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The Economy Is In Big Trouble—Part II, Our Diminished Future.

February 12th, 2010 · No Comments · Economics, Politics

To understand your life in the future, you must understand that what happened in the last 8 years, particularly in the last year of the Bush Administration, as described in Part I, is irreversible. We cannot go back and sue all those Tom DeLays or Dick Cheneys, or even whatever number of Democrats joined in somewhere along the line. We cannot go back and undo the foolish wars or bring back the American and Iraqi dead, let alone the $3 trillion it has cost us.

We cannot even go back and apologize to those who, during the Clinton Administration, voted to cut deficits and balance the budgets…those whom we voted out of office because we felt were not bringing home enough bacon to their districts. But they were right in balancing the budget. It is too late now to apologize. They have moved on in their lives. But the subsequent deficits brought on by those we voted in during the Bush years will remain with the rest of us for the next twenty or fifty years, even if we act right now.

Resign yourself to one thing. Life in these United States will never be restored to what it was before 1980. We will never see the same number of jobs as a percentage of the population. We will never see a single day when the country is not restricted in helping you because all its excess capital is being used to pay down the national debt or the interest on the debt. You will never see a strong middle class again. The middle class is in decline and family earning under $150,000 will only see its position in society decline, not elevate. Yet those with incomes over $330,000 may well see incomes rise substantially. The former is an admittedly arbitrary dividing line for the upper end of the middle class and the latter is the tax category definition for the average income of the top 5%.

The Republican Party will now become the de facto party of the corporations. The Supreme Court decision has said that a corporation may, for example, on the day before an election, run a television commercial against a candidate, smearing him truthfully or falsely and spend millions on that one day if they wish. Henceforth, in this country, anyone who seeks to enter politics must consider whether he or she is willing to take on the monolithic power of corporate America. Or, perhaps, decide to work exclusively for corporate interests.

With 90% of media already in the hands of either Conservative corporations or literally owned by Right Wing individuals or families, no counter-message that is not paid for will ever see the light of day or TV screen. And the simple facts of corporate size and profitability in this country means that even Unions can be outspent by 10 to 1. Candidate Obama raised a record $800 million from the people in $5 and $10 increments on the Internet. Corporations can raise that amount if necessary every month. They won’t give contributions any longer to a candidate that does not tell them specifically what they want to hear. It is simple self-interest, unencumbered by legal restriction.

So, the cavalry is not coming, folks. Here’s an example. President Obama has passed an act designed to help those in foreclosure. It gives banks huge incentives to restructure mortgages and reduce principal and interest. Banks simply refused to do it. Consequently, homes will continue to fall in value. They have already dropped in value by 30% from 2006 and with an estimated 3 million homes predicted to be foreclosed in 2010, up from a record 2.8 million homes in 2009, values will drop even further. That means more people unable to sell a home that is now less than its mortgage value. But the banks show no flexibility at all. None.

We have many problems with the economy and with health care insurance rates going up by as much as, for example, 39% by Blue Cross this year in California. But the tea party morons and the vicious Right Wing Neocon, health-industry supporters don’t care. They have their Rush Limbaughs who relentlessly lie about the most valuable piece of legislation since Medicare was first introduced.

With fewer than 5% of the radio time permitted to be for anything but corporate-Right Wing, anti-middle class arguments, there is no hope to prove to Americans that when they vote for Neocons they are voting for Representatives who are actually lying to them about legislation. They somehow cannot register the fact that they are voting for the very people who have put them into the mess we’re in. They can’t seem to understand that these Neocons are mis-characterizing reform legislation as “socialist” when it is merely attempting to rectify the financial catastrophe that they created.

The Neocons in the Senate have executed 112 filibusters in this congress alone, just in the last year–on the jobs bill, on health care, on the stimulus and on every single piece of legislation designed to help the People, including alternative energy. In other words, they are actually voting with the Arabs against Americans. And the tea baggers and the Independents and about a quarter of Democrats are so ill-informed that they still think that a bunch of corporate bought-and-paid-for Neocon legislators will not make that 113th filibuster to stop programs for the unemployed or the homeless or for food stamps for the indigent.

And now for the really bad news. We have about 9 months of stimulus, whether it be a lot or a little. If thinks continue politically as they have been, with people like Christie in New Jersey and Brown in Massachusetts being elected, not only will we have a corporate-run House, Senate and many Governors offices, but we will then start on a ten year austerity program where corporations are now going to tell you…because they will own the entire political system…how it will be handled.

Our current ratio of debt to GDP is unsustainable. Studies show that when a country reaches 90% of debt to its GDP, gross domestic product, all the revenues for everything produced for that year, it begins to decline. It is a pretty hard and fast rule. Our debt has grown to near that point. So there is no question that we will, in the second half of this year at least, have a commission that will begin to make recommendations.

Here is what we know right now. Both Social Security and Medicare will probably be reduced by some amount. Taxes on the middle class will go up and a wide variety of new taxes, even a national sales tax perhaps, will be instituted. If there is no health bill, Medicare costs will continue to climb and cuts will be more severe. If any kind of health care bill is passed, it may be possible to have it go into effect in a meaningful way before the November elections, when…incredibly but apparently…more Neocons will be elected to do more economic damage to the very people who will elect them.

