Bernie Sanders Calls for ‘Boldest Legislation in History’ to Halt Spiraling Covid-19 Catastrophe

April 03, 2020 by Common Dreams

“In this unprecedented moment in modern American history, it is imperative that we respond in an unprecedented way.”

by Eoin Higgins, staff writer

 116 Comments

Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) speaks during a campaign event at NOAH's Events Venue on December 30, 2019 in West Des Moines, Iowa.

Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) speaks during a campaign event at NOAH’s Events Venue on December 30, 2019 in West Des Moines, Iowa. (Photo: Joe Raedle/Getty Images)

Sen. Bernie Sanders on Friday released his demands for six key priorities that he said must be included in the next round of federal economic relief for suffering Americans as the coronavirus pandemic cripples the country’s healthcare system and eviscerates the economy.

“We are in the midst of a COVID-19 pandemic that could lead to the death of hundreds of thousands of Americans and infect millions of others, and we are entering an economic downturn that could be worse than the Great Depression of the 1930s,” Sanders said. “In this unprecedented moment in modern American history, it is imperative that we respond in an unprecedented way.”

According to the Vermont lawmaker’s office, Sanders wants the next bill to include six provisions that are aimed at helping working people in the U.S. weather the crisis:

  • Addressing the employment crisis by ensuring workers remain employed and paid as well as providing social services for everyone in the country, regardless of citizenship or immigration status
  • Guaranteeing a free at point of service Medicare for All single payer healthcaer system for everyone in the country
  • Immediately using the Defense Production Act to manufacture personal protective equipment (PPE), ventilators, and other needed healthcare equipment for frontline workers dealing with the pandemic
  • Providing food for everyone in the country for the duration of the crisis
  • $600 billion in aid to states and cities 
  • An immediate suspension of collections of rent, mortgage payments, medical debt, and consumer debt for four months and a suspension of student loan payments through the duration of the pandemic

In a video posted to social media, Sanders said the pandemic presents an outright “emergency” for the nation’s most vulnerable populations and for all working people, and that drastic measures must be taken to protect people’s health and economic wellbeing:

Sanders, a candidate for the 2020 Democratic presidential nomination, announced the priorities Friday afternoon. Campaign co-chair Nina Turner, in a tweet, cited the need for ambitious thinking.

“We are entering a downturn that could be worse than the Great Depression,” said Turner. “We must respond to this unprecedented challenge with the boldest measures: Sanders is outlining the most comprehensive set of priorities that will IMMEDIATELY provide relief and leave no one behind.”

The plan won praise from Ana Maria Archila, co-director of the Center For Popular Democracy Action.

“Bernie’s plan for the fourth phase of a federal legislative response centers people, not corporations,” said Archila. “It is about helping us survive with the cash assistance, healthcare, nutrition, worker safety we need, and relief from monthly payments we cannot make. It speaks to the needs of frontline workers who are battling the pandemic and making it possible for the rest of us to shelter in place.”

Inclusion of the kind of provisions that Sanders is demanding in the next stimulus bill would make the package “the boldest legislation in history,” the senator’s office said. However, as some observers pointed out, the six core concepts likely represent the least that is necessary to stop a total economic meltdown.

A number of progressive groups backed the Sanders plan, calling the forward-thinking ideas in the proposal necessary to stave off an economic disaster.

“Senator Sanders’ economic rescue principles speak to the bold, fast action needed to protect and support people and prevent corporations from consolidating economic and political power amidst a crisis,” said George Goehl, director of People’s Action.

Make the Road Action co-director Javier H. Valdés made the case that Sanders is offering concrete, real help to Americans.

“The priorities outlined by Senators Sanders for the next Coronavirus Stimulus Package are what our country needs to ensure everyone in our community can access the financial and medical support needed to withstand this crisis,” said Valdés.” We stand with Senator Sanders in demanding a $2,000 monthly emergency payment, emergency food, and Medicare to every person in our country regardless of their housing situation, immigration status, or whether they have a bank account or internet connection.”

Meanwhile, Sanders’ rival former Vice President Joe Biden continues to claim that universal healthcare is an unworkable solution to the insurance crisis in the U.S. and that a single-payer system would not have stopped the outbreak. As Common Dreams reported, estimates of workers losing coverage due to loss of employment in 2020 could top 35 million. 

