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In these scandal-sodden weeks, it's been tough to write passionately about the fight here over deficit reduction. I look up from some wearisome bulletin on the latest maneuvers of the Gang of Six, and here's Tristane Banon's mother admitting to consensual, albeit "clearly brutal," sex with Dominique Strauss-Kahn amid the filing cabinets in an OECD office. Before that, it was Anthony Weiner. Last week it was Murdoch's comeuppance. One distraction after another.
But, back to dreary business and the fight over the deficit. Here we have the supposed specter of Uncle Sam turning into a deadbeat rather than the best credit risk on the planet. On Aug. 2, the United States could start defaulting on its obligations, as the tea party crowd in the House of Representatives refuses to raise the debt ceiling.
On Aug. 3, the lights might start to go out: The U.S. government is scheduled to send out $23 billion in Social Security checks to 56 million people. If the checks don't arrive, within a couple of days America's old folk are going without food and can't make the rent. U.S. Treasuries will lose their top rating, and the entire credit structure of the planet starts to come unglued. Goldbugs will be crazed with triumph, as the precious metal soars to $3,000 an ounce and hyperinflation roars into life. Next thing you know, greenbacks are being tossed in the trash, and we're heading back to a barter economy.
America is in love with Apocalypse. It always has been. Every couple of years, someone says the End is Nigh. When I came to America's shores in 1972, Hal Lindsey's The Late Great Planet Earth had just been published and sold 30 million copies over the next 20 years. Lindsey wrote, rather presciently, that the Antichrist would rule over a 10-nation European Community through the 1970s until the Rapture—scheduled for the 1980s—and the Second Coming.
The next big rendezvous with Apocalypse I remember was New York's brush with bankruptcy in the late 1970s. The air was thick with what-ifs, and remained so till the arrival of the third Christian millennium and a tremendous burst of alarm at the notion that the world's computers would shut down. They called it Y2K, and it was a bust. From there, it was a brisk transition to Global Warming—the non-believers' version of the End Times.
Not many people here really think the U.S. government will shut down on Aug. 3. As former Assistant Secretary of the Treasury Paul Craig Roberts writes on our CounterPunch site: "The U.S. government will never default on its bonds, because the bonds, unlike those of Greece, Spain and Ireland, are payable in its own currency. Regardless of whether the debt ceiling is raised, the Federal Reserve will continue to purchase the Treasury's debt. If Goldman Sachs is too big to fail, then so is the U.S. government."
The fight over the deficit is one of those American ceremonies, as embalmed in ritual speech and gesture as an English coronation. I came to an America about to writhe under the lash of Democratic candidate Jimmy Carter comminations about living beyond our means and the need for "zero-base" budgeting and fiscal prudence.
Nearly 40 years later, here we are listening to Barack Obama lofting the battle standard of austerity, calling on Republicans to find common ground. Here's comes Pete Peterson with yet another bipartisan report calling for the evisceration of entitlement programs. Here are the Gangs of Five, Six, Seven marshalling bipartisan support for evisceration of social programs, balanced by tax fakery. At the end of the day, there are real dead bodies—decent programs tossed to the wolves, food and energy costs taken out of measurements of inflation. The ship settles a bit lower in the water, and on we go.
The essentials of the long-term crisis are simple. For a generation now, the only essential plank for any Republican candidate is a pledge not to raise taxes and to roll back even the modest sums that the rich and corporations are supposed to send to the U.S. Treasury each year. The second plank is an equally vehement pledge, proclaimed by both parties, to keep America strong by throwing money at the Pentagon. Right now, the total military/security budget is in the vicinity of $1.1-$1.2 trillion, or 70-75 percent of the federal budget deficit.
The Republicans would like to erode and ultimately privatize Social Security and Medicare. Not so secretly many Democrats are of the same disposition but know that they may depend for political survival on the votes of poor and middle-income citizens who see them as the defenders of social programs. Hence the complex rituals, the dancing at the edge of the cliff. Can Obama coax Reps. Eric Cantor or Paul Ryan into even more ferocious demands for cuts in social programs, before calling the Republicans' hand?
In this latest ritual enactment, the Republicans are faring badly, losing in the opinion polls because many of them are insane and increasingly perceived as such by the American electorate, magnificently tolerant in such matters. There's nothing like hearing that you might not get your Social Security check next Wednesday to concentrate the mind.
Meanwhile the left legitimately fears that Obama's unceasing public tributes to bipartisanship and the spirit of compromise will end up with him giving away the store. It's a fake question. It's the historic mission of the Democrats to give away the bits of the store that the Republicans don't dare torch directly. It's a gradual process but an unceasing one.
Don't look for Apocalypse. These are familiar rituals, and no one really has the nerve to toss a bomb onto the dance floor, however much they may swear that the time has come for brutal measures. It seems we have to turn to Dominique Strauss-Kahn for that kind of commitment.
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