We know that the Chamber of Commerce is already working to find candidates who will do whatever big corporations will tell them. That is why you are seeing challenges to many in the Republican Party, even those who have voted with the Party a very high percentage of the time. There will be no more Conservatives in the Republican Party. Only corporatists, those who will obey the “party line” 100%.

And why not? Many members of the House and Senate will finally become what many are already–very highly paid employees of certain corporations. Monsanto will have its Senators and its members of the House of Representatives from St. Louis. They will be able to simply dictate policy on environmental issues, for example, to their man or woman. Not doing so would be suicide because the corporation would simply bankroll a campaign against him or her that the Representative would never be able to counter with anything but millions of dollars.

Average American citizens will suffer as they have never experienced. We will return to the late 19th Century where 12-hour days, child labor, union-busting thugs, with cities like cesspools and people begging on street corners. We spent a century overcoming these obstacles and now in the 30-years since a charismatic actor, falling into senility was able to create a propaganda machine of ultimate quality and sadistic purpose, we about to return the country to the hands of these moguls…now much more savvy and with much more legal power, thanks to our own Supreme Court.

The goal of the Congress will be to reduce the national debt to a certain amount, a certain percentage of gross domestic product. Here’s how they will say that they will do it, if the Neocons take control, which now is almost inevitable.

First they will make huge cuts in government. There will be no cuts in services to corporations, those things often referred to as “corporate welfare.”

The military budget, at most, will receive a 5% cut strung out over a long timeline. Corporations are strong, but military-industrial corporations are even stronger because they offer good jobs, which we all pay for, and the idea that not voting for their war machines…which are almost immediately obsolete or destroyed…is considered unpatriotic.

Medicare and Social Security will be cut. You are seeing the Neocon proposals already. Paul Ryan’s plan, mentioned in the “Top News” section of this blog wants to privatize everything. They won’t be able to do it until after the next election after this one in November. But by then they will have been able to buy not only all the Neocon House members and Senate members that they need, but many Democrats who will simply get into the race to take the money.

Remember, there will only be one real political Party, the one that can literally obliterate the opposition’s ads. That party will be the Neocon (corporate) Party, the currently named Republican Party. Any candidate that goes up against the corporations, the health insurance companies combined with the oil companies combined with the nuclear power companies (oh yes, you’ll see a LOT of nuclear power in the next ten years…not so much solar and wind) will be demolished in the campaign. And it is all legal now, thanks to the Bush Supreme Court.

Then taxes will go up. Not on the top 5% because that is where every single CEO resides. But there will be taxes on consumption and taxes on a wide variety of consumer products and services that are currently used by the middle class. Life will, in general, in many ways become more expensive. They will try to keep it as unobtrusive as possible. There will be no corporate taxes of course beyond the pittance they pay now, about 7% of annual gross tax receipts, the lowest in modern history and far lower than any other industrialized nation.

The 12% of GDP that we currently get in federal tax revenue, the lowest in something like 70 years is insufficient to bring down the national debt, so eventually the Neocons will turn the screws even tighter on the services most used by Middle Class, what will be left of it. Once the corporations own the Congress completely, it is morel likely that they will invent excuses, just as they do now, lies about how there is very little hardship on the people, just as now they lie that a reform and expansion of private health care insurance is a “government takeover.”

We will probably try to get the national debt down from $12 trillion where it will be soon, to perhaps $6 trillion by the end of this decade. You must imagine the staggering task of going from a $500 billion annual deficit to a $500 billion surplus, because that is what must happen. There will be no visible surplus because somehow $500 billion of the debt must be written down each year to cut the national debt to about 60% of GDP.

And it could be worse. Part of our even beginning an austerity program, that is, going from being partially destitute and living on the freeway, to deciding to live on a thousand-calorie-a-day diet until things get better, depends on coming out of the recession.

After the consecutive deficits of the last 8 years, capped by the Bush Recession of 2008, where, for example, we now know we lost 800,000 jobs in one month alone, January of 2009, there is no longer an alternative to austerity. There is only how we will do it. With the corporations in full control of the political process, we can be pretty sure that it will fall heavily on Social Security, Medicare, Medicaid, Veterans’ benefits, HUD, the Energy and Interior Departments, and, externally, Unions. Wall Street, on the other hand, will run amok.

As an overall society, we can only blame ourselves; our lack of education has led to a transient and ignorant society, taken with every popular whim. The Neocons and their allies in the corporations and the hugely wealthy families of the oil and manufacturing sectors have been relentless in their pursuit of greed and power. We failed to match them in our resolve. They allied with Fundamentalist religions and racists to defeat democratic proposals and with like-minded greedy ideologues to distribute their propaganda.

Elections have consequences. The consequence of 30 years of electing corporatist Republicans is that their true selves, the Neocons, will soon exit the Trojan horse under whose false banners of patriotism and phony populism they campaigned for so many years. They will show themselves clearly to be the mercenaries of the corporations. The sad part is that, like Troy, after so many years of so many noble people having fought for justice and equality, we will have failed. Sadder yet is what will happen to so many decent, hardworking American people in the coming decade.

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