In an interview Friday, Sen. Elizabeth Warren (D-Mass.), a former candidate for president whose run was seen as ideologically similar to Sanders’, praised Biden as analogous to former President Barack Obama, who “saw us through a crisis starting back in 2009 with steady, thoughtful, smart leadership.”

“That’s what I think we can expect from Vice President Biden,” said Warren, who stopped short of an outright endorsement.

Sanders appeared on MSNBC Friday to promote his plan. During the segment, host Ali Velshi listed a number of longstanding priorities of the senator’s, including Medicare for All and student debt relief, and wondered if the crisis was making Sanders’ case for president for him.

“Reality has endorsed Bernie Sanders,” tweeted progressive political group People for Bernie—a sentiment many progressive voices have shared in recent weeks.

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Was the Fed Just Nationalized?

Posted on April 3, 2020 by Ellen Brown (ellenbrown.com)

Did Congress just nationalize the Fed? No. But the door to that result has been cracked open.

Mainstream politicians have long insisted that Medicare for all, a universal basic income, student debt relief and a slew of other much-needed public programs are off the table because the federal government cannot afford them. But that was before Wall Street and the stock market were driven onto life-support by a virus. Congress has now suddenly discovered the magic money tree. It took only a few days for Congress to unanimously pass the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which will be doling out $2.2 trillion in crisis relief, most of it going to Corporate America with few strings attached. Beyond that, the Federal Reserve is making over $4 trillion available to banks, hedge funds and other financial entities of all stripes; it has dropped the fed funds rate (the rate at which banks borrow from each other) effectively to zero; and it has made $1.5 trillion available to the repo market.

It is also the Federal Reserve that will be picking up the tab for this bonanza, at least to start. The US central bank has opened the sluice gates to unlimited quantitative easing, buying Treasury securities and mortgage-backed securities “in the amounts needed to support smooth market functions.” Last month, the Fed bought $650 billion worth of federal securities. At that rate, notes Wall Street on Parade, it will own the entire Treasury market in about 22 months. As Minneapolis Fed President Neel Kashkari acknowledged on 60 Minutes, “There is an infinite amount of cash at the Federal Reserve.”

In theory, quantitative easing is just a temporary measure, reversible by selling bonds back into the market when the economy gets back on its feet. But in practice, we have seen that QE is a one-way street. When central banks have tried to reverse it with “quantitative tightening,” economies have shrunk and stock markets have plunged. So the Fed is likely to just keep rolling over the bonds, which is what normally happens anyway with the federal debt. The debt is never actually paid off but is just rolled over from year to year. Only the interest must be paid, to the tune of $575 billion in 2019. The benefit of having the Fed rather than private bondholders hold the bonds is that the Fed rebates its profits to the Treasury after deducting its costs, making the loans virtually interest-free. Interest-free loans rolled over indefinitely are in effect free money. The Fed is “monetizing” the debt.

What will individuals, families, communities and state and local governments be getting out of this massive bailout? Not much. Qualifying individuals will get a very modest one-time payment of $1,200, and unemployment benefits have been extended for the next four months. For local governments, $150 billion has been allocated for crisis relief, and one of the Fed’s newly expanded Special Purpose Vehicles will buy municipal bonds. But there is no provision for reducing the interest rate on the bonds, which typically runs at 3 or 4 percent plus hefty bond dealer fees and foregone taxes on tax-free issues. Unlike the federal government, municipal governments will not be getting a rebate on the interest on their bonds.

The taxpayers have obviously been shortchanged in this deal. David Dayen calls it “a robbery in progress.” But there have been some promising developments that could be harnessed for the benefit of the people. The Fed has evidently abandoned its vaunted “independence” and is now working in partnership with the Treasury. In some sense, it has been nationalized. A true partnership, however, would make the printing press available for more than just buying toxic corporate assets. A central bank that was run as a public utility could fund programs designed to kickstart the economy, stimulate productivity and generally serve the public.

