50 Signs That The U.S. Health Care System Is About To Collapse

The U.S. health care system is a giant money making scam that is designed to drain as much money as possible out of all of us before we die.  In the United States today, the health care industry is completely dominated by government bureaucrats, health insurance companies and pharmaceutical corporations.  The pharmaceutical corporations spend billions of dollars to convince all of us to become dependent on their legal drugs, the health insurance companies make billions of dollars by providing as little health care as possible, and they both spend millions of dollars to make sure that our politicians in Washington D.C. keep the gravy train rolling.  Meanwhile, large numbers of doctors are going broke and patients are not getting the care that they need.

At this point, our health care system is a complete and total disaster.  Health care costs continue to go up rapidly, the level of care that we are receiving continues to go down, and every move that our politicians make just seems to make all of our health care problems even worse.  In America today, a single trip to the emergency room can easily cost you $100,000, and if you happen to get cancer you could end up with medical bills in excess of a million dollars.  Even if you do have health insurance, there are usually limits on your coverage, and the truth is that just a single major illness is often enough to push most American families into bankruptcy.

At the same time, hospital administrators, pharmaceutical corporations and health insurance company executives are absolutely swimming in huge mountains of cash.  Unfortunately, this gigantic money making scam has become so large that it threatens to collapse both the U.S. health care system and the entire U.S. economy.

The following are 50 signs that the U.S. health care system is a massive money making scam that is about to collapse...

#1 Medical bills have become so ridiculously large that virtually nobody can afford them.  Just check out the following short excerpt from a recent Time Magazine article.  One man in California that had been diagnosed with cancer ran up nearly a million dollars in hospital bills before he died...

By the time Steven D. died at his home in Northern California the following November, he had lived for an additional 11 months. And Alice had collected bills totaling $902,452. The family’s first bill — for $348,000 — which arrived when Steven got home from the Seton Medical Center in Daly City, Calif., was full of all the usual chargemaster profit grabs: $18 each for 88 diabetes-test strips that Amazon sells in boxes of 50 for $27.85; $24 each for 19 niacin pills that are sold in drugstores for about a nickel apiece. There were also four boxes of sterile gauze pads for $77 each. None of that was considered part of what was provided in return for Seton’s facility charge for the intensive-care unit for two days at $13,225 a day, 12 days in the critical unit at $7,315 a day and one day in a standard room (all of which totaled $120,116 over 15 days). There was also $20,886 for CT scans and $24,251 for lab work.

#2 This year the American people will spend approximately 2.8 trillion dollars on health care, and it is being projected that Americans will spend 4.5 trillion dollars on health care in 2019.

#3 The United States spends more on health care than Japan, Germany, France, China, the U.K., Italy, Canada, Brazil, Spain and Australia combined.

#4 If the U.S. health care system was a country, it would be the 6th largest economy on the entire planet.

#5 Back in 1960, an average of $147 was spent per person on health care in the United States. By 2009, that number had skyrocketed to $8,086.

#6 Why does it cost so much to stay in a hospital today?  It just does not make sense.  Just check out these numbers...

In 1942, Christ Hospital, NJ charged $7 per day for a maternity room. Today it’s $1,360.

#7 Approximately 60 percent of all personal bankruptcies in the United States are related to medical bills.

#8 One study discovered that approximately 41 percent of all working age Americans either have medical bill problems or are currently paying off medical debt.

#9 The U.S. health care industry has spent more than 5 billion dollars on lobbying our politicians in Washington D.C. since 1998.

#10 According to the Association of American Medical Colleges, the U.S. is  currently experiencing a shortage of at least 13,000 doctors.  Unfortunately, that shortage is expected to grow to 130,000 doctors over the next 10 years.

#11 The state of Florida is already dealing with a very serious shortage of doctors...

Brace yourself for longer lines at the doctor's office.
Whether you're employed and insured, elderly and on Medicare, or poor and covered by Medicaid, the Florida Medical Association says there's a growing shortage of doctors — especially specialists — available to provide you with medical care.
And if the Florida Legislature goes along with Gov. Rick Scott's recommendation to offer Medicaid coverage to an additional 1 million Floridians — part of the Affordable Care Act that takes effect next January — the FMA says that shortage will only get worse.

#12 At this point, approximately 40 percent of all doctors in the United States are 55 years of age or older.

#13 In America today, many hospital executives make absolutely ridiculous amounts of money...

In December, when the New York Times ran a story about how a deficit deal might threaten hospital payments, Steven Safyer, chief executive of Montefiore Medical Center, a large nonprofit hospital system in the Bronx, complained, “There is no such thing as a cut to a provider that isn’t a cut to a beneficiary … This is not crying wolf.”
Actually, Safyer seems to be crying wolf to the tune of about $196.8 million, according to the hospital’s latest publicly available tax return. That was his hospital’s operating profit, according to its 2010 return. With $2.586 billion in revenue — of which 99.4% came from patient bills and 0.6% from fundraising events and other charitable contributions — Safyer’s business is more than six times as large as that of the Bronx’s most famous enterprise, the New York Yankees. Surely, without cutting services to beneficiaries, Safyer could cut what have to be some of the Bronx’s better non-Yankee salaries: his own, which was $4,065,000, or those of his chief financial officer ($3,243,000), his executive vice president ($2,220,000) or the head of his dental department ($1,798,000).

#14 Health insurance administration expenses account for 8 percent of all health care costs in the United States each year.  In Finland, health insurance administration expenses account for just 2 percent of all health care costs each year.

#15 If you can believe it, the U.S. ambulance industry makes more money each year than the movie industry does.

#16 All over America, people are reporting huge health insurance premium increases thanks to Obamacare.  The following example is from a recent article by Robert Wenzel...

A California small businessman tells me that he switched healthcare insurance carriers in 2012.  The monthly premium for him and his wife was about $400, but when he received his first bill in January of this year it was for $1,200.  He hasn't been to a doctor in years, his wife has only gone for minor care.
Apparently there is some clause in the Affordable Healthcare Act that results in health insurance firms using a new method to calculate premiums. Those who have health insurance plans that have been in effect since at least 2010 are grandfathered under the old calculation method, but insurance carriers are using a new formula for new plans.

#17 Blue Shield of California has announced that it wants to raise health insurance premiums by up to 20 percent this year in an effort to keep up with rising health costs.

#18 Aetna's CEO says that health insurance premiums for many Americans will double when the major provisions of Obamacare go into effect in 2014.

#19 Close to 10 percent of all U.S. employers plan to drop health coverage completely when the major provisions of Obamacare go into effect in 2014.

#20 According to a survey conducted by the Doctor Patient Medical Association, 83 percent of all doctors in the United States have considered leaving the profession because of Obamacare.

#21 Approximately 16,000 new IRS agents will be hired to help oversee the implementation of Obamacare, and the Obama administration has given the IRS 500 million extra dollars "outside the normal appropriations process" to help the IRS with their new duties.

