Friday, March 11, 2005

 

Oxley - "Nothing to fear: but more lies and bullshit"

We had a dream last night. It took place in Washington today as Michael Oxley walking to the podium as the inaugural speaker of the Ripon Society's new "Bully Pulpit" series:
Ladies and Gentlemen, I had some prepared remarks to make today, but I am going to put them aside. I really meant to read this speech. As late as last week, I was proud of myself for coming up with the title, "Nothing to Fear: Owning Retirement Security". I thought it would be clever nod both to FDR and President Bush's "Ownership Society".

But last Monday I was back in the Ohio heartland, and something changed me. My district is a mix of small rural communities and has-been industrial towns. These are hard working people that play by the rules and consider Social Security even more sacred than the Marion Popcorn Festival and the Allen County Fair. They are angry and scared that the big shots in Washington are going to sell off their retirement.

And I've let them down. I was blinded by the hundreds of thousand of dollars I rake in each year from the financial community. I lost my bearings, but now I see the light.

If it weren't for my constituents shaking me out of my cash-induced psychosis, I would have done and said whatever it took to pry those funds from the Social Security trustees.

And I had been prepared to lie to you today.

First, I was going to soften you up with one of those lies about what FDR said. Hell, I figured that if Brit Hume and John Fund can do such a brilliant job of slicing and dicing Roosevelt’s words that I figured that I could to.

I was prepared to bamboozle you with the new phrase that President Bush, Karl Rove and Frank Luntz wants Republican leaders to use now - 'add-on' accounts' instead of private accounts or even personal accounts. You see, the boys at the White House had a 'come to Jesus' meeting with some of us last week, and you know how Luntz wants us to say everything just right, especially if we can steal some of the oppositions own words.

And, so, I had planned to tell you that what we need was a rational discussion on adding a personal account option to Social Security. And that would have been a lie, because the President has no intention of adding on anything. His plan is a carve out, plan and simple. I saw how the press corps had been torturing Scotty McClellan and he deserves it. Anyone Republican that tries to use that 'add-on' stuff ends up looking stupider than a javelin thrower at the Ashland Balloon Festival.

Speaking of Luntz, I was also prepared to tell you another whopper that was more or less cooked up by old Frankie boy. I was going bring out that old chestnut about how polls showed young people have a greater belief in UFOs than in a Social Security check being there for them. The truth is that there was really only one poll, if you want to call it that, and it was cooked up by Frank back in 1995 back before he ran into a few integrity problems. I wasn’t going to mention that Luntz’s so-called findings have been thoroughly debunked, cause, well, it would have ruined the story.

I had more lies I was prepared to tell today. I was going to tell you that Social Security is in crisis and would soon be growing an enormous deficit. Calling it a 'deficit' does make it sound scary, but honestly it’s not all that scary. Hell, one of those 75-year guesstimates from those Social Security trustees is that we won't fall short for another 40-50 years, and even those guesses have wildly underestimated the growth of the Social Security trust funds.

I have to admit that if I told you these lies about the add-on accounts and the deficit today, I would have been immediately humiliated. That's because right now, across town, GAO head David Walker is telling the Ways and Means Committee that "the Social Security program does not face and immediate crisis" and that private accounts "would exacerbate the insolvency problem. . . You will end up with negative cash flow earlier." Who would the public have believed, a public servant like Walker, or a horse with its head in the Wall Street trough like me?

But believe me, I really was prepared to lie to high heaven. These tall tales I’ve outline already are bad enough, but I’ve yet to mention the worst lie I was going to tell. I was going to lie about the nature of the Social Security program, itself.

You see, ladies and gentlemen, my friends at Credit Suisse and Morgan Chase wanted me to keep telling the American people that it was an investment program and not an insurance program, and the Social Security just wasn't giving you the rate of return you deserve.

But, I decided that I don't think voters are that stupid. Jeez, unless someone is a member of the coupon-clipping class like some of you, they are going to see the FICA deduction on their check every payday. The name, the Federal Insurance Contributions Act, really doesn't leave much question, does it?

The Wall Street fellas think that if we can convince Americans that their FICA payments belong to them, then they can start getting them to gamble on getting higher rates of return. Hah! Apparently the guys over at Goldman Sachs have never tried to ask the companies that insure their Lexus's and vacation homes to return their past premiums so they could invest them.

