
Republican presidential candidate, former Massachusetts Governor Mitt Romney, greets supporters at his Florida primary primary night rally in Tampa, Florida, Tuesday, January 31, 2012. (AP Photo/Gerald Herbert)
Want to know how Mitt Romney won Florida and why he’ll almost certainly be the GOP nominee? There’s an easy answer: a Super PAC and deep-pocketed donors.
According to the latest disclosure reports, the pro-Romney Super PAC, Restore Our Future, raised $30 million in 2011, 98 percent from donors who gave $25,000 or more. The PAC got $10 million from ten donors who gave a million bucks each, including from Houston Republican Bob Perry, the major funder behind the vile Swift Boat Veterans for Truth in 2004.
Here’s the recap from the New York Times:
Millions of dollars came from financial industry executives, including Mr. Romney’s former colleagues at Bain Capital, who contributed a total of $750,000; senior executives at Goldman Sachs, who contributed $385,000; and some of the most prominent and politically active Republicans in the hedge fund world, three of whom gave $1 million each: Robert Mercer of Renaissance Technologies; Paul Singer of Elliott Management, and Julian Robertson of Tiger Management.
Harlan Crow, the Texas construction magnate, gave $300,000 personally and through his company. William Koch, whose brothers Charles and David are among the country’s most prominent backers of conservative causes, gave $1 million personally or through Oxbow Carbon, the energy company he founded. Members of the Walton family, founders of the Walmart chain, gave over $200,000, while Bob Perry—a wealthy home builder who has long been the top patron of Mr. Romney’s erstwhile rival, Gov. Rick Perry of Texas—chipped in $500,000 in early December.
This elite Super PAC money, financed by the 1 percent of the 1 percent, allowed the pro-Romney forces to outspend the pro-Gingrich forces by 5 to 1 on TV ads in Florida. Romney’s side ran 13,000 ads in Florida compared to only 200 for Gingrich. Ninety-six percent of the total ads in Florida were negative in nature, with 68 percent targeting Gingrich. Gingrich’s advocacy of the Citizens United decision, which has led to the creation of Super PACs, ironically hastened his demise.
The Romney campaign itself is almost as dependent on big money as the pro-Romney Super PAC. According to Open Secrets, just 8.8 percent of Romney’s $24 million fourth-quarter haul in 2011 came from donors who gave $200 or less. Thirteen lobbyists, on the other hand, gave $1.2 million to Romney’s campaign, which Michael Beckel of Open Secrets said accounted for “about $1 out of every $20 he raised.” Overall, sixteen corporate lobbyists raised $2 million for Romney in 2011. Of the $56 million that Romney has raised this year, $51 million, or 91 percent, came from contributions giving $200 or more. Romney’s top three campaign contributors are Goldman Sachs ($496,430), JPMorgan ($317,400) and Morgan Stanley ($277,850). Romney’s fundraising further confirms how the candidate is an unabashed proponent of Wall Street and the 1 percent.
Barack Obama’s fundraising, in contrast, paints a more nuanced version of the candidate, telling the story of two campaigns—one financed by a select group of incredibly rich bundlers, the other bankrolled by the small donors who helped propel Obama to the White House in 2008.
On the big donor front, 445 bundlers raised at least $74.4 million for Obama and the DNC in 2011. Sixty-one bundlers raised $500,000 or more. Last night Obama held his twelfth and thirteenth fundraisers of the month, where the price of admission was $35,800 a head.
On the flip side, of the $39.9 million the Obama campaign raised in the fourth quarter of 2011, 43 percent came from donors spending $200 or less, giving Obama a major small-donor advantage over Romney. (Obama raised $68 million for his campaign and the DNC, but the DNC figures, which are more dependent on large donations, are not yet available.) In total, of the $125 million Obama raised in 2011, 47 percent came from donors giving $200 or less, and 54 percent from donors giving $200 or more. The president’s top three contributors are Microsoft ($188, 643), DLA Piper ($151,375) and Google ($139,030).
The big-money race is only going to intensify from here on out. According to Josh Kraushaar of The Hotline, Obama plus Democratic Super PACs have $98 million to spend in 2012, while GOP groups have $94 million on hand. The GOP has received a major boost from the Karl Rove–founded American Crossroads and Crossroads GPS, who raised $51 million last year. Newt Gingrich now likes to say that “people power will defeat money power.” In 2012, I’m afraid the opposite may be true.