#22 During 2013, Americans will spend more than 280 billion dollars on prescription drugs.

#23 Prescription drugs cost about 50% more in the United States than they do in other countries.

#24 In the United States today, prescription painkillers kill more Americans than heroin and cocaine combined.

#25 Nearly half of all Americans now use prescription drugs on a regular basis according to the CDC.  Not only that, the CDC also says that approximately one-third of all Americans use two or more pharmaceutical drugs on a regular basis, and more than ten percent of all Americans use five or more pharmaceutical drugs on a regular basis.

#26 The percentage of women taking antidepressants in America is higher than in any other country in the world.

#27 In 2010, the average teen in the U.S. was taking 1.2 central nervous system drugs.  Those are the kinds of drugs which treat conditions such as ADHD and depression.

#28 Children in the United States are three times more likely to be prescribed antidepressants as children in Europe are.

#29 There were more than two dozen pharmaceutical companies that made over a billion dollars in profits during 2008.

#30 According to the CDC, approximately three quarters of a million people a year are rushed to emergency rooms in the United States because of adverse reactions to pharmaceutical drugs.

#31 According to a report by Health Care for America Now, America's five biggest for-profit health insurance companies ended 2009 with a combined profit of $12.2 billion.

#32 The top executives at the five largest for-profit health insurance companies in the United States combined to bring in nearly $200 million in total compensation for 2009.

#33 The chairman of Aetna, the third largest health insurance company in the United States, brought in a staggering$68.7 million during 2010. Ron Williams exercised stock options that were worth approximately $50.3 million and he raked in an additional $18.4 million in wages and other forms of compensation.  The funny thing is that he left the company and didn’t even work the entire year.

#34 It turns out that the financial assistance that Barack Obama promised would be provided for those with "pre-existing conditions" under Obamacare is already being shut down because of a lack of funding...

Tens of thousands of Americans who cannot get health insurance because of preexisting medical problems will be blocked from a program designed to help them because funding is running low.
Obama administration officials said Friday that the state-based “high-risk pools” set up under the 2010 health-care law will be closed to new applicants as soon as Saturday and no later than March 2, depending on the state.

#35 In America today, you are 64 times more likely to be killed by a doctor than you are by a gun.

#36 People living in the United States are three times more likely to have diabetes than people living in the United Kingdom.

#37 Today, people living in Puerto Rico have a greater life expectancy than people living in the United States do.

#38 According to OECD statistics, Americans are twice as obese as Canadians are.

#39 Greece has twice as many hospital beds per person as the United States does.

#40 The state of California now ranks dead last out of all 50 states in the number of emergency rooms per million people.

#41 According to a doctor interviewed by Fox News, "a gunshot wound to the head, chest or abdomen" will cost $13,000 at his hospital the moment the victim comes in the door, and then there will be significant additional charges depending on how bad the wound is.

#42 It has been estimated that hospitals overcharge Americans by about 10 billion dollars every single year.

#43 One trained medical billing advocate says that over 90 percent of the medical bills that she has audited contain "gross overcharges".

#44 It is not uncommon for insurance companies to get hospitals to knock their bills down by up to 95 percent, but if you are uninsured or you don’t know how the system works then you are out of luck.

#45 According to a study conducted by Deloitte Consulting, a whopping 875,000 Americans were "medical tourists" in 2010.

#46 Today, there are more than 56 million Americans on Medicaid, and it is being projected that Obamacare will add16 million more Americans to the Medicaid rolls.

#47 Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, one out of every 6 Americans is on Medicaid.

#48 Today, there are more than 50 million Americans on Medicare, and that number is projected to grow to 73.2 million in 2025.

#49 When Medicare was first established by Congress, it was estimated that it would cost the federal government$12 billion a year by the time 1990 rolled around.  Instead, it cost the federal government $110 billion in 1990, and it will cost the federal government close to $600 billion this year.

#50 Even if you do have health insurance, that is no guarantee that medical bills will not bankrupt you.  Just check out what a recent Time Magazine article says happened to one unfortunate couple from Ohio that actually did have health insurance...

When Sean Recchi, a 42-year-old from Lancaster, Ohio, was told last March that he had non-Hodgkin’s lymphoma, his wife Stephanie knew she had to get him to MD Anderson Cancer Center in Houston. Stephanie’s father had been treated there 10 years earlier, and she and her family credited the doctors and nurses at MD Anderson with extending his life by at least eight years.
Because Stephanie and her husband had recently started their own small technology business, they were unable to buy comprehensive health insurance. For $469 a month, or about 20% of their income, they had been able to get only a policy that covered just $2,000 per day of any hospital costs. “We don’t take that kind of discount insurance,” said the woman at MD Anderson when Stephanie called to make an appointment for Sean.
Stephanie was then told by a billing clerk that the estimated cost of Sean’s visit — just to be examined for six days so a treatment plan could be devised — would be $48,900, due in advance.

By the way, that hospital down in Houston made a profit of 531 million dollars in one recent year.

So what can be done about all of this?

Well, the truth is that the status quo is a complete and total disaster, and every "solution" being promoted by politicians from both major political parties would only make things worse.

In the end, the U.S. health care system needs to be rebuilt from the ground up, but we all know that is not going to happen.

Instead, our politicians and the health care industry will just find additional ways to extract money from all of us, and the level of care that we all get will continue to decline.

If you don't believe this, just check out what Paul Krugman of the New York Times had to say recently...

We’re going to need more revenue…Surely it will require some sort of middle class taxes as well.. We won’t be able to pay for the kind of government the society will want without some increase in taxes… on the middle class, maybe a value added tax…And we’re also going to have to make decisions about health care, doc pay for health care that has no demonstrated medical benefits . So the snarky version…which I shouldn’t even say because it will get me in trouble is death panels and sales taxes is how we do this.

Others are urging us to become more like Europe.

But do we really want what they have in the UK?...

Sick children are being discharged from NHS hospitals to die at home or in hospices on controversial ‘death pathways’.
Until now, end of life regime the Liverpool Care Pathway was thought to have involved only elderly and terminally-ill adults.
But the Mail can reveal the practice of withdrawing food and fluid by tube is being used on young patients as well as severely disabled newborn babies.
One doctor has admitted starving and dehydrating ten babies to death in the neonatal unit of one hospital alone.
Writing in a leading medical journal, the physician revealed the process can take an average of ten days during which a  baby becomes ‘smaller and shrunken’.

In the end, my philosophy is just to avoid the U.S. health care system as much as possible.  Most doctors are just trained to do two things - prescribe drugs and cut you open.  In an emergency situation where you are about to die, those may be your best options, but otherwise I would just as soon avoid the gigantic money making scam that the U.S. health care industry has become.

But just don't take my word for it.  The following is some very sound advice from Dr. Robert S. Dotson...

