Newburyport Democrats Meet Wed, May 18

Newburyport Democrats Meet Wed, May 18

The next meeting of the Newburyport Democratic City Committee is Wednesday, May 18 at the Newburyport City Hall Auditorium at 7pm. All Newburyport Democrats are welcome to attend. Democrats wishing to be become members from their respective wards are welcome. For further information, email Ed Cameron, Chair of the Newburyport City Committee, at edcameronNBPT@gmail.com

Deficit Solution: Get Americans Back To Work

http://www.npr.org/2011/05/09/136129747/deficit-solution-get-americans-back-to-work

RENEE MONTAGNE, host:

Next, we'll hear an alternative view of the debate over the federal budget.

STEVE INSKEEP, host:

House Republicans and President Obama have offered competing plans to bring down the deficit.

MONTAGNE: A bipartisan group of senators is trying to work out a deal.

INSKEEP: All of their approaches share the stated goal of reducing federal dependence on borrowing over time. And Nobel Prize-winning economist Joseph Stiglitz contends that all these approaches miss the point.

Mr. JOSEPH STIGLITZ (Economist): The most important thing for addressing the deficit is putting America back to work.

INSKEEP: Stiglitz wants to create more jobs, even if the nation builds up more debt.

Mr. STIGLITZ: If you're spending money for investments that increase the productivity of the economy - infrastructure, technology, education - that has two effects. It grows the economy today, puts people back to work, but it also increases the future potential output of the economy. And when you increase output, both today and in the future, that means more tax revenues, and that means it's money well spent, even from the narrow fiscal perspective.

INSKEEP: Mr. Stiglitz, isn't that the flip side of the Republican argument - or the conservative argument, let us say - which essentially is if you want to make the economy grow, cut taxes and ultimately the people will invest the money and there'll be so much more economic growth, you'll get more tax revenue coming in. Isn't that the same argument?

Mr. STIGLITZ: It sounds a little bit similar, and it - you know, all economists talk about demand and supply, but then you have to look at more detail, at the underlying hypotheses. So what they say is that if we only lowered tax rates a little bit more, tax the billionaires a little bit less, they would work more.

But the tax rates were lowered by President Bush. Did savings increase? No. The national savings rate went down, plummeted close to zero - some quarters it was actually negative. The evidence is very clear that those supply side effects on savings just aren't there.

INSKEEP: Does the argument for government investments, the argument you're making here, have the same basic weakness as the argument for tax cuts to spur the economy? Because in both cases what you're saying is I want to do something very definite and concrete now that will very definitely increase the deficit right now, in the hopes that eventually some of that money will be coming back, but I can't really be sure about that part.

Mr. STIGLITZ: Well, nothing in economic policy is ever done with certainty, so we have to do the best we can based on past experience, analytic studies. Right now the United States you might say is in a lucky position because we've underinvested in infrastructure, technology, education.

One concrete example, in 2000 we knew what were some of the key things we needed to invest in infrastructure. One of the things at the very top of the list were the levies in New Orleans. If we had made that few-billion-dollar investment that the engineers said we needed, we would have saved a couple hundred billions of dollars and our economy would have saved even more.

INSKEEP: So would you argue for running up even higher deficits than the ones we have now?

Mr. STIGLITZ: Yes, I would. I mean I - let's be frank about it. We are going to be running up deficits no matter what we do. But if we go into mindless austerity cutbacks, our deficits are not going to go down as fast as those people who argue for it claim. Because what's going to happen is, the economy is going to get weaker, tax revenues will go down, more people will be unemployed, expenditure for unemployment insurance will go up, expenditure for welfare payments will go up, and the savings in the deficit will be much smaller than they anticipated. We're already seeing, you might say examples, case studies, of this. The U.K. began its austerity package and the economy has gone into a double dip.

INSKEEP: Well, let me ask about that, because as I'm sure you know very well Standard and Poor's, the rating agency, has in recent weeks issued a warning about the security, the safety, of U.S. government debt. I wonder if the United States really doesn't have much of a choice in this matter for very much longer.

Mr. STIGLITZ: Yeah, that's sheer nonsense. First of all, we should say the S&P and the other rating agencies really have lost their credibility. They gave the A ratings to the subprime securities that brought our economy down. And if anybody, after that, really pays much attention to them, I find it actually striking.

We can't ignore the deficit. I mean, that's correct. The real question is we have to address it in an intelligent way. And an intelligent way means invest in the future, and grow the economy today. And a mindless response will actually put us in the road to those who lend to us not being willing to lend to us, because our economy will be weak.

