How Wisconsin Can Turn Austerity into Prosperity: Own a Bank

by Ellen Hodgson Brown / March 8th, 2011

Public sector man sitting in a bar: “They’re trying to take away our pensions.”
Private sector man: “What’s a pension?

— Cartoon in the Houston Chronicle

As states struggle to meet their budgets, public pensions are on the chopping block, but they needn’t be. States can keep their pension funds intact while leveraging them into many times their worth in loans, just as Wall Street banks do. They can do this by forming their own public banks, following the lead of North Dakota — a state that currently has a budget surplus.

Wisconsin Governor Scott Walker, whose recently proposed bill to gut benefits, wages, and bargaining rights for unionized public workers inspired weeks of protests in Madison, has justified the move as necessary for balancing the state’s budget. But is it?

After three weeks of demonstrations in Wisconsin, protesters report no plans to back down. Fourteen Wisconsin Democratic lawmakers — who left the state so that a quorum to vote on the bill could not be reached — said Friday that they are not deterred by threats of possible arrest and of 1,500 layoffs if they don’t return to work. President Obama has charged Wisconsin’s Governor Scott Walker with attempting to bust the unions. But Walker’s defense is:

“We’re broke. Like nearly every state across the country, we don’t have any more money.”

Among other concessions, Governor Walker wants to require public employees to pay a portion of the cost of their own pensions. Bemoaning a budget deficit of $3.6 billion, he says the state is too broke to afford all these benefits.

Broke Unless You Count the $67 Billion Pension Fund…

That’s what he says, but according to Wisconsin’s 2010 CAFR (Comprehensive Annual Financial Report), the state has $67 billion in pension and other employee benefit trust funds, invested mainly in stocks and debt securities drawing a modest return.

A recent study by the PEW Center for the States showed that Wisconsin’s pension fund is almost fully funded, meaning it can meet its commitments for years to come without drawing on outside sources. It requires a contribution of only $645 million annually to meet pension payouts. Zach Carter, writing in the Huffington Post, notes that the pension program could save another $195 million annually just by cutting out its Wall Street investment managers and managing the funds in-house.

The governor is evidently eying the state’s lucrative pension fund, not because the state cannot afford the pension program, but as a source of revenue for programs that are not fully funded. This tactic, however, is not going down well with state employees.

Fortunately, there is another alternative. Wisconsin could draw down the fund by the small amount needed to meet pension obligations, and put the bulk of the money to work creating jobs, helping local businesses, and increasing tax revenues for the state. It could do this by forming its own bank, following the lead of North Dakota, the only state to have its own bank — and the only state to escape the credit crisis.

This could be done without spending the pension fund money or lending it. The funds would just be shifted from one form of investment to another (equity in a bank). When a bank makes a loan, neither the bank’s own capital nor its customers’ demand deposits are actually lent to borrowers. As observed on the Dallas Federal Reserve’s website, “Banks actually create money when they lend it.” They simply extend accounting-entry bank credit, which is extinguished when the loan is repaid. Creating this sort of credit-money is a privilege available only to banks, but states can tap into that privilege by owning a bank.

How North Dakota Escaped the Credit Crunch

Ironically, the only state to have one of these socialist-sounding credit machines is a conservative Republican state. The state-owned Bank of North Dakota (BND) has allowed North Dakota to maintain its economic sovereignty, a conservative states-rights sort of ideal. The BND was established in 1919 in response to a wave of farm foreclosures at the hands of out-of-state Wall Street banks. Today the state not only has no debt, but it recently boasted its largest-ever budget surplus. The BND helps to fund not only local government but local businesses and local banks, by partnering with the banks to provide the funds to support small business lending.

