Robert S. McElvaine: GOP Pledge: Repeal Arithmetic!

American students currently rank 25th in math among advanced nations.

The Republican “Pledge to America” will further lower that ranking.

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Ever since Barack Obama became president, the Republicans have been shouting “No” to all proposals for improvement and encouraging people to focus on every diversion they can think of, from birth certificates to genetic anti-colonialism, from “death panels” to deficits, from “socialism” to citizenship, from immigrants to mosques.

Now the Republicans have given voters the context that unites these red-state herrings. The “Pledge to America” provides the text behind the GOP con.

The GOP “Pledge to America” is a text composed of cons, a Con-Text.

Reading this Con-Text makes it plain that all the diversions are designed to throw the American people off the trail of the Wall Street bandits who destroyed the economy for their own enrichment.

Perhaps the greatest con is that they campaign on fear of the effects of a growing deficit, yet pledge to maintain tax cuts that will add an estimated 3.7 trillion dollars to that deficit over the next ten years, while also pledging “robust” military spending and specifying only a very few cuts in other programs.

It is reminiscent of Ronald Reagan’s 1980 campaign in which he said he would begin with a deficit, vastly increase military spending, greatly reduce taxes, maintain the “social safety net” and the result would be a balanced budget. George H.W. Bush correctly called that “voodoo economics” and John Anderson said it could only be done “with smoke and mirrors.”

In fact the only way to do it then, as now, is what is implicitly the centerpiece of the Republican Pledge:

A Constitutional Amendment to Repeal Arithmetic.

The winning message for Democrats is very simple:

Republicans say they want to take our country back;

Democrats want to take our country forward.

The choice is yours.

Read more: Math, Wall Street, George H.W. Bush, Ronald Reagan, Federal Deficit, Economic Crisis, GOP Con, Republican Pledge to America, 2010 Midterm Elections, Voodoo Economics, John Anderson, Barack Obama, Federal Budget, Politics News

Marian Wright Edelman: Growing Poverty Problems Among Young Families and Their Children: A Major Neglected National Crisis

By Andrew Sum and Marian Wright Edelman


Earlier this month, the U.S. Census Bureau released its annual report on the size and incidence of poverty problems in our nation. The news was, as predicted by poverty analysts, quite distressing. The nation’s overall poverty rate rose to 14.3%, the third consecutive annual increase and the highest poverty rate in the nation since 1994. Nearly 44 million people were categorized as living below the official poverty line, the largest aggregate number in the 50 year history of the poverty data.


Underneath these aggregate poverty statistics, however, lie a highly variable set of findings on who the poor are, substantial differences in the poverty rates across age and race-ethnic groups, and differing time trends in the incidence of their problems. The past decade has taken a terrible toll on young adults under 30, their families, and their children. The nation’s children, those under age 18 and especially those under 5, experienced the highest increase in poverty over the past three years, and those residing in young families face overwhelmingly high rates of poverty, near poverty, and low incomes. An extraordinarily high fraction of the children in young families—46%—were either poor or near poor in 2009.


Since the beginning of the national war on poverty in 1964, the age structure of poverty rates has changed markedly. In the mid-1960s, the nation’s older population (65+) was the most likely to be poor. Due largely to changes in the levels and structure of Social Security payments in the early 1970s, this age disparity changed. Children became the most poverty prone group in the nation and the age gaps have widened considerably over time. In 2009, the poverty rate of all children under 18 increased to just under 21% versus 13% for adults ages 18-64, and under 9% for those adults 65 and older. Children today are 2.3 times as likely to be poor as our older residents, and for those children under five the gap is closer to three to one.


Due to declining employment and real annual earnings among young adults under 30 and the continued decline in marriage among young parents, children in the nation’s youngest families are by far the most poverty prone. In 2009, nearly 40 percent of all children residing in young families were poor, 46 of every 100 were poor or near poor, and 66 of every 100 were low income i.e., an income under twice the poverty line.


Growing up in a poor/near poor family places children, especially young children, at a high risk of encountering a wide array of cognitive, educational attainment, health, nutrition, public safety, and housing problems. They are far more likely than their more affluent peers to have severe academic achievement deficits, to fall behind their age peers in grade level, and to drop out of high school before graduation. They are more likely to experience malnutrition problems, to encounter physical and mental health problems in their childhood and teen years, and to become teen parents. During their teenage years, they are much more likely to be jobless, especially when they are both poor and African American or Hispanic. When they do graduate from high school, they are much less likely to attend college and to graduate with a bachelor’s degree even when they have high academic achievement.


