Budget Slavery, Budget Freedom Past and Present


As the fog of Barack Obama’s frustrated air war on Syria receded from the headlines in mid-September of 2013, the most recent round of plutocratic austerity budget politicking moved to the forefront of the daily U.S. news. In the official mainstream media account of the most recent budget fiasco brewing in Washington, the “conservative” Republicans in the House of Representatives and Senate were holding the “liberal” Democrats in the White House and Congress hostage with the threat to shut the government down and provoke a debt crisis—possibly throwing the economy into a tailspin—unless the president agreed to dismantle the supposedly “socialist” health insurance reform (the Affordable Care Act aka “Obamacare”) that is the signature “liberal” legislation of his Administration.

The narrative was not completely wrong. House Republicans and a handful of Senate Republicans did threaten to do precisely that, even as they, and the Republican-controlled House and the Congress, were more unpopular than ever. They did so despite the fact that, as liberal New York Times columnist Paul Krugman noted, “Republicans are coming off an election in which they failed to retake the presidency despite a weak economy, failed to retake the Senate even though far more Democratic than Republican seats were at risk and held the House only through a combination of gerrymandering and the vagaries of districting. Democrats actually won the popular ballot for the House by 1.4 million votes. This,” Krugman adds, “is not a party that, by any conceivable standard of legitimacy, has the right to make extreme demands on the president” (“The Crazy Party,” NYT, September 19, 2013).

As this article was being completed September 30, 2013, the Republicans made good on their threat to shut down the government. A debt default loomed around the corner (on October 17), but seemed unlikely  given the profound damage it promised to inflict on the financial elite, which controls both of the nation’s dominant political organizations (see www.paulstreet.org for fiscal crisis developments) .

Radical Republicans, Conservative Democrats

Where the official story broke down was with its use of the terms “liberal” and “conservative.” The Republicans have, for some, been a party of radically regressive arch-reactionaries who want nothing less than the complete elimination of what’s left of the United States’ social and welfare state. They seek draconian cuts in Food Stamps at a time of durable and deep mass poverty. They want an even greater upward distribution of wealth in a time when the United States has reached levels of inequality not seen since the late 19th century, they pursue the destruction of environmental regulations in a time when signs of deepening ecological catastrophe are shockingly evident. They are pseudo-conservatives.

The Democrats are not. As the left-liberal political scientist Sheldon Wolin noted in his aptly titled book Democracy Incorporated (2008), they have for some time been the nation’s true conservative party. Having “fended off its reformist elements and disclaimed the label of liberal,” the Democratic Party is no less captive to the nation’s corporate and financial elite than the GOP. By Wolin’s account, “the timidity of a Democratic Party mesmerized by centrist precepts points to the crucial fact that, for the poor, minorities, the working-class, anticorporatists, pro-environmentalists, and anti-imperialists, there is no opposition party working actively on their behalf. And this despite the fact that these elements are recognized as the loyal base of the party” (Democracy Incorporated). Were Democrats to be elected, Wolin prophesized in early 2008, “corporate sponsors make it politically impossible for the new officeholders to alter significantly the direction of society…the drift rightwards. By offering palliatives, a Democratic administration [would] contribute…to plausible denial about the true [corporate-managed] nature of the system…fostering an illusion among the powerless classes that the party can make their interests a priority” (Wolin, 201). The presidency of the deeply conservative Barack Obama has offered rich validation to Wolin’s prediction by:

  • its expansion of the monumental bailout of hyper-opulent financial overlords
  • its refusal to nationalize and cut down parasitic financial institutions
  • its passage of a corporatist health “reform” bill that only the big insurance and drug companies could love
  • its cutting of an auto bailout deal that raided union pension funds and rewarded capital flight
  • its undermining of carbon emission reduction efforts
  • its refusal to advance serious public works programs (green or otherwise)
  • its staffing of key positions by top corporate and financial operatives
  • its green-lighting of escalated strip mining and hazardous deepwater oil drilling
  • its disregard of promises to labor and other popular
  • constituencies 
  • its advance of neoliberal “free trade” agreements
  • its appointment of a Deficit Reduction Commission “headed [in economist Michael Hudson’s words] by avowed enemies of Social Security”
  • its persistent emphasis on deficit reduction and austerity over and against job creation and social programs
  • its repeated offers and attempts to cut Social Security and Medicare benefits (in the name of a “grand deficit-slashing bargain” and “entitlement reform”)
  • its launching of a coordinated federal campaign to crush the national Occupy Wall Street rebellion and other betrayals of its “progressive base” and promises kept to corporate sponsors
Obama’s “change” and “hope” presidency (mendaciously sold in 2012 as an Administration for “the 99%”) has almost perfectly epitomized the power of what Edward S. Herman and David Peterson call “the unelected dictatorship of money.” Along the way, Obama has passed giant, record-setting “defense” (empire) budgets and kept the nation’s vastly expensive military machine set on “kill” abroad (in Libya, Yemen, Afghanistan, Pakistan, Syria, North Africa, and elsewhere)—this while boasting that he has slashed discretionary federal spending to its lowest level since the Eisenhower administration.