The BND is also a boon to the state treasury. It has a return on equity of 25-26%, and it has contributed over $300 million to the state (its only shareholder) in the past decade — a notable achievement for a state with a population less than one-tenth the size of Los Angeles County. In comparison, California’s public pension funds are down more than $100 billion — that’s billion with a “b”— or close to half the funds’ holdings, following the Wall Street debacle of 2008. It was, in fact, the 2008 bank collapse rather than overpaid public employees that caused the crisis that shrank state revenues and prompted the budget cuts in the first place.

Seven States Are Now Considering Setting Up Public Banks

Faced with federal inaction and growing local budget crises, an increasing number of states are exploring the possibility of setting up their own state-owned banks, following the North Dakota model. On January 11, 2011, a bill to establish a state-owned bank was introduced in the Oregon State legislature; on January 13, a similar bill was introduced in Washington State; on January 20, a bill for a state bank was filed in Massachusetts (following a 2010 bill that had lapsed); and on February 4, a bill was introduced in the Maryland legislature for a feasibility study looking into the possibilities. They join Illinois, Virginia, and Hawaii, which introduced similar bills in 2010, bringing the total number of states with such bills to seven.

If Governor Walker wanted to explore this possibility for his state, he could drop in on the Center for State Innovation (CSI), which is located down the street in his capitol city of Madison, Wisconsin. The CSI has done detailed cost/benefit analyses of the Oregon and Washington state bank initiatives, which show substantial projected benefits based on the BND precedent. See reports here and here.

For Washington State, with an economy not much larger than Wisconsin’s, the CSI report estimates that after an initial start-up period, establishing a state-owned bank would create new or retained jobs of between 7,400 and 10,700 a year at small businesses alone, while at the same time returning a profit to the state.

A Bank of Wisconsin Could Generate “Bank Credit” Many Times the Size of the Budget Deficit

Economists looking at the CSI reports have called their conclusions conservative. The CSI made its projections without relying on state pension funds for bank capital, although it acknowledged that this could be a potential source of capitalization.

If the Bank of Wisconsin were to use state pension funds, it could have a capitalization of more than $57 billion – nearly as large as that of Goldman Sachs. At an 8% capital requirement, $8 in capital can support $100 in loans, or a potential lending capacity of over $500 billion. The bank would need deposits to clear the checks, but the credit-generating potential could still be huge.

Banks can create all the bank credit they want, limited only by (a) the availability of creditworthy borrowers, (b) the lending limits imposed by bank capital requirements, and (c) the availability of “liquidity” to clear outgoing checks. Liquidity can be acquired either from the deposits of the bank’s own customers or by borrowing from other banks or the money market. If borrowed, the cost of funds is a factor; but at today’s very low Fed funds rate of 0.2%, that cost is minimal. Again, however, only banks can tap into these very low rates. States are reduced to borrowing at about 5% — unless they own their own banks; or, better yet, unless they are banks. The BND is set up as “North Dakota doing business as the Bank of North Dakota.”

That means that technically all of North Dakota’s assets are the assets of the bank. The BND also has its deposit needs covered. It has a massive, captive deposit base, since all of the state’s revenues are deposited in the bank by law. The bank also takes other deposits, but the bulk of its deposits are government funds. The BND is careful not to compete with local banks for consumer deposits, which account for less than 2% of the total. The BND reports that it has deposits of $2.7 billion and outstanding loans of $2.6 billion. With a population of 647,000, that works out to about $4,000 per capita in deposits, backing roughly the same amount in loans.

Wisconsin has a population that is nine times the size of North Dakota’s. Other factors being equal, Wisconsin might be able to amass over $24 billion in deposits and generate an equivalent sum in loans – over six times the deficit complained of by the state’s governor. That lending capacity could be used for many purposes, depending on the will of the legislature and state law. Possibilities include (a) partnering with local banks, on the North Dakota model, strengthening their capital bases to allow credit to flow to small businesses and homeowners, where it is sorely needed today; (b) funding infrastructure virtually interest-free (since the state would own the bank and would get back any interest paid out); and (c) refinancing state deficits nearly interest-free.