“Romney, sinking in polls, says ‘banks aren’t bad people.’ ” That headline from the LA Times encapsulates, in a nutshell, why Mitt Romney is in trouble, both in the Republican primary against Newt Gingrich and in a possible general election campaign against President Obama.
In two weeks, Romney’s unfavorability rating among independent voters—an important constituency of his—has increased by seventeen points, according to a new Washington Post/ABC News poll. Fifty-one percent of independent voters now view him unfavorably, while only 23 percent have a favorable opinion. Romney’s experienced an even larger plunge among white voters making less than $50,000, notes Washington Post blogger Greg Sargent, dropping twenty points in less than a month. “The spike in negative views of Romney among blue collar whites suggests the possibility that the assault on his wealth, privilege, low tax rates and generally out of touch persona could be resonating with them, and is possibly beginning to define Romney among them,” Sargent writes.
The key problem for Romney is that at a time when Americans are increasingly concerned about income inequality and the political voicelessness of the 99 percent, Romney is an unabashed proponent of Wall Street and the 1 percent. The fact that he paid only 13.9 percent in taxes on $21.6 million in income in 2010, that he had investments in offshore tax havens, that he profited at Bain Capital from bankrupt companies and shuttered steel mills, and that he believes corporations are people all reinforce this central weakness of his candidacy.
Romney’s fortune itself is not so much the problem as much as the fact that he wants to preserve the broken status quo for the wealthiest in our society, keeping the tax rate on capital gains and dividends at 15 percent (Gingrich, it’s worth noting, would make it zero), while accusing those who want to restore a basic sense of fairness to the US economy of practicing the “bitter politics of envy.”
The Washington Post recently asked voters what was a bigger problem for the country: “unfairness in the economic system that favors the wealthy or over-regulation of the free market that interferes with growth and prosperity?” Fifty-five percent answered “unfairness,” while only 35 percent said “over-regulation.” Yesterday a New York Times poll found that 59 percent of the public believes that upper-income Americans are paying “less than fair share” of taxes, while just 35 percent thought they were paying too little or the right amount. This is a capsule version of the Obama-Romney debate, and a good preview of Romney’s vulnerability should he make it to the general election.

Texas Governor Rick Perry, left, speaks as former Pennsylvania Senator Rick Santorum, and former Massachusetts Governor Mitt Romney listen at the South Carolina Republican presidential candidate debate in Myrtle Beach, Monday, January 16, 2012. (AP Photo/Charles Dharapak, Pool)
Martin Luther King Day would have been a perfect occasion for the GOP presidential candidates to express their commitment to racial tolerance and diversity. Instead, just the opposite occurred at last night’s GOP debate in Myrtle Beach, South Carolina. Who needs a dog whistle when you’re in a state where the Confederate flag still flies atop the statehouse grounds?
This Republican field has been marked by questionable racial assertions, as my colleague Gary Younge recently noted. Rick Perry’s hunting at a camp called Niggerhead. Ron Paul’s publishing of scores of racist newsletters. Newt Gingrich’s calling Barack Obama the “food stamp president.” Rick Santorum’s saying “I don’t want to make black people’s lives better by giving them somebody else’s money.”
This racially inflammatory rhetoric was on full display last night, as candidate after candidate auditioned to be the next George Wallace. It started when debate moderator Juan Williams asked Perry about South Carolina’s restrictive voter ID law, which the Department of Justice found would disproportionately impact minority voters. Here’s the key exchange:
WILLIAMS: Governor Perry, last month the Department of Justice challenged South Carolina’s new law requiring registered voters to show state issued identification before they can vote. Governor Haley has pledged to fight the federal government all the way to the Supreme Court. You sided with the government.
[Applause]
WILLIAMS: Now, Governor Perry, are you suggesting on this Martin Luther King Jr. Day that the federal government has no business scrutinizing the voting laws of states where minorities were once denied the right to vote?
PERRY: I’m saying that the state of Texas is under assault by federal government. I’m saying also that South Carolina is at war with this federal government and with this administration.
