There is a certain irony in the fact that the party of debt has now become a flock of austerity hawks. This is the same Republican Party that gave us two wars, an increase in military spending and whopping loss of tax revenues due to tax breaks for mega-rich corporations and wealthy Americans. Nobel Prize-winning economist Paul Krugman raises the question of what happened to the federal government budget surplus of 2000 and insists that the answer is, “three main things. First, there were the Bush tax cuts, which added roughly $2 trillion to the national debt over the last decade. Second, there were the wars in Iraq and Afghanistan, which added an additional $1.1 trillion or so. And third was the Great Recession, which led both to a collapse in revenue and to a sharp rise in spending on unemployment insurance and other safety-net programs.”(1) All told, President George W. Bush added $4 trillion to the national debt – and there was no debate about raising the debt ceiling at that time, which was raised seven times.(2) What is often missed in these discussions is that deficits have always been the objectives of hard right-wing Republicans and some equally conservative democrats who see them as an excuse for cutting social benefits and generating massive amounts of inequality that benefit the rich.(3) Michael Tomasky further legitimizes this claim with the charge that “the Republican Party cares nothing about the public debt. In fact, it wants more … It is the party of debt. It is the party of deficits. It is the party of recession. It is the party of unemployment. It is the party of inequality. And it is the party of middle-class stagnation and slippage…. They scream about crisis because what they desire is to use the crisis as an excuse to do things to this country that the hard right has wanted to do for 30 years.”(4) What Tomasky leaves out is that the current crop of right-wing Republicans controlling the shots in Washington and various states appear to revel in “a deep urge to inflict pain.”(5) How else to explain that during recent debt negotiations between leaders of both parties, the Republican leadership walked out as soon as the Democrats suggested the need to talk about not only cutting programs that benefit the poor, but also limiting tax breaks for corporate jets, hedge-fund managers, the obscenely wealthy and corporations.
According to the children of Ayn Rand, Milton Friedman and Ronald Reagan, “neoliberal economics,” individual interests and market driven needs trumped social needs; brilliant individuals were more qualified to run government and largely blossomed within institutions committed to making money; freedom was largely defined as freedom from regulation; and any government that passed policies to provide social protections, regulate corporations, or lessen inequality were either grossly authoritarian or unwise. In this scenario, especially under the administration of Ronald Reagan, government was declared the enemy and the market was turned into a form of casino capitalism as a series of policies were inaugurated in which there was a sustained assault on the working and middle classes through “the busting of unions, the export of millions of decent-paying jobs and the transfer of enormous wealth to the already rich. The tax rates for the wealthiest were slashed about in half. Greed was incentivized.”(6) Accordingly, the ideologues of casino capitalism believed that as the rich and corporations paid less taxes and inequality was left unchecked, society as a whole would benefit, wealth would trickle down. Of course, what has actually happened in the last decade with the unchecked, Wild West, Bush-type casino capitalism is that wages for workers have stagnated; the top 1 percent of the population has gotten fabulously wealthy; health care has deteriorated for the vast majority of the population; schools have been turned into test centers; the nation’s infrastructure has been allowed to rot; and, more recently, millions of people have lost their jobs, homes, and hope. Moreover, two-thirds of US corporations paid no taxes. For example, Bank of America has not paid any taxes for the last two years.(7) At the same time, increases in inequality in the United States dwarf the rest of the world, while increases in executive pay undercuts any claim we might have on democracy.
