Tuesday, July 26, 2011 - 11:55 AM

President Obama and Speaker of the House Boehner both wasted their opportunities to address the American people Monday night. They repeated familiar formulations, made no progress, offered no hope. Indeed, they offered the American people a display of empty petulance that will only confirm their darkest fears that Washington is now hopelessly broken. Obama's call for compromise and balance was far more lucid, rational and constructive, but, even as one who is very supportive of the approach offered by the President, watching the remarks I was forced to acknowledge that neither man led us one inch closer to the resolution of the unnecessary, man-made crisis that now holds the United States and the global economy in its thrall.
As Melissa Harris-Perry stated accurately in wrap-up comments on MSNBC, if this kind of display served anyone at all, it was the Republicans who argue that government is the problem. To them, it hardly matters that they are the ones who have guaranteed that theirs is a self-fulfilling prophecy. Which of course, would be just breathtakingly cynical were it not so dangerous.
It's dangerous of course, because government is not the problem. Indeed, for those who expect a functioning national defense, or stewardship of our national resources, or care for those who cannot help themselves, or education for our children, or the infrastructure we need to compete in the world, government is an essential part of the solution. In fact, in times like these, it is an even more important part of the solution than it is when the economy is more robust.
Similarly, one of the great lies at the heart of this debate is that the U.S. government is too big. The U.S. government's share of the economy is large and our budget is inexcusably out of balance, but those are both very different things than the bloated public-sector bully that the "too large" label implies. The vast majority of government's share of the economy is in payments to those who need assistance for health care or to pay for their retirements or for unemployment. It's not for rule-makers but for service providers, not for those with power over Americans but with those who work for them. Indeed, it is arguable that, given the power ceded over time to markets to set currency values, given the impact of globalization and trade deals on opening our borders, given the formulation of laws that appropriately constrain government power and eliminate public sector discretion over the behavior of citizens, that this government, regardless of the dimensions of its budget, may in many important ways be the least powerful in American history.
That said, at the moment, despite Republican efforts to evoke the threatening specter of a super-intrusive government that doesn't really exist, it's not the power of public institutions that at the moment commands our attention. It is the sad behavior of those who have been entrusted with the stewardship of those institutions. So consumed are they with their own ambitions that they are willing to practically invite ratings agencies to downgrade America, raise the cost of borrowing, choke off our growth, inflate the costs of our debt, create an entirely new and unnecessary burden on the American people. They dissemble as the Speaker did when he called his "cut, cap and balance" bill bi-partisan when it managed the support of only five Democrats. They deny logic and fairness when they suggest it is appropriate to balance the budget by taken from the needy while preserving the privileged tax status of the rich and of large corporations. And, in the president's case, they shirk responsibility when they suggest this is a Republican problem when for months the White House did precious little to move this forward or address the deficit when it had countless opportunities to do so. (As Vermont Sen. Bernie Sanders said afterwards, the president's speech was pretty good but it probably "should have been given six or seven months ago.")
Of course, as disturbing as Monday night's display was to those hoping for reason and progress, there is an even more disturbing scenario. What if the dysfunctionality in Washington is not evidence that our system is broken but that it works too well, too accurately reflecting the nature of our society, the divisions among our people and the views they actually hold?
If that's the case, this most recent circus is not an aberration, but a harbinger. And if it is true, we are headed toward not one possible downgrade, but many, not toward the renewal of the American dream but to what might be called the onset of the Japanese nightmare, as we drift hopelessly toward the decision-less, leader-less, direction-less government much like that which has kept Japan trapped without relief in dire economic straits for almost two, long, hard decades now.
Rothkopf makes one thing perfectly clear
It's been pretty clear for some time, anyway. He doesn't comprehend the idea that people have principles. Next and possibly terminal step in his transition in the past few months from whatever he was last year to the New, Improved Rothkopf who puts such probing issues before us as listing the world's biggest assholes of the week, while saying that he's "answering for each of you the following question: Who were the world's biggest assholes this week?"