Harnessing the Central Bank

The reason the Fed is now working with the Treasury is that it needs the Treasury to help it bail out a financial industry burdened with an avalanche of dodgy assets that are fast losing value. The problem for the Fed is that it is only allowed to purchase or lend against securities with government guarantees, including Treasury securities, agency mortgage-backed securities, debt issued by Fannie Mae and Freddie Mac, and (arguably) municipal securities. To get around that wrinkle, as Wolf Richter explains:

[T]he Treasury will create (or resuscitate) a series of special-purpose vehicles (SPVs) to buy all manner of financial assets, backed by $425 billion in collateral conveniently supplied by the US taxpayer via the Exchange Stabilization Fund. The Fed will lend to SPVs against this collateral which, when leveraged, could fund $4-5 trillion in asset purchases.

That includes municipal bonds, non-agency mortgages, corporate bonds, commercial paper, and every variety of asset-backed security. The only things the government can’t (transparently, yet) buy are publicly-traded stocks and high-yield bonds.

Unlike in QE, in which the Fed moves assets onto its own balance sheet, the Treasury will now be buying assets and backstopping loans through SPVs that the Treasury will own and control. SPVs are a form of shadow bank, which like all banks create money by “monetizing” debt or turning it into something that can be spent in the marketplace. The SPV decides what assets to buy and borrows from the central bank to do it. The central bank then passively creates the funds, which are used to purchase the assets backing the loan. As Jim Bianco wrote on Bloomberg:

In other words, the federal government is nationalizing large swaths of the financial markets. The Fed is providing the money to do it. BlackRock will be doing the trades. This scheme essentially merges the Fed and Treasury into one organization. …

In effect, the Fed is giving the Treasury access to its printing press. This means that, in the extreme, the administration would be free to use its control, not the Fed’s control, of these SPVs to instruct the Fed to print more money so it could buy securities and hand out loans in an effort to ramp financial markets higher going into the election.

Of the designated SPVs, none currently serves a public purpose beyond buoying the markets; but they could be designed for such purposes. The taxpayers are on the hook for replenishing the $425 billion in the Exchange Stabilization Fund, and they should be entitled to share in the benefits. Congress could designate a Special Purpose Vehicle to fund its infrastructure projects, and to fund those much-needed public services including Medicare for all, a universal basic income, student debt relief, and similar programs. It could also purchase a controlling interest in insolvent or profligate banks, pharmaceutical companies, oil companies and other offenders and regulate them in a way that serves the public interest.

Another possibility would be for Congress to fund these programs in the usual way by issuing government bonds, but to enter into a partnership agreement first by which the central bank would buy the bonds, roll them over indefinitely, and rebate the interest to the Treasury. That is how Japanese Prime Minister Shinzo Abe has funded his stimulus programs, with none of the predicted inflationary effects on consumer prices. In fact the Japanese consumer price index is hovering at a very low 0.4%, well below even the central bank’s 2 percent target, although the Bank of Japan has monetized nearly half of the government’s debt. Half of the US debt would be over $11 trillion. Assuming $6 trillion for the current corporate bailouts, that means another $5 trillion could safely be monetized for programs benefiting individuals, families and local governments. (How to do this without driving up consumer prices will be the subject of another article.)

Relief for State and Local Governments

State and local governments, which are on the front lines for delivering emergency services, have for the most part been left out of the bailout bonanza. While we are waiting for action from Congress, the Fed could make cheap loans available to local governments using its existing powers under Federal Reserve Act Sec. 14(2)(b), which authorizes the Fed to purchase the bills, bonds, and notes of state and local governments having maturities of six months or less. Since local governments must balance their budgets, these loans would have to be repaid, but the loans could be extended by rolling them over for a reasonable period, as is done with repo loans and the federal debt; and the loans could be made at the same near-zero interest rate banks can borrow at now. State and local governments are at least as creditworthy as banks – they have a taxpayer base and massive assets. In fact the private banking industry would have been insolvent long ago if it were not for the deep pocket of the central bank and the bailouts of the federal government, including the FDIC insurance scheme that rescued the banks from bankruptcy in the Great Depression.

