Archive for the ‘Financial Crisis’ Category

21
Jul
2011

The Truth About The Deficit

   Posted by: Dennis Perkinson

“Truth is so obscure in these times, and falsehood so established, that, unless we love the truth, we cannot know it.”

- Blaise Pascal

Since the large cadre of children was elected to Congress last November, the American people have been subjected to antics similar to those my own children tried when they were three and four years old. Don’t get my way—hold my breath until I turn blue. Don’t want to do what I’m told—lie on the floor, kick, scream and beat the floor with my fists. At three and four, the children don’t see the parents laughing at their antics. They don’t realize that infantile showmanship isn’t the way to get what they want—cooperation is.

Unfortunately, the same behavior loses its comedic aspect when the perpetrators are, at least in the eyes of the legal system, adults. Then, the behavior becomes pathetic, immature and downright insulting. But that’s the performance we’ve been forced to witness from the clowns elected to Congress by the right wing in November.

These idiots have a personal philosophy that can best be described as, “when the facts don’t fit the fiction, either lie about them or change them.” That they might be wrong is simply a concept they can’t seem to comprehend. As a result, they are willing to take the whole country down rather than cooperate or compromise.

First, consider their worship of Ronald Regan as an icon of fiscal responsibility. While they repeatedly mouth his infamous statement that “government is not the solution to our problem; government is the problem,” they continue to ignore that the Federal Government nearly tripled in size during the Regan Years.

Despite the continued failure of Regan’s “trickle-down economics,” they continue to preach that we can’t tax the wealthy because they are the ones who create jobs. Over and over since Reagan, the U.S. has shown that trickle-down economics would only work in an altruistic society in which the wealthy class feels more responsibility to helping those less fortunate than they do to feeding their own greed. Unfortunately, ours is not such a society.

For two years now, the ultra-right has blamed Obama for the deficit. But they’re ignoring the facts. From 2001 to 2008, the worst president ever to hold the office (Author’s note—I used to at least rate “W” above Buchanan and Hoover, but having seen the continuing effects of the Bush administration, “W” has sunk to the bottom of my list.) took an annual surplus of $86 billion left for him by Bill Clinton and ran the budget deficit to over half a trillion dollars a year ($642 billion in 2008). Altogether, George W. Bush blew up the national debt by over $3 TRILLION. Then he left the bills, and the blame, to Barack Obama.

For eight years, Bush spent like a sailor on a bender who hadn’t seen shore leave in two years. The world was the GOP’s Tiffany’s and they had the American people’s credit cards. See a chance to purchase a shiny, new war? Just buy it—Iraq and Afghanistan are on the shelf. Oh, and let’s not forget the mid-life-crisis enthrallment with shiny, hot-off-the-show-room-floor slick weapons that really make a President and a Vice-President feel macho—half a trillion dollars a year on fancy weapons for wars that will never come; like the Virginia Class (V-Class) submarine, which was designed to attack Soviet subs. Never mind that there are no more Soviet subs; Bush ordered three dozen anyway—at $1.8 billion each.

Tax cuts? Don’t get me started!

The Bush administration acted just like Sarah Palin when she was set loose in Neiman Marcus in Minneapolis—grabbing whatever she could carry, because Never-Finish-What-I-Start Sarah maintains an entourage of salivating sycophants who are all more than willing to let her put her merchandise on their accounts.

During the “W” years, the GOP’s fat cat fraternity brothers gorged on food and spent wildly on wine, women and song. Then, when the waiter arrived with the bill, the rich kids belched, looked around, pointed at the poor schmuck American worker sweeping the floor and said, “THAT GUY will pay.”

At this point, we should probably point out that Congressman Eric Cantor (R-VA), the guy leading the Republicans’ refusal to lift the debt ceiling, voted for the V-class sub. He also voted for Bush’s bogus scavenger hunt for weapons of mass destruction in Iraq. But now that the check has come due, Cantor doesn’t want to pay the bill—he wants seniors, welfare recipients, veterans and those who have lost their jobs and homes to pick up the check.

When I was growing up, my parents taught me: “If you buy it, you pay for it.” Apparently, Cantor’s country club operates under a different philosophy. The members of Cantor’s club expect the spending spree by the rich to be paid for by the working class. The Washington elite agree we must pay for tax holidays for hedge fund managers by closing health clinics. We must fund private corporate jets by cutting food funding for needy women, infants and children.

But, and here’s a thought, there just might be a simple solution—What if we don’t pay the banksters?

There’s an incorrect assumption controlling this debate over debt. Everyone assumes the debt holders must be paid. When the bankers, the Chinese and the Saudis lent Bush $3 trillion dollars for his irresponsible buying spree, they were betting, like any investor, on the good faith of the borrower to pay it back. But if the investment goes south, they should be subject to the same rules that apply to any other investor. Investing carries inherent risk. Have you ever had someone offer to pay you back for an investment in the stock market that went bad? I haven’t.

So, let Hu Jintao and King Abdullah send a collection agency after Cantor and the other Republican shirkers. Repossess their limousines; take their palatial estates; foreclose on their country club memberships—or send a few Jersey Goodfellas around to remind Cantor what happens when you don’t pay what you owe.

There is no reason Obama and Geithner can’t say to Hu, the Sheik and Goldman-Sachs:

“We have identified $3 trillion in Treasury notes issued between 2001 and 2008 which were lent to fund President Bush’s expenditures. Unfortunately, those who borrowed your money don’t want to pay it back. You made a bad investment and you’ve lost your money. I am suspending payments on these Treasury notes until we can round up the deadbeats and make them live up to their commitments. That’s how the free market works.

“As president, I have a Constitutional duty to pay the bills of the Veterans Administration, Social Security, Medicaid and other vital services that have already been voted and appropriated by Congress. All these bills get paid before we pay the bankers of Bush’s follies. Get used to it.”

Will the bankers have heart attacks? Gosh, I hope so. Maybe if bankers are ill, the GOP will vote for universal health care.

Will China refuse to buy more US debt? Not a chance. The Chinese cannot afford a devaluation of the $2 trillion to $3 trillion in US Treasury notes they have in their pokey, a devaluation which would surely follow their abandoning the US treasuries.

From my perch, “default” is not the real issue. The real issue is that age-old battle between Them and Us. They ran up the credit card; now they want Us to pay the bill. Default lies with the Republican spendthrifts.

Perhaps Obama should build a new wing at Guantanamo—a debtors’ prison for trillion-dollar deadbeats. And while they’re there, they can experience up close and personal the benefits of the “enhanced interrogation” techniques their former leader wrought…but that’s another nightmare.