Why Give Wisconsin’s Enormous Credit-generating Power Away?

The budget woes of Wisconsin and other states were caused, not by overspending on employee benefits, but by a credit crisis on Wall Street. The “cure” is to get credit flowing again in the local economy, and this can be done by using state assets to capitalize state-owned banks.

Against the modest cost of establishing a publicly-owned bank, state legislators need to weigh the much greater costs of the alternatives – slashing essential public services, laying off workers, raising taxes on constituents who are already over-taxed, and selling off public assets. Given the cost of continuing business as usual, states can hardly afford not to consider the public bank option. When state and local governments invest their capital in out-of-state money center banks and deposit their revenues there, they are giving their enormous credit-generating power away to Wall Street.

Ellen Brown is an attorney in Los Angeles and the author of 11 books. In Web of Debt: The Shocking Truth About Our Money System and How We Can Break Free, she shows how a private banking cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Read other articles by Ellen, or visit Ellen's website.

This article was posted on Tuesday, March 8th, 2011 at 8:01am and is filed under Banks/Banking.

The Restorative Revolution: It's Coming

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Peacemeal

Creating a life of harmony one choice at a time.

by Elaine Shpungin

The Restorative Revolution: It's Coming

This revolution will not be bloody but it's coming just the same.

Published on February 28, 2011

Call me crazy - but I think we are ready for a Revolution.

I'm talking about a revolution in the way we approach justice, transgression, punishment, crime, and every day conflict among ordinary people. I am talking about the way we treat each other after we hurt each other - even in very deep ways - and the way we treat those who are less powerful than us when "justice" is placed in our hands.

I am talking a transformational, society-wide, lens-shifting, all-affecting revolution the scale of the 1960's civil rights and women's rights movements, a revolution in how we think about who we are and how we live, work, and love together.

Not a solution to everything. Not panacea, utopia, peace and love for all. But a fundamental shift in the collective understanding of what might be possible.

I feel it in my bones, like the rumble of a train coming down the tracks way before you see its lights appear from behind the bend.

People are sensing the heavy creaking of the current justice system, the way it is over-burdened and under-humane, the way it takes our sons and daughters and nieces and nephews and puts them back into our communities more hardened and less integrated than they were before, the way it creates rifts among us, decreasing rather than increasing the sense of safety for which we all long.

And people are becoming dissatisfied with the way we inadvertently replicate that same model in our homes, with people most precious to us, and in our communities, the places where we spend our waking hours.

I work with a lot of communication modalities and I have been talking to people about empathy and healing and dialogue for a long time.

But when I mention the restorative practices work in which I am involved, people respond with the kind of excitement, the kind of energy I have not seen before. Their eyes light up. They smile. They want to learn more. They want to get involved.

I am talking about people across all economic, class, age, and race differences: administrators working in the formal justice system and grandmothers of boys in the local jail, academics and activists, rabbis and conservative ministers, teachers and parents, college students and poets. When I share what might be possible, there is a spark, an electrical surge of hope.

And what is possible is a way of doing conflict and justice in which each voice and each side gets heard, in which people who have been hurt get to ask their toughest questions and those who have caused pain get to experience the impact of what they have done and come out feeling more human, not less. What is possible are solutions to conflicts that are not believable until you hear them, that stem from human creativity that is untapped by the current way we do things, and are agreed upon by everyone who is impacted by the conflict.

Restorative practices, as ancient as human society, have been making their way back into our collective knowledge. Some of them, like the Restorative Circles practice which I have been learning, are laced with a modern edge, an edge forged in the fires of inner-city Brazilian favelas where drugs, gun violence, racialized tensions and numbing poverty overlay the struggle for daily survival.

And that is what makes the possibility so palpable. There is another way and it works. It works to re-humanize people to each other in the most trying of circumstances across deeply etched lines. In a place where unbelievable beauty and unbelievable disparity go hand in hand, restorative practices are growing and being embraced by school districts, youth courts, youth prisons, neighborhoods and homes, presidential candidates and major news networks. Restorative Circles are winning awards and changing circumstances, changing lives, changing how people think about and live with conflict.

