Sunday, October 23, 2011

Occupied Thoughts: Will demonstrations gel an effective movement?

Will the Occupy Wall Street movement have an impact similar to the TEA Party movement? The TEA Party, like Occupy, began as a grass roots organization of frustrated voters demanding change. 

Its followers brought a wide variety of viewpoints and issues to rallies, but their primary issue was taxes. After all, TEA stands for Taxed Enough Already. They were fearful that the federal stimulus spending by the Bush and Obama administrations in response to the Great Recession had created long term deficits that would eventually result in higher taxes (despite the fact that much of the stimulus ‘spending’ was in the form of tax cuts).  Most also expressed fear that the Patient Protection and Affordable Care Act, (aka Health Care Reform), would increase deficits and be an unwelcome intrusion into Americans’ rights to manage their own health care needs and choices (I believe those fears to be unfounded, but that argument is for another day). What the TEA Party was most concerned about, though, was jobs and the economy, and a general feeling that President Obama and the Democratic Congress, led by Harry Reid and Nancy Pelosi, were not representing their interests (most TEA Partiers are white, middle-aged, and male).

TEA Party principles are:
  • Fiscal Responsibility: taxes should be low, budgets should be balanced, national debt should be paid off. 
  • Constitutionally Limited Government: the role of the federal government should be limited to that which the founders outlined or intended in the Constitution.
  • Free Markets: the government should not intervene in business.

These principles have the ring of sensibility, but if strictly adhered to would result in a fundamentally different America than exists today. “Original Intent” might not allow for Social Security, Medicare, Medicaid, Departments of Education, Health and Human Services, Environmental Protection Agency, etc.  TEA Partiers believes the constitution leaves those areas to the states or individuals. Most health, safety, and financial regulations would be abolished, and the Federal Reserve dismantled. However, surveys of self-identified TEA Partiers show that large majorities would be against cuts in Medicare and Social Security, though wanting to cut both taxes and deficits. The only way to square those kinds of desires is through faith that cutting taxes will miraculously raise tax revenues, a belief that Reagan’s and G.W. Bush’s experiments proved false.

Nevertheless, most conservative Republicans and many Independents find these ideas attractive, with the caveat that change must be incremental or that anyone currently receiving Medicare, for example, would continue to receive it. Republican politicians identifying themselves as TEA Partiers emerged with the message that they would be the ‘true conservatives,’ and unlike the big Republican spenders during the Bush years and before, would hold the line, even if it meant shutting down the government. With the promise of even lower taxes and roll backs of regulations, and aided by the Supreme Court’s ruling in Citizen’s United allowing for unlimited political spending, wealthy corporate interests and individuals stepped up with a massive influx of cash to support TEA Party Republican candidates and unseat Democrats in statehouses and Congress in the 2010 elections.

Without the massive influx of corporate cash supporting think tanks, media buys, and political campaigns often disguised as issue advertising (and claimed as tax deductible charitable contributions), the TEA Party influence might have been marginal. Jane Mayer, a journalist writing for the New Yorker, has detailed the methods used in 2010 in articles about the billionaire Koch brothers and a recent article about multi-millionaire Art Pope’s almost single handed purchase of North Carolina for the Republicans.
So, while the TEA Party started as a grass roots organization that hoped to inspire millions of American voters with mass protests and rallies, it is currently supported by only 15-20% of voters. It remains to be seen whether the Republican candidate for president in 2012 will have TEA Party support, and if not, whether there will be a movement to put up their own candidate.

The Occupy movement, like the TEA Party, started as a grass roots movement in response to concern about the economy. Unlike the TEA Party, however, they do not blame government alone for our economic woes; instead they identify the greed of corporations and their influence on government. While the demographic is clearly younger than the TEA Party’s and reflects the frustration or idealism of unemployed college graduates and students, they have recently been joined by unions and other progressive, Democrat supporting organizations, such as Van Jones’ Rebuilding the American Dream. Some proposals taking shape are for more equitable wages and taxation, which line up well with President Obama’s and Democratic platforms.

Will this movement continue to grow, as the organizers hope, into a massive peaceful revolution such as occurred in Egypt, so large that politicians will be forced to take action on yet to be identified demands? Or, as racist elements within the TEA party did, will radicals in Occupy discredit it for most Americans? Will the enthusiasm and persistence of its supporters influence the Democratic Party as the TEA Party has influenced the Republicans? Will their efforts translate into positive change for America? I hope so.

This essay appeared in the Charleston Gazette-Mail on October 21, 2011

Sunday, October 2, 2011

We Need a 4-Wheel Drive Economy

(published in Charleston Gazette-Mail Sunday, October 2, 2011)

What powers the American economy? Many folks have compared the U.S. economy to a vehicle out of control, in a ditch, or flying over a cliff. Let's examine this metaphor.

In the 1700's and early 1800's our economy was pulled by horse-drawn carts and sailing ships, though in the South, enslaved African-Americans were pulling as well. Most Americans fended for themselves on farms, feeding themselves and selling or bartering the surplus.

Steam power, industrialization, and immigration brought more of us into the cities to labor for wages and seek education, leading to more recognition of human rights, a Civil War that ended slavery. The economy was pulled into the 20th century by steam locomotives opening up land and opportunity in the great American West and booming trade exports to the world.