Leftists and liberals who dare to criticize these and other big business-friendly White House policies have been mocked by the Administration as “purists” who “do not live in the real world,” who make “the perfect the enemy of the good” and who fail to grasp the necessity of “compromise” to “get things done.”

The bewildering 900-page health care reform (Obamacare) that today’s Republicans are so fiercely opposed to epitomizes the corporate conservatism of the current Democratic presidency and party. Modeled on a state-level plan that 2012 Republican presidential nominee Mitt Romney passed and oversaw as governor of Massachusetts, it is dedicated to a vision of “change” that leaves a parasitic oligarchy of giant private insurance and drug companies free to extract massive profits that drive health care costs to the breaking point for individuals, families, communities, non-profits, small businesses, and government. It was designed precisely to advance corporate and financial America’s preference for “market solutions” over and against genuinely public, social-democratic policy that would de-commodify health care and establish health care as a basic human right in the U.S.

So what if, as the economist Dean Baker has shown, America could eliminate its fiscal deficit by replacing the dysfunctional privatized and employment-based health insurance system with a universal public model similar to what exists in other industrial nations and replace it with a system that would cut health costs in half and yet deliver superior outcomes? And so what if a solid U.S. public majority has long favored a Canadian-style single-payer system whereby the government grants equal health coverage to all citizens regardless of wealth, income, and other social distinctions? None of this matters in the authoritarian U.S. “plutonomy” (Citigroup’s 2005 term for America’s dollar-drenched distortion of democracy). As Noam Chomsky observed in August 2011, at the height of the debt-ceiling crisis that sickened the nation and helped spark the Occupy rebellion, “the financial institutions and Big Pharma are far too powerful for such options even to be considered” (Chomsky, “American Decline: Causes and Consequences,” al-Akhbar, August 24, 2011).

The Real Polarization

According to a dominant media narrative, Washington and the nation’s politics are crippled by partisan “polarization” and a related inability of the nation’s elected officials to compromise to “get things done.” There should be little doubt about the very real cultural and demographic divisions between “red state” and “blue state” America, but this narrative misses two key things. The first thing is the fact that the right-leaning Democrats under Obama—as under Bill Clinton—have been highly flexible and far more willing than Republicans to make deals with the other dominant political organization.

It’s the rightmost of the two great state-capitalist “parties”—the “stand your ground” Republican Party—that is far and away most responsible for “gridlock” in Washington. Standing to the right of Republican presidents of the long New Deal era (Nixon and Eisenhower), the Democratic administrations (Carter, Clinton, and Obama) and party of the neoliberal era have shifted ever-more rightward on key political and socio-economic matters like “entitlements,” “free trade,” labor rights, taxes, regulation, the environment, and more. Along the way they have remained no less committed than top Republicans to the maintenance of a giant military empire that accounts for half the world’s military spending and maintains more than 1,000 U.S. military installations across more than 100 “sovereign” nations.

A second and related thing missing from the dominant narrative is the deeper and more significant polarization between the U.S. party and policy system (“Democracy Incorporated”) on one hand and the majority working class U.S. citizenry on the other. In the current New Gilded Age of extreme inequality, a flood of elite corporate and financial political money meant to keep the 1%’s ever more astonishing fortunes safe from popular envy and public redistribution has pushed both of the nation’s reigning parties and the government well to the right of the populace, whose progressive views are ever more irrelevant to the conduct of politics and policy.