Not a solution to everything. Not panacea, utopia, peace and love for all. But a fundamental shift in the collective understanding of what might be possible.

A Restorative Revolution. It's coming.

Wanna get on board?

AlterNet.org

ECONOMY

AlterNet / By Joshua Holland

Don't Sit on the Sidelines -- This Saturday, Be Part of the Uprising Sweeping the Country from Wisconsin to Your Home Town

A huge coalition of progressive groups have organized rallies across the country to stand up against harsh budget cuts and tax cheats, and protect the middle class.

February 25, 2011 |

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Noam Chomsky was asked in a recent interview whether it's possible to make our government work for ordinary Americans rather than a rarified elite. “What has to be done,” he replied, “is what’s happening in Madison, or what’s happening in Tahrir Square in Cairo. If there’s mass popular opposition, any political leader is going to have to respond to it, whoever they are.”

Today, we may be seeing the emergence of just such a force in American politics. This Saturday, the sleeping giant will stir as progressives across the country rally in solidarity with public-sector workers and in opposition to the draconian cuts to our already threadbare safety net proposed by the Tea Party-infused GOP.

There's a new militancy in the air. Inspired not only by the protesters standing tall in Wisconsin, Ohio and a half-dozen other states but also by the seismic upheaval taking place around the world, progressive America, long overshadowed by the media-friendly Tea Parties, will show up in force in all 50 states this Saturday to demand that budgets aren't balanced on the backs of working people and the most vulnerable among us.

In Wisconsin, there has even been talk of organizing a general strike, an event not seen in this country since the 1930s, if right-wing Governor Scott Walker manages to push his union-busting bill through the legislature. Labor hasn't flexed its muscles like that for generations, but there is a growing sense that we, as working people, face a defining moment in our democracy.

On Saturday, there will be two opportunities to make your voice heard above the astroturfed right-wing din. First, a coalition of grassroots progressive groups are staging a nationwide “Rally to Save the American Dream” in front of every state house in the country at noon local time to express support for the working people of Wisconsin.

In Wisconsin and around our country, the American Dream is under fierce attack. Instead of creating jobs, Republicans are giving tax breaks to corporations and the very rich—and then cutting funding for education, police, emergency response, and vital human services.

But this weekend's rallies won't be the end of this effort. Taking a page from the noisy town-hall meetings that marked last year's health-care reform debate, an unnamed labor organizer told Politico that union members “have been urged to attend congressional town hall meetings to ask Republican lawmakers 'pointed questions' about the cuts they supported last week. ...We are targeting various House Republicans in town hall meetings during the recess to let them know these budget cuts are beyond the pale,” the organizer said.

You can find out more about the Rally to Save the American Dream, and get involved in the action, here.

The other major actions this weekend are being organized by US Uncut, which is targeting the corporate power behind the elites' assault on our middle-class. Modeled on the UK Uncut movement that was organized to push back against the “austerity” measures being imposed by the Cameron government (and inspired by an excellent essay by Johann Hari titled, “How to Build a Progressive Tea Party”), they have an exceedingly simple yet powerful message: there is a simple alternative to imposing economic pain on working people to balance budgets: make corporate tax cheats pay.

The questions US Uncut is trying to inject into the discourse are: “If we pay our taxes, why don’t they?” and “If corporations profit here, shouldn't they pay here?”

Enjoying record profits and taxpayer-funded bailouts as the economy slowly recovers from a financial crisis, nearly two-thirds of US corporations don't pay any income taxes, instead opting to abuse tax loopholes and offshore tax havens. According to this studyfrom the non-partisan Government Accountability Office, 83 of the top 100 publicly traded corporations that operate in the US exploit corporate tax havens. Since 2009, America’s most profitable companies such as ExxonMobil, General Electric, Bank of America and Citigroup all paid a grand total of $0 in federal income taxes to Uncle Sam. Tax havens alone account for up to $1 trillion in tax revenue lost every decade, money that could be invested in K-12 education, colleges, public health, job creation and hundreds of other worthy public programs.