But even if we did divvy up the funds into individual accounts, the truth is that their would be a lot of losers. In my prepared remarks, I was going to paint this fantasy picture of the emergence of worker-capitalists taking control of their own financial destiny. It would have been a pretty picture, but one that faker than Starving Artist sale at the Kenton Holiday Inn.

Even the Carey Times, a small newspaper in my district, did a man-on-the-street interview on Social Security reform recently. One person remarked, "I don't think the common people are disciplined enough or know enough about stocks to play the stock market." Another said, "I'm afraid people will lose their money the stock market."

The story Wall Street wants me to tell - but I won't anymore - boils down to this: we can "save" Social Security by shifting the funds to retirement accounts. These guys like it when guys like me suggest that American's' stock investments will receive annual returns of 7%, the average return on stocks over the past seventy-five years.

Now, I'm no MBA, but I know that for stocks to provide returns of 7% under such conditions, the average price-to-earnings ratio -- already at 30 to 1, more than twice the historic average -- would have to rise eventually to incredible levels of over 400 to 1.

Of course, it is possible that the economy will grow more quickly than the Trustees predict, making 7% stock returns more plausible. But if that were to occur, there would be little or no shortfall in Social Security revenues to begin with.

Ladies and gentleman of the Ripon Society, I know that this is not what you expected to hear. I know that my honesty may cost me my seat on the Society's board. And I know that you may never call me back to have lunch here again. But I'll sleep easier thinking that I am truer to the values of Lincoln and Roosevelt than to the Bush's . . .
And then our hotel's wake up call suddenly brought us back from reality

Thursday, March 10, 2005

 

Actually, there are 1,078,000 reasons why Oxley talks about Social Security in DC but not in Ohio

This is an update our earlier post suggesting why U.S. Rep. Mike Oxley is so fond of advocating - in DC - for the carving of private accounts out of Social Security. We've now had enought time to sort through all of Oxley's campaign contributions from 1997 til now and the pattern of heavy donations from the financial services community is even more obvious, to the tune of $1,078,000!

This is probably a conservative number. We did not count donations from law firms, some of whom may work for the banks, investment houses and insurance companies. We did not even count the donations from all insurance companies. The only insurance contributions we counted were those from companies that clearly market their annuity, 401k, pension and retirement financial services. Finally, we did not count the contributions from accounting firms even though it could be easily argued that they stand to benefit - albeit indirectly - from the private accounts.

Here is a roundup of the top 20 investment and financial services contributors to Oxley since 1997:

Wednesday, March 09, 2005

 

Jobs continue to slide in Ohio

The belated ODJFS's monthly report on Ohio's job situation was finally released, and as we had predicted, the seasonally adjusted number shows another sharp decline of 8,200 jobs.

Although seemingly contradictory, the report indicates that the unemployment rate (ODJFS uses different methods to measure jobs and unemployment rates) dropped to 5.9 % from 6.1% in December. To add to the confusion, ODJFS reports that this December rate of 6.1% was revised upward from 5.9%.

One way to interpret the conflict between the jobs numbers and the employment numbers is that more workers have stopped actively looking for jobs and are therefore no longer counted in the unemployment rates. In otherwords, only a fool would rejoice at the reduced unemployment numbers when the number of jobs took another steep dive. But count on the Republicans in Congress like Pollyanna Pryce to ignore the continued bad jobs news and focus on the unemployment rate.

Here's the jobs loss breakdown for January:
We hope to have the non-seasonally adjusted numbers later today or tomorrow.

Tuesday, March 08, 2005

 

Libertarian Lima rag holding Social Security forum

Some time in the next few days the Lima News apparently will be holding some sort of "forum" on Social Security. Exactly what kind of get together this will be is uncertain. We expect that it's not open to the public and will be populated with people the newspaper has selected to "represent" the community, plus a guest appearance by Congressman Mike Oxley:
The Lima News will be holding a community roundtable discussion with Oxley. We’re inviting in a diverse group of representatives from small business, manufacturing, education, labor and agriculture to share their viewpoints about the Bush plan. A story from the session will be published March 13.
The Lima News is owned by the Freedom Communications Inc., known for its ownership of the Orange County (California) register and its far right/libertarian views (by their own admittance). This is not going to be treated as just another news story, and as shown by the Cato Institute plotting, libertarians are out to kill Social Security, the Lima News is going to have its own agenda.

