------------------------- Via Workers World News Service Reprinted from the June 23, 2003 issue of Workers World newspaper -------------------------
BUSH AND THE TRILLION DOLLARS: NOW YOU SEE IT, NOW YOU DON'T
By Leslie Feinberg
It wasn't that long ago that the sharks on Wall Street and the politicians in Washington were insisting that social programs like welfare had to be cut back because the economic health of the United States depended on balancing the budget. "End deficit spending" was the mantra of the conservatives. It became the rationale for big cuts in needed social programs. For a few years toward the end of the nineties, the government's debt was actually reduced.
But then came the big military buildup, the beefing up of the domestic police agencies under the excuse of "homeland security," the huge tax cuts to the rich, and a downturn in the economy. The budget deficit began to grow sharply.
So, very quietly, President George W. Bush signed a bill on May 27 that raises the federal government's debt limit by close to $1 TRILLION.
That's a million times a million dollars.
Imagine the howls of indignation from the political representatives of big business if this colossal amount of debt were being contemplated in order to finance a federal jobs program, or free medicines for those who can't afford them, or a crash program to develop sustainable sources of energy.
But there have been no howls. Both Democrats and Republicans have been very quiet about it. For not only is this money earmarked for Bush's "endless war," it also has the blessings of Wall Street.
The growing debt means the government will have to borrow massive amounts of money. Wall Street is happy about that because it means more interest to the banks. The prime interest rate set by the Federal Reserve Bank is on the floor, supposedly to get companies to borrow money and expand, but lowering the rate hasn't led to an upturn in the economy because businesses don't want to expand when the markets are glutted. So the government will now be taking out huge loans--a boon for the banking empire.
Why haven't the Democrats made a big noise about all this? They usually claim to be the party that cares about workers and the middle class--and an election year is looming.
The Democratic Party used to advocate government spending on social programs as a means to stimulate the economy during recessions. The irony of the present situation is that both Democrats and Republicans hope that government spending will work again--but the spending is on the military-industrial complex and domestic repression, not on programs to help the unemployed or improve health care or Social Security.
In fact, the capitalist economic slump is not based on lack of cash or capital investment. It's rooted in the boom-and-bust cycle of a profit- driven economy. The crisis is one of over-production, of abundance.
Who will pay this debt? The government is making it crystal clear that the "tax man" won't be hounding the rich or their corporations and banks for it.
The very next day after Bush quietly signed the IOU for a trillion dollars, he signed the third-largest tax cut in history, making it a media event. However, it gives billions to the wealthy elite and little or nothing to the workers and poor, who are already being hit with increased local taxes, mass transit hikes and other forms of taxation.
This is class warfare on the domestic front.
More than a half-million jobs have already been lost this year and more than 8.7 million people are counted as unemployed. That official figure doesn't count those who are discouraged and have stop ped job hunting.
Wages are falling, across the board.
"The president is not calling his tax package the 'Windfall for the Wealthy' act, which is what it is," observers Jared Bern stein, an economist with the Washington-based Economic Policy Institute. "He calls it the 'Jobs and Growth' act, which is what it's not."
And when the yeas and nays were tallied, the tax measure passed 58 to 33. Almost a quarter of the congressional votes came from Democrats.
Those who voted for it made a big deal about an addition of $400 to the child tax credit. But as soon as it passed, the truth came out. The bill denies the credit to families with incomes between $10,500 and $26,625. That's 12-16 million kids--one out of every six children in the U.S. under the age of 17, according to the Center on Budget and Policy Priorities.
About half of all African American and Latino children either get no benefit, or a very meager allowance, from this bill.
The legislation also leaves high and dry, without any tax relief, some 8 million mostly low-income taxpayers who have no children.
What would it have cost to pass on the extra $400 credit to all families? $3.5 billion. But the legislators thought that was just too extravagant.
However, House and Senate negotiators slashed provisions in the bill that would have cracked down on corporate tax shelters, blocked some accounting scams like those that enriched Enron CEOs, prevented U.S. companies from creating post-office box headquarters in offshore tax havens, and limited bloated deferred-compensation plans for executives. (New York Times, June 2)
That cost us $25 billion--and the corporations laughed all the way to the bank.
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