Tuesday, February 4, 2014

Last Call For Two Seemingly Related Data Points

Just days away from the administration’s deadline to extend the nation’s borrowing authority, Speaker John A. Boehner told House Republicans he sees no reason to pick a fight on the issue. 
There’s no sense picking a fight we can’t win,” the Ohio Republican told members in a private conference meeting, according to sources in the room. 
Leadership has been looking for a plan that could draw Republican support for a debt limit increase, and Boehner urged his members to coalesce around a plan. If they do not, he warned, the Senate could move first and tack a provision to a debt limit hike that is unpopular among Republicans, such as an extension of unemployment insurance benefits.

Second data point:

ForAmerica announced Tuesday that it's pouring six-figures into its "Dump The Leadership" campaign. 
It probably won't come as a surprise that the man behind the group is none other than L. Brent Bozell III, the right-wing flamethrower who's proven himself plenty willing to take on the GOP establishment. 
After Paul Ryan hashed out a bipartisan budget deal late last year, Bozell predicted that the conservative base would "stampede away from a party that has lost its principles and bearings.”
"Time and again, year after year, the Republican leadership in the House and Senate has come to grassroots conservatives, and Tea Party supporters pleading for our money, our volunteers, our time, our energy and our votes," Bozell told CNN in a statement. 
Bozell said the group will use digital ads between now and November to target House Speaker John Boehner (R-OH), House Majority Leader Eric Cantor (R-VA), House Majority Whip Kevin McCarthy (R-CA), Senate Minority Leader Mitch McConnell (R-KY) and Senate Minority Whip John Cornyn (R-TX).

Your math may vary, but it seems to me we're back into "Republicans in disarray" territory and in deep.

Republicans Have No Problem Taking Health Insurance Away From You

When Republicans start screaming about hoe Obamacare is "taking people's insurance away" tell them about Arkansas, where Republicans are lining up to reverse the state's Medicaid expansion that they voted for last year, and now will take insurance coverage away from 85,000 people for the sole reason of they hate Barack Obama.

The revanchist Republicans are setting up their state, one of 25 to expand Medicaid this year under the health care reform law, to be the first to strip Obamacare coverage from people who already have it. Arkansas expanded the program, using a unique privatized model, under the tutelage of Democratic Gov. Mike Beebe and with the support of most GOP leaders in the legislature. But a cohort of conservative lawmakers believe they now have enough votes to block funding for the expansion during the legislative session that starts next week.

So the Tea Party is taking health insurance away from tens of thousands, all because they can't stand Barack Obama.  This seems pretty reasonable, right?

If that came to pass, more than 85,000 Arkansans who have signed up for coverage through the Medicaid expansion would presumably have that coverage stopped in 2015. Arkansas's alternative Medicaid plan uses Medicaid dollars to pay for low-income residents to purchase private coverage through HealthCare.gov. A select few, those making between 100 and 138 percent of the federal poverty level, would qualify for tax credits to purchase new coverage through HealthCare.gov. But the poorest of them, those below the poverty level, would be left without insurance.
But that doesn't matter to the Republicans in Arkansas or any other state for that matter.  Why?  It's okay to punish the poor in a red state.  It's their fault for being poor anyway.

What Middle Class?

A sobering NY Times piece by Nelson Schwartz details just how bad it's been for the American middle class since the 2008 financial meltdown.  It's gotten to the point that in 2014, the business world as all but given up on us.

In Manhattan, the upscale clothing retailer Barneys will replace the bankrupt discounter Loehmann’s, whose Chelsea store closes in a few weeks. Across the country, Olive Garden and Red Lobster restaurants are struggling, while fine-dining chains like Capital Grille are thriving. And at General Electric, the increase in demand for high-end dishwashers and refrigerators dwarfs sales growth of mass-market models. 
As politicians and pundits in Washington continue to spar over whether economic inequality is in fact deepening, in corporate America there really is no debate at all. The post-recession reality is that the customer base for businesses that appeal to the middle class is shrinking as the top tier pulls even further away.

America is a consumer driven economy, and nearly all the growth in consumption is at the top.

In 2012, the top 5 percent of earners were responsible for 38 percent of domestic consumption, up from 28 percent in 1995, the researchers found. 
Even more striking, the current recovery has been driven almost entirely by the upper crust, according to Mr. Fazzari and Mr. Cynamon. Since 2009, the year the recession ended, inflation-adjusted spending by this top echelon has risen 17 percent, compared with just 1 percent among the bottom 95 percent. 
More broadly, about 90 percent of the overall increase in inflation-adjusted consumption between 2009 and 2012 was generated by the top 20 percent of households in terms of income, according to the study, which was sponsored by the Institute for New Economic Thinking, a research group in New York. 
The effects of this phenomenon are now rippling through one sector after another in the American economy, from retailers and restaurants to hotels, casinos and even appliance makers.

After a generation of stagnant middle-class wages, the money in the last five years has gone to the richest Americans, and life is very, very good for them.

For the rest of us, not so much.  And so the American business model has now given up on the American middle class.  The real growth industries are goods and services for the moneyed elite.  And the divide between rich and poor is only going to get worse.


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