Jan 26, 2009
When Barack Obama took the oath of office on January 20, the United States was still engaged in two wars – one in Iraq and the second in Afghanistan, spilling over into Pakistan – and the U.S. was engulfed by an economic collapse. George W. Bush certainly was not the only person responsible for these disasters, but he presided over them. Most workers greeted his departure with relief and the hope for a change in his policies.
But to change policy requires more than just a change in the man occupying the office. By his actions, his appointments and his very speech on Inauguration Day, Barack Obama quickly demonstrated that he will serve the interests of the bourgeoisie every bit as much as George W. Bush did – and more efficiently, if he is able to divert the population with false hopes.
It is understandable that there was a popular resurgence of hope on January 20, a desire that government would begin to address the problems of the population, after eight years during which the Bush White House had so openly defended the interests of the wealthy.
Barack Obama played on those hopes in his inaugural address, January 20: “Our time of standing pat, of protecting narrow interests and putting off unpleasant decisions – that time has surely passed. Starting today, we must pick ourselves up, dust ourselves off, and begin again the work of remaking America....The state of the economy calls for action, bold and swift, and we will act – not only to create new jobs, but to lay a new foundation for growth. We will build roads and bridges, the electric grids and digital lines that feed our commerce and bind us together. We will restore science to its rightful place, and wield technology’s wonders to raise health care’s quality and lower its cost. We will harness the sun and the wind and the soil to fuel our cars and run our factories. And we will transform our schools and colleges and universities to meet the demands of a new age. All this we can do. And all this we will do.”
But despite the promises of radical change, the real practical kernel of Obama’s speech came in his repeated warning that change would not come easily nor soon, and his call for individuals to sacrifice for the common good.
Nowhere in his whole speech was there a call for corporations to forego their profit, rather than layoff a worker. But Obama pointedly did call for “the selflessness of workers who would rather cut their hours – that is, lose pay – than see a friend lose their job.”
An oversight, that only workers were called on for sacrifice? Not hardly. It simply reflected the lines of the economic program that Obama had announced a week before he took office.
Nor was it an oversight when Obama forgot to say he would remove all troops from Iraq within 16 months of taking office – his one-time campaign pledge. Instead, he had only vague words about both Iraq and Afghanistan. The clear statement of his intentions came three days later, however, when he authorized missile attacks on two Pakistani villages.
And while Obama made a few bows in the direction of “diplomacy,” he showed that he too would dredge up the specter of terrorism, with a militaristic warning addressed to unknown enemies: “Know this... that our spirit is stronger and cannot be broken, you cannot outlast us, and we will defeat you.” A page right out of Bush’s book.
In the days following his inauguration, Obama rushed to announce a few demonstrative changes in Bush’s policies. He asked Congress to continue the children’s health insurance program for lower income families – something which Bush had vetoed. He authorized one research study using stem cells. He reversed Bush’s ban on giving federal money to any organization that provides abortions oversea or even gives information about abortions – although he said nothing about intending to reverse the “Hyde Amendment,” the provision which denies the use of federal Medicaid funds to pay for abortions for poor women in this country. He announced the closing of the prison at Guantanamo – but not an end to the indefinite detention of prisoners without access to a trial. And he is certain to go on announcing some really cosmetic changes, like his intention to freeze the salaries of White House staff making more than $100,000 – starting a year from now!
But under the pretext of the current financial crisis, Obama’s advisers have let it be known that some of his main campaign promises will have to be “deferred.” His medical plan to “begin covering every American” apparently will have to wait a while. So will his promise to make a vast push on education, so that “all students are excited to learn because they are attending fully-staffed schools of the future,” or his pledge to “make college affordable for all Americans.” Card check authorization for union membership seems to have dropped between the cracks. And so on.
On the two essential questions – the wars and the economy – Obama made things crystal clear. He has already shown that his policies will closely track those of the Bush administration.
First of all, his new cabinet is filled with people either responsible for or supportive of current policies on the war and the economy.
Obama’s decision to keep Bush’s Secretary of Defense, Robert Gates, was an open affirmation of his intention to continue Bush’s war policies. Gates directed the “surge,” which destroyed wide parts of Iraq and turned millions of people into exiles; he is leading the expansion of the war in Afghanistan and on into Pakistan.
Obama backed up that choice by tapping Hillary Clinton as Secretary of State. A strong supporter of the war in Iraq, Clinton also strongly advocated using Israel as the bastion for U.S. control over the rest of the Middle East. No one would ever mistake her for a critic of U.S. wars or of its current policies in the Middle East.
Nor did Obama stake out new ground in his economic appointments.
Timothy Geithner, Obama’s new Secretary of the Treasury, spent the last five years as head of the New York Federal Reserve Bank. It was under his watch that speculation on Wall Street went into the stratosphere, leading to the collapse of the bubble. He joined with Henry Paulson and Ben Bernanke to cobble together various bank bailouts – which have already made available to the banks as much as 8.5 trillion dollars – without asking the banks for any commitments.