Any segregationist governor could have uttered those very lines in the 1950s or 1960s.
Later in the debate, Williams asked Gingrich about his incendiary suggestions that black Americans should seek jobs, not food stamps, and that poor children should work as janitors. “Can’t you see that this is viewed, at a minimum, as insulting to all Americans, but particularly to black Americans?” Williams asked Gingrich.
Gingrich responded by saying that “New York City pays their janitors an absurd amount of money,” and that “only the elites despise earning money.” He also reiterated his claim that “more people have been put on food stamps by Barack Obama than any president in American history.” That statement is utterly lacking in context, failing to note that Congress expanded the food stamp program under George W. Bush and that the Great Recession forced many more people onto food stamps than in normal times.
The GOP’s race problem doesn’t pertain just to Perry and Gingrich. Romney also voiced his opposition to restoring voting rights to ex-felons, which disproportionately disenfranchises minority voters, and said he would veto passage of the DREAM Act, which would give the children of undocumented immigrants who attend college or serve in the military a path to citizenship.
The 2008 electorate was the most diverse in US history. But last night it sounded as if the GOP candidates were practically whistlin’ Dixie.
In recent days Mitt Romney has strenuously defended his tenure at Bain Capital, lauding his former employer as a classic success story of free-market capitalism and lambasting his opponents on the left and right for practicing the “bitter politics of envy.”
In his New Hampshire primary speech, Romney claimed that “President Obama wants to put free enterprise on trial” and “turn America into a European-style entitlement society.” In Romney’s telling, Obama relies on government for his solutions, while Mitt draws his inspiration from the power of the free market. There are winners and losers in the free market, this argument goes, and it’s not the government’s job to determine who they are. At a recent debate, Romney said that government “by and large…gets in the way of creating jobs.”
But a closer look at Bain’s record under Romney reveals that the company relied on the very government subsidies that Romney and Tea Party conservatives routinely denounce as “crony capitalism.” The Los Angeles Times ran a big story yesterday about Bain’s investment in Steel Dynamics, which received $37 million in subsidies and grants to build a new plant in DeKalb County, Indiana. An analyst at the Cato Institute called it “corporate welfare.”
Romney has recently pointed to Steel Dynamics as one of his success stories at Bain, including in a new ad, which contributed to the 100,000 net jobs he’s claimed to have created at the firm (an incorrect figure he’s subsequently had to walk back). He never mentions that government subsidies played a major role in ensuring that success.
Phil Mattera, research director for Good Jobs First, provides a few more examples of the government subsidies Bain received during Romney’s tenure at his blog, Dirt Diggers Digest.
GS Industries. In 1996 American Iron Reduction LLC, a joint venture of GS Industries (which had been taken private by Bain in 1993) and Birmingham Steel, sought some $20 million in tax breaks in connection with its plan to build a plant in Louisiana’s St. James Parish (Baton Rouge Advocate, April 6, 1996). As the United Steelworkers union noted recently, GS Industries later applied for a federal loan guarantee, but before the deal could be implemented the company went bankrupt.
Sealy. A year after the 1997 buyout of this leading mattress company by Bain and other private equity firms, Sealy received $600,000 from state and local authorities in North Carolina to move its corporate offices, a research center and a manufacturing plant from Ohio (Greensboro News & Record, March 31, 1998). In 2004 Bain and its partners sold Sealy to another private equity group.
GT Bicycles. In 1997 GT, then owned by Bain and other investors, decided to move its manufacturing operations to an enterprise zone in Santa Ana, California. Being in the zone gave the company, which was later purchased by Schwinn, special tax credits relating to hiring and the purchase of equipment (Orange County Register, July 9, 1999).
These subsidies didn’t always provide the return states and localities were looking for. Seven hundred and fifty workers lost their jobs, for example, after Bain took over GS Industries. “They walked out of here with millions,” said one former steelworker. “They left us with nothing.”
Sealy, another company cited by Mattera, moved its headquarters from Cleveland to Greensboro after Bain’s investment to take advantage of the generous government subsidies, a fact that is not likely to endear Romney to Ohioans.
There are likely other examples of Bain profiting from these type of subsidies, along with a host of unanswered questions. How much did Bain-owned companies receive in total government subsidies? Did Bain take public money and then lay off workers? Did Romney seek these subsidies out?