The long-run economic, educational, health, and social consequences of having so many children being raised in poor and low income families are likely to be quite severe. Left unaddressed, these problems will reduce the human capital of our future workforce, reduce the economic competitiveness of our nation, curtail economic mobility, contribute to our growing budget deficit, and increase the already heightened degree in income and wealth inequality in society. The time for immediate and sustained public policy actions to radically reduce childhood poverty is right now. The clock is ticking.


Andrew Sum is Professor of Economics and Director of the Center for Labor Market Studies at Northeastern University. Marian Wright Edelman is President of the Children’s Defense Fund, a national child advocacy organization.

Read more: Child Poverty, Poverty, Ending Child Poverty, Recession, Economy, Impact News

Fed Officials Clash Over How To Fix The Economy

WASHINGTON — Divisions within the Federal Reserve over how to pump up the economy and lower unemployment came into sharper view Wednesday.

Three Fed officials squared off in competing speeches over how much help would come from one likely next step – buying more government debt.

Read more: Boston, St. Louis, Charles Plosser, Minnesota, Eric Rosengren, Federal Reserve, Economic Stimulus Package, Government Debt, James Bullard, Fed, Economic Recovery, Ben Bernanke, Philadelphia, Federal Open Market Committee, Narayana-Kocherlakota, Business News

Unemployment, Economy Forcing Savers To Give Up $5 Billion A Year

Savers are giving up $5 billion in annual income as concerns about the dampening recovery and increasing unemployment push the prudent to keep their money in cash and away from investments, new research shows.

Over the past year, consumers moved $542 billion from certificates of deposit to money market deposit accounts, according to Market Rates Insight, a San Anselmo, Calif.-based data provider. Representing about one-fifth of the $2.6 trillion savers have in CDs, the shift from investments that offer a fixed rate of return over a specific time period to near-zero-yielding money market accounts is a reflection of the dour economy and the fear and uncertainty that it breeds, analysts said.

The average CD yielded 1.15 percent in August. The average money market account yielded 0.31 percent, or about a quarter of the average CD, according to the California-based researcher. Applied to $542 billion, the difference in interest over the course of a year equals about $5 billion in lost annual income.

“The current economic uncertainty is causing some savers to make emotional rather than financial-based decisions,” said Dan Geller, executive vice president at Market Rates Insight. The firm attributes the “reluctance” of savers to park their money in CDs, even for short periods, to the fact that “consumers are not confident about the prospects of economic recovery any time soon,” according to a statement.

A leading index used to gauge consumer confidence dropped to an unexpected low on Tuesday. The Conference Board’s index hit 48.5 this month. It was at 62.7 as recently as May.

Geller said consumers are keeping their money in money market funds — cash, essentially — because they want to have easily-accessible cash in case they’re forced to deal with the unexpected, like a job loss.

“The need to satisfy or alleviate the fear of uncertainty is greater than the need to have a higher rate of return,” he said.

Greg McBride, the senior financial analyst for Bankrate.com, said the new research is consistent with what he’s seeing in Federal Reserve data. Overall, there’s been a consistent decline in CDs and investments with a corresponding increase in savings account balances and other deposit accounts.

“The preference investors have for liquid cash is understandable at a time when unemployment is at 9.6 percent and more than 6 million people have been out of work for longer than six months,” McBride said. “Investors are more than willing to give up rate of return now in exchange for safety and flexibility.”

In a Wednesday speech in London, Federal Reserve Bank of Minneapolis President Narayana Kocherlakota said that “the lack of vitality in the U.S. labor market can only be termed disturbing.” He added that he finds the behavior of unemployment — the lack of new jobs, the number of workers falling out of the labor force — “deeply troubling.”

McBride added that the move was also a reflection of the low interest rate environment. Since the Federal Reserve’s primary policy-making body lowered the main interest rate to a range of 0-0.25 percent in December 2008, there’s been a steady decline in rates across the board. Savings accounts are yielding next to nothing; mortgage rates are at historic lows; and corporations are issuing debt at record-low rates.

The analyst said investors are loathe to lock in their cash for a substantial period of time in a low-rate investment like a CD. The highest yielding one-year CD is giving investors 1.48 percent interest, Bankrate.com data show. By comparison, the most generous money market account yields 1.35 percent.

“If you’re an investor with a one-year CD that’s maturing and you’re looking — ‘What do I do with that cash now?’ — the yield isn’t that much higher than what you’d get in a high-yield savings account,” McBride said.

Though it’s important to note that savers don’t typically search for the highest-yielding accounts, and the average money market account is much, much lower than the most generous of them, the sentiment regarding keeping money in cash form remains: savers and investors are scared of the economic environment, and reluctant to park their money in low-yielding investments for fear of missing future opportunities.

