Some of you might not know why this vote had to go through the 2/3rd's reconciliation process. The reconciliation process is a way to pass legislation through the Senate without Filibuster and streams of Amendments. For a majority vote to happen, Amendments have to be allowed on the floor, and this Amendment process has been used by the Republicans like an automatic machine gun of often superfluous quality in order to delay and slice up the very legislation being voted upon. In years past, this type of political distortion of the majority vote was no where near what the Republicans are now doing.

For example. Say there is pending legislation to doing something important: like build a high-speed railroad from New York to Chicago and then to Seattle. The entire legislation is worked out, including the funding and the complete timeline. The Republicans do not want this at all, and they know they can win a 66% vote, so they torpedo the legislation with a barrage of amendments. For instance:

1. an amendment that makes the route dependent upon 2/3 rds local county votes for all the counties that the railroad will traverse -- the idea being to increase the costs and perhaps delay the effort long enough so they can point their finger at another example of bad government
2. an amendment that makes all employees on the train and the construction non-union
3. an amendment that makes it illegal for local funds to be used for the construction -- which seems innocent enough, until you realize the extra costs and time involved because of the difficulty this entails -- anyway the language can be just vague enough so that some partisan lawyers out there can use the tool of lawsuits, thus adding costs and causing delays
4. an amendment to prohibit criminals from using the train -- which would be difficult and costly to enforce -- because the language of the term "criminal" is vague and manipulative -- which is of course the idea

Tax decreases cannot and do not automatically get directed towards investment. Most of the recent tax cut to the upper 1% went into savings, and was thus outsourced into speculative or foreign markets seeking a high return. That is not the same thing as creating businesses and economic wealth in the communities across the United States.

Krugman is all over this in a recent New York Times Column.

Mr. Ryan’s plan calls for steep cuts in both spending and taxes. He’d have you believe that the combined effect would be much lower budget deficits, and, according to that Washington Post report, he speaks about deficits “in apocalyptic terms.” And The Post also tells us that his plan would, indeed, sharply reduce the flow of red ink: “The Congressional Budget Office has estimated that Rep. Paul Ryan’s plan would cut the budget deficit in half by 2020.”

But the budget office has done no such thing. At Mr. Ryan’s request, it produced an estimate of the budget effects of his proposed spending cuts — period. It didn’t address the revenue losses from his tax cuts.

The nonpartisan Tax Policy Center has, however, stepped into the breach. Its numbers indicate that the Ryan plan would reduce revenue by almost $4 trillion over the next decade. If you add these revenue losses to the numbers The Post cites, you get a much larger deficit in 2020, roughly $1.3 trillion.

You should check out what he also says on his blog.

Here is a link for the Tax Policy Center.

Here is a link about the 5 Myths about the Bush Tax Cut at the Tax Policy Center.

Yep, that's right, we don't have a deficit because of entitlements and social-spending or loans to foreigners. Nope, it's because of the the 3 colored strata: yellow, golden, and dark blue.

Wars, tax-cuts to the wealthy, and the economic downturn.

And the tax-cuts are more than the other two put together.

Click here for the long version (with footnotes) of the budget analysis by the CBPP (Center on Budget and Policy Priorities).

Here is New York Congressman Anthony Weiner getting upset at Republican hypocrisy. The issue is whether to include 9-11 Emergency Responders under the Government Health-care provisions. Rather than voting outright "no", Weiner watches as Republican after Republican repeatedly whine about the awful procedure, standing that they want to vote "yes" but they have principles and can't do so under the current procedure.

Seriously, I'd be pissed too.

~ ~ ~ ~ ~ ~ ~ ~ ~
UPDATE: Oh, I forgot another thing about this incident. Jon Stewart had a piece on it that I will post above, but here is the skinny: in order to pay for this the Democrats were going to rescind tax breaks for any corporation that uses the Cayman Islands as a Post Office location in order to avoid paying income taxes on their revenues and pay-rolls.