The working and middle classes have been condemned to a new form of neoliberal tyranny “in which there can be only one kind of value, market value; one kind of success, profit; one kind of existence, commodities; and one kind of social relationship, markets.”(8) The global recession has intensified the war on the American public, as professionals and politicians who make up a global business class now displace democracy with the call for austerity and, in doing so, produce a hidden order of politics in which the “demand for the people’s austerity hides processes of the uneven distribution of risk and vulnerability.”(9) Under the guise of austerity, politically motivated attacks are now being waged on young people, low-skilled workers, the poor, African-Americans and the elderly. On the other hand, austerity measures against the rich are almost nonexistent. Richard D. Wolff provides the details in looking at what he calls “some alternative ‘reasonable’ kinds of austerity.” He writes:
Get our free emails
Serious efforts to collect income taxes from US-based multinational corporations, especially those who use internal pricing mechanisms to escape US taxation, would generate vast new federal revenues. The same applies to wealthy individuals. The US has no federal property tax on holdings of stocks, bonds and cash accounts (states and localities levy no such property taxes either). If the federal government levied a 1 per cent tax on assets between $100,000 to 499,000 and 1.5 per cent on assets above $500,000, that would raise much new federal revenue (everyone’s first $100,000 could be exempted just as the existing US income tax exempts the first few thousands of dollars of individual incomes). Exiting the Iraq and Afghanistan disasters would do likewise. Ending tax exemptions for super-rich private educational institutions (Harvard, Yale, etc.) and for religious institutions (church-goers would then need to pay the costs of their churches) would be among the many other such alternative “reasonable” austerity measures. Comparable alternatives apply – and are being struggled over – in other countries.(10)
One side effect of this blatant, if not corrupt mode of austerity is what I call the politics of trickle-down cruelty. This is evident in policies in which austerity-based cuts are used to reward corporations and billionaires with tax breaks, while simultaneously exploiting the budget crisis in order to eliminate protections provided by the welfare state. The resulting reductions in state spending have drastically cut many basic social services so as to endanger the lives of many young people and others at the margins of society structured in massive financial inequality. For example, in Philadelphia “fire departments have been closed on a daily rotating basis” delaying response time. One unfortunate and possibly preventable consequence occurred “when two children were pulled from a burning row home too little too late…. Mike Kane of the Philadelphia Firefighters Union Local 22 said there was no way to tell whether the children would have lived had the fire station been open, but if not for the brownouts, ‘maybe them kids would have had a shot.'”(11) In Arizona, Gov. Jan Brewer signed a bill that effectively denied health care to over 47,000 low-income children.(12) More recently, a 59-year-old man in Gastonia, North Carolina, robbed a bank for $1 so he could get health care in America. He handed the teller a note asking for only a dollar and medical attention. He sat in a chair in the bank waiting for the police to arrive. As he pointed out to the press, he had lost his job of 17 years as a Coca Cola deliveryman and ended up taking a part-time position in a convenience store. But the work was backbreaking, compounded by the fact that he had arthritis, carpal tunnel syndrome and a painful lump on his chest. With no health insurance, he decided that his best option was to rob a bank and get health care in prison.(13) We also hear about the return of debtors’ prisons, which were abolished in the US in the 19th century. The Minneapolis Star Tribune reports that “people are routinely being thrown in jail for failing to pay debts” and that in some cases “people stay in jail until they raise minimum payment. In January  a judge sentenced a Kenney, Ill., man to ‘indefinite incarceration’ until he came up with $300 toward a lumber yard debt.”(14) Joy Uhlmeyer, a 57-year-old patient care advocate spent 16 hours in jail because she missed a court hearing over a credit card debt.(15) Surely, it is hard to miss the irony of putting someone in jail for not paying a small debt while, as Matt Taibbi has pointed out, law enforcement under the Obama regime has not convicted a “single executive who ran the companies that cooked up and cashed in on the phony financial boom – and industry wide scam that involved the mass sale of mismarked, fraudulent mortgage-backed securities – has ever been convicted.”(16) These financial crooks hid billions from investors and ripped off the American people so as to cause untold suffering and hardship. And, yet, law enforcement does not consider them liable for the crimes they committed, and the Obama administration rewards them with a weak regulatory laws and an open season on obscene bonuses. Such stories serve as flashpoints about a society. And as Zygmunt Bauman points out, even though they may tell us little about deeper causal connections, they “prod the imagination. And sound an alert. They appeal to the conscience as well as to survival instincts…. [They also show] that the ideal that one can ‘do it alone’ is a fatal mistake which defies the purpose of self-concern and self-care.”(17)