There is a way state and local governments can take advantage of the near-zero interest rates available to banks even without federal action. They can set up their own publicly-owned banks. Besides giving them the ability to borrow much more cheaply, having their own banks would allow them to leverage their loan funds. A $100 million revolving fund issuing loans at 3% would gross the state $3 million per year. If that same $100 million were used to capitalize a bank, it could issue ten times that sum in loans, grossing $30 million per year. Costs would need to be deducted from those earnings, including the cost of funds; but the cost of funds is quite low for banks today. They can borrow to meet their liquidity needs from their own deposit pool, or at 0.25% in the fed funds market, or at about the same rate in the repo market, which is now backstopped by the central bank.

The blatant disparities in the congressional response to the current crisis have shone a bright light on how our financial system is rigged against the people in favor of a wealthy elite. Crisis is when change happens; this is the time for advocates to unite in demanding change on behalf of the people. As Greek economist Yanis Varoufakis admonished in a recent post:

[T]his new phase of the crisis is, at the very least, making it clear to us that anything goes – that everything is now possible.… Whether the epidemic helps deliver the good or the most evil society will depend … on whether progressives manage to band together. For if we do not, just like in 2008 we did not, the bankers, the spivs [petty criminals], the oligarchs and the neofascists will prove, again, that they are the ones who know how not to let a good crisis go to waste.

________________________

Ellen Brown chairs the Public Banking Institute and has written thirteen books,including her latest, Banking on the People: Democratizing Money in the Digital Age. She also co-hosts a radio program on PRN.FM called “It’s Our Money.” Her 300+ blog articles are posted at EllenBrown.com.

Coronavirus forces Nancy Pelosi’s SF election foe to take a different path

Coronavirus forces Nancy Pelosi’s SF election foe to take a different path

Photo of Joe Garofoli

Joe Garofoli April 2, 2020 (SFChronicle.com)

Shahid Buttar is a democratic socialist running against House Speaker Nancy Pelosi to represent California's 12th Congressional District in San Francisco.
1of4Shahid Buttar is a democratic socialist running against House Speaker Nancy Pelosi to represent California’s 12th Congressional District in San Francisco.Photo: Santiago Mejia / The Chronicle
House candidate Shahid Buttar delivered masks to Glide Memorial United Methodist Church.
2of4House candidate Shahid Buttar delivered masks to Glide Memorial United Methodist Church.Photo: Santiago Mejia / The Chronicle
A portrait of Shahid Buttar on Wednesday, April 1, 2020, in San Francisco, Calif. Buttar is running for election to the U.S. House to represent California's 12th Congressional District.
3of4A portrait of Shahid Buttar on Wednesday, April 1, 2020, in San Francisco, Calif. Buttar is running for election to the U.S. House to represent California’s 12th Congressional District.Photo: Santiago Mejia / The Chronicle

If Joe Biden is having a hard time attracting attention for his presidential campaign during the coronavirus pandemic, imagine what it’s like for Shahid Buttar. The long shot of long shots just saw his odds get worse.

Buttar is the San Francisco democratic socialist trying to unseat Speaker Nancy Pelosi from the House seat she has held since 1987. That’s the steepest of challenges in the best of times, and there’s little indication Buttar was poised to pull an upset even before life turned upside down. In the March top-two primary, Pelosi won 74% of the vote to Buttar’s 13%.

It gets even tougher when Buttar’s volunteers can’t campaign door to door, and when Buttar can’t hold rallies or star at one of the DJ parties the campaign hosted in the Mission District before the pandemic struck. That’s no small loss for him — Buttar is perhaps the nation’s only House candidate who is both a Stanford Law graduate and an accomplished rapper, which he flashed on The Chronicle’s “It’s All Political” podcast.

To try to replace all that, Buttar is launching something different for a moment when people have more pressing concerns than politics.

He and his campaign volunteers are calling supporters and others in the district just to check on them. No politics. No strong-arming for donations. Instead, they ask people how they are doing. Are they aware of the services the city has made available?

If they need help, Buttar volunteers give them specifics about how to find a food pantry, get health care or learn how to apply for unemployment benefits.

“We’re not in a position to deliver services, but we can help people find them,” Buttar said.

Buttar says he’s made many of these calls himself — he helped a low-income college student find a food pantry and directed others to local support services. On Wednesday, he delivered 60 N-95 masks, which his campaign bought during last year’s wildfires, as a donation to Glide Memorial United Methodist Church.