Romney will no doubt try to channel Reagan in the coming campaign, echoing, in one form or another, the Gipper’s famous refrain that “government is not the solution to our problems; government is the problem.” Romney, based on his own compromised history, will have a tougher time making that argument.
As the GOP presidential candidates stepped up their attacks over the past few days on Mitt Romney’s private equity career at Bain Capital, a new meme quickly emerged in the press: Romney was being “Swift-Boated.”
“Gingrich Swift Boats Romney,” wrote New York magazine. “Is Gingrich swift-boating Romney?” asked MSNBC’s Morning Joe. National Review coined a new phrase: “Romney-Boating.”
It’s an absurd comparison. Criticism of Romney’s business career is nothing like the attacks made by the Orwellian-named Swift Boat Veterans for Truth against John Kerry’s combat record in Vietnam. The entire Swift Boat campaign against Kerry was a monstrous lie. The scrutiny of Romney’s Bain tenure, on the other hand, is grounded in the truth.
The media’s Romney-Kerry comparison is based on a new documentary produced by an ex-Romney staffer and released by a Gingrich-aligned Super PAC. I haven’t seen the entire twenty-seven-minute film (only a Gingrich Super PAC would release such a long-winded attack documentary), just the trailer. While it’s certainly propagandistic, hyperbolic and partisan, the central premise of the film is rooted in reporting done by the likes of Reuters, Bloomberg News, Boston Globe, the Los Angeles Times and many other large mainstream publications. These reports found that Bain, under Romney’s leadership, closed plants, downsized companies and outsourced jobs in order to maximize profits for the consulting firm and its shareholders.
Will the film tell the full story about Bain Capital? Doubtful. There’s more gray than black and white to most stories. Bain is a very good at what it does. But Romney did profit, at times, from other people’s misery. The Wall Street Journal found that 22 percent of the companies Bain invested with during Romney’s tenure “either filed for bankruptcy reorganization or closed their doors by the end of the eighth year after Bain first invested, sometimes with substantial job losses.” To suggest precisely that is not “Swift Boating.” It’s the truth.
Moreover, Romney has left himself open to attacks on this front by consistently exaggerating his business record, first claiming he created 10,000 jobs at Bain while running against Ted Kennedy in 1994 and now alleging he created 100,000 net jobs at the company during his tenure, which fact-checkers at the Washington Post, the New York Times and AP have debunked. The person guiltiest of distorting Romney’s record is Romney himself
The Swift Boat campaign against Kerry was far more odious than the Bain-related critique of Romney. Let’s remember that the Swift Boat vets said that John Kerry did not earn his Silver Star, Bronze Star and three Purple Hearts, had made "phony war crimes charges…exaggerated claims about his own service in Vietnam…and deliberate misrepresentations of the nature and effectiveness of Swift boat operations”—all of which was completely untrue. As the LA Times wrote, “These charges against John Kerry are false."
In 2004, much of the media failed to clearly denounce the Swift Boat ads. Today, the danger is that they’ll draw a false equivalence between the outrageous attacks on Kerry’s service and legitimate questions about Romney’s business career.
In the end, Mitt Romney won Iowa by a staggeringly close eight votes and will likely be the GOP presidential nominee. But we already knew that heading into last night. How Romney gets the nomination, and what shape he’s in when he faces off against Barack Obama, will be the real story of the GOP race. Based on his performance last night, Romney’s showing in Iowa doesn’t exactly inspire confidence in his campaign.
Romney has outspent Rick Santorum by a margin of 17-1 so far (not including upwards of $3 million in pro-Romney Super PAC advertising in Iowa) and still only won by eight votes. He won fewer counties last night (17) than he did in 2008 (24), got a slightly lower percentage of the vote (24.55 percent last night vs. 25.19 percent in ’08) and actually lost six votes overall (30,015 last night vs. 30,021 in ’08). Sure, Romney hardly campaigned in the state this cycle, but you’d expect a rich front-runner in a weak field with four years of additional exposure to at least improve upon his showing.
