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Democracy For The Southern Adirondack/Tricounty Area
Monday, November 30, 2009
DFA Update: Meeting Reminder, Gov. Dean
Hello Everyone;

Hope you all had a Happy Thanksgiving!

In this update for 11-30-09:

1. Wednesday Meeting Reminder
2. Governor Dean On Healthcare & Consequences of Failure

1. Wednesday Meeting Reminder

We'll be holding our December meeting of Democracy For The Greater Glens Falls Area at our usual time and place, on Wednesday, Dec. 2nd, at 7pm at the Rockhill Bakehouse Cafe in downtown Glens Falls one block west of the roundabout.

The discussion and the view ahead for the year to come should be unusually packed this week, what with the President's decision to escalate the war in Afghanistan and Rep. Murphy's recent vote against the healthcare bill, and other matters.

As recent attendees know, Mike Parwana, who has family in Afghanistan, has been talking about how we need to stop calling Afghanistan a war and start treating it as a police and security action, and he is clearly right, but it looks like the military approach and war has won out, sad to say. I call this the Nixon option-- end the "war" by "winning" it.

2. Governor Dean On Healthcare & Consequences Of Failure

Governor Dean has also been talking about how the healthcare bill has changed and the consequences for Democrats down the road, and his comments, as always, are worth a careful read. He is a strong advocate for using the reconciliation process.

Along the same line, two postings on the lastest dKos poll show a rapidly growing "enthusiasm gap" between Republicans and Democrats disillusioned by absence, so far, of "change we can believe in." This above all includes healthcare reform, a more personal issue than any we have seen in years.

Two in five Democrats consider themselves unlike to vote in 2010, as compared to only one in five Republicans. This is very worrisome stuff:

Thanks, everyone! See you all Wednesday,


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Wednesday, November 11, 2009
Tricounty DFA Update: Storm Over Murphy Vote
Hello Everyone;

This is a special update for November 11, 2009:

Storm Over Murphy Vote

Rep. Scott Murphy was one of 39 Democrats who voted against the Healthcare Bill Saturday night.

I've been moderating this group since April, 2003 and I have never seen anything like the hurricane of emails and postings that vote provoked. What's more, the level of shock and outrage is unprecedented, too.

Part of this was because the vote was unexpected. Murphy spoke in favor of the Public Option and callers were told he supported it. At our meeting Wednesday we passed a resolution offering support for that and urging changes that you can see at

However, what really whipped up that hurricane was the statement Rep. Murphy issued. He made it clear the biggest factors in his decision were what he termed "taxes," specifically a "tax" on paper manufacturers and a 2.5% excise tax on medical device manufacturers, both of which are in the 20th CD.

To clarify the issue, let's take a look at what those actually are.

Fact Check: What, Exactly, Is The "Tax" & What Is Black Liquor?

I've been researching what, exactly, is the "tax" on paper mills in the Healthcare Bill that Scott Murphy objected to. The issue revolves around a substance known in the paper industry as "black liquor."

Black liquor is an alcohol like substance (also known as cellulosic methanol) that is an inherent by-product of the modern paper making process. Most paper mills produce it and have been for 70 or 80 years. It burns and has always been used to fuel the mills, producing about 2/3rds of the energy used to power paper mills nationwide. This is the first of several important points, so note it carefully: because they create it anyway, they would naturally use it for fuel rather than throw it away- it's free energy, and always has been.

In a 2007 Energy Bill amendment to the 2005 Transportation Bill, Congress created a program to give a tax break to any company that mixed a renewal source of energy with fossil fuel. Congress had a good goal: they wanted to promote green, renewable energy.

However, this was essentially a screw up by Congress. Since black liquor, obviously, comes from a renewable source-- trees-- paper mills qualified for this tax credit.

Second big point: The paper industry did not have to do anything new to create this particular renewable energy source, or make any investment in creating renewable energy, or take any action at all-- which was the point, creating new renewable energy. But Congress missed all this largely unheralded black liquor production. It clearly would have been excluded, since it was not new.

What resulted was a windfall for the paper industry, one they did nothing to earn. They got free money for doing nothing.

