Subsidize Students, Not tax cuts

New York Times Editorial, April 25, 2012

In 2007, President George W. Bush signed a bill that cut in half interest rates on subsidized student loans until 2012. Those low rates will expire on July 1 — going back to 6.8 percent from 3.4 percent — and, to prevent college from becoming even more unaffordable for millions of students, the obvious move is to renew them.

But nothing is that easy or sensible anymore in Washington, where House Republicans are far more interested in cutting taxes, largely for the rich, than they are in helping low- and middle-income students get a college education.

House Republicans say the country cannot afford the $6 billion a year that it costs to pay for the lower rates. The Ryan budget, recently approved by the House, would allow the rates to double, and, at the same time, would cut taxes by $10 trillion over a decade. Representative John Kline Jr., the chairman of the House Committee on Education and the Workforce, said keeping the rates low would mean “piling billions of dollars on the backs of taxpayers.”

Instead, Republicans would rather pile that burden on the backs of taxpayers-to-be, specifically the 7.4 million students who now have federally subsidized Stafford loans and the millions more who will need them. At a time when many graduates are desperate for jobs, the interest rate increase would add an average of $1,000 a year to their debt. Already, many Republican lawmakers around the country have made it clear that they don’t even want students to vote, imposing identification requirements that would keep students away from polling places.

In the first of several speeches about the cost of higher education, President Obama urged students on Tuesday to demand that Congress renew the rates. “At this make-or-break moment for the middle class,” he said at the University of North Carolina at Chapel Hill, “we’ve got to make sure that you’re not saddled with debt before you even get started in life.”

Nothing is more important to this country’s future than ensuring a good education for coming generations. The issue also plays directly into Mr. Obama’s own need to re-energize younger voters, who turned out in overwhelming numbers for him in 2008 but seem far less enthusiastic these days.

Once the White House began its effort, Mitt Romney broke with House Republicans and said Monday that he supports renewing the loan subsidies. As usual, though, that also meant breaking with himself, since he had fully embraced the House budget and never expressed any reservations about the student loan provisions. Indeed, only a few months ago, he argued repeatedly in interviews that student subsidies were a bad idea that encouraged colleges to raise their tuition.

Mr. Romney, along with the Senate Republican leader, Mitch McConnell, said that the $6 billion cost of the subsidy should be offset with cuts to other programs, but predictably neither man said where those cuts should come from. The White House and Democrats have proposed raising the money by ending a loophole used by high-paid employees of S-corporations to avoid paying full payroll taxes.

The Republican response to that idea is also predictable. This is a party that shows time and again that it wants to protect only those who have made it, not help those struggling to get started.

Republicans echo Taliban in condemning Obama's Nobel Peace Prize

The Republican National Committee, still giddy over America losing its bid to host the 2016 Olympics, had this to say about the President of the United States being award the Nobel Peace Prize:

The real question Americans are asking is, ‘What has President Obama actually accomplished?’ It is unfortunate that the president’s star power has outshined tireless advocates who have made real achievements working towards peace and human rights. One thing is certain – President Obama won’t be receiving any awards from Americans for job creation, fiscal responsibility, or backing up rhetoric with concrete action.

Their statement echoed the Taliban's criticism of Obama's selection for the prestigous award.
"We have seen no change in his strategy for peace. We condemn the award of the Nobel Peace Prize for Obama" Taliban spokesman Zabihullah Mujahid told AFP.

The real question patriotic Americans are asking is, "Why do Republicans hate America?" Or as the Democratic National Committee put it:

Republicans cheered when America failed to land the Olympics and now they are criticizing the President of the United States for receiving the Nobel Peace prize — an award he did not seek but that is nonetheless an honor in which every American can take great pride — unless of course you are the Republican Party.

The 2009 version of the Republican Party has no boundaries, has no shame and has proved that they will put politics above patriotism at every turn. It’s no wonder only 20 percent of Americans admit to being Republicans anymore – it’s an embarrassing label to claim.

Obstructing Health Care Reform Is A Money-Maker

If you are wondering why some Democrats are not supporting President Barack Obama's health care reform initiative follow the money! It leads right from those who profit from the current bloated and bureaucratic system that leaves 50 million American uninsured right to the Blue Dog Political Action Committee which has collected $1.1 million for the 2010 election cycle.

People might voted for reform in November, but as we approach the dog days of August, its business as usual for the Blue Dog Democrats.