In contrast, 25,000 Iowa Democrats turned out to hear President Obama give a brief address to supporters at last night’s essentially meaningless Democratic caucus. Despite the rapid desire among Republicans to defeat the president, Democratic turnout in 2008 (239,000 voters) was nearly double the GOP turnout last night (122,000). At last night’s caucus, the Obama campaign signed up 7,500 volunteers and will leave behind eight campaign offices in the state as GOP candidates criss-cross the country.
That’s not to suggest that Obama’s re-election efforts will be smooth sailing. But in this crucial swing state, the president has to like his chances.
Tomorrow Attorney General Eric Holder will gave a major speech on voting rights at the LBJ presidential library in Austin. According to the library, “Holder will discuss the importance of ensuring equal access to the ballot box and strengthening America's long tradition of expanding the franchise.”
Holder’s speech could not come at a more critical time. Over the last year we’ve witnessed an unprecedented GOP war on voting, with a dozen Republican governors and state legislators passing laws to restrict voter registration drives, require birth certificates to register to vote, curtail early voting, mandate government-issued photo IDs to cast a ballot and disenfranchise ex-felons who’ve served their time. The Brennan Center for Justice has estimated that “these new laws could make it significantly harder for more than 5 million eligible voters to cast ballots in 2012,” and notes that “these new restrictions fall most heavily on young, minority and low-income voters, as well as on voters with disabilities.”
On Saturday, in conjunction with UN Human Rights Day, thousands of activists and concerned citizens in New York City held a march and rally to protest these restrictive new laws. The march began outside the New York headquarters of the Koch brothers, who have given more than $1 million to the American Legislative Exchange Council (ALEC), the shadowy conservative advocacy group that has masterminded the push for new voter ID requirements this year. Protesters held signs that read “Koch Bros & The 1%: Undermining Democracy.”
The march then continued to the UN for a rally with civil rights leaders, good-government activists and voting rights experts. One organizer told me that 20,000–25,000 people participated in the march, which, if true, would be a very good turnout on a chilly December morning. (The AP, on the other hand, said that “hundreds” protested, though the numbers seemed significantly larger to me). Groups sponsoring the march/rally included the NAACP, SEIU1199 and the United Federation of Teachers.
The purpose of the march was both practical and symbolic. “The march on Saturday was an indication that Americans will not go backwards,” said Judith Browne-Dianis, co-director of the Advancement Project. “We will keep up the momentum to end voter suppression by taking to the streets, to the legislatures and to the courts. We won't be silenced by those who want to undermine democracy.”
The Advancement Project has helped gather 120,000 signatures asking the Justice Department “to oppose any discriminatory laws that will disenfranchise voters.” The Justice Department has that authority under the Voting Rights Act. DOJ has sent pointed questions to states like Texas and South Carolina about their new laws, but we still don’t know how aggressively they will enforce the existing laws on the books. Perhaps Holder’s speech tomorrow will shed some light.
“Occupy A Voting Booth,” read one sign I spotted on Saturday. Many of the speakers echoed that theme. While Occupy Wall Street is rightly fighting for systemic change in a broken political system, the demonstrators on Saturday are leading a struggle to protect the most basic of political rights—the right to vote. Because of the new GOP laws, Bob Fertik of Democrats.com recently told me, voting itself has become an act of resistance.
The last ad the Karl Rove–backed Crossroads GPS ran against Elizabeth Warren, which sought to tie her to violence at Occupy Wall Street, was one of the most disingenuous and inaccurate ads of the 2012 cycle. Their new ad against Warren is even worse—ludicrously suggesting that Warren supported the Wall Street bailout and has done the bidding of the biggest banks.
First Crossroads claimed that Warren was the intellectual godmother of Occupy Wall Street. Now they’re claiming she’s Wall Street’s best friend. So much for consistency!
Simon Johnson does the fact-checking that Crossroads GPS obviously didn’t bother to do. He notes at least five major inaccuracies in the new ad:
1. TARP was a Republican program—proposed and implemented by President George W. Bush. At the time, Ms. Warren was busy championing people whose rights had been trampled by the financial sector through various kinds of abuses.
2. Ms. Warren became chair of the Congressional Oversight Panel (COP) for TARP, precisely because people in Congress—on both sides of the aisle—trusted her to provide an honest and professional check on the support provided to financial firms. She did her highest profile work during the Obama administration, bringing relentless pressure on the Treasury and other agencies who just wanted to prop up big firms without any conditions.