All of these examples point to the collateral damage invoked by a casino capitalism that now takes austerity as its clarion call to gut social protections and weaken the rights of labor and unions. Moreover, austerity in this instance is designed to reward the fabulously wealthy while imposing in some cases poverty, suffering and severe hardship on those marginalized by race, disability and class. For many people, these examples I have noted above suggest that the writing is on the wall regarding their future and the message is dark indeed. Complaints by right-wing politicians and conservative pundits about the growing federal deficit and their call for a harsh politics of austerity are both hypocritical and disingenuous. Hypocritical, given their support for massive tax breaks for the rich, and disingenuous, given their blatantly transparent goal of implementing a market-based agenda that imposes the burden of decreased government services and benefits on the backs of the poor, young people, the unemployed, the working class and middle-class individuals and families. As Wolff’s quote suggested above, in this transparent scenario, austerity measures apply to the poor, but not to the rich, who continue to thrive under polices that produce government bailouts, support deficit-producing wars, tax breaks for the wealthy and deregulation policies that benefit powerful corporations. The conservative and right-wing politicians and policy wonks calling for shared sacrifices made in the name of balancing budgets have no interest in promoting justice, equality and the public good. Their policies maximize self-interest, support a culture of organized irresponsibility, and expand the pathologies of inequality, military spending and poverty. Austerity porn functions within the current political climate to promote deficits in order to return the United States to the Gilded Age policies of the 1920s.(18)
This conservative assault is not just about the enactment of reactionary government policies, it is also about the proliferation of a culture of cruelty whose collateral damage is harsh and brutalizing, especially for young people, the unemployed, the elderly, the poor, and a number of other individuals and groups now bearing the burden of worst economic recession since the 1920s. Cruelty in this instance is not meant to simply reference the character flaws of the rich or to appeal to a form of left moralism, but to register the effects especially since the 1970s of how the institutions of capital, wealth and power merge not only to generate vast modes of inequality, but also to inflict immense amounts of pain and suffering upon the lives of the poor, working people, the middle class, the elderly, immigrants and young people.(19) What should be clear is that the politics of austerity is not about rethinking priorities to benefit the public good. Instead, it has become part of a discourse of shame, one that has little to do with using indignation to imagine a better world. On the contrary, shame is now used to wage a war on the poor rather than poverty, on young people rather than those economic and political forces that undermine their future and on those considered other rather than on the underlying structures and ideologies of various forms of state and individual racism.
As the welfare state is dismantled, it is being replaced by the harsh realities of the punishing state, as social problems are increasingly criminalized and social protections are either eliminated or fatally weakened. The harsh values of this new social order can be seen in the increasing incarceration of young people, the modeling of public schools after prisons, harsh anti-immigration laws and state policies that bail out investment bankers but leave the middle and working classes in a state of poverty, despair and insecurity. For poor youth of color and adults, the prison-industrial complex is particularly lethal. Michelle Alexander has pointed out that there are more African-American men under the control of the criminal justice system than were enslaved in 1850 and that, because of the war on drugs, four out of five black youth in some communities can expect to be either in prison or “caught up in the criminal justice system at some point in their lives.”(20) In states such as Georgia, Alabama and South Carolina, new immigration laws “make it impossible for people without papers to live without fear. They give new powers to local police untrained in immigration law. They force businesses to purge work forces and schools to check students’ immigration status. And they greatly increase the danger of unreasonable searches, false arrests, racial profiling, and other abuses, not just against immigrants, but anyone who may look like some officer’s idea of an illegal immigrant…. The laws also make it illegal to give a ride to the undocumented, so a son could land in jail for driving his mother to the supermarket, or a church volunteer for ferrying families to a soup kitchen.”(21) The Obama administration fares no better on punishing immigrants. In fact, its stance on immigration suggests something about its own misplaced priorities in that it refuses to prosecute Wall Street crooks and CIA thugs who tortured men, women and children in Iraq. And, yet, “it has used its criminal justice system and law enforcement apparatus to deport 393,000 people, at a cost of $5 billion.”(22) White-collar crooks produce global financial havoc because of their crooked deals and go scot-free while illegal immigrants looking for work that most Americans will not perform are put in jail.
The trickle-down cruelty of the anti-tax, anti-public and anti-government extremists is on full display in Minnesota where Republicans have refused Gov. Mark Dayton’s call for a tax on “the 7,700 Minnesotans who make more than $1 million a year” in order to raise revenue to address the state’s budget deficit. Rather than tax the rich, Republican legislators have called for slashing “billions from … education, health care and safety programs” and, in order to get their way, have literally shut down state government.(23) The result is that 22,000 workers have been laid off, child care subsidies have dried up and essential services for the poor have been suspended, all so taxes on the rich will not be raised. The mean-spirited Gov. of New Jersey, Chris Christie, has followed the same playbook and has used his veto to eliminate $1.3 billion in spending, most of it for schools, Medicaid and aid to cities. But he also cut much smaller items favored by Democrats, like programs to help abused children and provide legal aid to the poor.
