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When an insurance firm boss saw a field hospital for the poor in Virginia, he knew he had to speak out. Here, he tells Paul Harris of his fears for Obama's bid to bring about radical change.

Wendell Potter can remember exactly when he took the first steps on his journey to becoming a whistleblower and turning against one of the most powerful industries in America.

It was July 2007 and Potter, a senior executive at giant US healthcare firm Cigna, was visiting relatives in the poverty-ridden mountain districts of northeast Tennessee. He saw an advert in a local paper for a touring free medical clinic at a fairground just across the state border in Wise County, Virginia.

Potter, who had worked at Cigna for 15 years, decided to check it out. What he saw appalled him. Hundreds of desperate people, most without any medical insurance, descended on the clinic from out of the hills. People queued in long lines to have the most basic medical procedures carried out free of charge. Some had driven more than 200 miles from Georgia. Many were treated in the open air. Potter took pictures of patients lying on trolleys on rain-soaked pavements.

For Potter it was a dreadful realisation that healthcare in America had failed millions of poor, sick people and that he, and the industry he worked for, did not care about the human cost of their relentless search for profits. "It was over-powering. It was just more than I could possibly have imagined could be happening in America," he told the Observer

Potter resigned shortly afterwards. Last month he testified in Congress, becoming one of the few industry executives to admit that what its critics say is true: healthcare insurance firms push up costs, buy politicians and refuse to pay out when many patients actually get sick. In chilling words he told a Senate committee: "I worked as a senior executive at health insurance companies and I saw how they confuse their customers and dump the sick: all so they can satisfy their Wall Street investors."

Potter's claims are at the centre of the biggest political crisis of Barack Obama's young presidency. Obama, faced with 47 million Americans without health insurance, has put reforming the system at the top of his agenda. If he succeeds, he will have pushed through one of the greatest changes to domestic policy of any president. If he fails, his presidency could be broken before it is even a year old. Last week, in a sign of how high the stakes are, he addressed the nation in a live TV news conference. It is the sort of event usually reserved for a moment of deep national crisis, such as a terrorist attack. But Obama wanted to talk about healthcare. "This is about every family, every business and every taxpayer who continues to shoulder the burden of a problem that Washington has failed to solve for decades," he told the nation.

Obama's plans are now mired and the opponents of reform are winning. The Republican attack machine has cranked into gear, labelling reform as "socialist" and warning ordinary Americans that government bureaucrats, not doctors, will choose their medicines. The bill's opponents say the huge cost can only be paid by massive tax increases on ordinary Americans and that others will have their current healthcare plans taken away. Many centrist Democratic congressmen, wary of their conservative voters, are wavering. The legislation has failed to meet Obama's August deadline and is now delayed until after the summer recess. Many fear that this loss of momentum could kill it altogether.

To Potter that is no surprise. He has seen all this before. In his long years with Cigna he rose to be the company's top PR executive. He had an eagle-eye view of the industry's tactics of scuppering political efforts to get it to reform. "This is a very wealthy industry and they use PR very effectively. They manipulate public opinion and the news media and they have built up these relationships with all these politicians through campaign contributions," Potter said.

Potter was witness to the campaign against Michael Moore's healthcare documentary Sicko. The industry slammed the film as one-sided and politically motivated. Secret documents leaked from the American Health Insurance Plans, the industry's lobby group, detailed the plan to paint Moore as a fringe radical. Potter now says the film "hit the nail on the head". "The Michael Moore movie that I saw was full of truth," he admits.

Thanks, as ever, to t r u t h o u t , where you can read the rest of this article.

Republicans are using the T-word - taxes - to attack the Obama healthcare program. It's a strategy based in a lie.

A very small niche of America's uber-wealthy have pulled off what may well be the biggest con job in the history of our republic, and they did it in a startlingly brief 30 or so years. True, they spent over three billion dollars to make it happen, but the reward to them was in the hundreds of billions - and will continue to be.

As my friend and colleague Cenk Uygur of The Young Turks pointed out in a Daily Kos blog recently, billionaire Rupert Murdoch loses $50 million a year on the NY Post, billionaire Richard Mellon Scaife loses $2 to $3 million a year on the Pittsburgh Tribune-Review, billionaire Philip Anschutz loses around $5 million a year on The Weekly Standard, and billionaire Sun Myung Moon has lost $2 to $3 billion on The Washington Times.