3. Ms. Warren has also been a strong supporter of all efforts to rein in Too Big To Fail banks, including by breaking them up. She has consistently been one of the strongest advocates for curtailing the abusive power of megabanks (and others who have behaved badly).
4. At the same time, Ms. Warren has not demonized the financial sector. On the contrary, when charged with setting up the new Consumer Financial Protection Bureau, she went out of her way to work closely with those in the financial sector who provide sensible products with reasonable conditions. Her emphasis throughout has been on transparency, fairness, and full disclosure in this sector. You are not allowed to sell dangerous toasters in the United States; her point is that you should not be allowed to sell financial products that have been proven dangerous.
5. The idea that Elizabeth Warren would ever side with “big banks” against the middle class is preposterous. Time and again, she has stuck up for the middle class (and anyone who uses financial services) - even when it was deeply unfashionable to do so. The big banks have opposed her relentlessly and on-the-record, both directly and through various surrogates
In a way, the Crossroads ad, despite its blatant falsehoods, is an admission that Warren’s brand of progressive populism is deeply resonant with voters. Her message of accountability for Wall Street and advocacy on behalf of consumers scares the bejesus out of Republicans. Indeed, in a new Boston Herald poll, where Warren leads Scott Brown by seven points, voters say they trust Warren more than Brown to fight for middle-class families and effectively regulate Wall Street.
In other words, Republicans are conceding that they can only defeat Warren by lying about her record and making it appear that she coddled Wall Street, when in fact her entire career has been about doing precisely the opposite. My guess is that this ad, like the last Crossroads ad, will backfire stupendously.
PS: Today Republicans also voted to filibuster the nomination of Richard Cordray to head the Consumer Financial Protection Bureau that Warren founded.

President Barack Obama speaks about the economy, Tuesday, December 6, 2011, at Osawatomie High School in Osawatomie, Kansas. (AP Photo/Carolyn Kaster)
It’s become a cliché to say that Occupy Wall Street has changed our country’s political conversation. But if you want to know exactly how the Occupy movement has impacted the debate in Washington, read Barack Obama’s speech in Osawatomie, Kansas, today.
For much of 2011, Obama’s speeches were all about the deficit. Today the central theme of his speech was income inequality—and how this mounting problem weakens our economy and our democracy. At long last, the president sounded like he was channeling his inner Elizabeth Warren.
Obama’s pivot away from austerity orthodoxy and toward public investment began with his jobs speech in September, but he’s subsequently sharpened his language and focus in recent months in response to pressure from Occupy Wall Street. He’s now tackling issues of basic fairness and attacking the GOP’s brand of “your-on-your-own economics” in a much more direct way. His nod to Teddy Roosevelt, who delivered his “New Nationalism” speech in Osawatomie in 1910, could not have come at a more appropriate time. Here’s the relevant section:
Now, just as there was in Teddy Roosevelt’s time, there’s been a certain crowd in Washington for the last few decades who respond to this economic challenge with the same old tune. “The market will take care of everything,” they tell us. If only we cut more regulations and cut more taxes—especially for the wealthy—our economy will grow stronger. Sure, there will be winners and losers. But if the winners do really well, jobs and prosperity will eventually trickle down to everyone else. And even if prosperity doesn’t trickle down, they argue, that’s the price of liberty.
It’s a simple theory—one that speaks to our rugged individualism and healthy skepticism of too much government. It fits well on a bumper sticker. Here’s the problem: it doesn’t work. It’s never worked. It didn’t work when it was tried in the decade before the Great Depression. It’s not what led to the incredible post-war boom of the ’50s and ’60s. And it didn’t work when we tried it during the last decade.
Remember that in those years, in 2001 and 2003, Congress passed two of the most expensive tax cuts for the wealthy in history, and what did they get us? The slowest job growth in half a century. Massive deficits that have made it much harder to pay for the investments that built this country and provided the basic security that helped millions of Americans reach and stay in the middle class—things like education and infrastructure; science and technology; Medicare and Social Security.
Remember that in those years, thanks to some of the same folks who are running Congress now, we had weak regulation and little oversight, and what did that get us? Insurance companies that jacked up people’s premiums with impunity, and denied care to the patients who were sick. Mortgage lenders that tricked families into buying homes they couldn’t afford. A financial sector where irresponsibility and lack of basic oversight nearly destroyed our entire economy.