Monica Sanchez writes:

Blue Dogs, as ‘fiscally conservative’ Democrats are called, are falling well in line with ‘the right's delay and kill strategy’ towards health care reform. As The New York Times reported:
“Fiscally conservative House Democrats forced leaders of their party on Tuesday to slow the pace of work on major health care legislation so Congress and President Obama could address their concerns about the cost of the bill, its impact on small businesses and the shape of a proposed new government health insurance plan...

“‘The seven of us cannot support the current House bill,’ said Representative Mike Ross, Democrat of Arkansas, who is the point man on health care for the Blue Dogs. ‘Whether it requires a new bill or whether this bill can be amended, those are decisions, I guess, for the parliamentarians to help us make.’”

Congressional Quarterly also highlighted the ‘friendly fire’ threatening the Democratic health care reform bill in the House:

“Moderate ‘Blue Dog’ Democrats are starting to show their potential influence on the health care overhaul being written in the House. And top dogs in the House are taking note.
“‘There’s no doubt in my mind that if the Blue Dogs join with the Republicans they can bring this bill down,’ said Rep. Henry A. Waxman, chairman of one of the committees that’s been working on the health bill.

“The Blue Dogs, a 52-member coalition, are a closely watched group, as they have threatened to block approval of the House bill (HR 3200) unless it is modified to meet their concerns about its policies and cost. House leaders have been struggling to woo enough of them to assure passage once the bill goes to the floor.”

But putting a wrench in the works may not be just about differing values. It has proven very lucrative, according to Congressional Quarterly Today: “Democrats in the Blue Dog Coalition might have drawn the ire of party liberals for putting the brakes on the fast-moving health care overhaul, but their political action committee has been raking in contributions from business interests with an eye on reshaping President Obama’s signature initiative.

“The Blue Dog Political Action Committee has collected $1.1 million for the 2010 election cycle, more than any other leadership political action committee on Capitol Hill, according to CQ MoneyLine.

“The total includes about $300,000 from health care interests, including $158,000 from doctors and other provider groups; $87,000 from makers of drugs and medical devices; and $50,000 from health insurance interests.”

Which begs the question, just whose interests are these ‘Blue Dogs’ representing? If you are one of their constituents, let them know you expect them to stand up for your need for affordable health care now by supporting the House health care reform bill as introduced.

Two year colleges will be key to revitalizing U.S. economy

Laura Fitzpatrick of Time writes:

Community colleges are deeply unsexy. This fact tends to make even the biggest advocates of these two-year schools — which educate nearly half of U.S. undergraduates — sound defensive, almost a tad whiny. "We don't have the bands. We don't have the football teams that everybody wants to boost," says Stephen Kinslow, president of Texas' Austin Community College (ACC). "Most people don't understand community colleges very well at all." And by "most people," he means the graduates of fancy four-year schools who get elected and set budget priorities.

Many politicians and their well-heeled constituents may be under the impression that a community college — as described in a promo for NBC's upcoming comedy Community — is a "loser college for remedial teens, 20-something dropouts, middle-aged divorcées and old people keeping their minds active as they circle the drain of eternity." But there's at least one Ivy Leaguer who is trying to help Americans get past the stereotypes and start thinking about community college not as a dumping ground but as one of the best tools the U.S. has to dig itself out of the current economic hole. His name: Barack Obama. (See pictures of Barack Obama's college years.)

The President hasn't forgotten about the 30 or so community colleges he visited during the 2008 campaign. These institutions are our nation's trade schools, training 59% of our new nurses as well as cranking out wind-farm technicians and video-game designers — jobs that, despite ballooning unemployment overall, abound for adequately skilled workers. Community-college graduates earn up to 30% more than high school grads, a boon that helps state and local governments reap a 16% return on every dollar they invest in community colleges...

Read the entire column.

Obama keeps promises to labor, but Corporate America fight back!

The New York Times' labor reporter, Steven Greenhouse, writes that labor has been very pleased with President Obama's efforts to reverse the Bush administration's anti-labor policies and with his labor appointments.

But Greenhouse warns that business organizations such as the the U.S. Chamber of Commerce are gearing up to defeat the Employee Free Choice Act (EFCA), legislation that would make it easier for workers to organize unions.

We can expect the Chamber to use fear mongering and the courts to oppose EFCA in the same way that the Milwaukee Metropolitan Chamber of Commerce (MMAC) has used them to try to stop the implementation of Milwaukee's paid sick day ordinance.

