08/14/11: Dubuque Telegraph Herald: Debt-ceiling showdown a victory for the elite, by Cynthia Moothart
Debt-ceiling showdown a victory for the elite
By Cynthia Moothart
Three months ago, an article on Republican actions in the debt-ceiling fight carried the headline: "America Held Hostage." In the deal struck this week to avert financial catastrophe, middle-class workers now will pay the ransom.
A great deal of bad faith undergirds this agreement, as Republicans skewed facts to defend their dealings before refusing to negotiate altogether. In creating intentional confusion and chaos, conservatives proved willing to put crass politics above sound policy, even if it brought down the entire U.S. economy.
Former Labor Secretary Robert Reich acknowledged this while summing the agreement: "Anyone who characterizes the deal ... as a victory for the American people over partisanship understands neither economics nor politics."
Before voting against the bill, U.S. Sen. Tom Harkin pointed out one basic fact: The American economy works only when Americans are working in the economy: "This city has been obsessed with the budget deficit. But the rest of the country -- with very good reason -- is most concerned with a far more urgent deficit: the jobs deficit."
Cutbacks in government spending over the last two years already eliminated 500,000 public-sector jobs, while a decade of expanded tax breaks failed to create any spike in hiring. Worse yet, 75 percent of $2 trillion in corporate profits gained since 2009 resulted from cutting jobs. And here we are, with 25 million Americans in need of full-time work.
Asked what remains of the economy now to deal with unemployment and slow growth, the economics editor of the Economist magazine replied: "Not much." As the world's wealthiest nation, she noted, the U.S. has resources to put its fiscal house in order, "It just lacks the political will to do it."
In 1945, with the nation at war, federal spending surpassed 47 percent of the GDP, nearly double what it is today, and the ratio of debt to total economic output reached 120 percent. America nevertheless invested in such things as the GI Bill and jobs creation, forging an economic expansion that built and sustained the middle class for decades.
Since the dawn of small government in the 1980s, however, that broad wealth consolidated in shrinking numbers of hands. A recent Census report shows that median household worth fell dramatically over the five-year period ending in 2009. Today, just 400 individuals hold wealth equaling that of 150 million Americans, or nearly half the U.S. population.
Sickened by Republicans' slash-and-burn policies to further benefit the wealthy, polls show that a majority of Americans are looking to the elections in 2012 for relief.
Those votes won't simply be a repudiation of where we are; they will be a referendum on what we are: the democracy our Founding Fathers imagined or a plutocracy benefiting only the economic elite.
Moothart grew up in Iowa and is policy director of the League of Rural Voters, a Minnesota-based nonprofit working to strengthen rural communities nationwide.
www.thonline.com/news/opinion/article_10c13b9a-b7ae-5791-ba97-a4890fcbed4a.html