Ideology aside, the New York Times’ chief national correspondent Mark Leibovich notes in his recent bestselling book This Town: Two Parties and a Funeral Plus Plenty of Valet Parking in America’s Gilded Capital that Washington DC has become a richly bipartisan “Gold Rush” wherein officeholders, lobbyists, and staff of the two dominant parties are part of the same “permanent feudal class of insiders.” The nation’s capital “becomes a determinedly bipartisan team when there is money to be made”—an “inbred company town where party differences are easily subsumed by membership in the club.”

As Leibovich told Bill Moyers on PBS last August: “Self-perpetuation is a key point in all of this…. The original notion of the founders [was] that a…public servant would serve a term [and] return to their communities, return to farm. Now the organizing principle of life in Washington is ‘how are you going to keep it going?’ Whether it’s how you’re going to stay in office by pleasing your leadership so that you get money, by raising enough money so that you can get reelected, by getting a gig after you’re done with Congress, after you’re done in the White House, by getting the next gig…. Cowardice is rewarded at every step…. The true mavericks are punished…if you want to build a career outside of office when you’re done, when you’re voted out as a lobbyist, as a consultant, as many of them do, you are encouraged not to anger too many people.

Not to take a big stand. No truth is going to be told. There are many ways in which the money, the system is financed, the politics are financed. The way the media works, that will not under any circumstances reward someone who takes a stand” (Bill Moyers, “Mark Leibovich on Glitz and Greed in Washington,” Moyers & Company, PBS, August 23, 2013).

The Freedom Budget, 1966

It is difficult in this current New Gilded Age to imagine a past like the middle-1960s when progressive U.S. activists thought they could influence the federal government to budget in accord with the needs and aspirations of the nation’s working and lower class majority. In the fall of 1966, the civil rights and social justice champions Martin Luther King, Jr., A Phillip Randolph, and Bayard Rustin—and more than 200 prominent academics, religious leaders, trade unionists, and civil rights figures—put forth an ambitious “Freedom Budget for All Americans.” Their people’s budget built on Franklin Delano Roosevelt’s calls (in 1941) for “freedom from want” (the third of Roosevelt’s “four freedoms”) and (in 1944) for an “Economic Bill of Rights,” including the rights to “a useful and remunerative job,” to “earn enough to provide adequate food and clothing and recreation,” to “decent homes,” to “a good education” and to “protection from the economic fears of old age, sickness, accidents, and unemployment.” It was designed to abolish poverty and provide a decent living within ten years by:

  • Providing full employment for all who are willing and able to work
  • Assuring decent and adequate wages to all who work
  • Providing adequate income to all unable to work
  • Guaranteeing modern health services and adequate education for all
  • Guaranteeing decent homes for every family
  • “Purify[ing] our air and water and develop[ing] our transportation and natural resources on a scale suitable to our growing needs”
  • “Unit[ing] sustained full employment with sustained full production and high economic growth”
  • Updating social security and welfare programs to provide full economic security against old age, sickness, accident, and unemployment

If the Freedom Budget had been successfully adopted and implemented in its time, “a majority of voters would not have responded positively to candidate Ronald Reagan’s challenge to Democratic incumbent Jimmy Carter where the conservative hopeful asked the American people…. Are you better off than you were four years ago?” As the socialist scholars Paul LeBlanc and Michael Yates argue in their new book, A Freedom Budget for All Americans: Recapturing the Promise of the Civil Rights Movement in the Struggle for Economic Justice Today (Monthly Review, 2013):“The history of the United States and the world would have been qualitatively different from the way things have turned out from the 1980s until now….poverty in the United States would have been abolished. Everyone who wanted a job would have had a job. Instead of economic inequality dramatically increasing over the past several decades, all people would be better off as the wealth gap barrowed and human needs were not sacrificed to amass super-profits for the top one percent. The very young, the elderly, and everyone in-between would enjoy greater care, greater security, greater dignity…. There would be universal health care as a matter of right…quality education…available to all as a matter of right, without students amassing exorbitant debt in the process…decent housing for all…no slums. Our social and economic infrastructure…would have been improved…environmental and ecological concerns would have been incorporated into the re-building of our economy and society…Crime would have diminished…. The immense power of the big business corporations over our economic, political, social, and cultural life would be diminished, while the power of the great majority of the people (the 99 percent) over these things would be greatly enhanced (that is, there would be greater democracy…. Institutional racism would be gone.”

