Sunday, February 13, 2011

Obama to Unveil Deep Austerity Plan

The plan:
  • Cut $1.1 trillion deficit over next 10 years
  • Two-thirds of savings to come from spending cuts and one-third from tax increases.
  • Defence budget: $78bn over five years
  • Pell Grant Programme: $100bn over a decade
We will be told in no uncertain terms that, regrettable though all of this is, it is unavoidable. But we know better.

First of all, Obama only just recently caved in on the Bush tax give-aways and signed over a massive lump sum of cash to the nation's wealthiest taxpayers. The Bush tax breaks for the rich have already inflicted a $3 Trillion loss over 8 years. Given that Obama has extended them, we are set to lose $67 billion over the next 2 years alone in order to pay for these lavish gifts. This is, of course, to not even mention the fact that our top marginal tax rate was already very low before the Bush cuts (well, now, they're the Obama cuts) went into effect. And, of course, corporate loopholes are so bounteous that almost no corporation in the US actually pays at the official rate of taxation.

Now, as if all of the above wasn't awful enough, there's plenty more to add. First off, last quarter corporations posted the highest profits on record, even though the majority of us are still suffering the effects of the recession. As millions are evicted and laid off, the richest are getting richer. This was made possible because of layoffs and work speed-ups, which actually caused productivity to rise last quarter. That makes clear a basic economic truth: more exploitation means bigger profits. So it's false that there just isn't enough money to go around right now.

Second, as everyone has recently become aware, the government spends a massive amount of money doing unsavory things abroad (e.g. propping up (former!) dictators like Mubarak to the tune of several billion a year). Plus, you may have heard of these two wars we're still fighting in Iraq and Afghanistan... yeah, kinda pricey. The bills on those as yet unpaid-for adventures continues to increase every day. I'm not impressed by Obama's plan to modestly decrease the number of $400 toilet seats purchased by the military each year. Ending the wars would free up a massive wealth of funds that could be redirected to meet human need at home.

Third, you may have heard of this thing called TARP. Recall that close to a $1 trillion dollars was suddenly mobilized and distributed, at the drop of a hat, to the financial institutions that caused this crisis. All of that money emerged in an instant when the elite were in trouble- but when schools, public transit, parks, libraries, health-care and scholarships are on the line we're told, patronizingly, to live within our means.

Yet, despite all of this, the folks upstairs are telling us "we" need to tighten our belts. But who the fuck is "we"? Certainly the massive profits amidst layoffs, and the massive tax breaks for the rich amidst school closings aren't felt equally. Some are letting their waistlines balloon as others are literally starving.

Obama has already done more to increase inequality in 3 years than Bush did in 8. He has already overseen more transfers of wealth from the bottom to the top than his widely-despised predecessor. If this isn't a clear indication that Obama, and the Democratic Party, are not progressive, I don't know what is. Progressives and liberals would do well to look at the writing on the wall. Their resources and energies are wasted so long as they are funneled into the Democratic Party, the party of continued war, austerity, tax breaks for the rich, and environmental degradation.

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