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Sunday, March 14, 2010

Back to Market Fundamentalism

Only certain aspects of the neoconservative agenda are returning. However, the author is surely correct in thinking that the deficit will be used as a justification for privatization of public services. But this has been a policy for some time now as attempts are made to find new profitable outlets for capital. It fits in well with the doctrine that government should be downsized and is not efficient at providing services. They may not be efficient at doling out taxpayer money to private contractors either!
Entitlement programs will be the next line of attack as working class people will be made to pay for the crisis in the capitalist system. Profits will be restored for capital and pain restored for workers who must pay for the deficit. The standard of living in the US for most people will begin a long decline and those who managed through decades of struggle to win benefits and contracts that provided a decent living and pension will now lose all of that in the name of efficiency and non-sustainable entitlements. It seems quite easy to turn the less well off workers against those who through their unions fought hard for these contracts and are now having to give back just to keep a few of their jobs. This is from informationclearinghouse.


Back to Market Fundamentalism
How champions of Neoliberal economics are reversing New Deal economics
By Ismael Hossein-zadeh

Outsourcing policies are bound to be further accelerated by the rising budget deficits of many states and municipalities, and their need to sell off public property or outsource their traditional services in order to raise funds to finance their budgetary needs. These include outsourcing the maintenance of parks, the management of toll roads, the collection of waste, the operation of municipal neighborhood centers, and more. For example, according to a recent MSNBC report, in the two years since Mitch Daniels was elected governor in Indiana, “the state has leased the 157-mile Indiana Toll Road to an outside company for the next 75 years for $3.8 billion, hired vendors for $1.16 billion over 10 years to process welfare applications, and brought in a company to serve food at a mental hospital.”
While cash-strapped states and other local governments can generate quick cash by privatizing public property or outsourcing public services, they forgo long-term opportunities of income generation from such properties and services.
Another Wall Street plot to rob the people of their social safety net programs is the recently renewed attack on the once-sacred entitled programs such as Social Security, Medicare and Medicaid. Having piled up huge sums of national debt and deficit (through bank bailouts, military spending, and tax cuts for the affluent), Wall Street champions, firmly ensconced at the Congress and the White House, are now singing the “fiscal responsibility” song as a prelude to chip away at Social Security and other entitlements. This ominous scheme is clearly reflected in President Obama’s recently appointed “National Commission on Fiscal Responsibility and Reform,” a bi-partisan group that is tasked with reviewing the Social Security and other entitlements in an effort to further “trim” social spending in order to pay for the sins of major banks and military contractor.
The bipartisan nature of the attack on Social Security indicates that the plan to undercut economic safety net programs cannot be blamed solely on the blatently neoliberal Republicans. It shows that, with few exceptions, Democrats are as much indebted and committed to the powerful financial interests as are Republicans. The neoliberal economic policies of the Obama administration, crafted by his economic team of ex-bankers/Wall Street advisors, should dispel any illusions that he is committed to “change” in favor of the people.
The New Deal and other basic needs programs were put in place not so much because of F.D.R.’s or Keynes’s genius, or the goodness of their heart, as they were because of the compelling pressure from the people. Freed (or feeling free) from that pressure, the government, as the executive body of the financial/economic oligarchy, is now trying to undermine those social safety net programs, and revive the pre-New Deal/pre-Keynesian economic orthodoxy, that is, the economic model of the survival of the fittest. This sinister, profit-driven effort at undermining the poor and working people’s hard-won basic needs programs can be stopped only through a renewed and compelling pressure from the grassroots—pressure that must be exerted not through the Democratic Party machine but independent of the so-called two-party system.
Ismael Hossein-zadeh, author of The Political Economy of U.S. Militarism, teaches Economics at Drake University, Des Moines, Iowa.

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