The Freedom Budget was defeated and pushed to the margins of historical memory by the end of the 1960s. The main culprits behind its failure were the Vietnam War, which diverted massive federal resources and national energy away from potentially attacking poverty to fighting an imperial war, and the accommodationist position of many of the Freedom Budget’s key champions, including Rustin, Tom Kahn, and Michael Harrington. These and other key social democrats of the time “concluded that the Democratic Party was the pathway to political relevance” and “identified the working class and organized labor movement with the person of the relatively bureaucratic and conservative AFL-CIO President George Meany. And they went along with (or at least didn’t organize opposition to) the Vietnam War, which was promoted by the Democratic Party leadership and fully supported by Meany” (Paul Le Blanc, interviewed by Scott McLemee “A Freedom Budget for All,” Inside Higher Ed, August 21, 2013).

This was a tragic calculation. As Le Blanc explains, “Most Democrats saw the Freedom Budget as too radical, especially given the spending priorities associated with the Vietnam War. Meany himself never endorsed the Freedom Budget, and the bulk of those around him were not inclined to mobilize the ranks of labor on its behalf—only the more radical elements in the unions were inclined to go in that direction” (Le Blanc, “A Freedom Budget for All”).

Dr. King took a different stand, linking opposition to the war to the struggle for economic justice because of moral opposition to the nation’s criminal, mass-murderous assault on Southeast Asia and from an understanding that the Freedom Budget was economically impossible while the war was fought and as the nation “continues year after year to spend more money on military defense than on programs of social uplift.”

The Green-Red Freedom Budget Today

It is doubtful that the Freedom Budget could have been achieved even if all of its leading advocates had taken King’s left position, however. It could not in all likelihood be won under capitalism, given that system’s underlying incompatibility with democratic social planning and the common good. If a new Freedom Budget for All Americans is going to be crafted and fought for today (Le Blanc and Yates advocate this and draft some principles towards that end in the last chapter of their book), it seems best to understand a Freedom Budget 2.0 as “what some revolutionary Marxists call a transitional demand…a proposal for social-economic improvement that makes sense to a majority of people, which consequently could mobilize massive and militant support in the here and how, but which the capitalist system of the here and how cannot provide…” (LeBlanc and Yates, A Freedom Budget for All Americans).

Contemporary left Freedom Budget-fighters would also be well advised to reject the original Freedom Budget’s architects’ refusal to challenge the nation’s gigantic Pentagon Budget and their attachment to endless and accelerated economic growth. “Defense” (empire) spending steals hundreds of billions of dollars each year from the potential meeting of social needs and the eradication of poverty at home and abroad, something that is regularly demonstrated in relations to domestic needs by the publications of the National Priorities Project

Besides being incompatible with ecological sustainability in an age of accelerating environmental catastrophe, “growth” has long been western capitalism’s false “solution” for the inequality that capitalism creates. “A rising tide lifts all boats,” the conventional western growth ideology proclaims, supposedly rendering irrelevant popular anger over the fact that an opulent minority sails in luxurious yachts while millions struggle on rickety dinghies and leaking rowboats.

As Le Monde’s ecological editor Herve Kempf noted six years ago, “the oligarchy” sees material growth as “the solution to the social crisis,” the “sole means of fighting poverty and unemployment,” and the “only means of getting societies to accept extreme inequalities without questioning them” (Herve Kempf, How the Rich Are Destroying the Earth, Chelsea Green).

The inequality that underpins mass poverty (the notoriously inadequate U.S. poverty rate today remains stuck at 15 percent) must no longer be evaded through a growth ideology that is fueling an environmental collapse that will render everything else progressives talked about irrelevant if it is not averted. Fortunately, the crisis can be averted, or at least significantly contained, through large-scale public investment in the ecological reconversion of economy and society, something that would put many millions of Americans to work in “useful and remunerative jobs.”

As Green Party presidential candidate Jill Stein notes, her party’s “Green New Deal”: “would end both the economic crisis and the climate crisis in one fell swoop. It would create 25 million jobs in green energy, sustainable agriculture, public transportation and infrastructure improvements—as well as jobs that meet our social needs, including teachers, nurses, day care, affordable housing, drug abuse and violence prevention and rehabilitation. It would be funded by scaling back the oversized military budget to year 2000 levels, adopting a Medicare-for-All insurance system that would save trillions of dollars, requiring Wall Street gamblers to pay a small (0.5 percent) sales tax, taxing capital gains as income, and taxing income more progressively. These key provisions of the Green New Deal enjoy majority public support in poll after poll…. The Green New Deal addresses the concocted deficit/debt problems by solving the bigger, underlying crises of an unraveling economy and accelerating climate catastrophe” (Jill Stein, “Obama Budget Throws American People Under the Bus,” www.jillstein.org).

