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The Dawn of Austerity in America

by JASON HIRTHLER

Since the rosy fingered dawn of austerity in America, the liberal media have consistently proclaimed that the Republicans are a deluded gang of filibustering rejectionists. By contrast, they make the rather more strident claim that, for all their faults, Democrats at least believe, as The New York Times columnist Paul Krugman puts it, “in letting its policy views be shaped by facts; the other believes in suppressing the facts if they contradict its fixed beliefs.” But is this true? Are Democrats a clear-eyed party of well-meaning centrists, and are conservatives a frothing admixture of venal Congressional lifers and mob-backed junior legislators, both taking their talking points from a dim confection of scripture and grainy clips of “Free to Choose”?

The Right—Delusional and Demented?

First, liberals seem to believe that the Republicans who push for austerity are ignorant knaves, a seething clan of badly misguided ideologues who whitewash their realities with the worst theoretical models to emerge from the Chicago School of Economics. For his part, Krugman has nobly piled fact upon fact in his columns and blogs, outlining the harshly regressive outcomes associated with spending cuts during economic downturns. Exhaustively argued, scrupulously referenced, Krugman is an economic champion of the liberal class. Even so, in articles like, “The Ignorance Caucus,” “Sequester of Fools,” and “Friends of Fraud,” Krugman asks, in a state of jaded disbelief, how could it be that, “Republicans are deep in denial about what actually happened to our financial system and economy.”

He’s not alone in this regard. Leslie Savan in The Nation also chalks up the deficit obsessions to the pitfalls of “groupthink,” a kind of innocent self-delusion that encourages “the punditocracy to repeat, despite incontrovertible evidence to the contrary, that austerity will pave the toward economic growth.” Robert Reich, who regularly and expertly denounces austerity, also seems baffled by the apparent inability of Congress to look facts in the eye. Columnist Ezra Klein touts studies that confirm the myopia of GOP legislators.

But the facts suggest that conservatives foresee austerity’s aftermath quite clearly, but are simply disinterested. To put it bluntly, Republicans and their backers know precisely what they’re doing. They aren’t mathematically-challenged stooges fumbling away the American dream. They’re conniving dogmatists bent on real social change—for the worse. A recent joint investigation by Democracy Now! and the Center for Media and Democracy is rapidly exposing the fraudulent claims of the Fix the Debt gang, a group of at least 127 corporate CEOs led by billionaire Pete Peterson. Like their Congressional shills, the Fix the Debt thugs claim they want to salvage America’s economy from being wrecked by debt. But what lies just beneath the surface of this thinly veiled publicity campaign is a desire by corporate interests to decimate the New Deal and Great Society initiatives.

Why? For a couple of reasons. First, because this faction of plutocrats and their confederates genuinely believe in the radical individualism they espouse: tax is theft, welfare is the path to dependency, and poverty is the rightful destiny of the dilatory and thriftless. And here’s the crucial verdict: if preserving the sanctity of individualism means America becomes a sea of indigence, so be it. If each of us controls our fate, and if our fate has led us to ruin, who’s to blame but ourselves? In this sense, we are witnessing the rise of a kind of secular Calvinism in which our destinies reveal our character.

Second, eviscerating the safety net is a good bottom-line bargain. A dramatically enervated and sickly state, bereft of its capacity to regulate, stripped of its assets, and shorn of its social mandate, is a state deterred from taxation for want of cause, and too enfeebled to counter the rapacity of monopoly capital. Capital is thus freed to cannibalize labor. Like a mining colony in a jungle with natives swept aside, the drills won’t cease until every fluid drop and mineral grain of profit is safely nestled on a northbound container vessel. Anything to stave off a declining rate of profit.

The related claim that our half-sighted multinationals needs to recognize that if American incomes continue to slide, the populace will no longer be able to purchase the products they peddle, is neither important nor novel for elite interests. Renewed lending and debt accumulation can falsely inflate another housing market, generating a freshet of new derivative plunder. But the larger point is that America is no longer corporate America’s primary growth market. China is. India is. Latin America is. The United States already looms large in the rear view mirror, diminishing by the day.

The Left—Decency Denied? 

If conservatives are Machiavellis incarnate, what about those malleable Democrats? That glum tribe forever beset by weak temperaments, constitutionally incapable of taking a hard line, handicapped, perhaps, by their bottomless empathy. Along these lines, liberals are happy to claim that President Obama is simply being stonewalled by his Republican colleagues, who have capitalized on his naïve faith in human decency to press their savage austerity agenda on the population.

The President, exhausted by ceaseless good-faith attempts to reason with pathologically irrational extremists, finally capitulates. “Alas,” writes Krugman, fawning with forgiveness, “Mr. Obama did not stand firm.” The intimation is that the President is a paragon of progressive values, an emblem of liberalism clad in multi-cultural cloth. In fact, the multi-cultural is running interference for the multi-national.

