"You left poor Behemoth, betraying him for a glass of brandy -- though it was very good brandy!"

Thursday, June 24, 2004

  John Gorenfeld, Moon the Messiah, and the Media Echo Chamber

[Reposted from my diary at dKos]

I've been thinking about how the story that John Gorenfeld has been following for months concerning politicans' close ties to the Rev. Sun Myung Moon, and in particular the bizzarre ceremony this March where Moon was crowned messiah, has suddenly burst into the open in the past several days. It has been a fascinating process to watch, because I have been following it closely since Gorenfeld's first piece that appeared in Salon last September detailing Republican's close ties to Moon and some of the more outrageous things Moon has said and done. Since then I have checked his blog regularly, and Atrios frequently posts links to John's latest updates.

Before this week, John couldn't get anyone to bite on this story. No one was interested. He would frequently post in the Atrios coments section describing his frustrations, and people would throw out suggestions to him as to who might be interested. The mainstream media was completely silent and utterly indifferent. Even those in the know didn't know -- I just did a search through the diaries at dKos, and the story kept coming up anew every couple weeks.

Then came his article in the Gadflyer a couple of weeks back, and it started to pick up some steam, you started to see articles here and there. But what really sent it over the top was this week's Salon piece. Suddenly it hit the St. Paul Pioneer Press, from which it spread to the Knight-Ridder wire, the Chicago Tribune, and, today, the front page of the Washington Post.

All of the sudden you can't miss the story -- even if you don't read, since it was apparently on ABC and CBS news. And Gorenfeld, who couldn't get anyone to pay any attention to him, is suddenly in hot demand. He is mentioned in the WaPo story, quoted in the NY Times (the Gray Lady, natch, pulled up the rear, just putting out the story in tomorrow's edition), and the moment I knew this was the tipping point was when I heard him being interviewd on All Things Considered.

The point of my going through all of this chronology is that it is an incredible case study in how the media echo chamber works, and therefore an experience very much to be learned from. The media in our country has lost its bearings, it has no sense of what makes a story important per se. The mainstream media couldn't get itself to touch this story, and John Gorenfeld was just some outsider, who maybe had a piece or two in Salon, but that wasn't enough to get them to pay attention.

Then there is a combination of events, a perfect storm: the Moon the Messiah ceremony is just so incredible, that it begins to pick up steam. Gorenfeld is on Air America and other radio outlets, he has the piece in the Gadflyer, and a couple of papers start to talk about it. Then this week's Salon article comes out, the WaPo finally jumps, and all of the rest of them follow like sheep. Unbelievably so. Newspapers and broadcast media outlets alike only became convinced that it was a story when they read about it in the Washington Post and Knight Ridder.

What's also interesting is how the story gets reported in the same way. Some of the details John G has been stressing concerning the utterly insane nature of Moon's speeches (in particular the Stalin and Hitler reference) have been getting picked up by these stories and reported as is. But the SCLM (the WaPo article in particular) has focused on the Democrats that were at the meeting and almost completely elided the fact that the overwhelming majority of Moon's support goes to Republicans, his recent courting of African-American Churches and the Congressional Black Caucus notwithstanding.

Still, annoying though this is to a certain extent, at least associating with Moon is on its way to becoming politically radioactive, which is needless to say how it should have been all along and has been, I think, one of Gorenfeld's goals in pursuing this story with such tenacity. It will be interesting to see what the fallout is. Will Moon money be dirty money? Will people begin to call for politicians to stay away from this sexually obsessed, homophobic, anti-semitic megalomaniac? I emailed the ADL shortly after the first Salon piece appeared last September asking why they hadn't demanded that politicians renounce all ties to this man who has suggested that the Holocaust was just retribution for Jews killing Christ -- as they've done with great energy vis-a-vis Farrakhan. I received no response. It will be interesting to see whether they will be more vocal now that the story can no longer be ignored.

Wednesday, June 16, 2004

  Political Taboos, pt. 2: Payroll Tax Reform

[reposted from my diary at dKos]

Part two of my series on "taboos" in American political discourse will argue for the need to reshift the tax debate from income to payroll taxes. Previously I have posted an introduction to the series and an entry on the need to eliminate agricultural subsidies. All posts in this series will also be reposted on my occasional blog begemot. The topics in this series are taboos not in the sense that they cannot be discussed at all, but that they are not currently the subject of serious legislative initiatives (as far as I'm aware). The series, for the most part, does not blame Democrats for not raising these issues, some of which are more politically feasible than others, but does argue that these issues should be considered more seriously -- at least after November's elections if not before. The usual caveat applies that I am not a specialist in any of the subjects I am posting on but have attempted to research it more or less thoroughly in order to produce an informed argument.