The current recession is the consequence of a thirty year failed experiment with laissez faire economics. But the U.S. Chamber and its local affiliates like the MMAC remain wedded to the market extremist pillars of deregulation, privatization and anti-unionism.

Greenhouse's article is linked here.

WPRI flawed study is politically motivated to deny Wisconsin's citizens health care

Last week the Wisconsin Policy Research Institute (WPRI) released a study predicting that 143000 "chronically ill, uninsured, sporadically employed and otherwise unemployable"people would migrate to Wisconsin between 2009 and 2015 if Healthy Wisconsin is enacted. It also projects escalating costs. It concludes that while Healthy Wisconsin may be well intended it would turn "the state of Wisconsin into a health care 'magnate.'"

This report will be used in the legislature by opponents of expanding healthcare coverage to the Wisconsin's 530,000 uninsured. The report may be an effective political instrument, but it is flawed social science.

The report resurrects the spectre of welfare migration which the WPRI helped promote as a major political issue in the late 1980s and 1990s when it released two reports on the issue. (For a good analysis of these WPRI reports and its flawed assumptions read "The Wisconsin Welfare Magnate Debate" by Thomas Corbett)

The WPRI's projections of Healthy Wisconsin motivated migration to the state rests on two questionable assumptions.

First, the authors assume that the decision to relocate is a rational economic choice -that people relocate because a state or community has a more attractive package of public goods and services than their current location. Second, they assume that there will be expansion of healthcare coverage at the national or state level before 2015.

The WPRI report assumes that relocation is essentially an individual economic decision driven by the following factors:

cost of living
spending on public education
growth in employment
presence of hazardous waste sites
comfort level of the local climate
state taxation of income
percentage of the population with health care coverage through employers
percentage of the population with health care coverage through Medicaid

The report ignores a body of research that has identified family ties as one of the prime factors in the decision to relocate. Yet, a cursory review of Milwaukee's historic immigration patterns indicates that large numbers of Milwaukee migrants came and come from places like Porticello, Sicily and Crystal City, Texas because they have family connections in Milwaukee. As Corbett noted in his paper on Wisconsin's welfare migration:"... people moved for a number of reasons; the relocation decision was not one-dimensional. Some reasons for relocating-proximity to family and friends, the desire for a better life, and the hope of finding a job-appeared significantly more important than the size of welfare payments."

If the authors are correct that universal healthcare will lure 143,000 to Wisconsin, they need to explain why we haven't experienced a similar migration of U.S. citizens to Canada where health care is a public good accessible to all. Even if we assume that Canada's cold weather is a sufficient disincentive for those from states with more temperate climates, surely tens of thousands would have migrated from northern states such as Wisconsin, Minnesota, the Dakotas, Vermont, and Western New York. That migration simply has not occurred.

Second, the report's projection assumes there will be no other progress in expanding healthcare coverage to the nation's uninsured and that Wisconsin would remain the only state with a universal healthcare program through 2015. Both are highly unlikely.

Only yesterday the U.S Congress allocated $127 billion to provide healthcare coverage for nearly 8.5 million newly uninsured people, the very folks the WPRI fears will move to Wisconsin if Healthy Wisconsin is passed.

Other states like Massachusettes, have already begun expanding health care coverage. If only one other state adopts a universal healthcare program, the WPRI projections would necessarily be cut in half and if 3 or 4 other states enacted similar legislation there would be further proportionate decreases. If Illinois or the Obama administration follows through on its commitment to provide access to healthcare for every American, the migration would disappear entirely.

hroughout American history reforms has often are initiated at the state level. Unemployment compensation, worker's compensation, child labor laws and minimum wage increases were originally developed at the state and even local level. Fortunately, the proponents of these successful reforms were not paralyzed by the fear that raising standards and or expanding coverage locally would attract hordes of unproductive people. But that is the WPRI paradigm.

There are other problems with the WPRI approach. They project increased costs associated with in-migration, but fail to factor in any savings associated with providing universal healthcare to the state's half a million uninsured despite the overwhelming evidence that caring for the uninsured is one of the factors now causing healthcare premiums to soar in the state.

It is not surprising that the WPRI would sponsor a study that undermines efforts to make healthcare a public good. The WPRI is an ideologically driven organization that promotes studies that reinforce its commitment to laissez faire economics. But should we really withhold healthcare from 530,000 uninsured Wisconsin citizens because some ideologues imagine a healthcare invasion?