INSKEEP: I wonder what you think of the proposals that, if I may, try to couple a mindful response with the mindless response. The White House, among others, there are various plans out there, that include some kind of trigger. If Congress doesn't figure out how they're going to reduce the deficit, automatic cuts begin kicking in, in order to provide them an incentive to do things in a thoughtful way. Would you favor that?

Mr. STIGLITZ: I haven't made up my mind on that. The reason is, across-the-board cuts are not an intelligent way of doing things. It's easy for a lot of people because it says we're not going to have to make the decisions, we're not going to have to annoy agribusiness that likes the ethanol subsidies, the oil and coal companies that enjoy the tax benefits. But I think we have to, unfortunately, annoy some people, and we have to make some of these painful political decisions. I think this is a little bit of a cop-out.

INSKEEP: You seem to think, based on your writings, that the political process here is being driven by a bunch of short-sighted rich people.

Mr. STIGLITZ: I think that's right. But it's more than that. There's ideology playing a very important role. Part of what is going on, you see it very clearly in some of the proposals for deficit reduction, is that they're really almost designed to cut back on the core functions of government.

So they're not asking the question, what kind of society do we want to create and how do we get there? What is the appropriate role of government and what does that cost and how do we best finance that?

There's certain things that we really do need government for. If we want to have a more equal society, we have to have public education. Quality of life, important to have livable cities, important to have parks. Rich people can have a big back yard, they can live in an isolated, gated community. Most Americans can't afford that, so we have to have public parks. That costs money. And we can go down the line and we can get a vision of what it is that is necessary to make our economy the kind of society that we want. We need to have a - as I say, a vision of what it is that we need the government to do. But it's not a question of the size of the government, it's a question of what it does, and that's what we need to have a national conversation about.

INSKEEP: Well, Joe Stiglitz, thanks very much.

Mr. STIGLITZ: Well, thank you.

(Soundbite of music)

INSKEEP: Joseph Stiglitz, one of many voices we have heard and will hear on the deficit. He served as chairman of the council of economic advisors under President Clinton and received a Nobel Prize for his work in economics.

How Does New Hampshire Do It? An Analysis of Spending and Revenues in the Absence of a Broad-based Income or Sales Tax

Interesting report from the Federal Reserve...

http://www.bostonfed.org/economic/neppc/researchreports/2011/neppcrr1101.pdf

New Hampshire is unique in New England
in that it levies neither a broad-based income
nor sales tax. Although high property tax bills,
education mandates handed down by the
courts, and fiscal crises past and present have
led some Granite Staters to question the continued
feasibility of this approach, the state
has thus far maintained its course.
New Hampshire’s ability to avoid a
broad-based tax stems partly from the fact
that governments there simply spend considerably
less, on average, than their neighbors.
In fiscal year (FY) 2007, New Hampshire
state and local governments combined spent
$6,442 per capita—20 percent less than the
New England average. The difference is even
starker if we consider state government alone.
Observing New Hampshire’s lack of
broad-based taxes and low public spending,
other states around the region have asked
whether they can emulate the state’s fiscal
model. This paper explores the Granite State’s
spending and revenues, to shed light on how
it has avoided a broad-based income or sales
tax. The analysis examines the factors that
drive New Hampshire’s lower-than-average
per capita spending, and the revenue sources
the state relies on to pay for that spending in
lieu of an income or sales tax.

6th Annual Democratic Three Towns & Two Cities Breakfast

6th Annual Democratic Three Towns & Two Cities Breakfast

The 6th Annual Democratic Three Towns & Two Cities Breakfast will be held on Saturday, April 9, 2011, at Nicholson Hall, 9 Harris Street, Newburyport, MA. Tickets are $25. Seating is limited.

There will be Coffee and Socializing from 8:30-9:00AM followed by the Program and Breakfast at 9:00AM.

The Democratic committees of Amesbury, Newbury, Newburyport, Salisbury, and West Newbury join together to invite you to a hearty buffet breakfast with state and local political leaders discussing relevant issues.

Confirmed guests to date include Congressman John Tierney, State Treasurer Steve Grossman, State Auditor Suzanne Bump, State Senator Stephen Baddour, State Representatives Michael Costello, Governor’s Councillor Mary-Ellen Manning, Essex County District Attorney Jon Blodgett, Salem Mayor Kim Driscoll and John Walsh, Chair of the Massachusetts Democratic Party.

US Senate candidates Bob Massie and Marisa DeFranco will also appear.

Bob Allison of Newburyport will provide musical accompaniment. HOBO Catering of Salisbury Beach will provide the buffet.