The Republicans called this a tax increase. The Republicans said that voting for a tax increase at this time would be bad for the economy and bad for middle class Americans trying to struggle during these hard times. Yes, that's right, these same Republicans who could not vote for 26 more weeks of unemployment for those same struggling middle class Americans only just last month, decided to call taking away tax subsidies from American corporations who are openly breaking the law by using a foreign post office as a means of circumventing taxes.

When you discover that a belief you held has no basis of truth, you can either toss the belief into the trash bin of bad ideas, or you can insist that your beliefs are still true.

However, once you go down the path of believing things without the requirement of logical consistency, the distance between reality and what you perceive to be reality increases. You evolve into something you do not really understand, a creature with a stunted feedback loop, ignoring evidence to the contrary.

If this persists, after a period of time, the distance gets to the breaking point, like a rubber band.

When the breaking point is reached, if you finally let go of the falsity, the energy is released, and everything comes crashing down at once. But if you instead still insist on your own version of truth, the rubber band snaps, and you are broken beyond repair, welded permanently to a frozen paradigm and instinctive delusions that will forever incessantly protect the self without the self even being aware of its own actions.

I'm reading this hilarious take on the trolls out there in internet-land. It's from a blogger who goes by the name of heartless doll. The above pic is from the page where the article is located.

The above is what is called the "Employment to Population Ratio." Divide the number of employed persons by the total population and you get a number less than 1, with 0.9 (or 90%) meaning 10% of the population is not in the recorded labor force for whatever reason (students, children, senior citizens, unemployed, immigrant labor, black market citizens). Notice that the ratio drives upward beginning in the mid-1970s. This occurred because more women were continuing to enter into the workforce and less becoming stay at home moms which occurred more often in the the 1950's. Notice that the ratio is now at the same point as the peak in 1972 -- and close to the peak of 1954, when the labor force was more affected by stay at home moms.

I can't say what this means because I don't know. But it does suggest that the employment picture has shifted to a lower level where good jobs will be more difficult to come by for at least another 3 or 4 years, assuming the past swings are any measure of the future. Are we on the precipice of a catastrophic fall in economic well-being? Are we in for a long period of malaise? Or are we on the verge of a dynamic upturn fueled by some driving social or technological change?

I don't think anyone knows for sure. We know that we are or will be approaching resource limitations. In the past the yardsticks of these limitations have moved in response to human ingenuity and luck, so who is to say this will not happen again. But in my humble opinion, I think we are finally up against too tall of an order this time, unless we begin to use less and become more efficient and self-sustaining.

Click here for the read over at ritholz.com by Edward Harrison.

Mr. Harrison also blogs over at Creditwritedowns.com

I realize that I have not been writing or commenting on this blog for the last 3 months. I could say that it is because I've been busy, which is only partially true. The real answer is that I've just not desired paying attention to the minutia and have preferred practicing guitar, taking walks outside in the park, and reading a lot of books.

In a sense too, I am a bit disappointed at our system of government's inability to actually address, or even understand the current crisis. The experts look at numbers and think they understand the real society around them. Unemployment went down, the stock market is up, the average selling price of a new home has stabilized for a few months. Woo-hoo, good times are around the corner.

Here's a number. It's called the average work hours per week by the paid per hour work force.


Since the early 1960's this number has dropped from 38 per week, to below 34 since 2001. Don't you think the trend over 45 years is telling you something about what is happening more than a recent trend over a few months, or a few years? All along the above graph, there are a number of intervals where the graph increased upwards, nevertheless the trend was still down.

The Big Picture? This crisis is going to bankrupt the way government disperses social services, and it will happen by forcing a plethora of cuts to the budget. The system of taxation will need to be completely overhauled at the state and federal level, but this will not happen in time because of the huge political risks at stake. It is easier to force draconian cuts to the social system then it is to get corrupt, self-serving politicians to actually make long-term decisions in the best interest of the people.

Unless the people organize and force the elites to change, the elites will take the path of least resistance and convince themselves that they have no other choice because they are completely oblivious about their own contribution to the problem.