Avoid contact with the existing health care system as far as possible. Yes, emergencies arise that require the help of physicians, but by and large one can learn to care for one’s own minor issues. Though it is flawed, the internet has been an information leveler for the masses and permits each person to be his or her own physician to a large degree. Take advantage of it! Educate yourself about your own body and learn to fuel and maintain it as you would an expensive auto or a pet poodle. One does not need a medical degree to:
1. avoid excessive use of tobacco or alcohol or, for that matter, caffeine;
2. avoid poisons like fluoride, aspartame, high fructose corn syrup, and addictive drugs (legal or illicit);
3. avoid unnecessary and potentially lethal imaging studies (TSA’s radiation pornbooths, excessive mammography, repetitive CT scans – exposure to all significantly increases cancer risk);
4. avoid excessive cell phone use and exposure to other forms of EMR pollution where possible (the NSA is recording everything you say and text anyway);
5. avoid daily fast food use and abuse (remember: pink slime and silicone) ;
6. avoid untested GM foods (do you really want to become “Roundup Ready?”):
7. avoid most vaccinations and pharmaceutical agents promoted by the establishment;
8. avoid risky behaviors (and, we do not need a bunch of Nanny State bureaucrats to define and police these);
9. exercise moderately;
10. get plenty of sleep;
11. drink plenty of good quality water (buy a decent water filter to remove fluoride, chloride, and heavy metals);
12. wear protective gear at work and play where appropriate (helmets, eye-shields, knee and elbow pads, etc.):
13. seek out locally-grown, whole, organic foods and support your local food producers;
14. take appropriate nutritional supplements (multi-vitamins, Vitamin C, Vitamin D3);
15. switch off the TV and the mainstream media it represents;
16. educate yourself while you can;
And, lastly...
17. QUESTION AUTHORITY!
Doing these simple, common-sense things will add healthy years to a person’s life and help one avoid most medical encounters during his or her allotted time on earth.

So what do you think?

Do you believe that the U.S. health care system is a gigantic money making scam that is about to collapse?

Shining Light on the Fourth Branch of Government

This week, Federal Reserve Chairman Ben Bernanke will deliver his semiannual testimony before Congress defending his reckless monetary stimulus.  He will testify before the Senate Banking, Housing and Urban Affairs Committee today and the House Financial Services Committee on Wednesday.  Now is a good time for Republicans to demand more accountability from the fourth branch of government – the one not mentioned in the Constitution.

It is amazing to watch how many Republicans will speak with such conviction against Keynesian fiscal stimulus policies, yet they will fervently promote monetary stimulus policies by the unaccountable Federal Reserve.  Their support for near-zero interest rates, quantitative easing, bailouts, and intervention in the housing sector has muddled our message against Obama’s anti-free-market policies.  Moreover, in this time of record commodity prices, pro-(monetary) stimulus Republicans preclude us from showing how government intervention on behalf of special interests distorts the markets, depletes savings, and devalues the currency – a winning political argument if there ever was one.

However, even those who place unflinching trust in Ben Bernanke’s economic acumen must agree that there is something fundamentally wrong when one unelected man has so much power without any oversight.  How could anyone who respects a representative republic blithely ignore the unlimited power of one unelected individual to grow the Fed balance sheet to over $3 trillion, placing the fate of the entire economy in Bernanke’s ability to prudently unload that balance sheet?  Shouldn’t there be some congressional oversight?

Congressman Jim Jordan (R-OH), the Chairman of the Oversight Subcommittee on economic growth, believes this to be a fair question.  Jordan has sent a letter to Fed Chairman Ben Bernanke requesting him to turn over documents detailing how he plans to unload the $3 trillion Fed balance sheet.  With the Fed purchasing $40 billion in treasuries and $45 billion in mortgage-backed securities per month, they will need to explain how to unwind without selling these bonds at a loss, contends Jordan.

Congressman Jordan also points out the often forgotten aspect of the monetary stimulus:

Most strikingly, by maintaining low interest rates, the Federal Reserve has distorted the real cost of the national debt, effectively “incentiviz[ing] the U.S. government to borrow and overspend.”

The debacle we face concerning the dependency created by monetary stimulus is eerily similar to the problems with interventionist fiscal policy.  Just take a look at the panic over the sequester.  When government crowds out the private sector and distorts the market with interventions and subsidies, we are then faced with the “calamity” that would ensue from disengaging from those policies.  This is how the statists have successfully dissuaded us from ever limiting government.  “You really plan to pull the rug out from under….such and such industry,” bemoans the forces of special interests.  There is no reason we should allow the Fed to use monetary stimulus in such an officious manner that the entire economy would collapse without the monetary morphine, yet we incur so many problems from the intervention in the first place.

There is nothing that exemplifies the vices of big-government doctrine and the virtues of free market doctrine than the rising cost and depleting savings of the American people.  Republicans need to seize the mantle of free market populism both in the realm of monetary and fiscal policy.

The reason why the statists are so successful is because their policies, which engender the problems they purport to solve in the first place, have the ability to self-perpetuate.  They create market distortions and dependency and warn of financial collapse without them.  We already tolerate this tyranny from our elected officials; there’s no reason we should put up with it from the unelected politburo at the Federal Reserve.

Louis Farrakhan: Gang Members Can Serve As Protectors Read more: http://www.dnainfo.com/chicago/20130225/chicago/louis-farrakhan-gang-members-can-serve-as-protectors#ixzz2LuzM2XEm

UNIVERSITY VILLAGE — Nation of Islam leader Louis Farrakhan told thousands of followers Sunday he was planning to reach out to gang leaders to help "protect" the Nation of Islam.

That came at the Nation of Islam's annual Saviours' Day convention. Farrakhan, 79, renewed the call for blacks to pool money and buy as much land as possible, in order to "control means of production" and produce food and other goods, such as clothing.

Farrakhan said collectively owning land is a way for black people in America to prosper economically. The calls were part of a speech that lasted more than three hours and touched on topics including Libya's Moammar Ghaddafi, U.S. Defense Secretary nominee Chuck Hagel and a national push for gun control.

Farrakhan told a packed crowd of more than 7,000 people that national lawmakers are using Chicago's violence epidemic to push for stronger gun control laws but said the second amendment has nothing to do with the spate of shootings in Chicago.

"The guns that every one of our young people have, are they legal? No!" Farrakhan said.

Instead, Farrakhan had a different idea for how to address gun violence. In addition to sending letters to black military leaders, Farrakhan said he planned to contact the city's gang leaders to recruit gang members to "protect" any land the Nation of Islam may buy in the future.

"All you gang bangers, we know you love to shoot, but you're killing yourselves," Farrakhan said. "All your weapons are illegal and you're using them like savages."

But Farrakhan said gang bangers are "natural soldiers" and could be taught "the science of war" to become protectors of the Nation of Islam's assets in the future.