I will argue in the current entry that shifting the tax debate to reforming payroll taxes is both a moral imperative and in the best interests of the Democratic Party in both the short and long run. Payroll taxes are regressive taxes which affect lower income Americans to a far greater extent than upper income Americans. Most lower income Americans pay more (sometimes significantly more) in payroll taxes than in income taxes. While the Republicans have made cutting income taxes, repeatedly, incessantly, and without regard for the consequences, one of the centerpieces (if not the centerpiece) of their political program, the have, unsurprisingly, entirely ignored payroll taxes.

As Paul Krugman (who else?) argued way back at the beginning of the Bush mal-administration,

When it comes to tax cuts, however, Mr. Bush's people ignore the payroll tax — that is, they propose no cut in the tax that is most of what most families pay, while demanding a large cut in the income tax, which falls mainly on the affluent. And they want to eliminate the inheritance tax, which is overwhelmingly a tax on the downright wealthy.

Moreover, as Krugman has argued more recently (the NY Times, annoyingly and pointlessly makes their archived version of this article for pay only), the recent tax cuts for the wealthy are possible in part because of the increase in payroll taxes foisted on us 20 years ago at the behest, among others, of Alan Greenspan.

The payroll tax is regressive: it falls much more heavily on middle- and lower-income families than it does on the rich. In fact, according to Congressional Budget Office estimates, families near the middle of the income distribution pay almost twice as much in payroll taxes as in income taxes. Yet people were willing to accept a regressive tax increase to sustain Social Security.

Now the joke's on them. Mr. Greenspan pushed through an increase in taxes on working Americans, generating a Social Security surplus. Then he used that surplus to argue for tax cuts that deliver very little relief to most people, but are worth a lot to those making more than $300,000 a year. And now that those tax cuts have contributed to a soaring deficit, he wants to cut Social Security benefits.

The point, of course, is that if anyone had tried to sell this package honestly — "Let's raise taxes and cut benefits for working families so we can give big tax cuts to the rich!" — voters would have been outraged. So the class warriors of the right engaged in bait-and-switch.

This represents an enormous opportunity for progressives to wrest the tax issue away from those who would use it to benefit the very wealthy and to show how it should be used instead to help out the hard working middle class.

In a recent issue of Atlantic Monthly, Maya MacGuineas, director of the Fiscal Policy Program at the New America Foundation, argued extensively and persuasively for the need for radical tax reform.

Social Security and Medicare payroll taxes, also regressive, have grown to the point where they are the largest federal taxes that most American families pay. Though the basic structure of the federal payroll tax has hardly changed in fifty years, its rate has been raised repeatedly. Today it is 15.3 percent, and all earners, whether they make $25,000 a year or $250,000, pay it on the very first dollar of earnings. But the 12.4 percent Social Security tax applies only to wage earnings below $87,900—meaning that the $25,000-a-year earner (every dollar of whose income is taxed at 15.3 percent) pays a higher effective tax rate than the $250,000-a-year earner (most of whose income is exempt). And investment income and employer benefits—which accrue disproportionately to high-income earners—go completely untaxed, making the system still more regressive. People who live entirely off inherited wealth pay no payroll taxes at all.

In a recent op-ed piece, MacGuineas and New America Foundation president Ted Halstead urge Kerry to consider making abolishing the payroll tax one of his fiscal priorities:

Although you'd never know it from listening to our political leaders, the largest tax now paid by over 70 percent of working American families is not the income tax but the payroll tax. No tax does more to discourage job creation or to reduce take-home pay for low- and middle-income workers. Likewise, nothing could do more to boost both than repealing it outright.

Unlike income taxes, the payroll tax kicks in from the first dollar earned and applies only to wages. It is split equally between employers and employees (except in the case of independent contractors, who bear both parts of the burden). While income taxes have been cut many times in recent decades, payroll taxes have risen steadily: from a tenth of the federal budget in the 1950s to over a third today.

The New America Foundation is not the only progressive group arguing along these lines. An organization called "Get America Working!", which includes Robert Reich on its board, is equally vocal on this issue:

Payroll taxes do more damage than any other tax -- to the economy, social well being, the environment and income distribution. Payroll taxes have grown from 2 to 34 percent of Federal revenues, a gigantic accidental national increase in the price of hiring people. Now 80 percent of American taxpayers pay more in payroll taxes than in income tax.