Larry Summers, Obama’s new chief economic adviser, was responsible, when he was Clinton’s Secretary of the Treasury, for junking many of the financial controls that had been in force since the last Depression. Jettisoning those controls opened the door to, if not caused the last decade’s vast increase in speculation.
Facing criticism for these and other appointments, Obama argued that the seriousness of the situation required him to put the most experienced people in key positions, and that in such a period the country requires “stability” and “continuity.”
But “experience” is not simply technical; nor does it stand above classes. “Experience” gained in the service of the bourgeoisie – carrying out a war on the working class – will not be transformed into a weapon for working people.
To call for “stability and continuity” in the midst of this financial collapse and growing recession can only mean defense of the very capitalists who got us into this mess. And that’s exactly what Obama has acted to do. He demonstratively supported the “bail-out,” which is running up enormous government deficits to hand over money to the banks whose speculation led to the financial collapse. When the bail-out proposed by Bush faced difficulties in Congress, Obama left his campaign in order to lobby for it and cast his vote for it. When the first 350 billion dollars of the TARP was spent – without any indication that the banks had used it for anything other than their own benefit – Obama asked Bush to request the second 350 billion. And when the Senate began to debate whether to attach conditions on this latest bank hand-out, Obama wrote the Senate, asking it to move rapidly, leaving the “details” for later!
No, the working class does not need “continuity” – a continuation of the very policies that are dragging the population down. What the working class needs is a radical transformation of the economic system that led to the current disaster.
The details of the stimulus plan are far from clear at this point – and it’s in the details that the devil is sure to lurk. Nor are the amounts of money very clear either. But even on the general level, it’s obvious that this latest plan is only one more monstrous bail-out, offering massive amounts of money to the very people whose drive for profit led us into today’s crisis.
But first: what the plan doesn’t do. It does not eliminate Bush’s tax cuts that had so heavily favored the wealthy – something Obama had once promised to do. And, since Obama intends not only to continue the wars, but expand the one in Afghanistan, there will be no cuts in military spending, even gradual, which he had also once promised. During his campaign, Obama had pledged to begin reducing military spending and increasing taxes on the wealthy, as a way to pay for extending medical coverage. That’s one of those promises on hold.
Nor does the stimulus plan get rid of Bush’s tax cuts to the corporations and the banks. Just the opposite. The corporations get between 45 and 50 billion dollars – justified by the old “trickle down” argument, which pretends that if the corporations get money, they will spend it on creating jobs. Since the beginning of the crisis, the corporations have been given money, but it did not induce them to create jobs. They simply took the money, and cut jobs anyway.
Moreover, the banks, the big investment houses and the wealthy will benefit from changes that provide 50 billion dollars more in tax cuts on certain bond investments.
Then there are the giveaways to the corporations through funding for a long list of projects, for example: “modernize information technology,” build “a smart electricity grid,” develop “energy production,” make public buildings “energy efficient,” build “science facilities” and “transportation projects,” expand “rail and mass transit.” This amounts to at least another 150 billion dollars, to be funneled into the hands of private contractors and businesses, who will take a big slice off the top, before any of the money is put to work.
When Tom Harkin and other Democrats proposed that guarantees needed to be written into the stimulus bill so that the money would go toward creating jobs, and not just down some company’s sinkhole, Obama adviser Larry Summers cautioned about the danger of getting “hung up on details.” And Obama, who floats promises of creating or saving three or four million jobs, insisted only on the need for “urgency.” Apparently jobs were only another of those “details.”
Obama justified handing all this money over to the corporations, declaring at his inauguration, “the market’s power to generate wealth and expand freedom is unmatched.”
All the evidence points to the contrary. The last years have shown that the “market,” that is, business, does not put the money it gets from government into creating jobs. When corporations put government tax breaks or subsidies into production at all, much of it goes into technology to cut jobs, without sharing out to workers any of the benefits of increased productivity. For the most part, not only did corporations take government money, they continued to drain money out of production, throwing it all into the financial bubbles.
The “market” has “generated wealth” only for the top layers of the population, by reducing the standard of living of the working class, impoverishing ever larger numbers.
Obama’s stimulus plan simply gives more money to that very same “market.”
The stimulus plan boasts of giving money to the “middle class” – it gives up to $20 a week, over two years’ time. But, according to the Citizens for Tax Justice, the bottom 60% of the population will get less than half the amount promised. Even in this small “middle class” tax cut, it’s the upper layers of the population who get the most!
The plan also boasts that rotting infrastructure will be repaired, but less than 200 billion is devoted to such items. The American Society of Civil Engineers puts the amount needed just to fully repair the country’s roads, bridges, sewer systems, water lines, public lighting, etc. at 1.6 trillion dollars. The Bush administration, with solid backing from the Democrats, just made 8.5 trillion dollars available to the banks in less than eight months time. Obviously, if the Obama administration were really determined to repair the infrastructure, it could take the 1.6 trillion out of the banks’ money – and use it in such a way to guarantee the money would create jobs, not line some businessman’s pocket.
The plan includes some payments to help states avoid cutting Medicaid – about 43.5 billion dollars a year, for two years. But Medicaid, which ran about 335 billion dollars in the 2007-08 budget year, has been cut so much already that 43.5 billion won’t even begin to replace the coverage that once existed, not to mention the new Medicaid applications that are swamping state after state as unemployment grows.