It’s a way of trying to understand the emotions voters are feeling during these stay-at-home times.

The idea is to “connect with people,” Buttar said. “A lot of them basically described how they have felt isolated. They appreciated the human connection.”

On Thursday, Buttar will explain his campaign’s reboot with an online gathering on Twitch, a platform popular with younger voters and gamers. At noon on April 9, he will be interviewed during an online meeting of San Francisco’s venerable Commonwealth Club.

But this reboot doesn’t mean Buttar, 45, who left his job as a civil rights activist for the Electronic Frontier Foundation to focus on his campaign, is abandoning his critique of Pelosi. He said she didn’t get enough for working people in the $2 trillion stimulus package that President Trump signed last week.

Buttar said Pelosi should have done more to thwart the $500 billion “slush fund” for corporations that will be administered by Treasury Secretary Steven Mnuchin. Congressional Democrats inserted a provision for a federal investigator to report to lawmakers on how the money is spent, although Trump already is pushing back on the idea.

The package did little to address the wealth inequality gap, which the pandemic has only widened, Buttar said.

People who have to work during the crisis, such as grocery store employees or transit drivers, are at elevated risk of falling ill. The new law doesn’t do enough to help those people, Buttar said.

Pelosi says her priorities for a follow-up bill will include paid family and medical leave for more workers, an increase in food-stamp benefits and more money for states and cities whose budgets are being drained fighting the virus. She also wants the federal government to cover the cost of treating people who contract COVID-19.

Buttar is unimpressed.

“What keeps (Pelosi) in office is her presence in the news cycle and simply the name recognition of a figure who frankly hasn’t done much for San Francisco in a generation, and frankly has done a lot to undermine the city and our interest in Washington,” Buttar said.

Pelosi’s campaign did not respond to a request for comment.

Buttar said the pandemic shows the weaknesses of the health care system to take care of the poor and uninsured. He supports the single-payer model proposed by Sen. Bernie Sanders, whom he endorsed for president. Pelosi favors improving the Affordable Care Act that she pushed through the House in 2010 before moving to a government-administered system.

“This pandemic is making the case for a paradigm shift in recent health care policy much more strongly than I, or even Bernie Sanders or anybody else, possibly could,” Buttar said.

Buttar has plenty of role models for long-shot candidates who have won. He points to four first-term House members known as “the Squad,” including fellow democratic socialist Rep. Alexandria Ocasio-Cortez of New York, who he said have pushed Pelosi to be more progressive.

However, none of the Squad members has endorsed Buttar. Even if they were inclined to, siding with the House speaker’s election opponent would be risky at best. Sanders hasn’t endorsed him, either, although local outposts of the Sanders-affiliated organization Our Revolution have.

Buttar has raised nearly $500,000, more than many of the election opponents Pelosi has trounced over the years. Nearly 80% of the money has come from outside the district, a reflection, he said, of a “broad national base that is disaffected with the speaker’s leadership.”

But Pelosi has raised $6.6 million for her race and tens of millions more nationally for other Democrats. She doesn’t just have 100% name recognition — she’s a cultural icon to many Democrats for her work as the first female speaker and her leadership in countering Trump.

Buttar knows that all too well. He’s just hoping to get his message heard during the worst time to run a long-shot campaign.

Joe Garofoli is The San Francisco Chronicle’s senior political writer. Email: jgarofoli@sfchronicle.com Twitter: @joegarofoli

Joe Garofoli

Follow Joe on:https://www.facebook.com/SFChronicle/joegarofoli

Joe Garofoli is the San Francisco Chronicle’s senior political writer, covering national and state politics. He has worked at The Chronicle since 2000 and in Bay Area journalism since 1992, when he left the Milwaukee Journal. He is the host of “It’s All Political,” The Chronicle’s political podcast. Catch it here: bit.ly/2LSAUjA

He has won numerous awards and covered everything from fashion to the Jeffrey Dahmer serial killings to two Olympic Games to his own vasectomy — which he discussed on NPR’s “Talk of the Nation” after being told he couldn’t say the word “balls” on the air. He regularly appears on Bay Area radio and TV talking politics and is available to entertain at bar mitzvahs and First Communions. He is a graduate of Northwestern University and a proud native of Pittsburgh. Go Steelers!