Last summer, Farrakhan led 500 men, known as the Fruit of Islam, to the city's Auburn Gresham neighborhood in response to the spike in violence in the first half of 2012.

Farrakhan also praised the reelection of President Barack Obama as a significant historical milestone but added Obama's victory would not mean prosperity for black people.

Farrakhan also decried the death of Ghaddafi, who was killed in 2011. Blaming the former Libyan leader's death on American and European government, he said they wanted Ghaddafi dead because he was an "impediment" to American and European interests having access to natural resources in Africa.

Farrakhan said he believes the American government also wanted to see black leaders like himself go away.

"You killed my brother [Ghaddafi], and now you got the same thing in your mind for me," Farrakhan thundered as the crowd rose to its feet applauding. "You want to put your hands on me. In fact, you're plotting it as I'm speaking."

Also on DNAinfo.com...

Read more: http://www.dnainfo.com/chicago/20130225/chicago/louis-farrakhan-gang-members-can-serve-as-protectors#ixzz2LuzPVGz8

Ted Cruz on America's Economic Problems

Sen. Ted Cruz: We’ve got a job and right now I think the U.S. Senate is the battlefield. Unfortunately, Republicans are in the minority. This last election did not turn out as I had hoped, but I nonetheless think that if we had principled, effective conservatives who make the case that the most effective engine, for economic opportunity, the most effective engine for climbing the economic ladder, for helping those with nothing to achieve anything has been free markets, has been limited government has been the incredible, American system. If we make that case, we can preserve that system. And I think that’s what the stakes are.

And so, my focus every day is on the substance of winning the fight, stopping the out of control spending and deficits and debt so that our kids aren’t crushed with those debts and getting the economy growing again. You know in the last four years under President Obama, our economy has grown 1.5 percent a year. That’s less than half the historical average. The historical average since World War II has been 3.3 percent. If we can’t get the economy growing, we can’t solve any of these problems.

If you want to get the 23 million people who are struggling to find jobs back to work, get the economy growing. If you want to transform our federal balance sheet, change it from the train wreck it is right now, get the economy growing.

And so, every day in the Senate, my focus is championing small businesses, entrepreneurs, championing economic growth, because ultimately, economic growth is what provides opportunity, it’s what enables people, like my dad, to climb the economic ladder, to climb from nothing to achieve prosperity. That’s my focus, and I try to pay attention to nothing else, but focusing on that.

David Brody: Too many people choosing politics over principle?

Cruz: That’s exactly right. Look, I mean there are a lot of people in Washington, I think, who desperately, desperately want to be in elected office. There’s an old line that ‘Politics is Hollywood for ugly people.’ And there’s an element of truth to that. You see those in elected office who, the prospect of not being in elected office is terrifying to them.

And one of the sad realities is that it has been career politicians, in both parties, who’ve gotten us in this mess. I think President Obama is the most radical president we’ve ever seen, but I think an awful lot of Republicans, failed to stand for principle and contributed to getting us in this mess, and I think what we’ve seen in 2010 and to some degree in 2012 is a new generation of leaders stepping forward that are committed to fixing these problems.

White House embarks on spending tour on eve of sequester

THIS IS EXACTLY WHAT ROOSEVELT DID DURING THE 1936 ELECTION WHEN IT LOOKED LIKE HE WAS GOING TO LOSE. HE WENT AROUND THE COUNTRY DISPENSING MONEY IN ORDER TO GET VOTES

Just days from massive spending cuts known as the budget sequester, the Obama administration has launched a 100-city tour that has dispatched officials from multiple federal agencies to help communities tap into new government spending.

The White House's "Connecting Your Community" program launched in Oregon earlier this month, and so outraged a senator influential on spending issues that hewrote President Barack Obama's top budget officials urging it be canceled immediately.

"If Washington is truly cutting spending on missions many consider vital, how can we at the same time promise and promote more financial assistance, much less afford this mammoth 100 city cross country tour?," Sen. Tom Coburn, R-Okla., wrote Thursday night in a letter to the White House Office of Management and Budget.

"It is important that we as public officials lead by example, and I look forward to continuing to work with you to save taxpayers money and better prioritize government spending," added Coburn, who was a key member of the so-called Gang of Six senators that sought bipartisan solutions to the nation's debt crisis.

Officials from the White House, Labor Department, Environmental Protection Agency, HUD, the Transportation Department and Commerce Department all descended earlier this month on Beaverton, Ore., a small city that has received extensive attention in recent months from the Obama administration, including a grant for a sustainable community awarded earlier this month.

White House officials did not immediately respond Friday to Coburn's letter. But White House Deputy Director for Intergovernmental Affairs, Jay Williams, was quoted earlier this week in the Oregon media as saying the tour is designed to eliminate barriers among various departments to speed federal aid and "help enhance the things that are going on here in terms of the revitalization."

Coburn's letter questioned why so many federal officials needed to visit the city, when it has already shown a strong ability to win federal monies with $2 million in recent grants. He said the specter of the larger tour conflicted with the doomsday scenarios the White House has been talking about in recent days in pressuring Congress to forestall the so-called sequester cuts that could leave to widespread federal layoffs, reductions in park services and significant reductions in military patrols.

"Much is being made about the possible impact of sequestration on government programs for the poor and middle class, food safety, and the defense of our nation.  It is somewhat surprising, therefore, for the White House to be headlining a 100 city government spending tour, transporting representatives from multiple departments and various agencies around the country to promote federal largesse," Coburn wrote Jeffrey Zienst, the OMB's deputy director.

Cruz's tactics boil Washington, but impress Texas

watch this guy. he's smart and tough. we'll see if he gets beaten down

Freshman senator stirs Washington's waters Texas style

UPDATED 23:35 PM EST, FEBRUARY 24, 2013 | DONNA CASSATA, ASSOCIATED PRESS

HOUSTON (AP) — Ted Cruz glanced at his black cowboy boots, beneath a silver Texas belt buckle, waiting for the admirers to stop clapping.

His arrival had turned a drop-by at a Houston lumber yard into a virtual campaign rally. At an earlier stop near Austin —at a gun manufacturer that churns out AR-15 rifles — cheering fans crowded next to employees, and one held a sign reading "Ted Cruz rocks!"

The new troublemaker of the U.S. Senate was home again, and savoring nothing short of a victory lap.

In just seven weeks on the job, the insurgent Republican elected with the tea party's backing and bankroll has run afoul of GOP mainstays, prompted Democrats to compare his style to McCarthyism and has voted against nearly everything of significance that came before him.

"My view is simple: Washington is a rough-and-tumble place. If folks want to attack me personally, they're welcome to it," Cruz said during a visit this week to a Houston lumber wholesaler. "Texans elected a senator to go to Washington and speak the truth."

His approach was unusual for a freshman in Washington, and its effectiveness long-term far from certain, but the reaction at home so far is effusive.