Proceeds from the breakfast will be used to support the sponsoring town and city committees. Sponsorships of $50, $100, and $200 are available. Those interested in sponsoring the event or in purchasing tickets should contact:

Amesbury, Jane Siebecker at jsiebecker@verizon.net,

Newbury, Jim Stanton at stanton.jim@gmail.com,

Newburyport, Ed Cameron at edcameronNBPT@gmail.com,

Salisbury, Lou Masiello at thesummerwind300@comcast.net,

West Newbury, Kathy Pasquina at kathypasq2@hotmail.com

Press: For more information about this event, please contact Ed Cameron at edcameronNBPT@gmail.com or call 978-518-0786.

Kabuki Democracy: Why a Progressive Presidency Is Impossible, for Now | The Nation

Kabuki Democracy: Why a Progressive Presidency Is Impossible, for Now | The Nation

In Mass. Senate Race, Spotlight Shifts to Suburban Mayor

In Mass. Senate Race, Spotlight Shifts to Suburban Mayor

http://www.nytimes.com/2011/03/18/opinion/18krugman.html

March 17, 2011

The Forgotten Millions

By PAUL KRUGMAN

More than three years after we entered the worst economic slump since the 1930s, a strange and disturbing thing has happened to our political discourse: Washington has lost interest in the unemployed.

Jobs do get mentioned now and then — and a few political figures, notably Nancy Pelosi, the Democratic leader in the House, are still trying to get some kind of action. But no jobs bills have been introduced in Congress, no job-creation plans have been advanced by the White House and all the policy focus seems to be on spending cuts.

So one-sixth of America’s workers — all those who can’t find any job or are stuck with part-time work when they want a full-time job — have, in effect, been abandoned.

It might not be so bad if the jobless could expect to find new employment fairly soon. But unemployment has become a trap, one that’s very difficult to escape. There are almost five times as many unemployed workers as there are job openings; the average unemployed worker has been jobless for 37 weeks, a post-World War II record.

In short, we’re well on the way to creating a permanent underclass of the jobless. Why doesn’t Washington care?

Part of the answer may be that while those who are unemployed tend to stay unemployed, those who still have jobs are feeling more secure than they did a couple of years ago. Layoffs and discharges spiked during the crisis of 2008-2009 but have fallen sharply since then, perhaps reducing the sense of urgency. Put it this way: At this point, the U.S. economy is suffering from low hiring, not high firing, so things don’t look so bad — as long as you’re willing to write off the unemployed.

Yet polls indicate that voters still care much more about jobs than they do about the budget deficit. So it’s quite remarkable that inside the Beltway, it’s just the opposite.

What makes this even more remarkable is the fact that the economic arguments used to justify the D.C. deficit obsession have been repeatedly refuted by experience.

On one side, we’ve been warned, over and over again, that “bond vigilantes” will turn on the U.S. government unless we slash spending immediately. Yet interest rates remain low by historical standards; indeed, they’re lower now than they were in the spring of 2009, when those dire warnings began.

On the other side, we’ve been assured that spending cuts would do wonders for business confidence. But that hasn’t happened in any of the countries currently pursuing harsh austerity programs. Notably, when the Cameron government in Britain announced austerity measures last May, it received fawning praise from U.S. deficit hawks. But British business confidence plunged, and it has not recovered.

Yet the obsession with spending cuts flourishes all the same — unchallenged, it must be said, by the White House.

I still don’t know why the Obama administration was so quick to accept defeat in the war of ideas, but the fact is that it surrendered very early in the game. In early 2009, John Boehner, now the speaker of the House, was widely and rightly mocked for declaring that since families were suffering, the government should tighten its own belt. That’s Herbert Hoover economics, and it’s as wrong now as it was in the 1930s. But, in the 2010 State of the Union address, President Obama adopted exactly the same metaphor and began using it incessantly.

And earlier this week, the White House budget director declared: “There is an agreement that we should be reducing spending,” suggesting that his only quarrel with Republicans is over whether we should be cutting taxes, too. No wonder, then, that according to a new Pew Research Center poll, a majority of Americans see “not much difference” between Mr. Obama’s approach to the deficit and that of Republicans.

So who pays the price for this unfortunate bipartisanship? The increasingly hopeless unemployed, of course. And the worst hit will be young workers — a point made in 2009 by Peter Orszag, then the White House budget director. As he noted, young Americans who graduated during the severe recession of the early 1980s suffered permanent damage to their earnings. And if the average duration of unemployment is any indication, it’s even harder for new graduates to find decent jobs now than it was in 1982 or 1983.

So the next time you hear some Republican declaring that he’s concerned about deficits because he cares about his children — or, for that matter, the next time you hear Mr. Obama talk about winning the future — you should remember that the clear and present danger to the prospects of young Americans isn’t the deficit. It’s the absence of jobs.

But, as I said, these days Washington doesn’t seem to care about any of that. And you have to wonder what it will take to get politicians caring again about America’s forgotten millions.