Sunday, November 3, 2013

Let's pick the path FDR chose

The continuous stream of Congressional "debt" crises has been crippling our main street economy, killing jobs, and creating unnecessary hardship for many Americans.  Every quote by a Republican politician regardless of subject always refers to "out of control federal government spending and unsustainable debt and the need to cut entitlements."  There not only is no push-back from Democrats, they seem go out of their way to pay homage to the "federal government debt" problem, which only  reinforces the myth that the federal government is no different than a family and must therefore balance its budget or go broke.

I wrote the following editorial published in the Helena Independent Record October 28, 2013.  The motivation was two especially scary editorials that had appeared in the same paper during the previous couple of weeks.
FDR: "The only thing we have to fear is fear itself."

Have you noticed every time a politician speaks, we’re told we should be very afraid for our future?  “Our federal government is going broke, we’re going to have to borrow more money from the Chinese, inflation is just around the corner, and our children and grandchildren are going to be saddled with an unbearable debt burden.   Revenue is not the problem, taxes are already too high.  Spending is the problem, it’s out of control and “entitlements” are the reason.  You’re just going to have to sacrifice more.”

The fear stories range from the hyperbolic overreach (IR, October 1) of the uninformed like Joe Balyeat, the Montana mouthpiece for the fossil fuels billionaires Koch brothers, to a more respectable John Snow, former Treasury Secretary under President Bush II, who undoubtedly knows the above fear stories are not true (as reported  by Bob Brown in the IR, October 16).

We’ve just witnessed a manufactured 16 day government shutdown engineered by the U.S. Congressional Republicans that caused ~$30 billion in lost GDP, the furloughing of nearly one million federal government workers, and a narrowly averted globally catastrophic economic meltdown that would have resulted if the Republican Congress had refused to allow the government to make interest payments on holders of U.S. Treasuries.   

These fabricated crises have caused over $700 Billion in lost national GDP since the Tea Party emergence in 2010.  Republicans are intent on scaring us all into believing that the U.S. government is going broke unless we dismantle Social Security, Medicare, and Medicaid.  But it’s all nonsense.

Many have been duped into believing the “government is going broke” storyline we are being fed by this anti-government rhetoric.  But consider this: never in its entire history has the country gone broke, yet it has carried a so-called “national debt” every year of its existence except for three years between 1834 and 1837.

If Congress spending creates a heavy debt burden on future generations, why haven’t those of us alive today had to pay back past “national debt?”

Ask yourself this.  Where do the Chinese get their U.S. dollars to lend us, when the U.S. government is the sole producer of the dollar?

Also ask yourself how the U.S. government can afford to spend trillions to bail out Wall Street and its mega-corporations every time they create a private-sector bubble that bursts, yet they cannot help the citizens who were financially destroyed by the explosion.

A brief review of America’s past century is revealing.  The wealth inequities of the 1920s were remarkably similar to the wealth inequities of the decade preceding the 2007 market crash.   The real estate and stock market behavior of the 1920s was nearly identical to the markets behavior of the 1990s and early 2000s.  Market values were artificially high and the wealth gap between the ultra-wealthy and the rest of us were at all-time highs at the times of both crashes.  

The end result of both periods was complete collapse of the economy, the Great Depression of 1929 and the Great Recession of 2008 respectively.  We’re still trying to recover from the latter, and today we sit at a tipping point much like the one Franklin D. Roosevelt faced in 1933.  

Rather than cut federal spending, FDR took a different approach in taking office in 1933.  At the depth of the depression, he recognized that only the federal government had the capability to provide jobs so desperately needed.

In his inauguration speech, FDR spoke these famous words, “The only thing we have to fear is fear itself.”  

Then he brought a conservative Utah banker, Marriner Eccles, to Washington to serve as the architect of FDR’s financial markets regulatory reform and New Deal jobs Programs.  Under Eccles’ leadership, a tightly regulated financial market coupled with government deficit spending lead America into an era of unprecedented worldwide prosperity.  We built gigantic modern public infrastructures like dams, airports, highways, and schools in America while at the same time propping up the economies of war-torn Europe.  During the 1940s through the 1970s, the federal government funded public education for all, developed the atomic bomb, and sent men to the moon.  The government funded all these inspirational things that provided people with jobs and did it with so-called government “borrowing.”  

Today we again stand at a cross-road and our federal government is faced with two options: 1) continue the current path of job-killing austerity, or 2) take the FDR path to return to prosperity by directly funding job creation programs to modernize our infrastructures, fully fund our safety net programs, and fund public education and state sponsored research institutions.  

The so-called “national debt” problem is pure political fabrication.  The real crisis we face today is very same one created by the extreme wealth inequity in America of the 1920s.   It is the failure of our federal government to directly fund job creation programs to rebuild our great nation as FDR did in the 1930s.
The fact is that the private sector businesses are not the only creators of “real” jobs, regardless of what the “small government” ideologues tell us.

The choice of America’s path belongs to us voters because it is us who send our representatives to Washington to create “our future” we demand of them.  Is it job creation or is it job-killing “debt” reduction. 

The 2014 mid-term elections are looming large!

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