Other Texas politicians are celebrating him, and supporters have turned his constituent visits during the congressional recess into revivals. On Twitter, Texas' popular attorney general Greg Abbott, a rumored candidate for governor next year, is among those beaming about the "Cruz Missile."

"He's been a terrific partner," declared the state's senior senator, Republican John Cornyn. "What he's finding is there's a lot of critics in Washington when you try to change the status quo."

As the lone tea party candidate to win a Senate seat in last year's election, the brash 42-year-old Harvard-trained attorney has aimed to become a force the GOP — and Democrats — must deal with. Having beaten a heavily favored establishment candidate in the Texas primary, he's made good on promises to be combative, uncompromising and absolute in his adherence to conservative principles.

His profile as an Cuban-American in a party struggling to appeal to Hispanics, and his pedigree as a top Ivy League debater and former clerk to Chief Justice William Rehnquist have made him the freshman to watch in Washington.

Yet Cruz's transition from the campaign trail to the Senate has been anything but smooth.

His sharp questioning of Defense Secretary-nominee Chuck Hagel during his confirmation hearing — and public challenges to Hagel's integrity— drew a sharp rebuke from Democrats and even a Republican. In pressing for more documents about Hagel's speechmaking in the private sector, Cruz suggested that Hagel, a former Republican senator, had received money from radical sources and possibly was hiding it.

While some Republicans attempted damage control, in Houston this week, Cruz didn't back down.

"The flurry of attacks on me has had their intended effect, which was to shift the conversation away from Chuck Hagel," Cruz said. "Away from his record, away from his refusal to provide financial disclosures, and toward the direct, nasty, personal attacks leveled at me."

Privately, some Republicans expressed surprise that Cruz was barely on the job five minutes before he was saying no to a Cabinet choice. As the latest iteration of "Senator No," he voted against Senate rule changes to modestly curb filibusters, aid for victims of Superstorm Sandy and the Violence Against Women Act.

The attention Cruz received has cast a spotlight on Cornyn, the No. 2 Republican in the leadership, who hasn't strayed far from Cruz on those votes as he looks ahead to his own re-election in 2014 and the possibility of a challenge from the tea party. The only votes against Sen. John Kerry to be the next secretary of state came from Cruz, Cornyn and Republican Sen. Jim Inhofe of Oklahoma.

Cornyn called it a "phony construct" that Cruz is pulling him farther to right in an act of political self-preservation.

Not all Republicans have been as comfortable with Cruz. After Cruz's rough treatment of Hagel, Sen. John McCain defended his fellow Republican and Vietnam veteran.

"I just want to make it clear Senator Hagel is an honorable man. He served his country. And no one on this committee at any time should impugn his character or his integrity," McCain said.

At Hagel's confirmation hearing, Cruz employed charts and a scratchy tape from an Al-Jazeera interview with Hagel to challenge the nominee. But it was his guilt-by-association line of questioning that surprised several in the Senate, particularly when Cruz tried to link Hagel to Charles Freeman, a former U.S. ambassador to Saudi Arabia who resigned in March 2009 as chairman of the National Intelligence Council. Freeman was undone by congressional criticism over his comments about the Israel government and alleged ties to foreign governments.

Cruz cited media reports that Hagel traveled with Freeman to China. Hagel said he had never been on a trip with Freeman and hadn't spoken with him in years.

Cruz shifted the questioning.

"Is he someone whose judgment you respect?" he asked.

Cruz's questioning raised the specter of 1950s communist-hunter Joe McCarthy, the former Wisconsin senator. He has dismissed those suggestions, and conservatives have come to his defense.

In Texas this week, those who came to meet Cruz at stops like Lodge Lumber and La Rue Tactical in Leander took no issue with his line of questioning.

At the end of a tour at Lodge Lumber, Cruz was met by a supporter who carried in his billfold several fake dollar bills bearing Obama's face, including one that read, "The People's Republic of Hollywood." He said it was the president he wanted Cruz to keep in his sights.

Owner John Lodge said he felt that for the first time in a long while, someone in Washington was on his side.

"He gets with them. He's gotten down to business," Lodge said. "He's the man."

___

Brain Surgery On The Untied States by Dan Bubalo

Media members were too busy last week putting salve on one another to note the very definition of “coincidence” with respect to a meeting between Barry Soetero and Eldrick Woods:  both men go by names other than the ones given to them at birth and both have exploited their skin color.  A definition of “irony” is that they were golfing together.

The tete a tete was a mother lode for a true journalist to point out they aren’t who they appear to be, to discuss what lurks behind their respective facades, how an idol-smooching press created their personae and catapulted each to unimaginable heights, and that they have taken Blacksploitation to an entirely new level.   They both carry the American Express Plutonium Card and are not afraid to flash it because the media accepts it wherever they go.  The major difference between them is Eldrick can play.

My associate unearthed Soetero’s paltry basketball statistics from his Hawaiian high school days which show he was a benchwarmer.   Nonetheless, due to a never ending list of sycophantic enablers Barry continues perpetuating a myth that he was a stellar athlete.  I’m sorry.  An “athlete” doesn’t bounce a baseball from the mound to home plate, looking like he had been hit by lightning as a child.  I intentionally avoided saying he threw like a girl, which would have been a great disservice to female athletes everywhere.  I think it’s safer to say he threw like he belonged in the Special Olympics………..(his words, not mine).   The recent photo-shopped picture of him shooting a rifle reflected the finesse of a Pilgrim shooting a blunderbuss, and the ad nauseam discussion about needing stitches in his mouth during a pickup basketball game is nothing but puffery.  Or, he miraculously recovered from sutures faster than Hillary overcame a clot on the brain.

Eldrick achieved mythic status in part because he was a champion but arguably as much because he was considered a black champion, and he did nothing to dispel that perception despite the fact that he is one quarter Thai, one quarter Chinese, one eighth Dutch, and one eighth Native American, and he’s done nothing to challenge inner city children unless one considers a contribution as having his lackeys teach the appropriate golf grip during youth clinics.  Barry’s no different, ignoring he is of Swiss, Welsh, Irish, French, and German extraction.  To paraphrase Ricky Ricardo, “someone has some splainin’ to do.”

Certainly, Eldrick sponsors a couple charitable golf events, although “charity” for high income earners is synonymous with tax shelter.   Barry doesn’t challenge the people he claims he represents to strive to become a Clarence Thomas, Condoleeza Rice, Dr.Benjamin Carter, or Mia Love, and instead lusts for frequent parties with Hollywood elites, has a chump like Samuel L. Jackson barking in his corner, and never seems to miss a party with Jay Z and Beyonce, which more closely defines the man behind the bogus image.  He claims to be black but isn’t.  He claims to be the guardian for underprivileged African Americans but has used that platform, instead, for personal and political leverage like a carny-man, and while he insists he has that unique constituency’s best interest at heart, he is merely luring them deeper into a web of dependency, very much like a drug dealer, or Jesse Jackson, Al Sharpton, and Calypso Louie Farrakhan.

