Trump jumped into bailout mode in response to the depth of the economic crisis triggered by the pandemic. A mountain of money has already been promised to the banks, while many other soon-to-be bankrupt corporations will get unimaginable sums with few strings attached, such as the airlines, Boeing, cruise ships, etc., many of whom, like Boeing, were doing poorly before the crash.
The Airlines are effectively bankrupt, in part, because they — and many other companies — spent all their savings gobbling up their own stocks, artificially propping up their share price that quickly collapsed. The incredible recklessness is set to be rewarded at massive taxpayer expense.
Meanwhile, virtually every city and state in the country will soon be facing the prospect of bankruptcy, as their revenue stream of taxes collapses. A similar thing happened in 2008 but this time will be deeper and more sudden. The economy is not going to spring back to life post-pandemic; this recession was overdue and will be a fact of life long after the virus is subdued.
Because every state is controlled by the same two parties who share the same neoliberal ideology, the outcome is easily predictable: public employees will be attacked, pensions will be slashed, mass layoffs at the city, county and state level; basic services that were already sparse will be further shredded. Many states will reverse course on Medicaid funding, creating a new wave of uninsured people — perhaps the final nail in the rotten coffin of Obamacare.
Some initial crumbs will be handed out — such as Trump’s Universal Basic Income scheme — while devastating, long term austerity will follow, unless a powerful force is organized against this anti-austerity strategy.
This is a critical moment for labor and community groups to come together with united demands, lest the ready-made demands of the business community take precedence. The wealthy will not be lazy in making their needs felt, because they understand the urgency of the situation. Their profits are on the line, versus the livelihood and future of millions of people.
Oregon’s pension system has already announced massive losses because of the Wall Street crash. Like most pension systems across the country, Oregon’s had still not recovered from the 2008 crash, which will prompt fresh and urgent calls from the establishment to “reform” the system out of existence.
Politicians will ask for “shared sacrifice”, as they did in 2008. Workers made sacrifices and never recovered their standard of living while the rich proceeded to take all the nation’s income. In addition since 2008 a housing crisis developed in every U.S. city, where landlords were transformed from “responsible housing providers” to aggressive price gougers. Only recently did laws in some cities curtail the worst of this behavior, but the outcome was that the wealth that shifted up never trickled down.
This inequality needs to be the centerpiece of the solution. Much of Bernie Sanders rhetoric needs to be deployed at the city and state level, immediately. Unions must demand “tax the rich” to fix the crisis, to avoid mass layoffs and attacks on living standards.
Demands should be placed on governors — who are organized under the National Governors Association — to use their collective voice in demanding that Trump prioritize states over banks.
No Going Back
The old economic-political system is dying before our eyes. Things will not return to the already unbearable “normal,” and there are only two irreconcilable directions we can go: deeper into the priorities of big businesses and the billionaires or towards the interests of working people.
If we aren’t prepared now a new age of deep austerity will be forced down our throats, while those force feeding us calmly explain that “we’re all in this together.”
A bearable future for working people involves mass job creation in public works that will guide the economy of the future, such as outlined by a Green New Deal. Though such a project could be stillborn if it’s constructed on a capitalist basis. Only a socialist Green New Deal has the ability to avoid the kind of market-based catastrophe that we’re currently in.
Such a project can create the millions of jobs that are needed to replace the collapse of the “gig economy” that the establishment hoped would be the future of work.
Real Leadership, Real Action Needed
Labor and community leaders should call for statewide meetings — virtual if necessary — to discuss concrete solutions to the current crisis, and to focus on keeping public services afloat by immediately increasing taxes on the wealthy and big landlords. A handful of concrete demands delivered by a strong coalition would shift the narrative and put politicians under enormous pressure.
Labor and community groups must also discuss the long-overdue formation of a workers party/ labor party, especially in lieu of the endless shenanigans deployed against Bernie Sanders by the Democratic Party’s top officials.
It should be clear to anybody paying attention that the Democratic Party is not reformable and that labor and community groups should immediately call for a national convention on the formation of a new and powerful party that represents working people and their allies, rooted in the collective strength of the unions but strengthened further by opening its doors to the millions of people inspired by Bernie Sanders campaign, and the new waves of young people being forced into politics by the current crisis.
We can no longer rely on the two-party system to direct social life. A strong intervention by the working class is necessary, immediately, lest millions of people suffer under the existing leadership that lead us into this impasse. With a crisis comes threats and opportunities. The working class has a historic opportunity to finally become an independent voice in U.S. political life, as has been done decades ago by most nations on earth.