US Uncut is a decentralized operation, and local activists can choose their own targets. But the main event this Saturday will be at Bank of America branches across the country. It's an appropriate choice, as the organizers explain:

Despite ruining the economy with their reckless greed, Bank of America has consistently avoided any form of accountability to the American taxpayer. In fact, in 2009, Bank of America actually received a net tax benefit. Yes, last year, the federal government gave Bank of America $2.3 billion.

That money alone could almost completely cover the proposed $2.5 billion cuts to the Low Income Home Energy Assistance Program (LIHEAP), which helps low-income families pay their heating and cooling bills and affects 34 million households.

Learn more about US Uncut, and sign up to protest outside of BofA, or another corporate tax cheat of your choice, here.

But the most militant response to the Right's push came from Madison, Wisconsin this week, when the local AFL-CIO federation voted to make preparations to hold a general strike if Walker pushes his bill through the legislature. This is a big deal -- a sign of how threatened the American labor movement feels after seeing its representation in the private sector fall under a withering campaign of union-busting from a third of all wage-earners 30 years ago to just 7 percent today.

General strikes don't target a single company or industry; they're an expression of power by all workers in a region or country. Greece had a one-day general strike this week, but in the U.S., the last one occurred in San Francisco in 1934.

So far, they are only threatening to call a general strike. Actually doing so – having unions walk out in support of other organized workers – has been illegal since the passage of the Taft-Hartley Act in the 1940s. The law, called the “slave act” by opponents, outlaws all strikes by workers who don't have a direct interest in the issue at hand.

As such, it would be a powerful act of civil disobedience. But violating Taft-Hartley exposes unions to costly judgments that could potentially wipe out some of the smaller unions. Nevertheless, labor journalist Mike Elk reports that some public employee unions – with their backs against the wall -- may take that risk.

It's important to understand that only labor unions are barred from organizing a general strike, and around 90 percent of American workers don't belong to a union. When the Wisconsin labor federation adopted its resolution, one long-time progressive activist remarked that it was “the most exciting idea I've heard in a long time.” With the power of online organizing, perhaps the next iteration of progressive power will be a general strike not of union workers, but of ordinary Americans who are sick of a government that's done everything for Wall Street while practically ignoring a 9 percent unemployment rate and a devastating foreclosure crisis.

It looks increasingly likely that we will see a government shutdown over the GOP's proposals to kill any economic progress we've made since the crash with their draconian cuts. Why not shut down the private sector in response? It's hard to imagine a more full-throated rejection of the political games being played in Washington.

All of this energy may be short-lived, but it could be the start of a more active progressive movement in the U.S. By and large, progressives have held their fire since the election of Barack Obama in 2008. Organizers of the protests spreading across this country in a decaying economy are tapping into a deep reserve of frustration with the status quo, and resurrecting a populist tradition long missing on the American Left.

This Saturday, we might witness the beginning of some real push-back against the plutocracy from a newly energized progressive movement. This is something you really shouldn't miss.

US Uncut

Rally to Save the American Dream

Joshua Holland is an editor and senior writer at AlterNet. He is the author of The 15 Biggest Lies About the Economy (and Everything else the Right Doesn't Want You to Know About Taxes, Jobs and Corporate America). Drop him an email or follow him on Twitter.

Top 5 Reasons Why Wisconsin Matters To Us All

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Wisconsin Matters To Us All
Public workers in Wisconsin and in several other states where they are under assault are fighting for the dignity of every worker. If these workers lose their ability to fight for fair wages and decent working conditions, we all lose

Top 5: Why Wisconsin Matters To You

By Bill Scher

February 22, 2011 - 3:14pm ET

Thousands are rallying in Wisconsin and across the nation to oppose conservative governors who are attacking the collective bargaining rights of our civil servants. And the people in the streets are not just public sector union members.

