The Choice Between Neoconservative and Progressive Becomes Clearer.

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There is no mystery about the difficult circumstances in which we find the American economy. Since 1981, when Ronald Reagan cut income taxes for the top bracket, multi-millionaires, from 70% at the top marginal rate, down to 28%, the country has run very large deficits every year. We have been running deficits in the $200 billion to $500 billion range almost every year. This does not include either the CIA budget nor does it include the annual surpluses in the Social Security system that have existed every year since 1984. 

Now, unlike Clinton, Presdent Obama and many top economists are not thinking of cutting the deficits right away. Because of the outcomes they are experiencing, they may want to actually stimulate the economy even further. The idea is to look much farther ahead to build a bigger and stronger economy at the other end of this recession. They want to build on past experience. Most economists now agree that we can recover from a large national debt if we do so in a way that makes serious improvements in infrastructure that lead ultimately to a sustained, job-producing, expanding economy.  

Just a clarification on Social Security, as it relates to those Bush deficits, in case some wild-eyed Right Wing freak happens to be reading this. Social Security is a government program that pays for itself. Social Security, unlike the Bush-Cheney administration does not give any contracts to their pals nor does it start wars at the discretion of the people running it. The facts are very clear. In the early 1980s, President Reagan and Tip O’Neill, then Speaker of the House, began discussions on how to make Social Security solvent, not only to solve an immediate problem but to build up reserves for the future. After the budget deficits became such an annual problem–so that Americans, particularly the very wealthy, could feel that they were still superior to the rest of the world, which we already were not–the government began to take those surpluses and spend them and not declare on the budget that they did. The only thing that was mentioned was the fact that the fund would run out by a certain date if it was not “reformed.” President Bush (in all probability spurred on by Dick Cheney and his secret, arch-conservative Neocon clique) began to look to Charles Schwab and other investment brokers, telling them that he was thinking of privatizing Social Security.

They all sprang into action, Schwab running around the country telling naive yuppies that Social Security would go broke, and he, Scwab, who stood to make untold billions in commissions, and his fellow Wall Street pals, would save them. Nancy Pelosi, among others, shot that down before it got started. But they had us going there for a while. If they had converted Social Security in the way that they wanted, the Baby Boomers would all be sitting right now with basically no Social Security. These are the people that the “tea party” fools are supporting. These people are simply a reminder that no matter how good an educational system a country has, some people do not want to learn and will never learn, and society will eventually pay the price for it.

So we have been running deficits for the last 30 years and at the end of the Clinton era, even though he did balance a few budgets, we still had a $5.16 trillion debt, a very large part of which is owned by China, Japan and countries in the Middle East. Since Dubya Bush took over, however, the budget has increased by the same amount it took 20 years to create. And he has left us a legacy, which–even if we did not have the stimulus–would add another couple of trillion. So he added another $5 trillion in 8 years, left us with his last annual budget, which we are operating on now, of $1.3 trillion and a near-Depression, which caused us to infuse huge amounts of money into the economy, to save banks, state governments. We also had the cost of trying to stop the six-to-seven hundred thousand jobs that were being lost each month from September of 2008 until we finally got it under control in around May of 2009. The kind of drop-off-the-table job loss we experienced in the last quarter of Bush’s administration we had not seen..that kind of dramatic, free-fall of the economy–since 1930-31. If you were watching the numbers, it was like descending from the top of the roller coaster, with your heart in your throat, not knowing how far you would fall or if, at the bottom, you would  go up again or simply hit something that was very, very hard.

So what is the outcome of all this? There are two possible outcomes. The first is the more traditional, more conservative, perhaps “reactionary” approach. The Neocons would go through the motions of somehow finding the individuals, industries or abstractions perhaps–that we can tax to raise money. Republicans see this as against their get-elected-at-any-cost-to-the-welfare-of-the-People approach. At the same time, they would cut government back to the bone. They would terminate health care reform, cut Social Security, cut Medicare and Medicaid benefits, perhaps cut the military very slightly, and encourage much more free trade, which would create more retail jobs, fewer manufacturing jobs and increase the deficit as well as the balance-of-trade deficit which affects the dollar. That is the Neocon, the Sarah Palin, approach.