“They have it in cash in event of emergency,” McBride said. “Investors are still risk-averse and it’s going to be some time before that risk-aversion subsidies. When it does, [that money] can be re-deployed to other investments.

“You don’t want to be tied up for 3, 4, 5 years at a very low rate of return,” he added.

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Shahien Nasiripour is the business reporter for the Huffington Post. You can send him an e-mail; bookmark his page; subscribe to his RSS feed; follow him on Twitter; friend him on Facebook; become a fan; and/or get e-mail alerts when he reports the latest news. He can be reached at 646-274-2455.

Read more: Financial Crisis, Great Recession, Unemployment, Interest Rates, Uncertainty, Business News

Sheri and Allan Rivlin: How Democrats Can Win 2010 Elections — Step 4: Concentrate on the House

As Congress enters its final days before adjourning for full time campaigning, the outlines of the substantive differences between the parties is set. The Democrats have passed a series of small bills aimed towards job creation but they were not able to pass their changes to the Bush tax cuts before the election. This is good news because even though Democrats believe they have a tactical advantage on taxes right now, strategically speaking, Democrats do not win elections by debating the topic of taxes, any more than Republicans win elections by talking about health care.

The Republicans finally answered the critics that were challenging them to produce some new ideas with bold proposals to move forward by going back to George W. Bush’s government spending levels and making George W. Bush tax cuts permanent. At least they are offering voters a clear choice. Republicans believe they are going to win this election by making it about national issues. But at the same time just a few Democratic leaders, strategists, and pundits are starting to buck conventional wisdom to suggest Democrats can win the 2010 election by nationalizing the issues.

But the real reason Democrats need to leave Washington and go home to campaign is because Democrats only win elections when moderates and progressives come together as they did in 2008. But the past two years have highlighted the degree to which legislating and coming together at the same time has proven to be a challenge for Democrats. Perhaps we can make it work on the campaign trail.

Here we continue our series: How Democrats Can Win 2010 Elections by adding step 4.

Steps 1-3 can be found here.

Step 4: Concentrate on the House of Representatives
Retaining the House is really the whole ball game in determining whether the new direction offered by President Obama and the Democrats will be ratified or reversed. If Democrats retain control of the U. S. House of Representatives even by one seat, they almost certainly “win” the 2010 election. The Republicans have committed a strategic error by letting their ambitions set their definition of success unnecessarily high. They have been talking about regaining control of both houses of Congress so long that they will have achieved a draw if they win just one of them and will certainly have “lost” the election if the votes are counted and Democrats control both chambers on Capitol Hill.

The Republicans’ chances of winning control of the Senate declined dramatically in the final round of primaries when Tea Party Candidate Christine O’Donnell defeated former Governor, Rep. Mike Castle in the Delaware Senate Republican Primary. Now Republicans need to win most of the too-close-to-call races on the board to win control of the Senate. The chances of this are low, and would almost certainly not happen if the environment is such that the House of Representatives stays Democratic.

Holding on to the House is a tall order to be sure, but it is important to understand that if Democrats retain control of the House and Senate by the slimmest of margins in each chamber, they will have won the night. They may have lost 8 or 9 Senate races and lost over 35 House seats, and been clobbered in Governors races from coast to coast in advance of a redistricting year, but they will have won this election. After electing a Democratic President and putting Democrats in control of the House and Senate in the elections of 2006 and 2008, the voters will have re-elected Democrats to control both chambers in 2010. That is a vote to continue the change Democrats promised in 2008, not reverse course.

Of course it will be hell trying to govern in 2011, but that is pretty much a given.

Steps 1-3 can be found here.

Read more: Jobs, Strategy, Democrats, 2010 Elections, Economy, Republicans, Pledge to America, Politics News

Obama faces voter policy doubts in backyard meeting

DES MOINES (Reuters) – President Barack Obama defended his economic policies on Wednesday in the face of tough questions from skeptical Americans less than five weeks before congressional elections that threaten his fellow Democrats’ grip on Congress.

Guantanamo civilian trial set to start in New York

NEW YORK (Reuters) – Jury selection began on Wednesday for a Tanzanian charged in the 1998 U.S. embassy bombings in Africa, the first detainee from the Guantanamo Bay military prison to go on trial in a U.S. civilian court.

Times Square bomber planned second attack, says U.S.

NEW YORK (Reuters) – U.S. prosecutors said on Wednesday they are seeking life in prison for a Pakistani-born American citizen who tried to set off a car bomb in New York’s Times Square and revealed he had planned a second attack.