The culture of cruelty, illegal legalities and political illiteracy can also be seen in the practice of socialism for the rich. This is a practice in which government supports for the poor, unemployed, sick and elderly are derided because they either contribute to an increase in the growing deficit or they undermine the market-driven notion of individual responsibility. And yet, the same critics defend without irony government support for the ultra-wealthy, the bankers, the permanent war economy, or any number of subsidies for corporations as essential to the life of the nation, which is simply an argument that benefits the rich and powerful and legitimizes the deregulated Wild West of casino capitalism. As public services are eliminated, health insurance cut for over a million kids and teachers and public workers are laid off, corporate profits have soared and Wall Street executives are having a bonus year. The average worker in the United States made $39,000 in 2010 and got a 0.5 percent pay increase, which amounted to $40,100. According to The New York Times, “the median pay for top executives at 200 big companies last year was $10.8 million. That works out to a 23 percent gain from 2009.”(24)
The moral obscenity that characterizes such salaries becomes clear at a time when 14 million people are looking for work, millions are losing their homes and thousands of families are trying to survive on food stamps. How can any society that calls itself democratic and egalitarian justify salaries that are so grotesquely high that it is difficult to imagine how such wealth can be spent? For example, how can anyone justify paying CEOs such as Philippe P. Dauman, the head of Viacom, $85 million in 2010? Or for that matter, the $32.9 million paid to Michael White of DirecTV?(25) The hidden order of politics and culture of cruelty comes into play when it is revealed that Mark G. Parker, the CEO of Nike, got $13.1 million in 2010 and cut 1,750 jobs, while Peter L. Lynch, the CEO of Winn-Dixie, got $5.3 million and cut 2000 jobs. One of the worst offenders is Michael Duke, the CEO of Wal-Mart, who got $18.7 million in pay in 2010 while eliminating 13,000 jobs.(26) Even more alarming is that some of these bonuses paid to risk-taking bankers were paid for, in part, with taxpayer’s money. For example, Benjamin M. Friedman writing in The New York Review of Books claims that this is precisely what happened in the case of the bonuses paid to Citigroup’s executives. He writes:
Despite the destruction of so much of the stockholders’ value and notwithstanding the enormous taxpayer assistance, Citi’s management announced in the spring of 2009 that it was paying out $5.3 billion on bonuses for 2008, including payments of more than $5 million apiece to forty-four employees of the bank. Because of the $45 billion investment of AARP and TIP money, by 2009 the US government was Citigroups’s largest shareowner. Hence the issue these lavish bonuses raised was not merely a private firm’s right to set its employees’ compensation. What Citi’s management was giving away was, in significant part, the taxpayers’ money. Yet the Obama administration voiced no objection, at least not publicly.(27)
What is daunting about all of these figures beyond being partly subsidized by taxpayer money and the human costs in hardship and suffering is that executive pay raises not only deepen inequality in the United States, lay off workers in order to deepen the pockets of rich CEOs, but they also concentrate enormous amounts of political, economic and social power in the hands of a few individuals and corporations. In the end, such practices contribute to massive amounts of suffering on the part of millions of Americans; they corrupt politics and they undermine the promise of a viable democracy. Frank Rich expands this critique in arguing, “As good times roar back for corporate America, it’s bad enough that CEOs are collectively sitting on some $1.9 trillion? America’s total expenditure on the Iraq and Afghanistan wars over a decade has been $1.3 trillion. But what’s most galling is how many of these executives are sore winners, crying all the way to Palm Beach while raking in record profits and paying some of the lowest tax rates over the past 50 years.”(28)
Of course, this form of economic Darwinism is not enforced simply through the use of a government in the hands of right-wing corporate extremists, a conservative Supreme Court or reliance upon the police and other repressive apparatuses; it is also endlessly reproduced through the cultural apparatuses of the new and old media, public and higher education, as well as through the thousands of messages and narratives we are exposed to daily in multiple commercial spheres. In this discourse, the economic order is either sanctioned by God or exists simply as an extension of nature. In other words, the tyranny and suffering that is produced through the neoliberal theater of cruelty is coded as unquestionable, as unmovable as an urban skyscraper. Long-term investments are now replaced by short-term gains and profits, while at the same time, compassion is viewed as a weakness and democratic public values are scorned because they subordinate market considerations to the common good. Morality in this instance becomes painless, stripped of any obligations to the other. As the language of privatization, deregulation and commodification replaces the discourse of the public good, all things public, including public schools, libraries and public services, are viewed either as a drain on the market or as a pathology. In addition, inequality in wealth and income expands, spreading like a toxin through everyday life, poisoning democracy and relegating more and more individuals to a growing army of disposable human waste.(29)
But there is more at stake than an increase in the hard currency of human suffering and the theater of trickle-down cruelty; there are also disturbing signs that US society is moving toward an authoritarian state largely controlled by corporations and a grotesquely irresponsible financial elite.(30) A market-driven society is not synonymous with democracy and the privileges of the rich and the corporate elite do more to crush democracy than uplift society as a whole. Any society that allows the market to constitute the axis and framing mechanisms for all social interactions has not just lost its sense of morality and responsibility; it is given up its claim on any vestige of a democratic future. Market fundamentalism along with its structure of extreme inequality and machinery of cruelty has proven to be a death sentence on democracy. The time has come not only to demystify the authoritarianism inherent in casino capitalism and the political, economic, and cultural institutions that mimic its policies, practices and values; but also to rethink what a real democracy might look like and to consider what it will take to actually organize collectively to make it happen.