The payroll tax is far more regressive even than it appears. The Social Security (largest) component applies only to wages up to $80,400 but not beyond. A family with two $50,000 earners pays more than another with one salary of $300,000 and investment income of $650,000.

Less obvious is the fact that low wage (i.e. little bargaining power) workers usually pay the "employer's" half of the tax. Their employers simply hold down wage increases until they have shifted the tax's cost to the workers. The opposite is true for highly skilled workers. The result: low wage workers pay the full tax and highly paid workers effectively pay little or nothing. That today's over $550 billion payroll taxes are so perfectly regressive – twice over – helps explain America's worsening income inequality.

[See also this GAW Chart on the rising U.S. reliance on payroll taxes.]

The possibility has not escaped Democrats, although they have so far not made it the centerpiece of their fiscal agenda. Of the Democratic candidates for president only Carol Mosley Braun, as far as I'm aware, addressed the issue on a consistent basis. (See for example her comments last summer on the News Hour.) Howard Dean flirted with the idea in January, but, to the disappointment of some of us supporters, never officially announced a plan including payroll tax reduction. Kerry has included payroll tax relief for new hires for small business in his extremely sophisticated plan for job creation but has, as far as I can tell, not addressed the issue of payroll tax relief more directly and comprehensively.

The main issue, of course, is how to make up the income that would be lost in cutting or eliminating payroll taxes. MacGuineas and Halstead propose a progressive national consumption tax which would also encourage savings. However, the idea of instituting an entirely new federal tax strikes me as particularly politically impossible. More realistic would be the possibility of extending tax credits or relief for social security taxes and making this up by repealing some of Bush's income tax and inheritance tax cuts for the very wealthy. This idea was proposed by Robert Reich who imagined the following scenario:

Starting as soon as possible, you'll be relieved of payroll taxes on the first $20,000 of your annual income. The tax holiday will last two years. Ballpark cost to the government: $700 billion. We'll pay for it by repealing Bush's estate tax cut, which will also cost around $700 billion. Are you with me? All we have to do is convince Democrats it's a smart move and strike fear in the hearts of enough Republicans to get it passed and signed

John Mattar of Democratic Underground proposed a very similar plan and also added the necessity (I would say moral imperative) of repealing the cap on contributions in order to make the social security tax less regressive:

Citizens for Tax Justice estimates that the elimination of the "earnings cap" would generate an estimated $52.8 billion in additional annual revenue (year 2000). That could pay for a full rebate of the payroll tax for up to 34.4 million workers earning $20,000 each year .

Can it be done? As with my previous post, this is an issue that I think truly can be drawn into the national political discourse. It is one that is both morally and fiscally imperative and also could provide potential enormous political advantage to the Democratic Party. Let's work to get this one on the table.

Wednesday, June 09, 2004

  Suggestions for W's Speech

I sent some suggestions to Chimpy for his speech at the Reagan necropallooza

(Oh, I should add, I suppose, that they are adapted from Stalin's speech at Lenin's funeral):

In leaving us, Comrade [Reagan] commanded us to hold high and to keep pure the great name of Member of the Party. We swear to thee, Comrade [Reagan], to honour thy command.

In leaving us, Comrade [Reagan] ordered us to conserve the unity of our Party as the, apple of our eye. We swear to thee, Comrade [Reagan], to honour thy command.

In leaving us, Comrade [Reagan] ordered us to maintain and strengthen the dictatorship of the [very wealthy]. We swear to thee, Comrade [Reagan], to exert our full strength to honour thy command.

In leaving us, Comrade [Reagan] ordered us to strengthen with all our might the union of [Wall Street brokers and Evangelists]. We swear to thee, Comrade [Reagan], to honour thy command.

In leaving us, Comrade [Reagan] ordered us to strengthen and enlarge the Union of the [corporations]. We swear to thee, Comrade [Reagan], to honour thy command.

In leaving us, Comrade [Reagan] enjoined on us fidelity to the [Corporate] International. We swear to thee, Comrade [Reagan], to devote our lives to the enlargement and strengthening of the union of the [CEOs] of the whole world, the [Corporate] International.

Just some ideas I thought might help him out.

Tuesday, June 01, 2004

  Political Taboos, pt. 1: Eliminate Agricultural Subsidies

[Reposted from my diary at dKos]

Last week I announced, to rapturous acclaim (or was it rapturous indifference?), that I would begin a series on topics that I believe to be taboo in American politics. Not, that is, that they cannot be talked about, but that they are unlikely at the present time to be pushed with any seriousness through the halls of congress or from the White House. Part of my reason for bringing up these topics is to suggest that they are issues that Democrats should eventually address and that we should begin the often long, hopelessly unpredictable, and almost always nonlinear process of trying to change the parameters of discourse in order to make this possible. Some of the items will be more realistic than others, and I have also invited others to take up topics that might interest them as well (there were several good suggestions in the comments to my initial post).

