Jan 172013
 

Remember the beleaguered middle class? Our political leaders don’t seem to.

Reeling from the fiscal cliff fiasco and hurtling toward the debt ceiling debacle, Washington has forgotten all of its election-year promises to focus on the best way to create jobs and enhance economic security for the 99 percent.

One of the most amazing aspects of the whole fiscal cliff/debt ceiling fiasco is the continuing ability of the political and media class to manufacture phony economic crises while ignoring the concerns that affect the majority of Americans every day.

High unemployment and rising health and elder care costs? Gnawing uncertainty about the future? Declining wages and disappearing pensions? Income inequality?

We haven’t heard much about them since Election Day.

Meanwhile our media elite cover every micro-twitch of the Washington insiders as they pose and posture their way through the debate, while smothering in ridicule anybody who dares question the prevailing deficit hysteria.

One piece of wisdom did surface briefly masquerading as a whacko proposal – having the government create a trillion-dollar platinum coin. Though this scheme was nixed by the Treasury, it did have the virtue of pointing up an important fact usually ignored in mainstream bloviating about the deficit – the government is not a family. The U.S. government can create money and does, except recently it’s been printing money only to hand it over to big banks with no strings attached, rather than using it to pay down the deficit, create jobs or fix bridges.

And how about that dramatic last-minute deal that averted the fiscal cliff? To paraphrase Vice-President Joe Biden (when he was dismissing Paul Ryan’s dismal budget plan), the whole thing is a load of malarkey.

Except this time Biden and his boss, President Obama weren’t blasting it, they were touting it as a great achievement.

If you’re not familiar with the term, Miriam-Webster defines malarkey as “insincere or foolish talk.”

The first tipoff that the deal constitutes malarkey is the whole dispute over whether it actually reduces the deficit at all.

The Congressional Budget Office contends the deal will increase the deficit nearly $4 trillion over 10 years, while the president, using a different starting for his calculation, argues that it will raise $620 billion over that time period. If you’re confused, you should be. The difference is not trivial, and makes the whole process stink. As the New York said, “How do you agree on what needs to be done going forward if you can’t agree where you are?”

When it comes to deficits, I’m from the Dick Cheney school. The former vice-president, in a rare moment of candor, said: “Deficits don’t matter.”

Except when politicians want to beat their opponents over the heads with them. Most recently, the deficit soared not primarily because of out of control government spending, but because the economy went in the toilet, and the government came to the rescue of our fellow citizens with jobless benefits, food stamps and stimulus spending.

Of course, Cheney was also trying to help out his boss, President George W. Bush, who   wanted to give rich people a mammoth tax break and put two wars on the government’s tab, thereby running up the deficit.

What he meant was that Republicans don’t care about deficits when the money goes to support spending they like – like military contracts. What they oppose is spending money on social programs that they would just as soon dismantle.

The second sign that the recent fiscal cliff deal is malarkey is what the politicians did to the payroll tax cut, which was enacted in 2010 and put more than $1,000 a year back into the bank accounts of average Americans.

In spite of all President Obama’s promises not to increase the economic burdens already weighing down the middle class, our leaders allowed this relatively small but significant tax cut to expire. As a result, 125 million Americans who couldn’t afford to hire lobbyists saw their paychecks decrease in January. Since the payroll tax helps pay for Social Security, some applauded the demise of the payroll tax cut.

But the end of the payroll tax cut is just the latest example of our leaders solving budget problems on the backs of those who can afford it least.

In addition, the president had insisted, going in to the fiscal cliff negotiations, that he would get $50 billion in new stimulus money in the deal. But those funds never materialized.

The third red flag buried in the fiscal cliff deal is an item that neither of the parties mentioned in their press conferences announcing it. But it’s the surest way to tell that the fiscal cliff and debt ceiling, which are supposed to be about this massive crisis, are just the latest chapter in Washington business as usual: major corporations using the cover of a manufactured crisis to get their hands on more goodies.

As reported by Matt Stoller, the deal contains eight separate giveaways to individual businesses or industries, including Goldman-Sachs, Hollywood movie studios, NASCAR, coal mine operators and asparagus growers.

Of particular interest was the extension of the tax exempt financing of something called Liberty Zone in New York, funds which were supposed to be designated to help business in the city recover from 9/11. But rather than going to small businesses, big corporations like Goldman-Sachs got the breaks. Goldman-Sachs has gotten $1.6 billion in tax-empt bonds to help defray the costs of building? its new $2.1 billion headquarters.

So while the politicians have been posturing in public vowing to protect the middle-crisis and wringing their hands over the dire state of the government’s finances, they’ve been working overtime in private doling out expensive favors to their corporate donors.

The biggest threat to our future is not the deficit, not by a long shot. The far greater danger remains the largely unchecked and hidden power of corporations to control our government.

About Martin Berg

Martin Berg, WheresOurMoney.org editor, is a veteran journalist.

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