Saturday, January 22, 2011

Quote Of The Day

Hearkening back to something I wrote months ago about who benefits from government "austerity", University of Massachusetts Emeritus Professor Richard Wolff writes:
California's new governor proposes to continue for five more years the massive, broad-based tax increases begun during the crisis and also to cut state services for the poor (reduced Medicaid funding) and the middle class(reduced budgets for community colleges, state colleges, and the university system). The governor admits that California's budget faces sky-high interest costs and reduced federal government assistance just when the crisis increases demands for public services. The governor does not admit his fear to tax the state's huge corporate and private individual wealth. So, he announces an "austerity programme", as if no alternative existed. Indeed, a major support for austerity comes from the large corporations and wealthiest Californians, who hold the state's bonds and want reassurances that the interest on those bonds will be paid.

The Myth Of 'American Exceptionalism' Implodes
[link from original, emphasis added]

Those people who are wealthy enough to buy the various bonds that states and other governments are selling to balance their budgets and fund infrastructure improvements are the ones who are benefiting from this. Interest rates on these bonds are far higher than just about anything available to the rest of us. Of course, they also benefit from the cheap, docile labor that high unemployment produces.

If you want to know who our government and our press work for, all you have to do is ask yourself why neither ever frames austerity measures in any terms but that they are inevitable. The fact is, they're not. Raising taxes on the rich would be any easy solution, if that's not who they worked for.

UPDATE: Let's riff on that "who they work for" theme for another moment, courtesy of Jesse at Cafe Americain:
In case there was any question remaining in your mind as to what is really happening.

It should be noted that GE was the number one corporation in lobbying, spending $40 million on the purchase of political influence last year.

Obama is looking more like Herbert Hoover every day, but without the Great Engineer's accomplishments.

GE's Jeff Immelt To Replace Paul Volcker
Paul Volcker was the closest thing to an advocate for everyday people among Obama's economic advisers, and it's an epic understatement to say he wasn't all that influential. Now he's gone, to be replaced by someone who Marcy Wheeler rightly labels as a big part of our competitiveness problem, and who ran a company that one news article recently described as a major recipient of bailouts during the financial crisis. This wouldn't be the first guy I hired to head a council on restoring American economic competitiveness and employment. In fact, he wouldn't be my 100th pick, either. But he was Obama's. Go figure.

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