I remain an avid reader of medical literature and once was a representative for a prominent company which specialized in providing ongoing education and new clinical information to physicians, though I doubt anyone would allow me to perform brain surgery.  I don’t know why, actually, because I have a lot of innovative ideas how it should be done, have watched extensive footage on The Learning Channel, and believe former East German, Russian, and Chinese medical teams have come up with more creative approaches than American physicians.  So?  C’mon.  Somebody with a tumor or aneurysm or, better yet, someone with a blood clot on the brain——– give me a shot.

So while I might be able to use medical vernacular to some degree, it would soon become apparent that I was unqualified, a man who had read extensively about something but had limited comprehension, and that brings us to Mr. Soetero.  His flamboyant rhetoric allows this neophytic imposter to hide as he  pontificates about economics and swipes gratuitously at commerce and free enterprise, even though he has never worked at something as small as a shopping mall kiosk.  He has no management experience, the flipside of which is that he has led a life free of responsibility.  I mean, who else would go AWOL during a murderous assault on one of our embassies?  Was it the fear of making a hot decision or is he simply reluctant to return fire on radical Islamic factions?  The manifestation of these numerous shortcomings has led the country, alright————— to a reputation for international fecklessness, to rewarding dependence at the expense of achievement, and to devolutionary cultural and financial practices from which we might never recover.

He is a man who has read books and been plied and indoctrinated with foreign information but has not the wisdom or experience to understand what he has read or why historically it has been proven to be ineffective, nor can overwhelming evidence to the contrary dissuade his radicalism.  61 million voters saw through the rice paper last November but, unfortunately, 66 million were either too uniformed, unable to see behind the mask, functionally illiterate, so dependent on another financial fix that they couldn’t care less, or a combination of all.

If his attorney general is censured by Congress for contempt, no problem.  If people are here illegally, no problem.  If the leader of the senate does not submit a budget in four years, no problem.  If the New Black Panthers intimidate voters outside a polling booth, no problem, nor is it a problem if they use  modern media to solicit funds on an interstate basis for a bounty to kill George Zimmerman.  Just look the other way.  If caught in a lie, lie some more.  If you are exposed for hypocrisy, yell louder.  When it appears you ran in fear instead of taking decisive action in Benghazi, send out your UN Ambassador and Secretary of State to shill and prevaricate endlessly.  And, if you don’t get your way, play the race card, for it is much easier to stir emotions of the uninformed than challenge them to finish their education and grow, instead of becoming another generational conscript.

It is the toxic mind of a dictator and quite literally a behavior that has now become pathological, yet he remains the prized pupil of dead tyrants from all parts of planet and a hero to the Left.

And he’s doing brain surgery on the country without so much as a manual or the benefit of anesthesia.

Insane Levels of Inequality – Which Hurt the Economy – Are Skyrocketing

http://www.google.com/reader/view/#stream/feed%2Fhttp%3A%2F%2Fwww.washingtonsblog.com%2Ffeed

Preface: All capitalist systems have some inequality.  We don’t want to prevent all inequality … just economy-wrecking levels:

Lawrence Katz, a Harvard economist, adds that some inequality is necessary to create incentives in a capitalist economy but that “too much inequality can harm the efficient operation of the economy.”

And you might assume that conservatives don’t worry about rampant inequality … but that is a myth.

Rampant Inequality – Which Hurts the Economy – Is Skyrocketing

A who’s-who’s of prominent economists in government and academia have all said that runaway inequality can causefinancial crises.

Extreme inequality helped cause the Great Depression, the current financial crisis … and the fall of the Roman Empire.

But inequality in America today is actually twice as bad as in ancient Rome , worse than it was in in Tsarist Russia,Gilded Age America, modern Egypt, Tunisia or Yemen, many banana republics in Latin America, and worse than experienced by slaves in 1774 colonial America.

Inequality has grown steadily worse:

It is worse under Obama than under Bush.

A recent study shows that the richest Americans captured more than 100% of all recent income gains. And see this.

There are 2 economies: one for the rich, and the other for everyone else.

Alan Greenspan said:

Our problem basically is that we have a very distorted economy, in the sense that there has been a significant recovery in our limited area of the economy amongst high-income individuals…
***
They are fundamentally two separate types of economies.

Why is Inequality Going Through the Roof?

The world’s top economic leaders have said for years that inequality is spiraling out of control and needs to be reduced. Why is inequality soaring even though world economic leaders have talked for years about the urgent need to reduce it?

Because they’re saying one thing but doing something very different. And both mainstream Democrats and mainstream Republicans are using smoke and mirrors to hide what’s really going on.

And it’s not surprising … Nobel prize winning economist Joseph Stiglitz says that inequality is caused by the use of money to shape government policies to benefit those with money. As Wikipedia notes:

A better explainer of growing inequality, according to Stiglitz, is the use of political power generated by wealth by certain groups to shape government policies financially beneficial to them. This process, known to economists as rent-seeking, brings income not from creation of wealth but from “grabbing a larger share of the wealth that would otherwise have been produced without their effort”^[59]
Rent seeking is often thought to be the province of societies with weak institutions and weak rule of law, but Stiglitz believes there is no shortage of it in developed societies such as the United States. Examples of rent seeking leading to inequality include

• the obtaining of public resources by “rent-collectors” at below market prices (such as granting public land to railroads,^[60] or selling mineral resources for a nominal price^[61][62] in the US),
• selling services and products to the public at above market prices^[63] (medicare drug benefit in the US that prohibits government from negotiating prices of drugs with the drug companies, costing the US government an estimated $50 billion or more per year),
• securing government tolerance of monopoly power (The richest person in the world in 2011,Carlos Slim, controlled Mexico’s newly privatized telecommunication industry^[64]).

(Background here, here and here.)

Stiglitz says:

One big part of the reason we have so much inequality is that the top 1 percent want it that way. The most obvious example involves tax policy …. Monopolies and near monopolies have always been a source of economic power—from John D. Rockefeller at the beginning of the last century to Bill Gates at the end. Lax enforcement of anti-trust laws, especially during Republican administrations, has been a godsend to the top 1 percent. Much of today’s inequality is due to manipulation of the financial system, enabled by changes in the rules that have been bought and paid for by the financial industry itself—one of its best investments ever. The government lent money to financial institutions at close to 0 percent interest and provided generous bailouts on favorable terms when all else failed. Regulators turned a blind eye to a lack of transparency and to conflicts of interest.
***
Wealth begets power, which begets more wealth …. Virtually all U.S. senators, and most of the representatives in the House, are members of the top 1 percent when they arrive, are kept in office by money from the top 1 percent, and know that if they serve the top 1 percent well they will be rewarded by the top 1 percent when they leave office. By and large, the key executive-branch policymakers on trade and economic policy also come from the top 1 percent. When pharmaceutical companies receive a trillion-dollar gift—through legislation prohibiting the government, the largest buyer of drugs, from bargaining over price—it should not come as cause for wonder. It should not make jaws drop that a tax bill cannot emerge from Congress unless big tax cuts are put in place for the wealthy. Given the power of the top 1 percent, this is the way you would expect the system to work.