Third big point: The provision was originally not supposed to cost much, but since black liquor unexpectedly was eligible for this tax break, and since there was a lot of black liquor production, was going to be very expensive. The Treasury Department originally estimated that the incentive would cost tax payers $61 million a year, but with black liquor it would soar to about $4 billion a year

Well, this was pretty embarrassing, and Congress and the Obama administration was planning to close this loophole promptly, and end the windfall. That closure was inevitable. That's actually the forth big point. Inevitable. But then financing healthcare became an issue, so, since the loophole creating the windfall was going to be closed anyway, they applied the revenue gained by closing the loophole to financing healthcare reform.
That was just a basic accounting measure, there was no "tax" being created. Rather, the kind of infuriating loophole in the laws that clever people exploit and taxpayers hate was being closed. The paper industry was going to go right back where they were before Congress slipped-up.

So, when Scott Murphy voted down the healthcare bill by his own statement because of a "tax" on the paper industry, he was actually voting not to kill a tax but to preserve a windfall tax break to the paper industry that A.) was a mistake, B.) had existed for a very short period of time, C.) did not promote new renewable energy, jobs or anything else, D.) was inevitably going to be closed anyway, and D.) was just a gift of our money to the paper companies.

Now, I am not against the paper companies-- do not get me wrong. Most of them are good corporate citizens and we need them. But if they need help they should ask for it so it can be clearly discussed and understood on the merits This is not the way to help them and closing the loophole, ending the windfall, and applying the money-- our money-- to healthcare is as reasonable an idea as Congress has probably ever come up with.

So. What to think of Rep. Murphy's portraying the closing of this loophole as some kind of unfair, oppressive blow, a "tax" unfairly targeting the paper industry? There are two alternatives: A. He has not the single, smallest clue of what he is talking about or, B. it's a claim of breathtaking mendacity. He's a really smart guy, a Harvard man who was a successful businessman and venture capitalist, what used to be called a financier, and, so I am inclined to think it's a pretty safe bet he voted for businesses getting our money and not our people getting healthcare.

4. Taxing Medical Devices...

As for the medical device manufacturers, that is indeed a real tax, a 2.5% excise tax, a type of sales tax not unlike what we pay when we go to the mall. But the excise tax is actually about leveling the playing field. The White House early this year cut a deal with the pharmaceutical industry, hospitals and so forth, wherein they agreed to give up something to finance the bill. That left the medical device manufacturers out. But why should the device manufacturers be so privileged as to not be asked to make some sacrifice, too? In fact, how could they be left out? And why should they expect to be? Everyone else is expected to pitch in. Why not them?

That, understandably became an issue with the other companies, and thus the excise tax was created-- to level the playing field so all would do their part.

Further, since all the medical device manufacturers have to pay the same tax-- in what way does the excise tax put any one company at a competitive disadvantage to any other, when they all have to pay it?

Like any tax, the excise tax will just become part of the companies' overhead. That cost will ultimately be passed along to us as consumers. No economist can see how this can possibly hurt them. In fact, because tens of millions of people will be getting healthcare for the first time, they will make more money than ever.

There is wide agreement there are many problems with the healthcare bill, but these two simply cannot characterized as legitimate reasons to vote down the most important piece of domestic legislation in 45 years, a program Democrats have pushed for since the Truman administration.

Finally, if you want an overall sense of what people feel about this kind of hand out to businesses, I cannot recommend Maureen Dowd's column today more highly:

Maybe we should get rid of Congress and replace it with Saturday Night Live.

Thanks every one,


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Tuesday, November 10, 2009



November 5, 2009


At its regular Wednesday, November 4th meeting at the Rockhill Bakehouse Cafe, Glens Falls DFA passed the following resolution to Rep. Scott Murphy.


Democracy For The Greater Glens Falls Area debated and unanimously approved the following resolution at its November 4th meeting:

We believe Rep. Murphy should support the present House healthcare bill. It is important for us to move forward on this issue. However, we feel the present bill has many serious, even grave, failings, and we urge Rep. Murphy to endeavor as best he can to improve the bill, and even after its passage, to work to continue to improve it.


1. We urge the restoration of the Kucinich Amendment protecting the rights of states to create their own single-payer healthcare systems. One of the strengths of our Federal system is the states are innovation laboratories. This is precious and must be preserved.