Why are these guys willing to lose so much money funding "conservative" media? Why do they bulk-buy every right-wing book that comes out to throw it to the top of the NY Times Bestseller list and then give away the copies to "subscribers" to their websites and publications? Why do they fund to the tune of hundreds of millions of dollars a year money-hole "think tanks" like Heritage and Cato?

The answer is pretty straightforward. They do it because it buys them respectability, and gets their con job out there. Even though William Kristol's publication is a money-losing joke (with only 85,000 subscribers!), his association with the Standard was enough to get him on TV talk shows whenever he wants, and a column with The New York Times. The Washington Times catapulted Tony Blankley to stardom.

"Fellowships" and other forms of indirect sponsorship of right-wing talk show hosts have made otherwise-marginal shows and their hosts ubiquitous, and such sponsorships of groups like Norquist's anti-tax "Americans for Tax Reform" regularly get people like him front-and-center in any debate on taxation in the United States.

All so they could run a tax con on the American people, thus keeping Moon and Murdoch and Scaife and Anschutz (and others) richer than you or I could ever even imagine.

All of this money was spent - invested, really, since it's been more than saved back in low income tax rates on millionaires and billionaires - to convince Americans that up is down and black is white when it comes to income taxes. Here's how it works:

Rich Person's Tax Effect

If a person earns so much money that he doesn't or can't spend it all each year, then when his taxes go down your income after taxes goes up. This is largely because there's little to no relationship between what he "needs to live on" and what he's "earning."

Somebody living on a million dollars a year but earning five million after taxes, can sock away four million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only three million a year, he's still living on a million a year, and only socks away two million in the Swiss bank. His "disposable" income goes down when his taxes go up, and vice-versa. (Technically, the word is "discretionary" income for after-tax, after-living-expenses income, but "disposable" income has become so widely used as a phrase to describe discretionary income I'll use it here.)

The Rich Person's Tax Effect is the one that virtually all Americans understand - and, oddly, most working class people think applies to them, too (this is the truly amazing part of the con job referred to earlier).

But it doesn't.

Working Person's Tax Effect - Version One

Most working people spend pretty much all of what they earn - their "disposable/discretionary" income is close to zero. Savings rates in the US among working people typically are small - one to five percent - and during the last few years of the W. Bush administration actually went negative. So the take-home pay that people have after taxes - regardless of what the taxes may be - is pretty much what they live on.

As economist David Ricardo pointed out in 1817 in the "On Wages" chapter of his book "On the Principles of Political Economy and Taxation," take home pay is also generally "what a person will work for." Employers know this: Ricardo's "Iron Law of Wages" is rooted in the notion that there is a "market" for labor, driven in part by supply and demand. So if a worker is earning, for example, a gross salary of $75,000, his 2008 federal income tax would be about $15,000 ($802.50 on
first $8,025 of income; $3,687.75 on income from $8,025 to $32,550; $10,612.50 on income from $32,550 to $75,000), leaving him a take-home pay of $60,000.

Both he and his employer know that he'll do the job he's doing for around $60,000 a year in take-home pay.

So what happens if his taxes go up, cutting his take-home pay to $55,000 a year (even though his gross is still $75,000)? Over time (typically one to three years) his wages will rise enough to compensate for the lost income.

Alan Greenspan used to be hysterical about this effect - he called it "wage inflation" - and The Wall Street Journal and other publications would often reference it, although the average working person has no idea that if his taxes go up, his wages will eventually go up. Similarly, when working-class people's taxes go down, their gross wages will, over time, go down so their inflation-adjusted take-home pay remains the same. We've seen both happen over the past eighty years, over and over again.

When I was in Denmark last year doing my radio show from the Danish Radio offices for a week and interviewing many of that nation's leading politicians, economists, energy experts, and newspaper publishers, one of my guests made a comment that dropped the scales from my own eyes.