We simply cannot return to this brand of your-on-your-own economics if we’re serious about rebuilding the middle class in this country. We know that it doesn’t result in a strong economy. It results in an economy that invests too little in its people and its future. It doesn’t result in a prosperity that trickles down. It results in a prosperity that’s enjoyed by fewer and fewer of our citizens.
Look at the statistics. In the last few decades, the average income of the top one percent has gone up by more than 250 percent, to $1.2 million per year. For the top one hundredth of one percent, the average income is now $27 million per year. The typical CEO who used to earn about thirty times more than his or her workers now earns 110 times more. And yet, over the last decade, the incomes of most Americans have actually fallen by about 6 percent.
This kind of inequality—a level we haven’t seen since the Great Depression—hurts us all. When middle-class families can no longer afford to buy the goods and services that businesses are selling, it drags down the entire economy, from top to bottom. America was built on the idea of broad-based prosperity—that’s why a CEO like Henry Ford made it his mission to pay his workers enough so that they could buy the cars they made. It’s also why a recent study showed that countries with less inequality tend to have stronger and steadier economic growth over the long run.
Inequality also distorts our democracy. It gives an outsized voice to the few who can afford high-priced lobbyists and unlimited campaign contributions, and runs the risk of selling out our democracy to the highest bidder. And it leaves everyone else rightly suspicious that the system in Washington is rigged against them—that our elected representatives aren’t looking out for the interests of most Americans.
More fundamentally, this kind of gaping inequality gives lie to the promise at the very heart of America: that this is the place where you can make it if you try. We tell people that in this country, even if you’re born with nothing, hard work can get you into the middle class; and that your children will have the chance to do even better than you. That’s why immigrants from around the world flocked to our shores.
And yet, over the last few decades, the rungs on the ladder of opportunity have grown farther and farther apart, and the middle class has shrunk. A few years after World War II, a child who was born into poverty had a slightly better than 50-50 chance of becoming middle class as an adult. By 1980, that chance fell to around 40 percent. And if the trend of rising inequality over the last few decades continues, it’s estimated that a child born today will only have a one-in-three chance of making it to the middle class.
It’s heartbreaking enough that there are millions of working families in this country who are now forced to take their children to food banks for a decent meal. But the idea that those children might not have a chance to climb out of that situation and back into the middle class, no matter how hard they work? That’s inexcusable. It’s wrong. It flies in the face of everything we stand for.
You’re likely to hear elements of this speech over and over as the campaign heats up, as the Obama campaign attempts to stand with the 99 percent and paint Gingrich or Romney as core defenders of the 1 percent. None other than Chuck Schumer, one of the senators who represents Wall Street, told Washington Post blogger Greg Sargent that Democrats would focus on income inequality “like a laser” in 2012.
That will entail, however, a shift not only in rhetoric, but also in policy for a party and president that has too often been seen as prioritizing Wall Street over Main Street. Nor is it realistic to think that the Obama campaign will suddenly win over disaffected former supporters with a series of speeches. Indeed, Occupy Wall Street is aimed as much at the president and the rigged political system in Washington as it is at the nation’s largest banks. As one OWS leader told New York magazine: “These [protesters] aren’t out here because they’re offended that they haven’t been spoken to nicely. They’re out here because they owe shitloads of money in student-loan debt and can’t find a job. Or they can’t afford their mortgage. And if Obama thinks that they’re gonna be able to divert this energy by talking about doing something, he’s got another think coming.”
To paraphrase Hillary Clinton, Obama now needs to prove to the movement that he has more to offer them, and the country, than just words. Still, the populist moment captured by Occupy Wall Street provides an opening for the president as well. It’s still an open question whether he’ll end up on the right or the wrong side of this movement. But today Obama took an important step in Occupy’s direction.
Tonight in Washington Representative Paul Ryan will receive Politico’s “Health Care Policymaker of the Year” award. Washington Monthly blogger Steve Benen deftly summarizes the many reasons why Ryan is so undeserving of said award.