Why? Why are so many who are not part of a union so committed to protecting the role of organized workers in our government and our economy?

1. Weak Economies Need More Demand: Our economy is struggling and our state budgets are distressed because increased unemployment and falling home prices have reduced economic demand. Weakening the ability of any workers to negotiate fair pay and secure retirements will only weaken demand further, hurting the overall economy.

2. Strong Standards Strengthen The Middle Class. When public sector workers can negotiate for fair pay, healthy workplaces and secure retirements, that puts pressure on private sector CEOs to do the same, or else they risk losing talent to the public sector. Making public sector work less inviting does nothing to make private sector jobs pay better. We need to raise the bar, not lower it.

3. Decent Government Pay Means Decent Government: Most everyone wants our federal, state and local governments to function effectively. That means being able to attract skilled, productive workers with fair pay, healthy workplaces and secure retirements, all of which will be lost if public workers can no longer bargain for their compensation packages.

4. Public Employees Are Not The Problem: Study after study shows the public employees do not receive extravagant compensation, and that the problems with state public pension systems are largely overblown. State budgets are reeling from an economic recession caused by reckless Wall Street speculators, top end tax cuts and corporate tax avoidance. The projected shortfalls in public retirement benefits derive mostly from skyrocketing health care costs thanks to private insurers, and poorly performing pension investments thanks to deregulated Wall Street firms.

Furthermore, civil servants in Wisconsin and elsewhere have repeatedly said they are willing to make concessions regarding pay and benefits. Unlike conservative corporate executives, they have proven their willingness to share the sacrifices. What we can't negotiate is their right to negotiate.

5. Scapegoating Lets The Culprits Get Away: Right-wing billionaires like the Koch brothers are pumping millions into a nationwide effort to break the public employee unions. Why would they bother? Because if they can get most people to blame public employees for the nation's economic ills, they won't hold irresponsible corporations accountable and force the ultra-rich to make any sacrifices, such as higher taxes and tougher regulations.

Now that you know why the assault on public employee unions affects us all, what can we do about it?

Sign The Petition: The AFL-CIO has a petition supporting fair pay and worker rights, to be delivered to all 50 state legislatures

Attend A Rally: SEIU and Jobs With Justice both have compiled lists of rallies taking place all across the country this week.

Share This Blog Post: Share with your friends, neighbors and colleagues the reasons why we all should care about the attack on our civil servants.

This is a critical moment in our nation's history. Will we be a nation where workers can thrive, or where workers are nickel and dimed? Will we have a vibrant economy that works for all, or will we have a stagnant economy that serves the few?

Now's the time to stand up.

First, they attacked PBS and NPR. Now AmeriCorps

First, they went nuclear on PBS and NPR. Now, they have voted to totally shut down AmeriCorps -- the groundbreaking national service program that has transformed the lives of millions of Americans.

In the dead of night on Saturday, a Tea Party-driven group of House members voted to kill AmeriCorps, completely eliminating all funding. With a potential government shutdown looming on March 4th, the fate of 85,000 AmeriCorp community organizers, teachers, and tutors will now be decided by the U.S. Senate.

Here is the heart of the matter: AmeriCorps volunteers help and protect our country's most vulnerable. Every day, AmeriCorps organizers work in many of the poorest communities in America, lessening the pain of those suffering in this brutal economy. As their work rebuilding New Orleans after Hurricane Katrina exemplifies, these organizers are the backbone of our country’s service community -- a Peace Corps for our own country.

After hearing the shocking news, former AmeriCorps volunteer Caleb Jonas decided he had to do something. From a coffee shop in Massachusetts, Caleb logged in to Change.org from his laptop and created a petition asking Congress to "Save AmeriCorps." Caleb’s inspiring action has already been signed by 17,266 Americans -- without significant promotion from any major organization. Until now.