Bloomberg reports:

The financial industry spends hundreds of millions of dollars every election cycle on campaign donations and lobbying, much of which is aimed at maintaining the subsidy [to the banks by the public]. The result is a bloated financial sector and recurring credit gluts.

Indeed, the big banks literally own the Federal Reserve. And they own Washington D.C. politicians, lock stock and barrel. See this, this, this and this.

Two leading IMF officials, the former Vice President of the Dallas Federal Reserve, and the the head of the Federal Reserve Bank of Kansas City, Moody’s chief economist and many others have all said that the United States is controlled by an “oligarchy” or “oligopoly”, and the big banks and giant financial institutions are key players in that oligarchy.

Economics professor Randall Wray writes:

Thieves … took over the whole economy and the political system lock, stock, and barrel.

No wonder the government has saved the big banks at taxpayer expense, chosen the banks over the little guy, andsaid no to helping Main Street … while continuing to throw trillions at the giant banks.

No wonder crony capitalism has gotten even worse under Obama.

No wonder Obama is prosecuting fewer financial crimes than Bush, or his father or Ronald Reagan.

No wonder:

All of the monetary and economic policy of the last 3 years has helped the wealthiest and penalized everyone else. See this, this and this.
***
Economist Steve Keen says:

“This is the biggest transfer of wealth in history”, as the giant banks have handed their toxic debts from fraudulent activities to the countries and their people.

Stiglitz said in 2009 that Geithner’s toxic asset plan “amounts to robbery of the American people”.
And economist Dean Baker said in 2009 that the true purpose of the bank rescue plans is “a massive redistribution of wealth to the bank shareholders and their top executives”.

Quantitative easing doesn’t help Main Street or the average American. It only helps big banks, giant corporations, and big investors. And by causing food and gas prices skyrocket, it takes a bigger bite out of the little guy’s paycheck, and thus makes the poor even poorer.

As I noted in March 2009:

The bailout money is just going to line the pockets of the wealthy, instead of helping to stabilize the economy or even the companies receiving the bailouts:

• Bailout money is being used to subsidize companies run by horrible business men, allowing the bankers to receive fat bonuses, to redecorate their offices, and to buy gold toilets andprostitutes

• A lot of the bailout money is going to the failing companies’ shareholders

• Indeed, a leading progressive economist says that the true purpose of the bank rescue plans is “a massive redistribution of wealth to the bank shareholders and their top executives”

• The Treasury Department encouraged banks to use the bailout money to buy their competitors, and pushed through an amendment to the tax laws which rewards mergers in the banking industry (this has caused a lot of companies to bite off more than they can chew, destabilizing the acquiring companies)

As I wrote in 2008:

The game of capitalism only continues as long as everyone has some money to play with. If the government and corporations take everyone’s money, the game ends.The fed and Treasury are not giving more chips to those who need them: the American consumer. Instead, they are giving chips to the 800-pound gorillas at the poker table, such as Wall Street investment banks. Indeed, a good chunk of the money used by surviving mammoth players to buy the failing behemoths actually comes from the Fed.

Government Policy Is Increasing Inequality

Without the government’s creation of the too big to fail banks (they’ve gotten much bigger under Obama), the Fed’s intervention in interest rates and the markets (most of the quantitative easing has occurred under Obama), andgovernment-created moral hazard emboldening casino-style speculation (there’s now more moral hazard than ever before) … things wouldn’t have gotten nearly as bad.

Goosing the Stock Market

Moreover, the Fed has more or less admitted that it is putting almost all of its efforts into boosting the stock market.

Robert Reich has noted:

Some cheerleaders say rising stock prices make consumers feel wealthier and therefore readier to spend. But to the extent most Americans have any assets at all their net worth is mostly in their homes, and those homes are still worth less than they were in 2007. The “wealth effect” is relevant mainly to the richest 10 percent of Americans, most of whose net worth is in stocks and bonds.

AP writes:

The recovery has been the weakest and most lopsided of any since the 1930s.After previous recessions, people in all income groups tended to benefit. This time, ordinary Americans are struggling with job insecurity, too much debt and pay raises that haven’t kept up with prices at the grocery store and gas station. The economy’s meager gains are going mostly to the wealthiest.
Workers’ wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.

David Rosenberg points out:

The “labor share of national income has fallen to its lower level in modern history … some recovery it has been – a recovery in which labor’s share of the spoils has declined to unprecedented levels.”

The above-quoted AP article further notes:

Stock market gains go disproportionately to the wealthiest 10 percent of Americans, who own more than 80 percent of outstanding stock, according to an analysis by Edward Wolff, an economist at Bard College.

Indeed, as I reported in 2010:

As of 2007, the bottom 50% of the U.S. population owned only one-half of one percent of all stocks, bonds and mutual funds in the U.S. On the other hand, the top 1% owned owned 50.9%.***
(Of course, the divergence between the wealthiest and the rest has only increased since 2007.)

Professor G. William Domhoff demonstrated that the richest 10% own 98.5% of all financial securities, and that:

The top 10% have 80% to 90% of stocks, bonds, trust funds, and business equity, and over 75% of non-home real estate. Since financial wealth is what counts as far as the control of income-producing assets, we can say that just 10% of the people own the United States of America.

As Tyler Durden notes:

In today’s edition of Bloomberg Brief, the firm’s economist Richard Yamarone looks at one of the more unpleasant consequences of Federal monetary policy: the increasing schism in wealth distribution between the wealthiest percentile and everyone else. … “To the extent that Federal Reserve policy is driving equity prices higher, it is also likely widening the gap between the haves and the have-nots….The disparity between the net worth of those on the top rung of the income ladder and those on lower rungs has been growing. According to the latest data from the Federal Reserve’s Survey of Consumer Finances, the total wealth of the top 10 percent income bracket is larger in 2009 than it was in 1995. Those further down have on average barely made any gains. It is likely that data for 2010 and 2011 will reveal an even higher percentage going to the top earners, given recent increases in stocks.” Alas, this is nothing new, and merely confirms speculation that the Fed is arguably the most efficient wealth redistibution, or rather focusing, mechanism available to the status quo. This is best summarized in the chart below comparing net worth by income distribution for various percentiles among the population, based on the Fed’s own data. In short: the richest 20% have gotten richer in the past 14 years, entirely at the expense of everyone else.