The Democratic approach…that of President Obama, Federal Reserve Chairman Ben Bernanke, Larry Summers, Tim Geithner, major economists from Joe Stiglitz (double Nobel Laureate) Paul Krugman, Dean Baker, Jamie Galbraith, Brad DeLong, Jeffrey Sachs, and on and on…is that we simply use this time to stimulate the economy by borrowing a little more from the government to restore a manufacturing economy and restore the infrastructure of the country…roads, bridges, dams, schools, hospitals. At the same time they would institute universal health care to set our health care costs on a permanent downward trend. Thus, many of these economists say, by 2019 we could be back in the manufacturing business, both using and manufacturing cheaper, domestic, solar and wind energy systems.  We would then begin to pay down the national debt over a longer time frams, perhaps fifty years.

The national debt, by 2019, even with the Obama proposals to cut many areas of government, aggressively pursue efficiencies, and gradually raise taxes, would still be pretty substantial. Economists tell us, however, that these kinds of deficits have been overcome and strong, sound economies have been built after such government stimuli, including the United States from the days of the war deficits to the booming, long-term economies of the 1950s and 1960s. As a percentage of the Gross Domestic Product, we are told, the national debt can be handled at even at greater numbers than we experience now, as long as there is a definite plan, and as long as that plan includes multiple ways to generate income, jobs and revenues to the government in a sustainable way over the long term.

The two alternatives are clear. Act. Take on more debt while increasing some taxes. This will create more jobs and allow the government the opportunity to reinvest in a way that it has not for the last 30 years. Or do nothing, and let the wealthy become more isolated, add tens of millions to the rolls of the poor and millions to the homeless, be unable to cope with a growing, resident illegal alien population and let the manufacturing job market go completely to Asia, creating still fewer jobs here in the United States. Finally, if we do not act,  health care costs will grow to over 30% of GDP and tens of millions more, perhaps as many as a third or more of all American families will be without health care.

The choice is pretty clear and you can see the two sides lining up on the health care issue. The Democrats and the Progressives and left-leaning Independents are for biting the bullet, listening to the best economic minds of our era, following a totally rational, thoughtful, visionary President in developing a sound health care plan over time, restoring our infrastructure, creating jobs and creating new green industries, while solving immigration and long-term energy problems.

The Neocons, including the Religious Right, the white supremacists, the gun-toters, the arch-conservative hyper-wealthy and their paid representatives, like the Heritage, Hudson and Cato Foundations want to continue to cut taxes on the rich and cut back on essential government services. They want to expand Cheney’s private, secret military organization, organize mobs, and support propaganda organizations, like Fox News, the Wall Street Journal and the National Review, plus thousands of owned radio stations to spew out hate speech to prevent the Progressive agenda. They have no real proposals on how to save or grow jobs (just “cut taxes for the rich” or “give tax incentives to the middle class” which never seem to show up on a monthly pay stub). They have no real plan for cutting the deficit except to cut Social Security, Medicare or Medicaid, things that will cost the average American, not the wealthy. They do want to keep free trade or expand it. Free trade has cost this country a net five million jobs in the last 8 years. That number represents jobs lost to foreign workers versus domestic jobs gained from imports.

We’re at a decision point. And we now must face decisions that can’t be screamed about or bullied. Do you want to take the risk of investing a little more in order to create a more secure, a longer horizon for job growth, for the restoration of industries and for the security of our borders, immigration, retirement and health care? Or do you want to pull back, keep doing what we have been doing economically, eventually probably return to a Bush-type regime, only this time with secret police, total control of the media by the Right Wing, the risk of losing your health care any time you get sick, constant worry about finances, even among people well up into six figures and illegal aliens pouring over the borders until the economies of Mexico and the U.S. are almost indistinguishable?

We have a strange dichotomy. Do you trust your government? If so, you are…strange to say…a Republican and you want to continue the Bush Administration policies of “do as little as possible.” Or do you not trust your government…and therefore want to see much more transparency and respnsiveness in this necesary instrument for the People? For the next several elections at least, you must make this choice, and the outcomes will structure our society for several generations.