We'd been discussing taxes on the air, what the Danes get for their average 52% tax rate (free college education, free health care, 4 weeks of vacation, being the world's "happiest" country according to research reported on CBS's "60 Minutes" TV show, etc.). I asked him why people didn't revolt at such high tax rates, and he smiled and just pointed out to me that the average Dane is very well paid with a minimum wage that equals about $18 US (depending on the exchange rate from day to day).

Off the air, he made the comment to me that was so enlightening. "You Americans are such suckers," he said, as I recall. "You think that the rules for taxes that apply to rich people also apply to working people. But they don't. When working peoples' taxes go up, their pay goes up. When their taxes go down, their pay goes down. It may take a year or two or three to all even out, but it always works this way - look at any country in Europe. And it's the opposite of how it works for rich people!"

Working Person's Tax Effect - Version Two

The other point about taxes - which Obama leveraged with his "no tax increases on people earning under $250,000 a year" pledge - has to do with the fact that our tax structure in the US is progressive.

Here's how it breaks out for a single person from the 2008 federal tax tables:

10% on income between $0 and $8,02515% on the income between $8,025 and $32,550;25% on the income between $32,550 and $78,850;28% on the income between $78,850 and $164,550;33% on the income between $164,550 and $357,700;35% on the income over $357,700.

Note that our $75,000/year worker has two full tax brackets above him, which, if they go up, will not affect him at all. (This is also true, of course, for the median-wage and average-wage American workers who earn in the low to mid-$40,000/year range.)

The top tax rate that a person pays is referred to as their "marginal tax rate" (in our worker's case 28%). So what happens if the top marginal tax rate on people making over $357,700 goes up from its current 35% to, for example, the Eisenhower-era 91%?

For over 120 million American workers who don't earn over $357,700/year, it won't mean a thing. But for the tiny handful of millionaires and billionaires who have promoted The Great Tax Con, it will bite hard. And that's why they spend millions to make average working people freak out about increases in the top tax rates.

Read the rest here

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If you want to know what really matters in Washington, don't go to Capitol Hill for one of those hearings, or pay attention to those staged White House "town meetings." They're just for show. What really happens - the serious business of Washington - happens in the shadows, out of sight, off the record. Only occasionally - and usually only because someone high up stumbles - do we get a glimpse of just how pervasive the corruption has become.

Case in point: Katharine Weymouth, the publisher of The Washington Post - one of the most powerful people in DC - invited top officials from the White House, the Cabinet and Congress to her home for an intimate, off-the-record dinner to discuss health care reform with some of her reporters and editors covering the story.

But CEOs and lobbyists from the health care industry were invited, too, provided they forked over $25,000 a head - or up to a quarter of a million if they want to sponsor a whole series of these cozy get-togethers. And what is the inducement offered? Nothing less, the invitation read, than "an exclusive opportunity to participate in the health-care reform debate among the select few who will get it done."

The invitation reminds the CEO's and lobbyists that they will be buying access to "those powerful few in business and policy making who are forwarding, legislating and reporting on the issues …

"Spirited? Yes. Confrontational? No." The invitation promises this private, intimate and off-the-record dinner is an extension "of The Washington Post brand of journalistic inquiry into the issues, a unique opportunity for stakeholders to hear and be heard."

Let that sink in. In this case, the "stakeholders" in health care reform do not include the rabble - the folks across the country who actually need quality health care but can't afford it. If any of them showed up at the kitchen door on the night of this little soiree, the bouncer would drop kick them beyond the Beltway.

No, before you can cross the threshold to reach "the select few who will actually get it done," you must first cross the palm of some outstretched hand. The Washington Post dinner was canceled after a copy of the invite was leaked to the web site Politico.com, by a health care lobbyist, of all people. The paper said it was a misunderstanding - the document was a draft that had been mailed out prematurely by its marketing department. There's noblesse oblige for you - blame it on the hired help.

In any case, it was enough to give us a glimpse into how things really work in Washington - a clear insight into why there is such a great disconnect between democracy and government today, between Washington and the rest of the country.

According to one poll after another, a majority of Americans not only want a public option in health care, they also think that growing inequality is bad for the country, that corporations have too much power over policy, that money in politics is the root of all evil, that working families and poor communities need and deserve public support if the market system fails to generate shared prosperity.