As we have noted, Oxley is avoiding real, public town meetings in his district and the Lima News event just provides more cover for him. Hopefully one of the "representative from small business, manufacturing, education, labor and agriculture" will have the balls to ask two questions of Oxley:
  1. What in the hell does carving out private accounts have to do with strengthening Social Security for future generations
  2. How can anyone believe Mike Oxley will act in his constituents best interests when he acccepts hundreds of thousands of dollars each year from firms that stand to reap enormous gains from the private accounts?
[UPDATE: We have heard from a reader that the "roundtable" happened yesterday, March 7. They confirmed that coverage of the session will be in Sunday's paper (March 13)]

Monday, March 07, 2005

 

Social Security meetings in northeast Ohio

As an addendum to the post below, we provide a link to the Plain Dealer that leads to a list of upcoming public Social Security meetings being held in Northeast Ohio by U.S. Representatives Sherrod Brown, Dennis Kucinich, Stephanie Tubbs Jones and March Kaptur.

The PD also has information on the local Coalition to Protect Social Security.

 

Dewine's calls: 30-to-1 against Social Security phase out

Does anyone know of one single town meeting that an Ohio Republican Congressman (or woman) has held with constituents on Social Security? We know that some have held meetings with students, but that doesn't really count. That doesn't make a lot of sense since it is your party's initiative, unless the polling is unbelievably bad. And it probably is.

According to the Plain Dealer,
Telephone calls since early January to [U.S. Senator Mike] DeWine have been lopsided -- with only 88 out of 2,696 in support of private accounts. Of 538 letters sent to the senator, only 94 backed Bush, according to a DeWine spokeswoman.
Ouch.

On the other hand the Ohio Democrats have been taking it to their voters:
This evening, U.S. Rep. Dennis Kucinich of Cleveland will host his ninth town hall meeting on Social Security -- more than 2,000 people have attended the earlier forums -- and U.S. Rep. Sherrod Brown of Lorain will hold his fourth.

Nearly 100 people defied a snowstorm to attend U.S. Rep. Stephanie Tubbs Jones' Bedford Heights meeting, and she's planning more.
And Dewine, Sen. George Voinovich and Rep. Steve LaTourette are continuing to distance themselves from the White House on this:
Sens. Mike Dewine and George Voinovich have not endorsed Bush's idea. Nor has U.S. Rep. Steven LaTourette, the Concord Township Republican. And the three Republicans say they have no plans to counter the Democrats' criticism with meetings of their own.

Sunday, March 06, 2005

 

367,000 reasons why Oxley talks about Social Security in DC but not in Ohio

As we noted previous, U.S. Rep. Mike Oxley is quite in demand as a speaker on Social Security in DC, yet he seems downright adverse to using whatever charm him might have to talk his constituents into supporting a phase out of the program.

Why would he do his? Oxley is somewhat of a split personality. On one hand, he has built a sterling reputation for constituent services in his district. On the other hand, he has built his reputation as the ultimate insider on issues of Finance in DC (think Sarbanes-Oxley Act).

As someone from what is still an agrarian heartland, it is sort of odd that Oxley has become the dean of banking and finance legislation. In fact, he has been so "good" at it that he is the Chairman of the House Committee on Financial Services. He leads 37 Republicans, 32 Democrats, and 1 Independent which, as his website says, "oversees Wall Street, banks, and the insurance industry."

Part of the reason for his success is that he has been able to do the bidding for the above-mentioned industries without raising eyebrows in his district. Oxley has been so willing to be in the pocket of big-time financiers and bankers that his middle name has probably been changed to "lint."

Oxley, however, clearly has a big problem - perhaps for the first time in recent years. Oxley's silence on Social Security while making appearances in Ohio is understandable because his constituents would probably string him up by his ears if the realized what a cheerleader he has become for ending Social Security. Yet, he apparently is pretty brazen about his support in DC.

Why is he so bold in DC? We don't think he has much choice. Oxley is a one-man advertising show for campaign finance reform. Millions of dollars have flowed to Oxley from outside his district and his state. More importantly, the bankers and brokers have paid for his influence and robbing Social Security to create private accounts looks like a damn good thing to them.