But looking past Obama’s hypnotic rhetoric, one finds a political graph marked by one artificial crisis after another, perpetrated by Democrats and Republicans alike. The debt ceiling, the fiscal cliff, sequestration. Afghanistan, Iraq, Iran. Every one a politically manufactured, fear-mongered crisis. Every one carrying a trillion-dollar price tag. Every one a bipartisan swindle. It’s Disaster Capitalism par excellence, as Naomi Klein laid out in her bestseller The Shock Doctrine, which popularized how crises are manipulated to justify the introduction of fiscal austerity.

While Republican intransigence—cemented by a record filibusters in the last two years—has muddled the president’s efforts to add some progressive sops to legislation, an obsession with conservative obstructionism obscures the bipartisan foundation of the deficit debate. From the earliest days of his presidency, Obama signaled that “entitlement reform” was a central plank in his agenda, offering up these sacrificial lambs marinated  in talk of “bitter pills” and “reasonable” spending cuts. Not only did Obama appoint Alan Simpson and Erskine Bowles to head his deficit commission, knowing they were deficit hawks of the highest order, but Peterson’s Fix the Debt gang grandly supported Simpson-Bowles precisely because it advocated the dramatic spending cuts both parties favor. Yet former New York Times editor Bill Keller recently claimed that Obama has not embraced the commission’s wisdom.

Obama’s own 2011 plan—different from the commission’s version in that its tax revenues were at least mildly progressive—also aimed at $4 trillion in deficit reduction, with all three social programs included for euphemistic “reforms.” Sequestration itself was hatched in the White House, a trigger mechanism that creates the illusion that Congress is at the mercy of a higher law and, of course, conservative hordes brandishing wildly underlined copies of Atlas Shrugged. Likewise, the notion that the Senate can only pass a bill with a super-majority of sixty is a technicality that can be dispatched by a simple Democratic majority. But the decorum of tradition trumps the exigencies of an anonymous populace. In the end, the policy prescriptions of both parties are overwhelmingly austere.

When the administration does differ from its conservative counterparts, largely in the desire to impose a degree of taxation to polish its progressive credentials, the onus falls largely on the working class. Obama’s much-celebrated tax on the wealthy is a clever sleight of hand: the tax hits a couple of million Americans whose incomes exceed $450,000, but the tax only applies to income over $450,000 and only by the smallest of marginal increases. Cobbled together with slight increases in capital gains taxes, new Obamacare taxes, and fewer deductions for the wealthy, the 1 percent will cede an extra $62 billion a year. By contrast, the media-slighted payroll tax will sift $95 billion in 2013 alone from the pockets of the working class. Although initially and intelligently proposed by Democrats as a stimulative measure in 2010, the payroll tax was allowed to expire with the consent of both parties. Treasury Secretary Timothy Geithner said he saw no reason to extend it. (Granted, it is hard to discern the smoking ruin through the cloud bank.) Nor did Obama bother to include it in his 2013 budget. Yet the tax penalizes 160 million working class Americans with a 50 percent increase in what amounts to a nationwide wage cut, wiping out the wage gains of 2012.

If it’s not austerity, it’s elitism. Both are now beltway consensus; the notion of handcuffed liberal do-gooders has worn thin, exposing the Janus face of progressive Washington—rhetorically populist, practically bought.

The Media—Paying the Price of Inclusion? 

As crass and crude an image as it may seem, the Oval Office is little more than a luxury suite being peddled to palm-greasing plutocrats, their lobbyists, and the venal sophists whose pockets they ply with cash. The political hue is never red or blue—but always green. It is ever Spring in Washington. But this truth, that both parties are consciously visiting hardship on a defenseless populace—is unspeakable. That Obama knows he’s favoring wealth at paucity’s expense—unmentionable. That conservatives know austerity will crush vast majorities—unprintable. And to coin a lie of this magnitude and continue to employ it as ideological currency requires you to simply elide sizeable sections of reality from your worldview.

Perhaps the price of writing for a mainstream paper like the Times, then, is silence on this point and substituting for it the fallacy that our leaders have honorable intentions. That purity of motive is part of our American exceptionalism, our ahistorical singularity. But even if it were so, and by our well-intentioned deeds we were unwittingly paving a highway to hell, how would this be any more ethically commendable than the brainwashed suicide bomber who believes liked a blind Bush that his actions are pure? Both are tragedies of delusion. Yet evidence abounds as counterpoint. The powers that be know exactly what they’re doing and attempts to render their Machiavellianism more palatable by obtruding it from sight, is itself a form of complicity. As Noam Chomsky once noted, there isn’t much value in speaking truth to power; they already know it.

Jason Hirthler is a writer, strategist, and 15-year veteran of the corporate communications industry. He lives and works in New York City. He can be reached at jasonhirthler@gmail.com.

 

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Jason Hirthler is a veteran of the communications industry and author of The Sins of Empire: Unmasking American Imperialism. He lives in New York City and can be reached at jasonhirthler@gmail.com.

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