With April 15 just around the corner, one thing is in everyone’s minds: taxes. While the government allocates spending for trillions of taxpayers’ dollars, workers are scrambling to deduct a handful of dollars here and there just to make ends meet. Slightly different versions of the Obama administration’s proposed budget for fiscal year 2010 have been approved by the House and the Senate, which now must work out the final details.
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Though the final version of the budget is yet to come, we take a look at Obama’s proposed budget and ask: Where will our hard-earned tax dollars go?
A quick glance shows that the Department of Defense will get the lion’s share of discretionary spending, $533.7 billion. Although he was elected largely by appealing to voters who wanted an end to U.S. wars of occupation, Obama proposed a 4 percent increase in military spending.
That 4 percent figure is misleading, however. In addition to the $533.7 billion slated for the Department of Defense, the budget also calls for $205.5 billion to be earmarked specifically for the wars in Iraq and Afghanistan. Of that sum, $75.5 billion is to be spent in fiscal year 2009. When that supplemental expenditure is added to the rest of the military budget, the result is a total of $739.2 billion being squandered on what is euphemistically called “defense.” Clearly, the war profiteers have nothing to fear from the new administration.
By comparison, funds for agencies that address human needs are paltry. The Obama administration has rapidly claimed ownership of the wars it inherited from Bush. Campaign promises to end the war in Iraq are a distant memory. The number of occupation troops in Afghanistan is being aggressively increased with no end in sight. Yet the federal government allocated only $52.5 billion for Veterans Affairs, an inadequate 10 percent increase from the previous budget.
The budget doles out $78.7 billion in discretionary funding to the Department of Health and Human Services. Only $13.3 billion is slated for the Department of Labor. The Department of Education is slated to receive $46.7 billion—less than 1 percent of the bailout money being poured into corporate coffers of Wall Street. Meanwhile, rapidly increasing tuitions are putting a college education out of reach of the struggling working class.
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The new budget allocates $47.5 billion for the Department of Housing and Urban Development. With the housing crisis growing and millions of families facing immediate foreclosure, the President and Congress are giving this department less than one-third of the amount handed out to corporate giant AIG.
Bailout dwarfs all social spending
A firestorm of public outrage erupted when the corporate elites of Wall Street went to Congress demanding hundreds of billions of dollars. Politicians, bending to the public mood, initially rejected the bailout. Then, facing pressure from political leaders—including then-presidential candidate Obama—the Congress finally approved a modified bailout package.
The Troubled Assets Relief Program gave an initial $700 billion to the banks, with Congress handing control to Treasury Secretary Henry Paulson to decide who would receive the vast sums of taxpayer money with no real oversight. Since then, additional sums to the tune of nearly $10 trillion have been either handed over or guaranteed to financial powerhouses and corporate giants, who have since nonchalantly paid out hundreds of millions in bonuses to corporate executives.
The bailout puts a tremendous burden on working-class taxpayers that goes well beyond its face value. The bailout has substantially increased the national debt—now more than $11 trillion accruing exorbitant interest. According to the Treasury Department, the interest paid on the U.S. debt for the first five months of fiscal year 2009 was nearly $149 billion. The only other practical means of funding the bailout is printing currency, which creates inflationary pressures that workers will feel in their pockets.
What is the alternative?
The new Democratic administration, much like the previous Republican White House, has assured Wall Street that the money will keep flowing to prop up their ailing bottom lines. The comparatively miniscule amounts spent on social needs reflect an economic system geared entirely toward the super rich.
There is no shortage of wealth in the United States, but a tiny minority of the population enjoys virtually all of it. It can be no different as long as economic and political power is concentrated in their hands. To turn the tide, a new system is needed.
Following the dismantling of capitalism in Cuba following the 1959 revolution, income taxes were abolished. Yet socialist Cuba has been able to guarantee the right to education, health care, housing and more. The overthrow of the Soviet Union has forced some changes as a matter of survival, but meeting people’s needs have remained the revolution’s top priority. The social benefits enjoyed by the Cuban people are not “government handouts.” Rather, workers get to enjoy the very wealth they create.
This stands in stark contrast with U.S. capitalist democracy, where workers are robbed twice. First at the workplace, where the wealth we create becomes the property of the capitalist bosses in exchange for paltry wages. Second through taxation, which largely amounts to legalized extortion performed by the government on behalf of corporate interests.
Under a socialist system, society’s resources could be used to meet the needs of the vast majority—the working class. Instead, we are forced to pay off the very people who directly brought the country and the world into the crisis now confronting us all.
