During World War 2, the Japanese deployed units of Kamikazi
pilots who turned their planes into bombs, and sacrificed themselves in
the name of their emperor in a holy war against US ships. They would
aim for the deck of aircraft carriers and do as much damage as they
could at a cost of their equipment and their lives.
Guerilla armies refined the tactic and made it less pricey. Much
lower cost suicide belts with explosives are used by individuals to
terrorize their enemies without having to sacrifice weapons systems.
Now, American politics has spawned its own kamikazes in the persona
of ultra-right wing fanatics in suits who were ready to blow up the
world financial system if they don’t get their way.
The use of the $14.3 debt ceiling was carefully calculated as a
political weapon to terrorize financial institutions and governments by
playing a game of their own version of apocalypse now. Concede to our
political demands to shrink the government, no matter what the cost to
the poor and or benefit dependent and even federal employees, or we will
further destabilize the system.
Our issues trump yours say these contemporary kamikazes because we
have the votes. We don’t care of the nation defaults on its financial
obligations. Take no prisoners is their approach; ‘Let it all fall
apart’ is the threat, ‘our way or the highway’ is their mantra.
In response, the Administration has been offering what it calls “a
grand bargain” which was off the table and is now back on after the
they agreed to accept a short term debt ceiling hike. This approach,
however, assures that this issue will stick around like a club to keep
the battle going.
The new deal will allow for $4 trillion in budget cuts over the next
decade. It will cut Medicare and Social Security in the name of “closing
loopholes.”
The tension is overheating in a Washington drenched in the sweat of
summer humidity. National Public Radio compares the discussions to a
game of high stakes poker:
“If you remove the politics, the talking points and the media from
the debt-ceiling showdown, you end up with something that looks like a
high-stakes, no-limit Texas Hold ‘em poker game. You’ve got posturing,
risk taking, betting and, of course, bluffing.”
“It’s a war zone. You can’t be a top-notch poker player without
bluffing,” says Antonio Esfandiari, a champion poker player who has won
millions at the tables.”
The Atlantic Wire reports: “ As the deadline approaches, both parties
will start flexing less and compromising more…. According to The New
York Times, the Republican hard-line stance on raising taxes is starting
to splinter. Some have “appeared more willing to consider a deal
locking in spending cuts that Mr. Obama has said he would take if
balanced by new revenues.”
The relentless righteousness of the ideologically driven Tea Party
backed ‘caucus of the crazy’ freaked out not just the President and the
Democrats but many Republicans who, like them, depend on financing by
Wall Street.
In a world of crashing currencies and defaults on the European
horizon they don’t want the same here as trigger happy hardliners
dictate to the country, and by extension the world.
Their political coup threatens to turn into an economic coup.
Wall Street is doing some political bombing of its own to get the GOP
leadership to try to rein in their renegade factions out to please a
base, which is, in turn, funded by the billionaire Koch brothers and
others with self-interested agendas of their own.
Schoolyard bullies have nothing on these guys who have been holding
the political debate hostage to their simplistic message points, which
are then drilled into the nodding minds of their base over the years by
the likes of the Fox Views Network and their rightwing radio brigade.
The politicians will keep dancing and prancing until the music stops.
Our fearless President who has rarely seen a compromise he won’t
embrace is playing his usual double game, telling his supporters how
firm he will be, and telling his avowed enemies he is willing to play in
their pigpen if they would just be more “reasonable.”
The whole point of their exercise is to posture at not being
reasonable, to maintain the appearance of a united front to get as much
as they can by way of concessions and goodies for their own districts
while lambasting all government spending.
New York Times points out that many of the Tea Party boosters on the
hill are not shy about seeking government pork while they are blasting
government excess,
“WASHINGTON — Freshman House Republicans who rode a wave of voter
discontent into office last year vowed to stop out-of-control spending,
but that has not stopped several of them from quietly trying to funnel
millions of federal dollars into projects back home.”
Progressive Democrats are furious and smell betrayal. Here’s what MoveOn had to say:
??“Reports that the White House is negotiating a secret debt deal
directly with House Republicans that could include deep cuts to
Medicare, Medicaid and Social Security with limited or no immediate
revenue increases are deeply troubling. Any deal that slashes programs
for seniors and working families while doing nothing to make the rich
and corporations pay their share is a total non-starter and Democrats in
Congress should rule it out immediately.?
?“The Democratic base did not work night and day to elect Democrats
so that they could cave to Tea Party extremists who are intent on
gutting the social safety net millions of us fought to establish and
protect.”
At the same time, Obama is following in Bill Clinton’s footsteps, according to former Labor Secretary Robert Reich:
“After a bruising midterm election, the president moves to the
political center. He distances himself from his Democratic base. He
calls for cuts in Social Security and signs historic legislation ending a
major entitlement program. He agrees to balance the budget with major
cuts in domestic discretionary spending. He has a showdown with
Republicans who threaten to bring government to its knees if their
budget demands aren’t met. He wins the showdown, successfully painting
them as radicals. He goes on to win re-election.
Barack Obama in 2012? Maybe. But the president who actually did it was Bill Clinton.”
This debt issue has been calculated to focus attention on government
as the fount of all evil, and distract attention away from out of
control corporate enrichment, Wall Street crimes and looting in form of
higher and higher CEO bonuses and greed driven compensation schemes.
A new poll shows public outrage at the government at their highest
levels ever. (Some of this is fueled by the stalemate on the hill.)