How much have they paid? We briefly examined Oxley's FEC filings to look at donations he received since the 2002 Congressional elections. Just looking at the obvious banks, financial houses and investment institutions, we quickly found that Oxley received at least $366,731 dollars from these groups. Here is a sampling:
VenturePAC - $14,000 Lehman Brothers- $13,000
CUNA - $12,000 HSBC - $11,000
Bear Steans - $10,000 Capital One - $10,000
Citigroup - $10,000 Credit Suisse First Boston - $10,000
E*Trade - $10,000 Goldman Sachs - $10,000
Ind. Comm. Bankers - $10,000 J.P. Morgan - $10,000
KeyCorp - $10,000 Morgan Stanley - $10,000
National City Corp - $10,000 Bond Market Assoc. - $10,000
UBS - $10,000 Wachovia - $10,000
Wells Fargo - $10,000 Bank of America - $8,000
Nat. Assoc. of Ins. and Financial Advisors - $10,000
This list reads like a Who's Who of potential major beneficiaries of the phase out windfall. And keep in mind, that this is only a partial list. We counted over 68 companies that gave Oxley over $1,000, 52 over $2,000 and 38 over $5,000.

We note that reporters have been invited to join Oxley on his "Anything But Discuss Social Security" district events tomorrow (March 7). Maybe one gutsy one could ask if the $367,000 he has received has anything to do with his refusal to discuss Social Security with his constituents.

 

Oxley: quiet on Social Security in Ohio but not in DC

From the Ripon Society, a moderate Republican group, we learn that Finlay-area Ohio Congressman Oxley will be speaking on Social Security Reform at the DC group's first-ever 'Bully Pulpit' series on Tuesday, March 8, at the Capitol Hill Club.
In his speech, entitled "Nothing to Fear: The New Face of Retirement Savings," Oxley will react to President Bush's proposal to add an individual account option to Social Security. He will discuss how more Americans are taking control of their retirement and the initiatives the committee is taking to promote responsible investing and financial literacy.
Oxley is clearly a coward and someone who is willing to climb the Bully Pulpit in DC but not so bold out in the Ohio hustings. It would seem that, for example, his recent schedule omits any discussion of Social Security, despite his apparent reputation in DC as being quite the expert:
March 7: Will meet with Allen County Office of Homeland Security and Emergency Response Director Russ Decker ; visit the Joint Systems Manufacturing Center; attend a ceremony honoring Ohioan killed in Iraq; announce grant at Ohio Northern University.

March 3: Met with President Bush to discuss Social Security reform.

Feb. 28: Spoke at Allen East High School about the U.S. Constitution, the role of a congressman, and the importance of young people participating in the political process; held press event at Lima’s Joint Systems Manufacturing Center; met with members of Rolling Thunder and accepted a POW/MIA flag; met with OSU Lima students to discuss his work in Congress (no mention of Social Security according to the Lima News); dedicated new Information Technology building at Rhodes State College.

Feb. 5: Spoke at local Knights of Columbus.
That, ladies and gentlemen, appears to be the total listing of Oxley appearances and speeches in his district in 2005.

Did you notice a pattern of being willing to talk shit about Social Security in Washington, but not in northwest Ohio? Good - we thought you would. We will have more on our theory on this.

 

Odd byline for Bush visit story

As we noted yesterday, Bush is to visit the Battelle Institute in Columbus March 9. One thing we failed to mention is that the story was filed by a Brittany Lawonn "for the Columbus Dispatch."

Googling indicates that Ms. Lawonn is the editor of Boston University's Free Press. Maybe she is interning with the Dispatch's Washington bureau, but the Dispatch, as far as we know, always just indicates the reporter is an intern.

Either way, it strikes us as strange and to significant (protocol wise) of a story for either the White House to go thru or the Dispatch to use an intern or stringer. Does that mean Jonathan "I am a loud and proud member of the David Goodman family" Riskind or Jack Torry got scooped on their own turf?

[UPDATE:] Sunday's print version of the Dispatch oddly contains no Jonathan Riskind bylines and the paper's weekly roundup of Washington clips ("D.C. Dispatches") is "Compiled by Brittanny Lawonn and Jack Torry of the Dispatch Washington Bureau." So maybe she is an intern. It's unusual though that, as chief of the bureau, Riskind wouldn't have a story in a Sunday paper. Maybe just a case of someone on vacation and a new intern starting out. Then again, maybe not.

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