2. There must be a Right To Private Action in the bill. If, for instance, an insurance company suddenly discontinues a service, individuals must have a right to go to court and sue. (This recently happened to one of our members, without warning.) This right needs to be both in the basic law, and incorporated into the language of individual policies.

3. We are deeply concerned at the steadily shrinking number of people eligible for the public option. We believe in principle that the public option should be open to everyone, it must not be regarded as, or degraded into, an option of last resort. The broadest pool will yield the greatest economies of scale and produce whatever hypothetical efficiencies competition may produce. It is also a matter of simple justice and rights. There must be real choice.

4. The Public Option and other provisions should be initiated much sooner than 2013. The drawn out timetable is unacceptable.

5. The cap on income subject to FICA payments should be removed to help pay for healthcare.

6. Medicare Advantage programs should be eliminated. They are inefficient, costly, and benefit companies not Medicare recipients.

7. It is good that Medicaid eligibility is being raised to 150% of the Federal Poverty Level. However, that is merely a start. It would be both more cost-effective, productive and fairer, to raise the eligibility threshold to 250% or even 300% of the FPL. At incomes over 150% of the FPL, most working people will still not be able to afford insurance, even with the projected subsidies to buy insurance, so subsidies, essentially, are not worth it.

8. Above all, it is simply imperative that the Public Option must cost less than any private insurance. Since this effort's moment of inception, our party has told the American people the Public Option will cost less and also promote competition. Obviously, there will be no competitive incentives if it costs more-- in fact, if it costs more, the Public Option will likely actually serve to drive up the cost of the private plans.

Democrats must deliver on this fundamental covenant, the Public Option must cost less than any private plan, failure to do will invite disaster.

Cost is one of the reasons we support the Kucinich Amendment and single-payer. Single-payer is by far the most cost-effective and economical solution, as well as fairer, as the experience in Canada and most other countries have proven. It is also the most powerful route to restore the U.S. to international trade competitiveness. Cost is also why we feel the Public Option must be open to all-- that is the way to reduce costs for everyone, it is axiomatic that the smaller the pool, the higher the cost.

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Monday, November 02, 2009
Tricounty DFA Meeting Reminder: Wednesday, 7pm: Healthcare Discussion
Hello Everyone;

This is a quick reminder that we will be having our monthly Democracy For the Great Glens Falls Area meeting this Wednesday, Nov. 4th, at 7pm at the Rockhill Bakehouse Cafe on the corners of Elm and Exchange Streets and Hudson Avenue, in downtown Glens Falls.

Healthcare on the agenda: I have some inquiries into COS Todd Schulte at Rep. Murphy's office about some specifics of the new healthcare bill, and hope to have a response.

There are many good things about the healthcare bill, but also some very troubling ones, and we will be making a recommendation (possibly). For instance, on the troubling questions, among others:

1. Is there a right to sue to force private insurances companies to honor their policies?
2. Why was the Kucinich Amendment guaranteeing the rights of states to create their own single-payer systems dropped?
3. Is it true insurance companies will have the right to immediately raise rates?
4. Contrary to wide spread public expectations, very few people will be able to get into the public option-- enrollment will not be open to all.
5. The public option was supposed to cost less than private insurance, but now the CBO says premiums for the public option may actually be higher than premiums for the private plans.
6. As few as six million people may eventually be in the public option. If so, how will that provide the much ballyhooed competition that will bring down costs and raise efficiency?
So there are many strange aspects to this. The reason the public option may now cost more is that only the sickest patients who cannot get coverage will use it as insurance of the last resort, and because sick patients cost more, the public plan will cost more. That of course, would discredit any public plan, which some critics say may be the idea.

One observation: the public option belongs to the American people. They own it, and they ought to be able to get into it.

I personally do not have an opinion at present. There are very compelling arguments both ways. The pro side says we will not have an opportunity to do this again for a long time. I think that is true. The con side says the bill has turned into another bailout for Wall Street and high finance, and a giveaway to the private insurances companies, and that seems to be true, too, at least at the moment.

Here is one anti view:

And a pro one:

Much will depend on whether rights under the law can actually be enforced, which is why the right to sue, called the right to private action, may be the deal breaking issue. If you cannot sue, you can count on being screwed.

So there will be much to discuss, including the entertaining fracas in NY-23.

See you soon,


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