Death By 1000 Ideologically Motivated Cuts

Obama buys the Republican myth of CUTTING our way to prosperity.

John Boehner Terrorisit Threats to Shut Government Poops Diapie Image

A last-minute budget deal cutting billions in spending postponed the Republican threat of a government shut down until next Thursday… thus giving Obama more time to capitulate to GOP terrorist demands.

Clearly, rather than fight for Democratic ideals – say… like the ones that lifted us out of the disaster of the FIRST Republican Great Depression… The so-called leader of the Democratic Party has bought into to Republican meme that we can “CUT” our way to prosperity.  We cannot.

Look at history.  Economists attributed the economic recovery out of the first Republican Great Depression from heavy government deficit spending. From the time he was inaugurated, Franklin D. Roosevelt increased spending with programs directly geared to putting people to work and the economy recovered partially from 1933 until 1936 until he caved to a Republican Congress bloviating about an unbalanced budget, cut spending, and the nation plunged into another recession.

Watch Thom Hartmann explain how Republican polices created and prolonged the Great Depression:

Republicans believe that tax cuts for the rich and just plain CUTS for everyone else is the “remedy” for the economic disasters Republican policies create, not because it creates a vibrant economy and strong middle class, but simply because it is Republican dogma. 

The Republican answer to the problems caused by their love of deregulation will always be “more deregulation” just like their answer to the problems caused by unfunded tax-cuts for the wealthy will always be “more unfunded tax cuts for the wealthy.”

It doesn’t matter a whit to Republicans that David Stockman, the father of Republican “trickle-down” economics recently made the media rounds to tell the late, great American Middle Class something they already know – that Reaganomics was a abysmal failure.

Yet, Barack Obama capitulates to the same class war policies that got us into the mess to being with, promising nothing but more of the same widening of the gap between rich and poor.

It makes no difference that Repug policies are the lynchpin on which all the destruction is hung–their true goal is to maintain the Plutonomy. Period.

In their own private Republican apocalypse, a world where the rich run and own everything is not a problem because everyone else, as their hero Ayn Rand says, is a “parasite.

“What are your masses [of humanity] but mud to be ground underfoot, fuel to be burned for those who deserve it?”  She mused in the original version of her first novel “We the Living.

Never mind that Libertarian heroine and sociopath Ayn Rand herself sucked off the government teat, receiving Social Security and Medicare under her married name after being afflicted with cancer and finding out that “Doctors could cost an awful lot more money than books earn.”   Like cult members “praying” for their child’s diabetes to be miraculously cured, the American Working Class are likewise suffering a slow death that could just as easily been avoided if only we weren’t forced to submit to dead-end Republican ideology.

Fast forward 30 years and Ayn Rand’s disciple Alan Greenspan, rather than avert disaster, let the economy fall into a ditch for a second time in a century because he had an ideological aversion to regulating what he hoped against hope was his fantasy of a “free-market.”

So here we are, still living in the consequences of Republican ideology, and rather than re-frame the argument and fight to raise REVENUES by dare suggesting the rich stop partying off our backs and pay their fair share, President Obama boasts how the wonderful leadership of “both parties” came together and made a “compromise” containing “the largest annual spending cut in our history.”

With none of the “I feel your pain” empathy of Bill Clinton, Obama assured the Serfs of America that we will be further stretched to the breaking point, saying,  “Some of the cuts we agreed to will be painful – programs people rely on will be cut back; needed infrastructure projects will be delayed.”

So working people will continue to suffer while the rich ride into the sunset with the American Dream.  Well, that sounds like “HAPPY DAYS ARE HERE AGAIN” – for Republicans.   Thanks Obama!

The following was Cross-posted from Robert Reich’s blog:

Obama’s Republican narrative of our economic woes

Quiz: What’s responsible for the lousy economy most Americans continue to wallow in?

A. Big government, bureaucrats, and the cultural and intellectual elites who back them.

B. Big business, Wall Street, and the powerful and privileged who represent them.

These are the two competing stories Americans are telling one another.