My general caveat for the series is that I am not an expert on the issues that I have chosen to examine but will attempt to research them more or less thoroughly in order to come to an informed (and well footnoted) summary analysis.

The first entry in the planned series is the reform or elimination of agricultural subsidies. On the one hand, this is a strange topic to initiate my writings, because in a sense, the elimination of farm subsidies is not really a taboo topic at all. Quite the contrary, almost all experts agree that it is a desirable and necessary step in agricultural reform, beneficial to farmers and consumers in both developed and developing countries. The existing situation is anathema both to progressives who see the great injustice in a grotesque system that continues to favor large agribusiness and to libertarians and honest conservatives (yes, they still exist, there are several excellent pieces on farm subsidies on the website of the otherwise odious Heritage Foundation) who point out the inequities, the massive financial burden, and the market distortion that result from farm subsidies.

Nor has this escaped the notice of policymakers. The 1996 FAIR (Federal Agriculture Improvement and Reform) Act was designed precisely to return agriculture to a more market-based and equitable system through the gradual elimination of tariffs. But it failed utterly to do so in large part because of “emergency” aid given during the late 1990s when agricultural markets collapsed. As one analysis [pdf] notes, “From 1990-1998, government payments were about 20 percent of net farm income. From 1999-2001, government payments were 47 percent of net farm income.” 1 The 2002 farm bill did away with the pretense of reform and increased subsidies substantially. As the Environmental Working Group, which has a superb database on U.S. agricultural subsidies remarks,,

Who will benefit from the 2002 farm bill? The same people who have always benefitted -- the top 10 percent of the biggest farms, mostly large corporate sized agribusinesses that need taxpayer money the least, will continue to collect at least two-thirds of the $125 billion budgeted for crop subsidies over the next ten years.2

And here's Brian M. Riedl in one of the aforementioned Heritage Foundation pieces:

America’s largest and most wasteful corporate welfare program is farm subsidies. The 2002 farm bill will cost taxpayers $180 billion over 10 years. It remains a shining example of the interest-group excess that has pushed annual federal spending above $20,000 per household while also diverting funds from vital national priorities.

American farm policy is an exercise in economic incoherence. It attempts to remedy low crop prices by paying farmers to plant more crops, which only lowers prices further. After paying these farmers to plant more crops, lawmakers turn around and pay other farmers to plant fewer crops. Worst of all, America’s farm subsidies undercut Third World farmers and keep millions of people in poverty.3

U.S. farm subsidies are haphazard and privilege certain sectors over others. In fact, as currently organized they are not only economically perverse but also profoundly unhealthy, as a group of medical students at Stanford has noted. And they aren't the only ones concerned [scroll way down for the quote]:

Clearly, some food industries have for many years successfully influenced the government in ways that keep the prices of certain foods artificially low. [Harvard Assistant Professor of Pediatrics] David Ludwig questions farm subsidies of "billions to the lowest-quality foods"—for example, grains like corn ("for corn sweeteners and animal feed to make Big Macs") and wheat ("refined carbohydrates.") Meanwhile, the government does not subsidize far healthier items like fruits, vegetables, beans, and nuts. "It's a perverse situation," he says. "The foods that are the worst for us have an artificially low price, and the best foods cost more. This is worse than a free market: we are creating a mirror-world here."4

As I noted above, when the Heritage Foundation is making the case for why U.S. Policy is unfair to farmers in developing nations, you know things are awry. Lest you suspect the above comments regarding the effect subsidies have on the developing world represent the disingenuous piety of the Right, I give you the following quotation from an editorial in the Guardian that inspired its creation of an excellent blog devoted entirely to the elimination of agricultural subsidies:

Let's get back to basics. Giving subsidies to farmers was a brilliant idea that transformed the food shortages after the second world war into a surplus. But it has grown into an institutionalised nightmare preventing developing countries from fulfilling their potential in one of the few areas where they enjoy a natural advantage - agriculture. Europe and the US are the main culprits.5

Recent trade talks have focused intensively on the heavy agricultural subsidies (and other supports, especially tariffs) of rich countries, which heavily burden poor nations. The U.S. was recently penalized by the WTO for its extremely high cotton subsidies and price supports, and Brazil is now leading a block of developing countries that is demanding that this issue be resolved once and for all.

