[Peace-discuss] Disgust with the business party, Dem & Rep

[C. G. Estabrook]

"...America is broke but here’s Obama, seemingly set on boosting a US force in 
Afghanistan..."

	February 14, 2009
	CounterPunch
	On the Rocks
	By ALEXANDER COCKBURN

I write these words at the end of a week in which:

A new Democratic president, Barack Obama, via his Attorney General, has 
explicitly endorsed Bush's policy on renditions and Bush's refusal to recognize 
the jurisdiction of US courts in any legal proceedings in this regard; also a 
week in which Obama’s solicitor general has explicitly endorsed  Bush’s policy 
on enemy combatants.

I write not long after the New York Times reported that state welfare rolls are 
actually shrinking in months when unemployment has risen to real totals of 17 
and 18 per cent - 1.7 million in Dec and Jan, hence when more and more people 
are in desperate straits. This is a consequence of a former Democratic 
president's "reform" of welfare in the mid-90s.

Back then, Clinton reached out in the spirit of bipartisanship to Republicans to 
effect this piece of legislative savagery. In the same spirit of bipartisanship 
Obama invited a New Hampshire right-winger, Judd Gregg, to be his Commerce 
Secretary, while simultaneously pledging that Judd’s vacated seat would be 
filled by… a Republican!  Ultimately, Judd contemptuously kicked away the 
proffered hand of friendship.

For much of last year progressives rallied support for Obama not just with 
scenarios of the destruction that would be wrought by John McCain, but with 
screams of fear at the menace of right-wing populist insurgency, embodied in the 
supposed threats to mainstream consensus represented by Ron Paul, Mike Huckabee 
and Sarah Palin. You know, fascists; at least two of them Christian fascists. 
Head for the deep shelters and vote Democrat! Vote for change.

The menace of the Christian hordes?   Christians now exult that Obama is talking 
of a waiver on constitutional prohibitions concerning federal support for 
faith-based initiatives. As the Los Angeles Times editorialized angrily last 
week, “Like his predecessor, Obama has supported providing federal grants and 
contracts to social-service programs operated by religious groups. The surprise 
-- an unpleasant one -- is that he is equivocating on a campaign promise to 
condition such aid on an agreement by religious charities not to discriminate in 
hiring.”

And meanwhile, in America as across the planet, it’s economic devastation, near 
and far. Here in northern California I walk into a local plumbing store, a large 
place used by building contractors. There’s one other man in the store, buying a 
$5 plastic fitting. One of the owners says there’s zero new construction in the 
area. “We fix a few toilets. The only people actually building  are the 
marijuana growers down in southern Humboldt.”

Take out Humboldt’s good fortune in being in the Emerald Triangle and multiply 
by every plumbing store in America. Throw in the idled lumber yards, 
construction stores, paint suppliers, and building crews. Count in the car lots 
that are going out of business because the banks won’t finance car loans. Go to 
the lost auto assembly jobs. It tots up to job loss across America just in 
December and January of 1,175,000. And that’s an underestimate. Every president 
since Reagan, particularly Clinton, has jimmied the unemployment criteria to 
produce an undercount. The actual number for the two months is nearer one and 
three quarter million. The actual total unemployment rate, according to 
statistician John Williams, on pre-Reagan criteria,  rose to 18 per cent  in 
January, from 17.5 per cent in December.

These are numbers out of the great Depression of the 1930s and it’s going to get 
worse in the next few months as businesses put up their shutters. The air is 
whistling out of  the American economy. We’re now heading into the Feb-May 
trough dreaded by every retail store on every Main Street in America. Consumer 
spending is dropping longer and faster than at any time since they began keeping 
records in 1947. A quarter of all home-buyers are late on mortgage payments or 
in foreclosure. People inch through monthly payments on maxed out credit cards.

My own state of California – often touted as the eighth largest economy in the 
world --  can’t pay its bills. There’s a shortfall in revenues and it can’t sell 
enough bonds. On January 26 the California State Controller John Chiang 
announced that the state is going to print its own money. If the state owes us 
money we’ll get this scrip as IOUs.  Who knows, in happier times maybe we can 
hawk them on e-Bay. Student aid and payments to the disabled and needy will also 
come in the form of  IOUs.  Governor Schwarzenegger and his aides are 
negotiating with the banks to get them to accept the IOUs as deposits.

America is in economic meltdown. In Washington President Obama has been battling 
for  his stimulus plan, with the Congress now totting up the exact total – 
somewhere around $800 billion.  Although it’s the largest such package in US 
history the New York Times’  Paul Krugman, resplendent with his Nobel prize for 
Economics, has torn into it for being way too skimpy and conservative,  far too 
respectful of Republican prejudices against hand-outs to anyone without a 10021 
zip code, a Wall St business address and a mansion in Connecticut or Long Island.