Yes, I know: It’s more complicated than this. In reality, the lousy economy is due to insufficient demand – the result of the nation’s almost unprecedented concentration of income at the top. The very rich don’t spend as much of their income as the middle. And since the housing bubble burst, the middle class hasn’t had the buying power to keep the economy going. That concentration of income, in turn, is due to globalization and technological change – along with unprecedented campaign contributions and lobbying designed to make the rich even richer and do nothing to help average Americans, insider trading, and political bribery.

So B is closer to the truth.

But A is the story Republicans and right-wingers tell. It’s a dangerous story because it deflects attention from the real problem and makes it harder for America to focus on the real solution – which is more widely shared prosperity. (I get into how we might do this in my new book, Aftershock.)

A is also the story President Obama is telling, indirectly, through his deficit commission, his freeze on federal pay, his freeze on discretionary spending, and his waivering on extending the Bush tax cuts for the rich.

Most other Washington Democrats are falling into the same trap.

If Obama and the Democrats were serious about story B they’d at least mention it. They’d tell the nation that income and wealth haven’t been this concentrated at the top since 1928, the year before the Great Crash. They’d be indignant about the secret money funneled into midterm campaigns. They’d demand Congress pass the Disclose Act so the public would know where the money comes from.

They’d introduce legislation to curb Wall Street bonuses – exactly what European leaders are doing with their financial firms. They’d demand that the big banks, now profitable after taxpayer bailouts, reorganize the mortgage debt of distressed homeowners. They’d call for a new WPA to put the unemployed back to work, and pay for it with a tax surcharge on incomes over $1 million.

They’d insist on extended unemployment benefits for long-term jobless who are now exhausting their benefits. And they’d hang tough on the Bush tax cuts for the wealthy – daring Republicans to vote against extending the cuts for everyone else.

But Obama is doing none of this. Instead, he’s telling story A.

Making a big deal out of the deficit – appointing a deficit commission and letting them grandstand with a plan to cut $4 trillion out of the projected deficit over the next ten years — $3 of government spending for every $1 of tax increase – is telling story A.

What the public hears is that our economic problems stem from too much government and that if we reduce government spending we’ll be fine.

Announcing a two-year freeze on federal salaries – explaining that “I did not reach this decision easily… these are people’s lives” – is also telling story A.

What the public hears is government bureaucrats are being paid too much, and that if we get the federal payroll under control we’ll all be better off.

Proposing a freeze on discretionary (non-defense) spending is telling story A. So is signaling a willingness to extend the Bush tax cuts to the top. So is appointing his top economic advisor from Wall Street (as apparently he’s about to do).

In fact, the unwillingness of the President and Washinton Democrats to tell story B itself promotes story A, because in the absence of an alternative narrative the Republican story is the only one the public hears.

Obama’s advisors explain the President’s moves are designed to “preempt” the resurgent Republicans – just like Bill Clinton preempted the Gingrich crowd by announcing “the era of big government is over” and then tacking right.

They’re wrong. By telling story A and burying story B, the President legitimizes everything the right has been saying. He doesn’t preempt them; he fuels them. He gives them more grounds for voting against raising the debt ceiling in a few weeks. He strengthens their argument against additional spending for extended unemployment benefits. He legitimizes their argument against additional stimulus spending.

Bill Clinton had a rapidly expanding economy to fall back on, so his appeasement of Republicans didn’t legitimize the Republican world view. Obama doesn’t have that luxury. The American public is still hurting and they want to know why.

Unless the President and Democrats explain why the economy still stinks for most Americans and offer a plan to fix it, the Republican explanation and solution – it’s big government’s fault, and all we need do is shrink it – will prevail.

That will mean more hardship for tens of millions of Americans. It will make it harder to remedy the bad economy. And it will set Republicans up for bigger wins in the future.

Cross-posted from Robert Reich’s blog.

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