Many prospered, but rich industrialists prospered disproportionately. They drove the economy in luxury cars like tanks, often exploiting their workers, treating them like replaceable parts subject to long hours, low pay and unsafe conditions. They crushed labor movements and created monopolies. Teddy Roosevelt broke them up by ushering in the Progressive era of government, regulating industry, increasing competition, creating the Interstate Commerce Commission to ensure a level playing field among the states. Now the economy could hum along, pulled by millions of Model-Ts owned by Americans entering the middle class.

The American Dream was evolving from 40 acres and a mule to a good job within driving distance of a home with a yard. We began to have savings to provide for retirement and access to credit, which many used to invest in property or the rapidly rising stock market. At the end of the 1920's, credit flowed freely, speculation was rampant, and inflation was kept low by the recently created Federal Reserve.

The bubble burst and over-leveraged banks and investors could not pay their debts. Americans' savings were wiped out and they had no pensions. There was no Social Security, no unemployment insurance, no food stamps, and no FEMA to help when the Dust Bowl blew the very earth from farms.

The economy, like a crowded highway full of speeding cars, hit a freak patch of black ice and crashed, causing a chain reaction and backing up the road to world-wide recovery for miles and years. During the Great Depression, Americans abandoned the economy, hoarding what money they had or could earn as they lost their homes and jobs and farms and hunkered down or drifted around in survival mode. It took that "traitor to his class," Franklin Delano Roosevelt to buy Americans a ticket on the train back to the middle class, regulating the financial markets, creating employment opportunities, providing Social Security for the elderly and much more.

The juggernaut of spending and employment that was World War II put America's economy aboard a fleet of fighter planes, roaring to world leadership. We emerged from the war with no damage to our own industry from the millions of pounds of explosives detonated around the world to roll back the militaristic fascist corporatism that had pulled the Axis powers out of the Depression. We were in a great position to export products to the world as we coasted along our new Interstate highways in our gas guzzling cars, built increasingly bigger homes, with two- and three-car garages, and entered the grand age of consumerism.

This carried us through until the rest of the world began to catch up and compete, beginning with the Japanese, who learned how to make things not only cheaper, but better. Meanwhile, in our desire to fend off Communism, which threatened to close markets to us, we squandered much of our treasure in Vietnam. While all that spending kept a lot of people working, for the first time, our balance of trade tipped the other way. At the same time, oil-producing nations decided it was time to get their fair share. Rising oil and gasoline prices spurred inflation and put the brakes on the economy in the 1970's, crashing Jimmy Carter's presidency like a helicopter trying to rescue hostages in Iran.

Ronald Reagan led the Republican tax cutting charge in the 1980's with their first foray into "trickle-down economics." Tax cuts, especially for the wealthy, would spur a boom, he said. Helped by a glut of oil and a tightening of the money supply begun under Carter, inflation decreased, and the economy picked up. However, Reagan's economy was a rented Lincoln. The national debt tripled to over $1 trillion. The money didn't trickle down; it trickled out.

Bill Clinton refilled the tank, and bought us a strong pickup truck by raising taxes on those who could afford it. Helped by a boom in technology and the internet, he balanced the budget and began paying off the debt. And then along came George W. Bush. He came to office facing a small bumpy patch created by the bursting of the tech bubble, and steered the economy onto a side road, invited his friends to strip it with tax cuts for all, mostly the wealthy. He re-fit it as a military vehicle funding the Afghanistan and Iraq wars with deficit spending. At the same time, he weakened regulators and regulations.
He crashed the economy, and it would have been totaled in the form of another Great Depression had he not taken the now nearly crippled vehicle into the shop for repairs in the form of emergency loans to banks and other financial institutions.

When President Obama came to pick it up, the repairs had barely begun to fix the wreck. Early estimates did not account for the full damage. Credit was frozen, employment and tax revenues were down while the deficit was up. Business and consumer confidence was shattered. Spending stalled. Housing prices were sinking while foreclosures rose.

He got it fixed enough to get back and forth every day, returning to the shop each night, borrowing stimulus spending for repairs and passing it to local and state governments to keep their teachers and policemen employed, to fix roads and bridges and to supply unemployment insurance. He lent money to auto companies so they could get back on their feet and help with the repairs.

In 2010, John Boehner took over management of the garage and said Obama's debt was too high, and he'd have to cut back on plans for further repairs. Then, as Obama was getting gas one day, a gang of  tea party teenagers threatened to hijack the car and refuse to raise the debt ceiling. They grabbed his credit card, insisting, "You'll have to give up health insurance and take money out of the retirement account. No asking your rich friends to pony up either." He promised to save some money by spending less on his kid's textbooks and a few other things, and they reluctantly released him.

Now, if you haven't been "driven crazy" by my metaphors, here's what we need to do. Obama has acknowledged this junker inherited from Bush is not worth fixing. He's proposed the American Jobs Act, a short-term rental, until we trade in for a new, more efficient hybrid four-wheel drive.

The drive wheels have to be a mix of industry, good education, a more equitable tax system, and energy and regulatory policies that will carry us into the future. We have to make it run more efficiently and give up a few luxury features we've enjoyed.

Some will grouse about spending the money for this new rig, but it will be more dependable getting us where we need to go. If we hit a slick spot or slide in a ditch, it could get us out again. We have always paid our debts, and we'll pay this one off, too. It just might take us a little longer.