The Republicans  have elected to array themselves in implacable opposition to 
the package – surely the stupidest political strategy available for public 
inspection since Walter Mondale tried to beat Reagan in 1984 by promising to 
raise taxes. One of the maddest moments was when they raised Herculean guffaws 
at money requested for a program trying to figure out the decline of the honey 
bee. What use is the honey bee – damn bug, buzzing around in the spring, 
pollinating!

When Obama went last week to Elkhart, Indiana, where official unemployment is 
running at over 15 per cent because no one wants to buy a recreational vehicle, 
he invited Indiana Republican Senator Dick Lugar to come along. Lugar declined – 
a petty, sectarian display of a sort which could cost Republicans badly in the 
2010 midterm elections.

Obama’s package is meant to generate three to four million new jobs which will 
maybe cope with job losses from December through next April if we’re lucky. It’s 
piecemeal: a wad  of money for schools, for health insurance for all children, 
for “infrastructure” – which means good times for cement pourers. But as Paul 
Craig Roberts has pointed out many times on this site,  to clamber out of this 
terrible economic hole Uncle Sam has to start making things he can sell abroad. 
That way the nation can offset the problem of running huge deficits importing 
things from China. “Infrastructure repair”  doesn’t do that. It causes traffic 
jams for the next ten years as the highway lobby gets its new overpasses, 
underpasses, bridges, freeway exits and toll-road expressways, none of which can 
be sold overseas and all of which don’t restore America’s near-dead 
manufacturing economy.

Obama’s Treasury Secretary Tim Geithner tried to sell his bank bail-out plan 
earlier this week. He deservedly drew an F because in his mumbled prospectus he 
conceded he didn’t actually  have a plan, but was toiling night and day to come 
up with  one. Markets duly plunged. In outline, the prospective  trillion-plus 
plan has the usual  forced perspective of a banker, whose idea of rescue is to 
lend people money, thus drowning them in even more debt. Americans don’t need 
more debt. They need debt relief.

Obama’s bailout plan, added to the FY 2009 budget deficit he has inherited from 
Bush, opens a expenditure hole of about $3 trillion.  As Roberts, former 
assistant secretary of the Treasury in the Reagan years, pointed out here last 
week, “Who is going to purchase $3 trillion of US Treasury bonds? Not the US 
consumer.  The consumer is out of work and out of money. Private sector credit 
market debt is 174 per cent of GDP.” The sum is too big for the increasingly 
wary Chinese and Saudis to underwrite by buying Treasury bills where interest 
yields are have been so low that one joke, quoted by CounterPuncher P. Sainath, 
  is that the US Treasury is the only institution in the world to be actually 
abiding by Islamic prohibitions on usury.

Failing everything else, there’s the government printing press, which can roll 
out the dollars and add inflation to unemployment.

The Republicans don’t have a plan, and though Obama has been  energetically 
selling his package even his fans are beginning to wonder if he really has a 
convincing vision either. Americans can understand something big in the way of 
make-work – like Roosevelt’s dams, or the construction of the interstate highway 
system in the 1950s, or Kennedy’s space project or even, in its ultimate 
absurdity and waste, Reagan’s Star Wars plan, still unworkable and now consuming 
19 per cent of the Defense budget. There’s nothing rhetorically tremendous in 
Obama’s stimulus plan, just a billion here and a billion there, on and on in an 
endless array.

There’s  always something cloudy about Obama, just when I’ve almost persuaded 
myself to like the guy, always hedging his bets, doffing his cap to the ruling 
powers, even micromanaging his press conferences so there are no follow-up 
questions. That meant last week  he didn’t have to deal with Helen Thomas 
following up on her initial inquiry as to whether he could name a nuclear power 
in the Middle East. Obama stalled until his aides could force Thomas to sit back 
down. The blacks his press secretary installed in the front row said later they 
were just put there as window dressing.

America is broke but here’s Obama, seemingly set on boosting a US force in 
Afghanistan where, according to the Center for Budgetary Analysis, it costs 
$775,000 per year to send a single soldier.  And, as I noted at the outset, this 
week Obama punched his core supporters twice in the stomach by committing his 
administration to the same unconstitutional canons of secrecy and claims of 
executive immunity to the rule of law that made Bush one of the most hated 
presidents in history. His staff can’t seem to nail down safe appointments. In 
sum, in these crucial early weeks, Obama  seems to have trouble setting his 
compass, as the ship  heads towards the rocks.  But hey, at least we have a 
Democrat in the White House, saving us from endless war, constitutional abuses 
and bank bailouts, right?

http://www.counterpunch.org/