Click here now to quickly sign your name to Caleb’s "Save AmeriCorps" petition to the Senate. Your signature will help Caleb reach his personal goal of 85,000 signatures -- one signature for every AmeriCorps member currently serving their country. DEADLINE: Thursday, 5 p.m.

Why does Caleb care so much about AmeriCorps? Because he spent a year improving the quality of tutoring programs for low-income kids in Minnesota -- and witnessed AmeriCorps members build houses for Habitat for Humanity, help political refugees start new lives, improve reading test scores for elementary school students, and help disadvantaged high school students get into college.

As Caleb told us over the phone, it breaks his heart that this vital national service program could be shut down at a time when people in the most marginalized communities in America need it the most. That’s why Caleb was inspired to start his "Save AmeriCorps" petition from a coffee shop -- and why AmeriCorps supporters are sharing it on Facebook and forwarding messages like this to their friends around the country.

With AmeriCorps on the chopping block, it’s time for us to stand up for Caleb and thousands of other volunteers who have committed years of their lives to community service. Will you click here now to sign your name and tell the Senate not to kill AmeriCorps?

http://www.change.org/petitions/save-americorps?alert_id=NNHcGQVECl_BqLSMFmEBk&me=aa

Thank you for joining Caleb and Change.org members across our country fighting to save AmeriCorps before it’s too late.

-- Patrick and the Change.org team

Reopening Health Care Reform

Reopening Health Care Reform

Daniel Greenwood

While the constitutional challenges to last year’s health care reform act barely pass the snicker test, the fact remains that the Patient Protection and Affordable Care Act is badly flawed.

We have two existing, popular, successful, and relatively efficient government-based health care plans: Medicare, which provides nationalized medical insurance for all Americans over sixty-five; and the VA system, which provides nationalized medical care for veterans.

The simplest form of national health care reform, thus, would have been simply to extend one of these existing systems to all Americans. Better still, we could have retained both the advantages of those reasonably well-run systems and added competition and choice by offering all Americans the option of choosing one of the two government-run systems or a nongovernmental, for-profit alternative.

Instead, the Obama Administration decided to take a fundamentally Reaganite approach. The PPAC Act imposes privatization without true competition, by subsidizing customers rather than creating a cheaper provider without the excess layers of costs and inefficiency that private insurance imposes. Despite its significant cost-reduction provisions, its fundamental structure was designed to overcome insurance company and GOP opposition by protecting the profits of incumbent insurance companies and, to a lesser extent, care-providers, at the expense of the taxpayers. The basic problems of private insurance—the strong incentives to cherry pick customers and deny needed care in order to protect executive pay and shareholder profits—remain in place, and regulation can only do so much to counteract them.

Now is the time to preempt GOP claims that health care finance reform is a disguised attack on Medicare, Tea Party attempts to repeal all forms of reform, court attacks on the constitutionality of this particular system, and insurance company attempts to enhance profits by capturing the regulators entrusted with resisting their pursuit of profits at the customers’ expense.

The Democratic leadership should propose the reform we really needed and that polls suggest Americans really want: a simple statute, mandating that every American have medical insurance, but offering every American the opportunity to enroll in Medicare or the VA system at the current fee schedule. If private companies can compete, let them do so. Don’t repeal, replace—with Medicare for all.

Health Care Reform, Health Care, Medicare, Patient Protection and Affordable Care Act

February 11, 2011 at 22:17:15

Our Founding Fathers Would Be Proud of the Egyptian People & Disgusted at the Spineless Sheep Most Americans Have Become

By Richard Clark (about the author)

opednews.com

America 's founding fathers stood up for their freedom, winning it from the British. The Egyptian people have stood up for their freedom, too, winning it from the Mubarak dictatorship, finding their courage even when Mubarak's thugs flew fighter jets low over their heads, beat and murdered protesters, and otherwise threatened violence.