It’s been several months since the political world debated Paul Ryan’s approach to health care in detail, so perhaps Politico has forgotten some of the more important realizations from the debate. Let’s remind the publication of the relevant details.
First, Ryan’s health care agenda repealed the entirety of the Affordable Care Act—in the process, taking coverage away from millions of Americans—and replaced it with nothing. What’s more, by scrapping the ACA altogether, Ryan would add billions to the deficit, and his plan simply asserted the opposite without evidence.
Second, Ryan’s plan claimed to control health care costs. A closer look reveals that Ryan’s claims were wrong. Indeed, Ryan pushed to shift Medicare cost burdens from the government to families, and apply the savings to more tax cuts.
Third, accusations that the Ryan plan would “end Medicare” were accurate. The right-wing lawmaker intended to scrap the existing program, replacing it with a privatized voucher scheme—and the vouchers wouldn’t cover escalating costs.
Fourth, though it often went overlooked, Ryan’s proposed changes to Medicaid were a tragic mess.
And perhaps best of all, independent scrutiny found that the numbers in Paul Ryan’s plan simply didn’t add up.
To know all of this, and give this guy an award “Health Care Policymaker of the Year” anyway, is madness.
Blogger Digby jokes that “To honor [Ryan] for his work on healthcare policy is akin to honoring Governor Scott Walker as Public Employee of the year.” The Politico award is reminiscent of a similarly ridiculous “fiscal responsibility” honor bestowed upon Ryan earlier this year by three leading deficit hawk groups, which I described in my recent Nation piece on the austerity class.
In 2008, when Ryan introduced his radical budget road map—which called for turning Medicare into a voucher system, privatizing Social Security and redistributing income upward by drastically cutting taxes for the wealthiest Americans and largest corporations—[Maya] MacGuineas praised his “tremendous courage and leadership.” When Ryan reintroduced his plan in 2010, the CRFB [Committee for a Responsible Federal Budget] lauded his “thoughtfulness and courage.” The CRFB failed to mention that Ryan’s plan would increase the deficit, from a debt-to-GDP ratio of 60 percent in 2010 to 175 percent by 2050. “Paul Ryan added a huge amount to the deficit,” says John Irons, policy director at the Economic Policy Institute (EPI). “To call that even remotely fiscally responsible was not a correct analysis. It’s almost as if they said, We don’t care what your plan does—as long as you talk tough on deficits we’re going to support you.”
Indeed, in January the CRFB, the Concord Coalition and the Comeback America Initiative (all funded by the Peterson Foundation) gave Ryan a cherished fiscal responsibility award, despite his deficit-exploding budget, hostility to tax increases and votes in favor of the Bush administration’s deficit spending. Bob Bixby, executive director of the Concord Coalition, introduced Ryan by quoting Time magazine: “The irony of Ryan’s rise is that he has vaulted to popularity by embracing historically unpopular ideas.” Said Bixby, “And I thought to myself, now there is a deficit hawk…. If we limit ourselves to popular ideas, we’re never going to solve the problem.”
MacGuineas said the award honored Ryan for being the first politician to put forth a budget plan in 2011, which she called “the most fiscally responsible of any of the plans.” Technically, that’s true. Ryan’s budget, a modified version of his road map, achieves a modest $155 billion in savings over ten years by proposing what the CBPP calls “the most severe and wrenching budget cuts in US history—two-thirds of which would come from programs for people of low or moderate incomes” (i.e., Medicaid, Pell grants, food stamps and low-income housing).
The award to Ryan illustrates just how dangerously obtuse the austerity class’s definition of fiscal responsibility is. The deficit hawks succeed by making the debate over the deficit a pure accounting game, with no acknowledgment of the adverse impact a plan like Ryan’s would have on the broader economy and on so many Americans if it became law. “If [you’re] willing to slash spending so that long-run deficits are brought under control, then it’s fiscally responsible,” Jim Horney, vice president for federal fiscal policy at CBPP, says of the Ryan plan. “But if by fiscally responsible you mean putting the budget on a sustainable path but making sure that government is able to meet the needs of the people of the United States, then I think it’s a terribly irresponsible plan.”
Ryan is so influential in DC precisely because of the endless street cred he receives from the Washington policy establishment. It would be nice if they stopped giving him awards that he doesn’t deserve.



