Those hoping for the reelected Obama administration to now make a progressive turn should instead be gearing up for a major battle against both parties to save Social Security, Medicare and other so-called “entitlements.” Tens of millions of poor and working people rely on these programs, but in the name of austerity and backing the country away from the “fiscal cliff,” these most vulnerable sectors will be told to pay for the crisis that the banks created.
The corporate media emphasized one message on Election Night: Because the popular vote was narrow and both parties would control a branch of government, a new era of “bipartisanship” must now emerge. Pundits asked, with fake frustration, if Washington can overcome “political gridlock,” “listen to the people,” and finally “make the difficult compromises needed to move this country forward.”
No sooner had the media presented the two parties with this “challenge,” that Democratic and Republican leaders suddenly—surprise, surprise—declared their willingness to negotiate.
While we do not know the particulars of the “Grand Bargain” currently being orchestrated between President Obama and the Republican-controlled House of Representatives, the broad outlines are fairly clear: a slight increase in the income tax rate for high-earners in exchange with dramatic long-term reductions of entitlement programs. The deal is likely to reduce Social Security payments, raise the retirement age, cut Medicare and lower corporate taxes.
The deal may also include the closing of some corporate tax loopholes and subsidies—the blatantly corrupt forms of corporate welfare. Liberal opinion-makers will celebrate these reforms, but in reality these are minor concessions for the ruling class in exchange for the long-term decline of the people’s safety net.
To be clear: There is no “mandate” from the people for the anti-worker “Grand Bargain.” In fact, notwithstanding the justifiable disgust with Washington, poor and working people will end up preferring a do-nothing, gridlocked and inefficient government to this united one!
“Fiscal cliff” nonsense
The “fiscal cliff” itself is entirely fabricated. It was created as last year’s debt deal, in which $1 trillion in automatic cuts would be made to social spending and future military expenditures unless the government passed a “deficit reduction” plan. In other words: Republicans and Democrats agreed to automatically cut government programs if they could not agree on how precisely to cut government programs. This is the most recent example of what “bipartisanship” really looks like.
The alarmist language of a fiscal “cliff” is intended to give the coming cutbacks an air of urgency and inevitability. Economic crises in earlier periods of human civilization were caused by natural disasters and geological formations. These rapidly diminished the living standards and life expectancies of the people. But not this one. Nothing in nature is compelling society to make workers wait longer before retiring or have inferior medical care.
January 1st—the day of the so-called “fiscal cliff”—will not look any different from the day before. All the fundamentals of the economy—the natural resources, the human power, the technology and machinery—will still be intact. This crisis is entirely a product of the form of social organization, capitalism, and deliberate decisions of capitalist politicians. It therefore follows that this crisis can be averted with other decisions and another form of social organization.
Who is behind the “Grand Bargain”?
Who is pushing these proposals? It is not primarily the Tea Party. Nor has Paul Ryan, having lost his way into the White House, carried out a backdoor coup over the budget process. Instead, much of the basic framework comes out of the Obama-appointed Simpson-Bowles Commission from 2010. The commission’s proposals lacked the super-majority to be taken up directly by Congress then, but has repeatedly resurfaced in both Democratic and Republican policy circles.
Alan Simpson is a so-called “moderate” Republican, who in fact spent most of his senatorial career trying to restrict immigration, and Erskine Bowles is a Democratic politician who formerly worked at JPMorgan Chase.
Once their commission expired, Simpson and Bowles continued their work in the “bi-partisan” Committee for a Responsible Federal Budget. This organization is backed by anti-Social Security crusading billionaire Pete Peterson and has been hard at work popularizing Wall Street’s vision for entitlement reform.
Most of the so-called political experts will praise this bi-partisan effort as “principled”—even “brave”—for tackling such tough and unpopular issues. In reality, whatever unpopularity these politicians face in the short term among their constituencies will be compensated with a lifetime of friends, support and job offers from Wall Street. Moreover, the corporate media will be hard at work to convince us that they are merely the handmaidens of an inevitable future.
Building the fight back
All this points to the misleadership of those progressive organizations and labor unions that poured much-needed resources into the Obama campaign and encouraged confidence in the Democratic Party. They have spent the last year describing President Obama as an ally of working people in millions of flyers, house visits and phone calls. As a result they are in an extremely poor position to turn around and call out Obama’s “Grand Bargain” for what it is, or to carry out the sort of mobilizations needed to stop it.
A recent AFL-CIO statement on the possibility of an anti-worker “Grand Bargain” suggested it was entirely the work of lame-duck Republicans. They refuse to draw the obvious point that any such “bargain” has two sides, and the Democrats are equally responsible.
As the PSL wrote prior to the elections, the pragmatic “lesser evil” politics is not just wrong on principle; it is a strategy that demobilizes and demoralizes progressive forces, leaving them organizationally and politically unprepared in the face of the bi-partisan onslaught.
Just as the major policy legacy of the Clinton administration was the bi-partisan gutting of welfare—a move that his Republican predecessors could only dream about—the Obama administration has positioned itself to gut entitlement programs in a way that Bush never could. The Democratic Party, which uses New Deal rhetoric to galvanize its base, would again prove itself to be the welfare state’s most effective gravediggers.
When Clinton gutted welfare in 1996, he succeeded because no mass movement arose. Because labor unions, civil rights and liberal organizations refused to fight the Democratic Party-led administration, 7 million children were denied essential benefits. The attack this time is on a far larger part of the population. There are two choices: to remain passive, so as to not embarrass the Democratic administration, in which case Wall Street wins. Or we can build a mass fight-back movement, with a clear sense of the bi-partisan enemy, to stop the “Grand Bargain” in its tracks. All these rights were won in the streets, through militant action and strikes, and can only be defended in similar form.