There are major political stumbling blocks to any sort of change. Both Republicans and Democrats are afraid of angering voters in rural states. As one editorial noted,

The [WTO] cotton ruling is a political problem for President Bush. He and his strategists are depending on Farm Belt voters, who benefit heavily from the government's $19 billion in annual subsidies. That's why the administration responded with a pledge to appeal. 6

The political stumbling block is predicated on the myth that cutting agricultural subsidies would devastate family farms, that great goddess of American political culture. Needless to say, this is not the case. As William Krist of the Woodrow Wilson International Center has remarked,

The billions spent on agricultural subsidies could be used to strengthen social security, fund Iraqi reconstruction, or reduce taxes for the average American. It would be nice to think that all this money is helping small family farms in the heartland. But in reality, more than 15 Fortune 500 companies receive subsidies and at least 100 large US farms receive more than $2 million in subsidies each. 7

It is this final point, needless to say, that forms the essence of the case for why Democrats should be fundamentally in favor of eliminating or at least radically reforming agricultural subsidies: in their current form they constitute one of the most egregious forms of corporate welfare in the American political system. Along with tax cuts for the wealthy, they form the center piece of the Bush administration's burdening of future generations. In addition, Democrats can focus on the fact that there are dozens of other things for which this money may be better intended – we may quibble with the way Krist orders his priorities, but it is a point well made in any case.

Oh, and I suppose none of you would be terribly hard pressed to figure out which of the two major political parties is more in the pockets of agribusiness?

Elizabeth Becker, reporting in the September 9 [2003] New York Times ("Western Farmers Fear Third-World Challenge to Subsidies"), underscores Mudd's analysis noting, "In the past decade, industrial-scale farmers have tipped their allegiance decisively toward the Republican Party, which supports the current system. Political contributions from agribusiness jumped from $37 million in 1992 to $53 million in 2002, with the Republicans' share rising from 56% to 72%, according to figures compiled by the Center for Responsive Politics.

"Those commercial companies were not disappointed when President Bush signed into law last year a new farm policy that increases permanent subsidies by $40 billion a year, even though Mr. [Robert] Zoellick [U.S. Trade Representative] had promised the developing world that subsidies would be cut in this new round of trade talks.8 "

The problem, of course, is twofold. First, Democrats, and particularly those from middle America, can ill afford to offend their agricultural base by appearing to support subsidy cuts (and we can be more than sure that Republicans would demagogue their "anti-farmer" policies as symptomatic of evil, northeastern, cityslicker, liberal elitism). The second, needless to say, is that these reforms would have to be done in a way that did not devastate those smaller farmers who do depend on them. Again I emphasize that the overwhelming majority of these subsidies go to large agribusiness, and it is an important part of the case we must make to destroy the myth of these supports being necessary for the survival of the family farmer. Nevertheless, to be true to the Democratic tradition of sticking up for the common man, we must be aware of how these policies affect those family farmers who do receive subsidies.

In fact, I would argue that it this latter point – that any reform that Democrats propose should be tailored so as not to hurt smaller farms, true family farms – that also could serve as a centerpiece of the political prophylactic against the charges of hurting farmers. Not that it would solve the problem entirely – the agribusiness lobby is vast and extremely powerful and would immediately start showing how many jobs would be lost due to the loss of their free lunches, but it would be an important start. As Al Krebs has declared, "when it comes to the subsidy question lets stop this silly rhetoric about "farm" subsidies and call them by their true name: corporate welfare. 9"

1 Daryll Ray, Daniel De La Torre Ugarte, and Kelly Tiller, Rethinking US Agricultural Policy: Changing Course to Secure Farmer Livelihoods Worldwide, Agricultural Policy Analysis Center, The University of Tennessee, 2003, p.9.
2 Environmental Working Group, " About the 2002 Farm Bill: A Missed Opportunity," http://www.ewg.org/farm/farmbill/stake.php (n.d.).
3 Brian M. Riedl, "Farm Subsidies vs. National Security" Heritage Foundation Press Room, May 27, 2004.
4 Craig Lambert, "The Way We Eat Now," Harvard Magazine (May-June 2004).
5 "Kicking the subsidies: Third world farmers need a fair deal," The Guardian, August 18, 2003.
6 "Reducing farm subsidies would spark competition," Atlanta Journal-Constitution, May 3, 2004, p.8.
7 William Krist, "All Together Now: Take the Free Market Plunge," Christian Science Monitor, February 12, 2004.
8 Quoted in Al Krebs, "Stop Calling Them 'Farm Subsidies'; It's Corporate Welfare!" Counterpunch, September 16, 2003.
9 Ibid.

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