There are grants to states to help with budget problems, amounting to about 24 billion a year for two years only. But the National Conference of State Legislatures estimates that states are facing shortfalls of 140 billion dollars in their regular budgets this year alone – not counting the hundreds of billions they have already cut out of public services and social programs in the last few years.
The plan includes various payments to the schools, amounting to about 60 billion a year. Compare that to the amount that the National Education Association estimates is needed, 502 billion dollars, simply to adequately repair and modernize existing schools, which doesn’t count operating expenses, nor money for more teachers, etc. Hardly the “schools of the future”!
There is supposed to be about 21.5 billion for one year to increase unemployment benefits and job training. A pittance. It would take 75 billion dollars just to cover those who are unemployed today but don’t qualify for benefits. (Today only about one-third of the fully unemployed qualify for unemployment benefits.)
This is not a stimulus package drawn up in the interests of the population. For the population, there is nothing but crumbs – while there are hundreds of billions going to the same corporations that have already taken government money without ever creating a single job.
Where is the “common good” in that?
As for what the future will bring, Obama’s advisers have already started to warn that the deficits being rolled up today in the bank bailouts and the stimulus plan will create government deficits so large that many ordinary programs will have to come under the knife in a year or two. Obama himself hinted at it, when he promised to cut out all the “fat” in various programs, speaking concretely in his speech on the economy of the need to “reform” Social Security and Medicare. “Reform” – that has always been a code word for cutting Social Security and Medicare, as well as unemployment benefits, insurance, welfare, Medicaid, workers’ compensation, etc., all the social programs offering some kind of protection to working people.
In an interview on ABC, January 11, George Stephanopoulos several times asked Obama, who kept trying to avoid answering the question, how these future cuts would be made. Finally, Stephanopoulos put it to Obama this way: “Let me press you on this, at the end of the day, are you really talking about over the course of your presidency some kind of grand bargain? That you have tax reform, health care reform, entitlement reform, including Social Security and Medicare where everybody in the country is going to have to sacrifice something, accept change for the greater good?” To which, Obama replied, “Yes.... Everybody is going to have to give. Everybody is going to have to have some skin in the game.”
Not quite everybody! No “skin in the game” from the corporations and the banks.
When questioned by supporters about Obama’s tax cuts for the corporations, his advisers explained that because of the crisis it was necessary to pass the bill in bi-partisan fashion; that Obama had included many of these tax breaks as a way to enroll support from the Republicans.
Other Democrats explained that since they hadn’t gained a 60-vote Democratic majority in the Senate, they didn’t have the means to prevent a Republican filibuster, which would have prevented Congress from passing anything. Therefore, they needed to get Republican backing for the plan.
What a bunch of bull! Bush never once had as big a majority in the Senate as Obama has today. In fact, in two of his eight years, the Republicans were in the minority. But Bush got his program passed anyway, year after year.
Obama came into office given a mandate for change by the population, and the means to carry it out. He had a much bigger majority than Bush’s wins in 2000 and 2004, both in the popular vote and the electoral vote. In 46 out of 50 states, the Democratic share of the presidential vote increased from 2004.
Overall, the election marked a real shift to the Democrats. They increased their control over Congress, winning both chambers by important margins (59 to 41 in the Senate, 256-178 in the House of Representatives). They increased their hold over governors’ chairs in the states (now heading 29 of the 50 states), as well as in state legislatures. And they did so because people put their hopes in Obama’s promise of “change.”
And on Inauguration Day, it was obvious Obama had the support of millions upon millions of people, including millions who had not voted for him.
If there ever was a year when the Democrats, who pretend to be the friend of working people, were in a position to make a radical break with politics serving the interests of the wealthy, it’s today. The situation demands it, and the elections and the population’s support gave them the means to do it.
Instead, the Democrats are carrying out the policies the bourgeoisie requires from its politicians. In this case, that means a continuation of the wars, and of vast tax breaks and subsidies for the banks, the big corporations and the wealthy.
Obama, with the Democratic Congress behind him, speaks of the aspirations of people for change, but calls on them to wait. His stimulus plan, just like the bank bailout, provides aid immediately – trillions of dollars – to the banks and the biggest companies in the country. But the population must wait!
We are caught in an economic crisis, in which the bourgeoisie is carrying out a war on working people, trying to force us to pay for the cost of the crisis they created. As Bush showed and Obama is showing, the bourgeoisie has the backing of the government and its two major parties. Today, the ruling class also has a new president, with all the hopes that can engender, calling on people to wait, to sacrifice for the common good.
If the working class continues to make sacrifices, it will not be for the “common good,” it will be for the wealthy class that already has imposed too many sacrifices on the working class.
In this situation, the worst thing for the working class to do would be to sit back and wait for “change” to arrive sometime in the future. If policies that today serve the interests of the bourgeoisie are to be junked, to be replaced by those serving the interest of working people, the population will have to mobilize, to fight to make sure its own needs are met – and immediately.
That’s what can transform “hopes” into reality.