1. Paul Krugman, “The Unwisdom of Elites,” The New York Times, (May 8, 2011) p. A23, online here.
2. Paul Krugman, “To the Limit,” The New York Times (June 30, 2011), online here.
3. James Crotty, “High Deficits were the Objective of Right Economics,” The Real News, (May 10, 2011), online here.
4. Michael Tomasky, “Why The GOP Loves the Debt,” The Daily Beast (July 1, 2011), online here.
5. Paul Krugman, “The Urge to Purge,” New York Times (June 27, 2011), online here.
6. Robert Parry, “If Ayn Rand and the Free Market fetishists were Right, We’d be Living in the Golden Age – Does This Look Like the Golden Age to You?” Alternet (June 28, 2011), online here.
7. Allison Kilkenny, “2/3 of US Corporations Pay Zero Federal Taxes,” AlterNet (March 27, 2011), online here.
9. Gesa Helms, Marina Vishmidt and Lauren Berlant, “Affect and the Politics of Austerity: An Interview Exchange with Lauren Berlant,” Variant 39/40, Winter 2010, online here.
10. Richard D. Wolff, “Austerity: Why and for Whom?” In These Times, (July 15, 2010), online here.
11. Rania Khalek, “Death by Budget Cut: Why Conservatives and Some Dems Have Blood on Their Hands,” AlterNet (June 13, 2011), online here.
13. Diane Turbyfill, “Bank Robber Planned Crime and Punishment,” Gaston Gazette (June 16, 2011).
14. Chris Serres and Glenn Howatt, “In Jail for Being in Debt,” StarTribune.com (June 9, 2010), online here.
16. Matt Taibbi, “Why Isn’t Wall Street in Jail?” Rolling Stone (February 16, 2011). Online here.
18. James Crotty, “High Deficits were the Objective of Right Economics,” The Real News, (May 10, 2011), online here.
20. Cited in Dick Price, “More Black Men Now in Prison System Then Were Enslaved,” LA Progressive, (March 31, 2011), online here. See also Michelle Alexander, “The New Jim Crow: Mass Incarceration in the Age of Colorblindness” (New York: New Press, 2010).
22. Matt Taibbi, “Why Isn’t Wall Street in Jail?” Rolling Stone (February 16, 2011), online here.
26. Josh Harkinson, “10 CEOs Who Got Rich by Squeezing Workers,” MotherJones (May 12, 2011), online here.
27. Benjamin M. Friedman, “Cassandra Among the Banksters,” The New York Review of Books (June 23, 201), online here.
28. Frank Rich, “Obama’s Original Sin,” New York (July 3, 2011), online here.
29. On the pernicious effects of inequality in US society, see Tony Judt, “Ill Fares the Land” (New York: Penguin Press, 2010). Also see, Göran Therborn, “The Killing Fields of Inequality,” Open Democracy, April 6, 2009, online here.
30. There are too many books on this issue to cite. Some of the more notable are Sheldon S. Wolin, “Democracy Incorporated: Managed Democracy and the Specter of Inverted Totalitarianism” (Princeton, NJ: Princeton University Press, 2008); Henry A. Giroux, “Against the Terror of Neoliberalism” (Boulder, CO: Paradigm Publishers, 2008); Chris Hedges, “Death of the Liberal Class” (Toronto: Knopf Canada, 2010); and Jacob S. Hacker and Paul Pierson, “Winner-Take-All Politics” (New York: Simon and Schuster, 2010).