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‘Still Ahead of His Time’: New Video Details Bernie Sanders’ Prescient Warnings About Pandemic Threat and Need for Medicare for All

April 02, 2020 by Common Dreams

“Voters are watching in real time as Bernie Sanders’ platform—Medicare for All, a federal housing guarantee, paid leave for everyone, and much else—is looking more and more like a common-sense solution to huge problems.”

by Jake Johnson, staff writer

 17 Comments

“Americans have long suffered from the outrageous costs of healthcare, and most workers know what it’s like to live paycheck to paycheck. They’re basic problems in our political and economic system that Bernie Sanders has been correctly diagnosing his entire career,” said RootsAction co-founder Norman Solomon. (Photo: Donna Light/Associated Press)

A video released Thursday by progressive advocacy organization RootsAction uses decades of archival footage to show that the deadly coronavirus pandemic has—in just a matter of weeks—vindicated Sen. Bernie Sanders’ career-long support for Medicare for All and sweeping economic change.

“They’re basic problems in our political and economic system that Bernie Sanders has been correctly diagnosing his entire career.”
—Norman Solomon, RootsAction

The two-minute clip features footage dating back to 1987 of Sanders, today a 2020 Democratic presidential candidate, warning about the “crisis of affordable healthcare” and urging the U.S. government take steps to “protect the American people and people throughout the world” from a possible global outbreak on the scale of the 1918 Spanish flu epidemic.

“Voters are watching in real time as Bernie Sanders’ platform—Medicare for All, a federal housing guarantee, paid leave for everyone, and much else—is looking more and more like a common-sense solution to huge problems,” Jeff Cohen, co-founder of RootsAction.org, said in a statement.

“With 27 states and territories left to cast their votes [in the 2020 Democratic presidential primary],” said Cohen, “we believe that it’s important to deliver this message as widely as possible.”

Watch the full video:

The video comes as the Democratic presidential primary has been thrown into complete disarray by the coronavirus crisis, which has forced 15 states to postpone their primary contests. Wisconsin, which is scheduled to hold its primary next Tuesday, is facing calls to delay the election, including from Sanders.

Meanwhile, the nationwide economic fallout caused by the coronavirus outbreak continues to intensify. On Thursday, as Common Dreams reported, the U.S. Department of Labor announced that a record-shattering 6.6 million Americans filed for unemployment benefits last week, bringing the total number of jobless claims from the month of March to more than 10 million.

The Economic Policy Institute estimated Thursday that “3.5 million workers likely lost their employer-provided health insurance in the past two weeks,” bolstering Medicare for All advocates’ argument that tying healthcare to employment is fundamentally problematic.

“Sanders has consistently advocated for the kinds of policies, such as Medicare for All and more substantial rights for working people, that would have left the U.S. better prepared to confront the coronavirus pandemic.”
—Kenny Stancil

“The coronavirus is exposing horrible gaps in our system,” Norman Solomon, co-founder and national coordinator of RootsAction.org and Common Dreams contributor, said in a statement. “But it’s important to note that they are not new flaws that appeared overnight. Americans have long suffered from the outrageous costs of healthcare, and most workers know what it’s like to live paycheck to paycheck.”

“These are longstanding realities that have gone unaddressed by the political establishment and left us more vulnerable to this pandemic,” said Solomon. “They’re basic problems in our political and economic system that Bernie Sanders has been correctly diagnosing his entire career.”

In a Common Dreams essay on Thursday, Kenny Stancil echoed that argument, noting that “even as Bernie’s path to the Democratic nomination is becoming more difficult, his bold ideas are increasingly popular and more necessary than ever to minimize death and misery in the wake of the diffusion of COVID-19.”

“Unlike his political opponents who have fought for the types of austerity measures that make the U.S. more vulnerable to disasters,” Stancil wrote, “Sanders has consistently advocated for the kinds of policies, such as Medicare for All and more substantial rights for working people, that would have left the U.S. better prepared to confront the coronavirus pandemic.”

Even if Sanders does not ultimately win the Democratic primary, he added, “it is essential… that [Sanders’] candidacy continues through the convention and that the movement for Medicare for All and a Green New Deal persists.”

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