But, when the insiders in Washington have finished tearing worthy intentions apart and devouring flesh from bone, none of these reforms happen. "Oh," they say, "it's all about compromise. All in the nature of the give-and-take-negotiating of a representative democracy."

That, people, is bull - the basic nutrient of Washington's high and mighty.

It's not about compromise. It's not about what the public wants. It's about money - the golden ticket to "the select few who actually get it done."

It gets juicier and will rile you even more, hopefully to take action and call your congresspeople. So....

Read the rest by: Bill Moyers and Michael Winship, at  t r u t h o u t | Perspective.

Thank you t r u t h o u t.

The Southern Poverty Law Center today urged Congress to investigate growing evidence that racial extremists are infiltrating the US military in order to ensure that the armed forces are not inadvertently training future domestic terrorists.

In a letter to committee chairmen with oversight over homeland security and the armed services, the SPLC said it recently found dozens of personal profiles on a neo-Nazi website where individuals listed "military" as their occupation - the latest evidence of extremist infiltration gathered by the SPLC. It also cites FBI and Department of Homeland Security reports supporting the SPLC's concerns.

"Evidence continues to mount that current Pentagon policies are inadequate to prevent racial extremists from joining and serving in the armed forces," SPLC founder Morris Dees wrote. He added, "Because the presence of extremists in the armed forces is a serious threat to the safety of the American public, we believe Congressional action is warranted."

The letter was sent to the chairmen of the House and Senate committees on Homeland Security and Armed Services. The SPLC has raised its concerns with Pentagon officials since publishing a report in 2006, but no apparent action has been taken.

In recent months, SPLC investigators found approximately 40 personal profiles that listed "military" as an occupation on the Internet forum New Saxon, which is operated by the neo-Nazi National Socialist Movement. One individual, who claims to be serving in Afghanistan, lists as his favorite book "The Turner Diaries," which was written by neo-Nazi leader William Pierce. The book served as a blueprint for the Oklahoma City bombing by Gulf War veteran Timothy McVeigh. Another individual said he was about to be deployed overseas and was looking forward to "killing all the bloody sand niggers." Still another spoke of his hatred for undocumented immigrants.

The SPLC has been involved with this issue for more than two decades. In 1986, the SPLC presented evidence to Defense Secretary Caspar Weinberger that Marines were participating in Ku Klux Klan paramilitary activities and urged him to prohibit all military personnel from being members of, or participating in, the activities of white supremacist groups. Although Weinberger issued a directive addressing extremist activity, it ultimately proved inadequate.

The SPLC again brought the problem to the attention of Pentagon officials again in 1996, after three neo-Nazi soldiers stationed at Fort Bragg murdered a black couple in North Carolina in a ritualistic, racially motivated slaying. Pentagon regulations were strengthened following an investigation by an Army task force and hearings by the House Armed Services Committee.

But a decade later, military recruiters, under intense pressure to meet quotas for the wars in Iraq and Afghanistan, appear to have lowered recruiting standards, according to the SPLC's 2006 report. The report revealed that large numbers of neo-Nazi skinheads and other white supremacists were joining the armed forces to acquire combat training and access to weapons and explosives.

In 2008, the FBI released an unclassified report that supported the SPLC's findings. This past April, the Department of Homeland Security issued a report stating that right-wing extremists currently pose the most significant threat of domestic terrorism and expressing the concern that they may attempt to exploit the combat training and experience of returning veterans.

The SPLC letter notes that since 1994 the military has discharged more than 12,500 servicemembers simply because of their homosexuality. "It seems quite anomalous that the Pentagon would consider homosexuals more of a threat to the good order of the military than neo-Nazis and other white supremacists who reject our Constitution's most cherished principles," said Mark Potok, director of the SPLC's Intelligence Project, which monitors extremist activity.

The letter also says that "the overwhelming majority of U.S. servicemembers reject extremism and are dedicated to serving and protecting the highest ideals of our country" and notes that there will never be a fail-safe system to weed out all extremists. "But we owe it to our courageous men and women in uniform, and the American public, to remain vigilant to ensure that the ranks are as free of extremists as possible," Dees wrote.