Talk About Chutzpah – Wall Street Lecturing America on “Fiscal Responsibility”?
ROBERT CREAMER FOR BUZZFLASH AT TRUTHOUT
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Standard and Poors' downgrading of the US treasury bills - and its
sanctimonious lecture about its "concerns" that the U.S. won't get its
fiscal house in order - are like a reckless, drag-racing teenager
teaching a safe driving class.
Wall Street in general - and Standard and Poors in particular - have
done more to contribute to America's budget deficit than anyone else in
America.
This is the same firm that maintained their AAA rating of the
mortgage-backed securities that were being used to gamble on Wall Street
right up until the time that Lehman Brothers collapsed and set off the
global market meltdown.
Their reckless disregard for any modicum of due diligence in
determining the soundness of the financial instruments traded by Wall
Street allowed the speculative bubble that caused the Great Recession to
grow and ultimately explode. The US Gross Domestic Product has yet to
recover to pre-meltdown levels. That is the single greatest
contributor to the all of the increases in the budget deficit that have
happened since.
And of course it is directly responsible for the jobs deficit that is
the real underlying disease afflicting the American economy - directly
costing eight million Americans their jobs.
But that's not all. The big Wall Street banks lobbied for years to
deregulate their operations. That lack of oversight - including lax
regulations of rating agencies like Standard and Poors -- led directly
to the meltdown. And, of course, the big Wall Street banks did
everything that they could to stop the Wall Street Reform bill that
passed last year. They continue to work hard to undermine the
regulations intended to implement it.
And when it comes time to pay their fair share to reduce the deficit,
Wall Street has done everything it can to lower tax rates on the rich
to the lowest levels since before the Great Depression. Let's remember
that the people with the highest incomes in America - hedge fund
managers - pay a lower tax rate than their secretaries do - just 15%.
All the while as they pontificate about the need to get America's
fiscal house in order, they twist arms to make sure that people like
hedge fund manager John Paulson - who made $5 billion in income last
year (that's $2.4 million an hour) - don't have to pay higher taxes. Paulson
had more income last year than the Gross Domestic Product of five nations.
Just a little over ten years ago, America had budget surpluses into
the foreseeable future. That was largely because President Clinton and
the Democrats voted in 1993 to modestly increase taxes on wealthy
Americans. Wall Street worked hard to roll back those modest tax
increases on the rich by passing the Bush tax cuts ten years
later. Those Bush tax cuts, together with two unpaid-for wars and an
unpaid-for Republican Medicare pharmaceutical bill - tipped the Federal
budget into huge deficits.
Of course their recklessness continues. The financial analysis that
Standard and Poors used to argue for its downgrade of U.S. debt had a
two trillion dollar mathematical error that was caught by the
Treasury Department. That's the kind of error that would get an "F" in
elementary school.
The very idea that Wall Street - and Standard and Poors - would have
the chutzpa to lecture the rest of America about fiscal responsibility
should infuriate each and every American.
Robert Creamer is a long-time political organizer and strategist,
and author of the book: Stand Up Straight: How Progressives Can Win,
available on Amazon.com. He is a partner in the firm Democracy Partners. Follow
him on Twitter @rbcreamer.
http://blog.buzzflash.com/node/12929
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