Fw: Economic Shock Therapy
----- Original Message -----
From: "Tom Cahill" <tcahill@mcn.org>
To: <Recipient List Suppressed:>
Sent: Sunday, December 12, 2004 2:02 AM
Subject: Economic Shock Therapy
Excerpted from Quo Vadis: Playing For Keeps
by Patrick C. Doherty
http://www.tompaine.com/print/quo_vadis_playing_for_keeps.php
Shock Therapy, Norquist-Style
In the 1980s, Reagan's chief budget adviser, David Stockman, admitted
that it was White House policy to expand the federal deficits in order
to squeeze out social entitlement spending. The Bush administration has
taken that tactic one step further, explained by the pre-eminent
Republican operative Grover NorquistÃs famous goal, "to get government
down to the size where we can drown it in the bathtub."
And they have already declared their intentions to do just that. The
Bush administration has identified its top three legislative priorities
in the next term, and none of them involves reducing American
consumption and increasing American savings. Instead, their priorities
represent the final operations of the battle started in 1964: tort
reform, Social Security reform and tax reform. Tort reform to curtail
consumer protections. Social Security reform to force every working
American to buy risk-filled investment accounts. Tax reform to make
taxation fully regressive, placing the highest burden on the lowest
earners through either a flat tax or a value-added tax.
Given our severe account imbalances, this second-term agenda of the
Bush administration will signal to our global creditors that we are not
serious about our debts. That will make dollar-denominated securities
worthless and the dollar will cease to be the global currency, as
America will no longer be the mass market of last resort. At some
point, OPEC will have to switch to a new currency, probably Euros, and
the price of oil for Americans will rise significantly as the dollar
continues to fall. As Roach's collapsing stock market ushers in a
recession, the inevitable job losses will pop the housing bubble across
the country. Americans, with trillions of dollars of consumer debt
leveraged on the value of their homes, will find that their futures
will have disappeared. Hard-earned home equity will be gutted and stock
values will have crashed. Unemployment will be widespread.
With a full four years in the White House, two years of hegemony in
Congress, and an escalating, multi-fronted war, the far right has
plenty of time and cover to push their agenda through. With no interim
accountability, they can ignore reality and continue to spin wildly to
the American public. Indeed, this administration has already shown that
it can use a national crisis to advance goals that in fact reinforce
the causes of the crisis. It happened with 9/11, and it can happen
again.
Too Crazy To Believe
The movement conservatives leading the GOP have decided that the way to
get what they want is to throw out all the rules, whether that means
speaking truthfully to American citizens, comity in the Senate, stare
decisis in the Supreme Court or fiscal discipline in the budget. These
concepts once defined the American form of government and placed the
republic above partisanship. But to operatives like Karl Rove and
Grover Norquist, they represent Democratic blind spots to be exploited.
Bipartisanship, as Norquist once said, is merely another word for date
rape.
Destroying the economy in order to remake it is just the kind of gambit
that Democrats would believe so unlikely that it is not worth
considering. It defies logic and credibility. Just like the possibility
that Christian Zionists could take over Congress or that Bush might
invade Iraq with no real evidence of a threat.
It's hard to write such a depressing analysis. It feels overly cynical.
But then I remembered Ron Suskind's profile of George W. Bush in the
NYT Sunday Magazine. In it, a senior adviser to Bush told Suskind:
"We're an empire now, and when we act, we create our own reality. And
while you're studying that reality, judiciously, as you will, we'll act
again, creating other new realities, which you can study too, and
that's how things will sort out. We're history's actors...and you, all
of you, will be left to just study what we do."
And then I think I might just be right.
Excerpted from Quo Vadis: Playing For Keeps
by Patrick C. Doherty
http://www.tompaine.com/print/quo_vadis_playing_for_keeps.php
Shock Therapy, Norquist-Style
In the 1980s, Reagan's chief budget adviser, David Stockman, admitted
that it was White House policy to expand the federal deficits in order
to squeeze out social entitlement spending. The Bush administration has
taken that tactic one step further, explained by the pre-eminent
Republican operative Grover NorquistÃs famous goal, "to get government
down to the size where we can drown it in the bathtub."
And they have already declared their intentions to do just that. The
Bush administration has identified its top three legislative priorities
in the next term, and none of them involves reducing American
consumption and increasing American savings. Instead, their priorities
represent the final operations of the battle started in 1964: tort
reform, Social Security reform and tax reform. Tort reform to curtail
consumer protections. Social Security reform to force every working
American to buy risk-filled investment accounts. Tax reform to make
taxation fully regressive, placing the highest burden on the lowest
earners through either a flat tax or a value-added tax.
Given our severe account imbalances, this second-term agenda of the
Bush administration will signal to our global creditors that we are not
serious about our debts. That will make dollar-denominated securities
worthless and the dollar will cease to be the global currency, as
America will no longer be the mass market of last resort. At some
point, OPEC will have to switch to a new currency, probably Euros, and
the price of oil for Americans will rise significantly as the dollar
continues to fall. As Roach's collapsing stock market ushers in a
recession, the inevitable job losses will pop the housing bubble across
the country. Americans, with trillions of dollars of consumer debt
leveraged on the value of their homes, will find that their futures
will have disappeared. Hard-earned home equity will be gutted and stock
values will have crashed. Unemployment will be widespread.
With a full four years in the White House, two years of hegemony in
Congress, and an escalating, multi-fronted war, the far right has
plenty of time and cover to push their agenda through. With no interim
accountability, they can ignore reality and continue to spin wildly to
the American public. Indeed, this administration has already shown that
it can use a national crisis to advance goals that in fact reinforce
the causes of the crisis. It happened with 9/11, and it can happen
again.
Too Crazy To Believe
The movement conservatives leading the GOP have decided that the way to
get what they want is to throw out all the rules, whether that means
speaking truthfully to American citizens, comity in the Senate, stare
decisis in the Supreme Court or fiscal discipline in the budget. These
concepts once defined the American form of government and placed the
republic above partisanship. But to operatives like Karl Rove and
Grover Norquist, they represent Democratic blind spots to be exploited.
Bipartisanship, as Norquist once said, is merely another word for date
rape.
Destroying the economy in order to remake it is just the kind of gambit
that Democrats would believe so unlikely that it is not worth
considering. It defies logic and credibility. Just like the possibility
that Christian Zionists could take over Congress or that Bush might
invade Iraq with no real evidence of a threat.
It's hard to write such a depressing analysis. It feels overly cynical.
But then I remembered Ron Suskind's profile of George W. Bush in the
NYT Sunday Magazine. In it, a senior adviser to Bush told Suskind:
"We're an empire now, and when we act, we create our own reality. And
while you're studying that reality, judiciously, as you will, we'll act
again, creating other new realities, which you can study too, and
that's how things will sort out. We're history's actors...and you, all
of you, will be left to just study what we do."
And then I think I might just be right.
posted by carol wolman @ 5:38 PM
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