the Republicans are unreasonable and uninterested in negotiating, i.e., he didn’t make the offer with any expectation that they’d accept it.  (See here for some arguments on why Chained CPI indexing is poor public policy.)  I’m not buying that it’s an Obama ploy to make the GOP look unreasonable.  If that were his goal there’s no shortage of existing evidence to make the case.

President Obama is who he is.  What do Pres. Obama’s statements and non-statements re Social Security tell us about him?  Well, let’s consider this chart:

taxableminimum_chart_1-2-2013_2

“What’s that?” you ask.  (I found it on the Urban Institute’s website.)  Well, it shows current shortfall in Social Security income (leftmost bar) along with projected surplus or shortfall under alternative revenue scenarios (four rightmost bars).   (I interpret the leftmost bar to mean that payroll taxes would need to increased by 2.22% in order to eliminate the current revenue shortfall.)  Little known fact:  For a long time the ‘maximum taxable income’ cap which applies to wages resulted in the Social Security tax being applied to approximately 90% of the wage base, i.e., 90% of the sum of all wages.   The ‘maximum taxable income’ number has grown less rapidly than inflation so now only about 84% of the wage base generates Social Security revenue.  If we simply corrected that discrepancy, we’d cut the shortfall roughly in half – that’s the two rightmost bars – if the additional taxes paid didn’t result in new benefits then you get the -1.21% bar, if they did then you get the -1.42% bar.   (Tip of the hat to Bruce Bartlett for cluing me in to that.)

That begs the question, what would happen if we removed the wage cap?  Well, according to the Urban Institute’s chart, which is supposedly based on data provided by Social Security’s chief actuary, if we removed the wage cap and didn’t increase benefits for those paying additional tax then SOCIAL SECURITY WOULD BE RUNNING A SURPLUS.  That would be more than a little prickish not to pay additional benefits to those paying the additional taxes so, figuring we upped benefits accordingly, eliminating the wage cap would reduce the Social Security revenue shortfall by 85%.  (Increase payroll taxes, implement some variant of Chained CPI to make up the last 15%, whatever.  The point is that there’s a simple policy change which would all but eliminate the problem.)  Has President Obama suggested eliminating the wage cap as an option?  (The Urban Institute website indicates past proposals for raising the taxable minimum but not for eliminating the wage cap.)  Has the Democratic leadership suggested this as an option?  Have you heard anyone suggest this as an option?  I haven’t, but perhaps I don’t get out of the house enough.  Why has this seemingly straightforward fix to the Social Security revenue problem not been suggested repeatedly, ad nauseum, again and again, and then a few more times just to drive the point home?  Riddle me that?  (UPDATE:  Apparently I do need to get out more.  Nancy Folbre sums things up at Economix.  Sen. Mark Begich (D-AK) and Rep. Ted Deutch (D-FL) have drafted a law which would eliminate the cap.  Still, why is Prof. Folbre’s column the first I’ve heard of this?)

I look at how Obama negotiated the ACA (killing off Single Payer before the fact to obtain insurance company buy-in, lack of support of a public option), the Fiscal Cliff deal (locking in 82% of W’s tax cuts in exchange for changes in marginal tax rates which don’t come close to paying for them), sequestration, how he suggested universal preschool with a straight face without any plausible means of funding it, his capitulation to the right on matters of national debt and deficits, his apparent indifference to the declining middle class standard of living, his lack of commitment to investments in infrastructure which would not only make much needed repairs but also create decent-paying jobs and give the economy an honest-to-god boost, his refusal to investigate members of the prior administration for war crimes despite overwhelming evidence of them, his willingness to give Wall Street a full pass on their fraud, his administration’s prosecution of whistleblowers, his choices for cabinet secretaries and top aides (e.g., Tim Geithner, Bill Daley, Ernest Moniz, Mary Jo White, Eric Holder), that he declined to back Elizabeth Warren to head the CFPB, his support for “free trade” agreements, the drone strikes, etc., etc. – I look at all those things and I ask myself, “Just how is this guy one bit better than Bush 1?  How is he any better than Ford?  Or Nixon?”  (I don’t recall Ford being particularly objectionable, just uninspiring.)  Frankly, while no fan of Bush 1, what I remember of him I find less objectionable than the current president.  I spared Bush 1 no quarter when it came to public policy so why the hell should I cut Obama any slack?  He had a term to prove himself.  He is who he is and he continues to be so.

mydreamharpers

I’m tired of his bullshit.   Having a D after his name doesn’t buy him a pass.

Let us grant that Barack Obama is as intelligent as his admirers insist. What evidence do we possess that he is also a moral virtuoso?  What evidence do we possess that he is a good, wise, or even a decent man? Yes, he can be eloquent, yet eloquence is no guarantee of wisdom or of virtue. Yes, he has a nice family, but that evinces a private morality. Public morality requires public action, and all available public evidence points to a man with the character of a common politician, whose singular ambition in life was to attain power; nothing in Barack Obama’s political career suggests that he would ever willingly commit to a course of action that would cost him an election. His preposterously two-faced approach to Afghanistan, wherein he simultaneously escalates the war while promising to begin “the transition to Afghan responsibility” just a year later, is a perfect illustration of his compulsion to split the difference on any given political question. (One could also point to the health-care boondoggle, or to his utter capitulation to Wall Street in economic matters.) He dilly-dallies, draws out both friends and opponents, dangles promises in front of everyone, gives a dramatic speech, and then pulls back to gauge the reaction. Since the policy itself is incoherent — and, as usual with Obama, salted with stipulations and provisos—he can always trim and readjust as necessary.  Deadlines and definitions of “combat forces” are infinitely malleable. Since Obama is an intelligent man, surely he understands the meaning of the word mendacity.

Having embraced and professionalized the powers of force and fraud previously associated with the likes of John Yoo and Dick Cheney, Obama has embarked on a course of war that will certainly invite further abuses of power. His political survival now depends on martial success in a land [Afghanistan] that has defeated some of history’s most brutal strategies of conquest.  Obama has set a trap for himself, but because he is such a clever politician, the spring is just as likely to fall on us instead. Such insidious governance demands serious, sustained opposition, not respectful disagreement or fanciful historical apologies or mournful lamentations about the tragedy of his presidency.  Principles can be sacrificed to hopes as well as to fears.

– Roger Hodge, from “The Mendacity of Hope” (Harper’s Magazine, February 2010)