***

Lastly, nowhere is the schism more evident, at least in market terms, than in the performance of retail stocks:

Saks chairman Steve Sadove recently remarked, “I’ve been saying for several years now the single biggest determinant of our business overall, is how’s the stock market doing.” Privately-owned Neiman- Marcus reported “In New York City, business at Bergdorf Goodman continues to be extremely strong.”
In contrast, retail giant Wal-Mart talks of its “busiest hours” coming at midnight when food stamps are activated and consumers proceed through the check-outs lines with baby formula, diapers, and other groceries. Wal-Mart has posted a decline in same-store sales for eight consecutive quarters.

Indeed, as CNN Money pointed out in 2011, “Wal-Mart’s core shoppers are running out of money much faster than a year ago …” This trend has only gotten worse: The wealthy are doing great … but common folks can no longer afford to shop even at Wal-Mart, Sears, JC Penney or other low-price stores.

Durden also notes:

Another indication of the increasing polarity of US society is the disparity among consumer confidence cohorts by income as shown below, and summarized as follows: “The increase in equity prices has raised consumer spirits, particularly among higher-income consumers. The Conference Board’s Consumer Confidence index for all income levels bottomed in February/March of 2009. The recovery since then has been notable across the board, but nowhere as much as for those making $50,000 or more.”

Over-Financialization

When a country’s finance sector becomes too large finance, inequality rises. As Wikipedia notes:

[Economics professor] Jamie Galbraith argues that countries with larger financial sectors have greater inequality, and the link is not an accident.^[66][67]

Government policy has been encouraging the growth of the financial sector for decades:

(Economist Steve Keen has also shown that “a sustainable level of bank profits appears to be about 1% of GDP”, and that higher bank profits leads to a ponzi economy and a depression).

Unemployment and Underemployment

A major source if inequality is unemployment, underemployment and low wages.

Government policy has created these conditions. And the pretend populist Obama – who talks non-stop about the importance of job-creation – actually doesn’t mind such conditions at all.

The“jobless recovery” that the Bush and Obama governments have engineered is a redistribution of wealth from the little guy to the big boys.

The New York Times notes:

Economists at Northeastern University have found that the current economic recovery in the United States has been unusually skewed in favor of corporate profits and against increased wages for workers.
In their newly released study, the Northeastern economists found that since the recovery began in June 2009 following a deep 18-month recession, “corporate profits captured 88 percent of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1 percent” of that growth.
The study, “The ‘Jobless and Wageless Recovery’ From the Great Recession of 2007-2009,” said it was “unprecedented” for American workers to receive such a tiny share of national income growth during a recovery.
***
The share of income growth going to employee compensation was far lower than in the four other economic recoveries that have occurred over the last three decades, the study found.

Obama apologists say Obama has created jobs. But the number of people who have given up and dropped out of the labor force has skyrocketed under Obama (and see this).

And the jobs that have been created have been low-wage jobs.

For example, the New York Times noted in 2011:

The median pay for top executives at 200 big companies last year was $10.8 million. That works out to a 23 percent gain from 2009.
***
Most ordinary Americans aren’t getting raises anywhere close to those of these chief executives. Many aren’t getting raises at all — or even regular paychecks. Unemployment is still stuck at more than 9 percent.
***
“What is of more concern to shareholders is that it looks like C.E.O. pay is recovering faster than company fortunes,” says Paul Hodgson, chief communications officer for GovernanceMetrics International, a ratings and research firm.
According to a report released by GovernanceMetrics in June, the good times for chief executives just keep getting better. Many executives received stock options that were granted in 2008 and 2009, when the stock market was sinking.
Now that the market has recovered from its lows of the financial crisis, many executives are sitting on windfall profits, at least on paper. In addition, cash bonuses for the highest-paid C.E.O.’s are at three times prerecession levels, the report said.
***
The average American worker was taking home $752 a week in late 2010, up a mere 0.5 percent from a year earlier. After inflation, workers were actually making less.

AP pointed out that the average worker is not doing so well:

Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.
– The average worker’s hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.
– The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

Alan Greenspan noted:

Large banks, who are doing much better and large corporations, whom you point out and everyone is pointing out, are in excellent shape. The rest of the economy, small business, small banks, and a very significant amount of the labour force, which is in tragic unemployment, long-term unemployment – that is pulling the economy apart.

Money Being Sucked Out of the U.S. Economy … But Big Bucks Are Being Made Abroad

Part of the widening gap is due to the fact that most American companies’ profits are driven by foreign sales and foreign workers. As AP noted in 2010:

Corporate profits are up. Stock prices are up. So why isn’t anyone hiring?

Actually, many American companies are — just maybe not in your town. They’re hiring overseas, where sales are surging and the pipeline of orders is fat.
***
The trend helps explain why unemployment remains high in the United States, edging up to 9.8% last month, even though companies are performing well: All but 4% of the top 500 U.S. corporations reported profits this year, and the stock market is close to its highest point since the 2008 financial meltdown.
But the jobs are going elsewhere. The Economic Policy Institute, a Washington think tank, says American companies have created 1.4 million jobs overseas this year, compared with less than 1 million in the U.S. The additional 1.4 million jobs would have lowered the U.S. unemployment rate to 8.9%, says Robert Scott, the institute’s senior international economist.
“There’s a huge difference between what is good for American companies versus what is good for the American economy,” says Scott.
***
Many of the products being made overseas aren’t coming back to the United States. Demand has grown dramatically this year in emerging markets like India, China and Brazil.

Government policy has accelerated the growing inequality. It has encouraged American companies to move their facilities, resources and paychecks abroad. And some of the biggest companies in America have a negative tax rate… that is, not only do they pay no taxes, but they actually get tax refunds.

And a large percentage of the bailouts went to foreign banks (and see this). And so did a huge portion of the money from quantitative easing. More here and here.

Capital Gains and Dividends

According to a study published last month by a researcher at the U.S. Congressional Research Service:

The largest contributor to increasing income inequality…was changes in income from capital gains and dividends.

Business Insider explains:

Drastic income inequality growth in the United States is largely derived from changes in the way the U.S. government taxes income from capital gains and dividends, according to a new study by Thomas Hungerford of the non-partisan Congressional Research Service.
Essentially, what Democrats have been saying about income inequality — that it’s in a large part due to favorable taxation and deduction policies for high income Americans — is largely right
***
The study … conclusively found that the wealthy benefitted from low tax rates on investment income, which in turn caused their wealth to grow faster.
Essentially, taxing capital gains as ordinary income would make the playing field more fair, and reduce over time income inequality.

Joseph Stiglitz noted in 2011:

Lowering tax rates on capital gains, which is how the rich receive a large portion of their income, has given the wealthiest Americans close to a free ride.

Indeed, the Tax Policy center reports that the top 1% took home 71% of all capital gains in 2012.

Ronald Reagan’s budget director, assistant secretary of treasury, and domestic policy director all say that the Bush tax cuts were a huge mistake. See this and this.