It’s hardly a surprise that the coalition of social-justice groups that held a press conference in Washington, DC, on December 10 had no influence on the latest lurch into austerity.
The press conference in the Cannon House Office Building demanded that Congress make deep cuts in the nation’s military budget, reject reductions in the Supplemental Nutrition Assistance Program (SNAP), and redirect funds into sorely needed social safety-net programs. Along with other political and community leaders, members of the Poor People’s Economic Human Rights Campaign talked about how joblessness, hunger, foreclosures, and economic distress were hurting their families.
After the press conference, they walked in the snow to the office of Rep. Paul Ryan (R-Wis.), co-chair of the Budgetary Committee, to present a “People’s Budget” and supporting petitions (see the video).
Unfortunately, the austerity agenda, premised on the idea that working Americans should shoulder economic losses caused by Wall Street’s criminal recklessness, required that Congress decree otherwise. The bipartisan budget deal reached later on Tuesday exempted the Pentagon from sequestration, while allowing proposed food-stamp cuts to move forward and blocking unemployment extensions.
For Republicans, austerity represents a step towards economic freedom and ending the tyranny of Big Government. For Democrats, austerity means responsible fiscal policy and deficit reduction. Or so the usual media narrative tells us. Don’t believe it.
Conservative politicians don’t want smaller government. They adore Big Government. For Republicans, moderate Democrats, and the lobbyists who sustain them with fat campaign checks, the ideal is powerful government that serves the One Percent more efficiently, generously, and exclusively.
They favor massive government intervention that feeds the corporate sector through taxpayer-funded subsidies, handouts, bailouts, insurance to cover losses in the stock market, boondoggle contracts (manna for the defense industries), privatization of public resources and services, and international trade deals that privilege big business at the expense of democratically enacted labor, environmental, and public-health protections. In short, a massive redistribution of wealth and power to the top.
We can discard the idea of an eternal struggle between government intervention and freedom. The real choice is intervention for the benefit of most of the population or for wealthy elites. The pure no-government libertarian ideal is a pipedream, existing only in places like Somalia. The U.S. came close during the Gilded Age, a time of endless sweatshop drudgery, poverty, and destitution for tens of millions of Americans before the corrections of the Progressive Era. That’s what conservativism means now, a return to the Gilded Age and the reign of the Robber Barons.
Food-stamp cuts represent a propaganda victory for this ideal. Millions of Americans complain that the lady at the supermarket who pays for groceries with food stamps is a drain on our tax dollars, probably living in the lap of taxpayer-funded luxury. Meanwhile, arms manufacturers, banks, oil companies, and other industries suck up billions from the public coffers with hardly a peep.
The era of deregulation, globalization, privatization, slashed safety nets, and bloated military budgets commenced with the Reagan Era, with some precursors under President Carter, such as the relax of airline industry regulations. It persists whether Democrats or Republicans control the White House and Congress.
Ronald Reagan’s administration made a special effort to enact the anti-regulation economic theories of Friedrich Hayek and Milton Friedman, even after the deregulation of the savings and loan industry, inspired by these theories, inflicted a catastrophe that ultimately cost the public over $370 billion. For all his rhetoric about shrinking government, President Reagan expanded the federal government’s size and power and tripled the national debt.
The libertarian dogmas of Messrs. Hayek and Friedman don’t supply freedom as most of us understand the word — the capacity of all people to act and determine the course of their own lives, without coercion. Instead, they provide a license for wealthy elites to exploit, plunder, pollute, and commit crimes with impunity.
Of course, corporations themselves don’t care much about academic theories and political ideologies. Their sole interest is profit and power.
The State-Cartel Ideal
The capitalist libertarian model has two effects. First, it allows big business to consolidate into a small number of corporations (cartels) with the monopolistic power to control the market, killing competition and turning the “free market” into an illusion.
Second, it enables a merger of corporate boardroom and government bureau, in which the main purpose of the state is to serve the interests of wealthy business elites.
There are lots of names for this condition: plutocracy, plutonomy, neoliberalism, neo-feudalism, the One Percent, corporate royalism, robber-baron economics, even fascism. Let me propose a more precise term: state-cartel capitalism. (The similarity to state-monopoly capitalism that has taken hold in China isn’t accidental.)
State-cartel capitalism measures the health of the economy according to corporate bottom lines and “competitiveness” (even when business competition has been effectively eliminated), Dow Jones, and the GDP, with little regard for the financial security of working people or the well-being of society’s most helpless. Thus the top 1% enjoyed 95% of all income growth from 2009 to 2012.
The state-cartel ideology abolishes the principle that people who work full-time jobs deserve the security of a livable wage and benefits. It turns “No one owes you anything if you don’t work” into “No one owes you anything even if you work.” It admits that the U.S. economic system not only doesn’t work for everyone, it shouldn’t work for everyone. It buttresses this admission with the propaganda myth that poor people are lazy unemployed parasites, despite the fact that most of the poor work.