Besides breaking with capitalism, a contemporary Freedom Budget that wants to succeed must reject the “dependence on the Democratic Party that was built into the strategic orientation of [the original Freedom Budget’s] architects” (LeBlanc, A Freedom Budget). If the systemic change required to end poverty and lessen inequality (and prevent ecocide) was unthinkable to Democrats at the corporate-liberal height of the New Deal era, it is pointless to pursue those objectives through alliances with Democrats in the current New Gilded Age, when both of the dominant business parties have moved to the right of the populace.

“Socialism” in the American Zeitgeist

The good news is that there appears to be a real constituency for a Left Freedom Budget in the U.S. today. The four decades of savage regressive neoliberal capitalism that followed the Freedom Budget’s defeat (culminating in the Epic Recession of 2007-2009) have eroded many Americans’ faith in the profits system. According to Merriam Webster, the most looked-up words in 2012 were “capitalism” and “socialism.” The number of times each word was searched on the company’s website doubled over the previous year, something the dictionary’s editor-at-large saw as a “no-brainer” since “They’re words that sort of encapsulate the zeitgeist” in the wake of the Great Recession and the Occupy rebellion.

Besides stirring new interest, the word “socialism” is now viewed in positive terms to a remarkable degree. In two recent polls by the right-leaning survey group Rasmussen Reports, Americans younger than 30 were almost evenly divided on whether capitalism or socialism was preferable. A December 2011 Pew survey discovered that 49 percent of young Americans aged 18 to 29 viewed the term “socialism” compared to 46 percent who reacted negatively to the term. By contrast, more of those young people viewed capitalism negatively (47 percent) than saw it positively (46 percent).

The progressive economist Gar Alperovitz finds this polling data unsurprising thanks to the stark economic failures, harsh inequality, austerity, and plutocratic authoritarianism imposed by the contemporary U.S. profits system and the fading capacity of liberal and progressive policy and institutions to mitigate capitalism’s negative impact on society, popular governance, and livable ecology. Alperowitz notes: “As economic failure continues to create massive social and economic pain and a stalemated Washington dickers, search for some alternative to the current ‘system’ is likely to continue to grow. It is clearly time to get serious about a different vision of the future…. Classically, the central idea undergirding various forms of socialism…is democratic ownership of ‘the means of production,’ or ‘capital,’ or, more simply, ‘productive wealth’… the core idea is simple and straightforward: Those who own wealth—and the corporations who control it—have far more power to control any system than those who don’t.

“In a nation in which 400 people own more wealth than the bottom 180 million together, the point should be obvious. What is new in our time in history is that the traditional compromise position—namely progressive, or social democratic or liberal politics—has lost its capacity to offset such power even in the modest (compared, for instance to many European states) ways the American welfare state once represented. Indeed, the emerging direction is to cut back previous gains in many areas—not to sustain or enlarge them. Even Social Security is now on the table for cuts…. Union membership has steadily decreased from roughly 35 percent of the workforce in 1954, to 11.3 percent now—a mere 6.6 percent in the private sector.

“Along with the decay, and give or take an exception here and there, major trends in income and wealth, in civil liberties, in ecological devastation…in poverty and many other important indicators have been ‘going South’ for several decades” (Gar Alperovitz, “The Question of Socialism Is About to Open Up in These United States,” Truthout, April 12, 2013).

It helps “socialism’s” favorability rating that we are now more than two decades past the collapse of the Soviet Union and its satellite regimes and the end of the Cold War. This makes it more difficult for the U.S. capitalist elite and its supporters to automatically identify the democratic and egalitarian project of socialism—workers’ control and “people over profits”—with the arch-authoritarian state-capitalist and/or bureaucratic-collectivist nightmare of Stalinist Russia, the Soviet bloc, and the so-called People’s Republic of China.

Z


Paul Street is the author The Empire’s New Clothes: Barack Obama in the Real World of Power and Crashing the Tea Party (co-authored with Anthony DiMaggio). His next book is They Rule: The 1% v. Democracy (Paradigm, January 2014).