This jihad on debt was hatched by right wing think tanks and the
studies commissioned by billionaire Pete Peterson paint alarmist
scenarios about the government going broke through a combination of
reckless entitlement programs like Social Security and Medicare and
runaway spending. There’s no mention of the amount wasted on wars or the
debt that finances programs spawned by the Pentagon and the private
sector that they believe can do no wrong.
It is in sharp contrast to the debt issue I explored in my 2006 film In Debt We Trust: America Before The Bubble Burst. I
focused on mounting consumer debt and how it turned so many families
into serfs, living to pay off high interest credit cards, crushing
student loans and fraudulent sub prime mortgages.
Not only is this debt crisis that so many American feel deeply and
personally not on the Republican agenda, but the kamikazes have fought
successfully to neuter proposed reforms to protect consumers and have
managed to force the Administration to abandon Harvard Professor
Elizabeth Warren who led the fight for government agency to stop the
abuses by banks and credit card companies.
These Republicans have no shame in weakening attempts to make the octopus of loan companies more transparent and less predatory.
Protecting people is not one of their priorities. Defending the privileged is.
While their narrative of negativity became dominant, progressives
either became a cheering squad for corporate democrats or over focused
on the machinations of the flamboyant Michelle Bachman’s, Sarah Palins
and Glenn Becks.
They mostly reacted instead of acting.
They did not fight their narrative with another one attacking the
economic powers in a crusade for justice. They watched as community
organizations like ACORN were driven into the ground and only woke up
when the Governor or Wisconsin went after the collective bargaining
rights of unions.
Instead of organizing and united around campaigns based on program
for substantive change, they went on the defensive designed to hold on
existing rights instead of also fighting for new ones for all Americans.
As a result, the left has left itself out of this polarized political
war even as the economy worsens while the media focuses on the clash of
the gladiators in the hill. Reich reminds us these are not Clinton
times:
“When the Great Recession wiped out $7.8 trillion of home values, it
crushed the nest eggs and eliminated the collateral of America’s middle
class. As a result, consumer spending has been decimated. Households
have been forced to reduce their debt to 115% of disposable personal
income from 130% in 2007, and there’s more to come. Household debt
averaged 75% of personal income between 1975 and 2000.
We’re in a vicious cycle in which job and wage losses further reduce
Americans’ willingness to spend, which further slows the economy. Job
growth has effectively stopped. The fraction of the population now
working (58.2%) is near a 25-year low—lower than it was when recession
officially ended in June 2009.”
Who is talking about this disaster?
News Dissector Danny Schechter directed the DVD Plunder The Crime of
Our Time to expose Wall Street Crimes. (PlundertheCrimeOfOurTime.com)
Comments to dissector@mediachannel.org
MORE, The Baseline Scenario Website: The Weirdness of 10-Year Deficit Reduction
By James Kwak
The Gang of Six plan proposes to reduce the cumulative deficit by
$3.6-3.7 trillion over ten years relative to the CBO’s March 2011
baseline. Everyone’s excited about it. Four trillion dollars! Hooray!
The weird thing is that if you are claiming deficit reductions
against the CBO’s baseline, I think intellectual honesty requires you to
point out that, according to the CBO’s baseline, there is no deficit
problem. The projected 2021 deficit is $729 billion, but net interest
spending is $807 billion (Table 1-5). That means that the primary budget
is running a surplus of $78 billion, the entire deficit is due to
interest payments on the debt, and the debt has stabilized around 75
percent of GDP. This is not a great situation, but it’s no emergency,
either.
Now, you may point out that the baseline is unrealistic, and I agree.
But the three most unrealistic things in the baseline cancel themselves
out. We know that Congress will continue to patch the AMT, which will
cost $804 billion over ten years. (Numbers are from the CBO’s January
Budget and Economic Outlook, Table 1-7; the baseline only changed
minimally (and in a good way) between January and March.) We know that
Congress will not let Medicare payment rates immediately fall by 28
percent; that costs $302 billion over ten years. But we also know that
we are reducing military operations in Iraq and Afghanistan, which will
save $1,371 billion over ten years.* Add those three corrections, and
the cumulative deficit is smaller than in the baseline by $265
billion.**
The big policy uncertainty that hangs over the ten-year baseline is
the Bush and Obama tax cuts of 2001, 2003, and 2009, which were extended
in December 2010 and now expire at the end of 2012. If we extend all of
those tax cuts, we will add $612 billion to the 2021 deficit (on top of
$137 billion for patching the AMT). That’s real money. To which my
answer is: let them expire. Let all the tax cuts expire, and there is no
ten-year deficit problem.
Instead, the Gang of Six plan proposes to cut taxes by $1.5 trillion
(over ten years) relative to the CBO baseline — which means $1.5
trillion in unnecessary spending cuts.
The real problems come after the ten-year horizon, when Medicare
spending accelerates due to an aging population and increasing health
care costs. Those problems need to be solved sooner or later, and sooner
is better than later, since every year of high health care cost
inflation that goes by makes the problem worse. But the Gang of Six plan
is the wrong way to solve those problems (although it is admittedly far
better than the Ryan Plan, which only makes them worse). Does anyone
really think that the middle class’s paltry 2001/2003 tax cuts will make
up for a lower Social Security cost-of-living adjustment and a cap on
federal health care spending?
* By statute, the CBO baseline must project military appropriations
as a straight line based on past appropriations, so it assumes constant
force levels for the next decade.
** The 2021 impact is even better: there you get a net $28 billion saving, which boosts the primary surplus to $106 billion.