The American people, on the other hand, have been cowed into passivity by an irrational fear of terrorism, laziness and mindlessness .

Some would point out, however, that the American government is nothing like the Egyptian government. So let's make some comparisons:

• There is a stunning amount of inequality in Egypt. But America is even worse

• Mubarak stole billions from his people, while the American oligarchs have stolen trillions. See this, this, this and this

• Egypt has been living under a state of emergency for 30 years, yes. But Americans have been living under a continuous state of emergency for 10 years straight.
  

• Mubarak was supported by the military. But the military-industrial complex has taken over America as well (moreover, there is a tradition in countries like Turkey for the military to ensure that religious fanatics do not take over the country)

• Mubarak ignored the wishes of his people. But has the American government been listening to its people? Consider the 2010 Rasmussen poll which found that "just 21% of voters nationwide believe that the federal government enjoys the consent of the governed." A 2010 Gallup poll determined that nearly half of all Americans believe "the Federal government poses an immediate threat to the rights and freedoms of ordinary citizens." Poll after poll shows that "both national parties are deeply unpopular with an electorate looking for something new and different." Polls reveal that 82% of all Americans wanted Wall Street to be reined in, in a substantial and meaningful manner, and yet our government has let Wall Street have its way on all the important issues. Polls find that Americans want the big financial players who acted with fraud to be punished, and yet our government has let all of the big fish off the hook. In fact, our government has ignored many other desires of the American people, as well, including investigations into torture and spying on Americans, impeaching George W. Bush if he lied about Iraqi WMDs (which he did).

• Mubarak repressed his people and stifled dissent. Bush and Obama have haven't been all that protective of liberty either

• Mubarak murdered and tortured people without following the rule of law. America hasn't been exactly saintly in this regard over the last 10 years either

And if you think our problems started on 9/11, remember that virtually all of the current domestic and foreign policies were already in place, or planned, before 9/11.

Unlike the Egyptian people, however, Americans have become scared of their own shadow. We have forgotten that courage and hope are choices -- which do not have to come from JohnWayne levels of testosterone, but can simply arise from loving something enough to want to protect it.

How Did We Turn Into the Oppressor?

England oppressed America. We were the downtrodden who broke free. But now, America has helped to repress the Egyptian people (see this and this).

So how did we get on the wrong side of history?

Minister Jim Wallis provides some answers in an open letter that he wrote to the Egyptian protesters. Here are some excerpts:

"The United States was not talking about democracy in Egypt, not advocating it, not saying a transition is necessary and urgent, UNTIL you risked your security, safety and lives for the sake of democracy. You changed the conversation, a conversation that would be the same as it has been for decades if you hadn't done what you did. Your generational peers are now watching what you are doing in countries across the Arab world, and beyond. This is the moment for you and for us."

"You represent a new generation, a new leadership, and a new hope for the possibility of real democracy. So keep leading. My government, which still calls itself the beacon of freedom, has sacrificed democracy in your region of the world (and many other places) for the sake of American "interests": Our foreign policy around the globe has put our interests before our principles. But they are not really the interests of the American people, but of oil companies, big banks and corporations. Their interest in "stability" and continuity is very different from ours in democracy. So don't be fooled, don't listen to the so-called "wise" voices that have been part of the old reality and want to now thank you for your service to democracy, but are offering to take it from here."

"Don't let them. Keep demanding democracy -- real democracy. Because, for the rest of us, democracy is the best defense of our interests, and the best path to genuine stability. And, for our part, we will do our best to stand with you."

* * *

With thanks to "George Washington" at Zerohedge.com.

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Several years after receiving my M.A. in social science (interdisciplinary studies) I was an instructor at S.F. State University for a year, but then went back to designing automated machinery, and then tech writing, in Silicon Valley. I've always (more...)

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