The most notorious purveyors of the state-cartel ideal include the Koch Brothers, the American Legislative Exchange Council (ALEC), and Walmart. Walmart is a company whose idea of free-market competition involves a mass extinction of locally owned businesses and wages so low that employees can only afford to shop at Walmart.
ALEC’s hatred of regulation doesn’t extend to homeowners who install solar panels. ALEC is currently lobbying Big Government to penalize homeowners who bypass the corporate grid in a quest for clean renewable energy.
For a shining example of state-cartel ruthlessness, there’s Bain Capital, Mitt Romney’s equity firm, which has reaped millions by purchasing small and medium-sized businesses and then dismantling them, destroying thousands of jobs. Mr. Romney’s election to the White House in 2012 would have surpassed his tenure as governor of Massachusetts in sealing the state-cartel deal.
The biggest mistake is to believe that the Democratic Party represents the opposition to the state-cartel ideal. The discredit that Obama-hating Tea Partiers and uncompromising GOP extremists in the U.S. House brought on themselves during the recent government shutdown shouldn’t lull us into forgetting that the most effective agents of state-cartel power are moderate Republicans and the Democratic Party’s centrist leadership.
Although Dems have opposed some of the grosser excesses, such as the Republican legislative proposal to have Wall Street losses incurred through high-risk derivatives trading insured with public funds, the Obama Administration’s agenda and accomplishments adhere closely to the state-cartel ideal. Obamacare’s individual mandate (originally a Republican idea) requires every American to subsidize the health-insurance industry and fails to rein in skyrocketing medical costs.
The proposal to slash Social Security and delay eligibility for benefits, promoted by President Obama’s National Commission on Fiscal Responsibility and Reform (“Catfood Commission”), will push more of our retirement money into the risky Wall Street casino. His “Race to the Top” enriches testing companies and other private school contractors, rewarding municipalities that privatize public education by funding charter schools.
And then there’s the Trans-Pacific Partnership (TPP), President Obama’s secretly negotiated trade pact that has been described as NAFTA on speed. Barack Obama and Mitt Romney didn’t bother to debate the TPP during their 2012 contest, because they both support it. Congress is now mulling fast-track status to conceal the TPP’s intense assault on workers’ rights, public health, the environment, Internet freedom, and democratic sovereignty from public scrutiny until it’s too late.
The Obama Administration follows the pattern set by President Clinton in enacting the Reagan state-capital agenda: expansion of the for-profit prison-industrial complex, NAFTA, the Welfare Reform Act, the Telecommunications Act (allowing consolidation of media ownership), and the Commodity Futures Modernization Act and repeal of the Glass-Steagall Act, both of which set the stage for the Wall Street fraud that caused the 2008 economic crisis.
If the state-cartel trend continues, as it will whether we elect Republicans or Democrats, the prosperity most Americans enjoyed in the second half of the 20th century will be a distant memory in a few years. And so will our rights and freedoms.
Another World is Possible
Freedom for all of us can’t co-exist with the “corporate freedom” paradigm of the state-cartel ideologues. Along with the four that Franklin Roosevelt articulated (freedom of speech, freedom of worship, freedom from want, freedom from fear), we can add freedom from destruction of our environment.
Genuine freedom embraces a list of rights that the state-cartel gang generally doesn’t care about, such as the right to live one’s private life without surveillance, without going broke because of a medical emergency, without being told what kind of love life or family is acceptable, without getting busted for smoking a certain kind of cigarette, without being targeted for police harassment and arrest for no other reason than one’s ethnicity.
Three big threats to the American republic have emerged in the 21st century: social instability as the global climate grows less stable, war without end (euphemized as the War on Terror), and the theft of our democracy, rights, and freedoms by a plutocracy that wants to restore a Gilded Age economy.
These threats are closely related. The wars without end are fought for control over the fossil fuels that are causing climate havoc, while feeding arms manufacturers, private security firms, and other military contractors. Food-stamp and other safety-net cuts enable Washington’s state-cartel establishment to render Americans helpless, in permanent debt, and focused on personal survival, deflecting attention from the redirection of the nation’s treasury into the perpetual war machine.
There’s a political opposition to the state-cartel paradigm, but you have to look hard to find it, at least in mainstream news media coverage. It reared its head for several months during the Occupy Wall Street protests and encampments. Some of its representatives were present at the Dec. 10 press conference and delivery of the “People’s Budget” to Sen. Ryan’s office: the Poor People’s Economic Human Rights Campaign; the Green Shadow Cabinet, which emerged from Green Party nominee Jill Stein’s 2012 presidential run (Dr. Stein was a featured speaker); genuine Democratic progressives who’ve been marginalized in their refusal to go along with the Obama program.
There are many more small-d democrats around the U.S., but they remain isolated and often focused on local or regional challenges and single issues. Many of them continue to hope unrealistically for a rehabilitation of the Democratic Party, or they resign themselves to supporting Dems as a lesser evil without illusions that doing so will hinder the country’s slide into the rightwing abyss.
It’s clear now that the crises of the new Gilded Age won’t be solved under the two-party political status quo. The first step in solving them is envisioning a Congress in which sponsors of the “People’s Budget” outnumber the state-cartel errand boys.