US: The Meaning of Bipartisan Compromise

Both Parties Plan Attacks on Working People

With Republicans in the House of Representatives threatening draconian budget cuts, and both parties slashing spending at city and state level, 2011 threatens to be a grim year for the poorest and most vulnerable workers and their families. This year’s round of state and local cuts are planned to be particularly horrific, targeting both social services and workers’ rights in an extremely drastic fashion.

For many other workers, young people, and the unemployed, 2011 will not bring any joy either, as their savings dwindle and their credit card debt mounts. For those able to get a job, employers will try to squeeze every last ounce of energy out of them at the workplace.

Meanwhile, the super-rich have won another bonanza. Flush from reaping two decades of unprecedented wealth, they just got a new tax cut extension courtesy of President Obama and the Republican leadership.

Two Economies

There is a growing realization that two economies exist: one for the super-rich, and one for the rest of us. And these two economies are going in opposite directions. The idea that capitalism raises all ships is increasingly exposed as false.

Today, big business and big banks make most of their profits from plants deployed overseas and through speculation on the stock markets and currency exchanges. Meanwhile, here in the U.S., the real economy is starved of investment, resulting in declining real wages and tens of millions haunted by the fear of unemployment. This is a result of the warped logic of capitalism, where profit alone is the deciding factor in investment decisions.

No wonder anger has been growing. In 2008 this anger kicked out the hated Bush regime and Republicans from office. In 2010 it was the Democrats’ turn. Playing on the fears of seniors about health care reform and anger at government’s bailout of banks, the Tea Party emerged to provide a vehicle to help get Republicans back into office.

But the solution offered by the Tea Party – smaller government – will make matters worse. The last two years have seen an endless media barrage of lies that teachers, government workers and government programs are to blame for our problems. But endless repetition doesn’t make a statement true. In fact, it is a classic trick of those in power to distract and confuse the public to get ordinary people to back policies not in their interests.

Cutting government spending and laying off hundreds of thousands of federal and state workers will reduce demand for goods and services in an already declining economy. Also, have the massive federal subsidies to agri-business, large banks and oil companies been targeted? No! They have received bailouts and tax handouts.

The programs under the knife, federally and locally, are those that are most important to working class families and the poor. The sober fact is: under this capitalist system, if you can’t get a job, without some form of state or federal support, you are on the slippery slope to falling off the economic map.

Many state and local budgets are on the edge of bankruptcy. Federal Reserve Chairman Ben Bernanke announced on January 7 that the central bank will not bailout state and local governments overburdened with big municipal debt burdens. This is after the Fed just carried out the “quantitative easing” backdoor bailout of big banks. Unionized public sector workers are especially being targeted. Big business and their politicians are looking to use this crisis to kill workers’ rights and shatter labor unions. This round of cuts absolutely must be met with resistance to prevent this attack on our living standards.

The “Big Lie”

Many progressive workers and young people had hoped that Obama and the Democrats would fight this “big lie” about government being the problem. Unfortunately, they got a rude awakening about the corporate nature of the Democratic Party and Obama.

Having demoralized his progressive base in his first two years in office, a new phase of Obama’s administration is opening up: one of bipartisan politics. But in many ways this phase was already initiated when Obama set up a bipartisan commission to reduce the deficit in February 2010.

The proposals published in November 2010 by its chairmen represent a wholesale attack on important social programs. They include increasing the retirement age to qualify for Social Security to 69; a reduction in retirement payments; a 15-cent increase in the gas tax; increased co-pay as well as benefit cuts to Medicare and Medicaid; and cutting 200,000 federal jobs while freezing pay for those remaining.

Putting the blame on Social Security and Medicare is a lie. Social Security is more secure than most major banks. We need to unmask these advocates of small government and those pointing at Social Security, Medicare and Medicaid. Behind these calls is the cold profit motive of big business.

Now we see Obama’s appointment of a new Secretary of Staff, William M. Daley. He will decide who gets into the Oval Office and what Obama’s agenda will be with Congress. The New York Times gives a quick biography: “He is a top executive at JPMorgan Chase, where he is paid as much as $5 million a year and supervises the Washington lobbying efforts of the nation’s second-largest bank,” (1/7/11).

The NYTimes article goes on to state: “Mr. Daley’s recruitment to Pennsylvania Avenue from the corporate boardroom is seen as a smart step by some in Washington, who argue that Mr. Obama has long needed a White House confidant who has the ear of the business community and a record of bipartisanship that might help the president negotiate with Republicans in Congress.” Thomas Donahue, President of the U.S. Chamber of Commerce, states: “I think it’s a very, very strong choice. Daley is a business person who understands politics.”

This appointment signals a further shift to the right by the Obama administration as it contemplates an agenda for bipartisanship with Republicans.

During his one-day brave filibuster of the bipartisan bill to extend tax cuts for the rich, independent senator Bernie Sanders explained this agenda: “They want to move this country back into the 1920s when essentially we had an economic and political system which was controlled by big money interests; where working people and the middle class had no programs to sustain them when things got bad, when they got old, and when they got sick; when labor unions were very hard to come by because of anti-worker legislation.”

The extent of the previous bipartisan agreement, the bailout of big banks in 2008 and 2009, is only now coming to light through relentless pressure on the Fed to release documents. Bernie Sanders explained this in his filibuster: “What we now know is the extent of the bailout for the large financial corporations. Goldman Sachs received nearly $600 billion. Morgan Stanley received nearly $2 trillion. Citigroup received $1.8 trillion. Bear Stearns received nearly $1 trillion. And Merrill Lynch received some $1.5 trillion in short-term loans from the Fed.”

Obama in the Next Few Months

The next few months of Congress will likely be stormy. While we can expect Republicans to play to the gallery and push policies through the House of Representatives that they hope will expose Obama and appease the Tea Party, the real deal will be Obama’s agenda of bipartisanship. The reality is that nothing will pass unless Obama signs it. The policies adopted will not be what benefits working people but, instead, those best for Corporate America and capitalism.

The same was true for Bill Clinton’s presidency in 1994. During the second two years of his first term in office, with resurgent Republicans in control of the House of Representatives, he turned to the right with policies, rebuffing any pressure from the left and sacrifcing the welfare program to get re-elected in 1996.

Thomas Palley, fellow at the conservative New American Foundation, states: “Painful though it is for Democrats to acknowledge, the reality is the economic policies of President Clinton were largely the same as those of President Bush. On this the record is clear for those willing to see. The Clinton administration pushed financial deregulation; twice reappointed Alan Greenspan; promoted corporate globalization through NAFTA and China PNTR; initiated the strong dollar policy; spoke of the ‘end of the era of big government’; contemplated privatization of social security; and truck down a core element of the New Deal by ending the right to welfare,” (Financial Times, 12/2/10).

This experience of the Democrats in power demonstrates their inability to be agents of progressive change. As increasing numbers of young people and workers come into conflict with this bipartisan corporate agenda, they will start seeking to build an alternative.

While 2009 and 2010 created conditions for the Tea Party to grow, during the next two years Tea Party supporters will discover the true corporate nature of the Republican Party. At the same time anger at Republican policies will spur workers and young people into increased struggles. The compromises by Obama and the Democrats will create a growing desire to break from the two corporate parties and create a pro-worker, anti-corporate left political alternative.

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January 2011