Two things wrong with this. If anybody's asking the question, they're not asking it of Mr Rothkopf. And his first list omits David J Rothkopf, the guy who explains his asshole list as justified by his not liking hot weather. A mercy to us all that most other folks are more tolerant.
That is one horrible post. Please re-write it.
Principles? Attacking the pensions of the elderly, eliminating support for the handicapped, and depriving elders of medical care is not a principle, it is greed - miserly avarice of astonishing proportions.
Japan? Who are you kidding? Try Malawi.
Would that we were so lucky to be like Japan.
Japan has:
1. Excellent infrastructure and high speed rail
2. A large trade surplus
3. World class high technology and manufacturing companies
4. Extraordinary wealth as evidence by high demand for luxury products
It would be more accurate to group the US with countries such as Mexico, Turkey, or Argentina (semi-industrialized countries) but whereas Mexico and especially Turkey and Argentina are on an upward trajectory deindustrialization is likely to continue for the US (with the occasional plateau) such that by 2025 it will be more accurate to group the US with Nigeria, Malawi or Bolivia.
Americans should stop kidding themselves. A ten day trip to East Asia would be enough to convince +95% of Americans that their country is already 20-30 years behind the world's industrial core. Worst of all, the US isn't even trying to catch up. Instead it is moving backwards hoping to specialize exclusively in raw commodity exports such as coal, natural gas and soy beans.
Recently there has been images being shared of a visualization of what America's debt would look like if it was in stacks of $100 bills. The most frightening one is showing that stack the size of one of the World Trade Center towers but substantially larger. That is America's unfunded committments totaling $115 trillion. Those are primarily Medicare and Social Security.
Mr. Rothkopf fails to acknowledge this reality. It is these current and future payments to the "needy" which puts us in this untenable position in the first place. A bipartisan solution which doesn't address current and future entitlement payments to the needy will be no solution at all. Since excessive spending and commitments is the heart of the problem, a real solution would require Democrats to yield far more than Republicans. They won't do this and so we are stuck daily getting closer to the cliff. And Republicans sense that the current situation is the only way to force Democrats to agree to sufficient limits to entitlements. Fine mess we're in.
So the solution would probably go something like this. Ongoing short-term debt limit raising in exchange for Democrats make incremental concessions. Raise the retirement age a couple of years. Lower Medicare payments. Reduce Social Security payments. Put in place formulas which triggers budget cuts if budgets cannot otherwise be negotiated. Increase legal immigration of already trained workers to provide the tax base to pay for entitlements. Allow off-shore drilling, nuclear plants, and develop ANWR to bring gas prices down to reduce our trade imbalance. Increase taxes on the rich but not on small businesses. Curtail public employee union spending. It's a balance of politically unpalatable concessions.
Finally, establish a Bipartisan Coalition of citizens who will elect moderates who would be willing to negotiate such agreements.
Recently there has been images being shared of a visualization of what America's debt would look like if it was in stacks of $100 bills. The most frightening one is showing that stack the size of one of the World Trade Center towers but substantially larger. That is America's unfunded committments totaling $115 trillion. Those are primarily Medicare and Social Security.
Mr. Rothkopf fails to acknowledge this reality. It is these current and future payments to the "needy" which puts us in this untenable position in the first place. A bipartisan solution which doesn't address current and future entitlement payments to the needy will be no solution at all. Since excessive spending and commitments is the heart of the problem, a real solution would require Democrats to yield far more than Republicans. They won't do this and so we are stuck daily getting closer to the cliff. And Republicans sense that the current situation is the only way to force Democrats to agree to sufficient limits to entitlements. Fine mess we're in.
So the solution would probably go something like this. Ongoing short-term debt limit raising in exchange for Democrats make incremental concessions. Raise the retirement age a couple of years. Lower Medicare payments. Reduce Social Security payments. Put in place formulas which triggers budget cuts if budgets cannot otherwise be negotiated. Increase legal immigration of already trained workers to provide the tax base to pay for entitlements. Allow off-shore drilling, nuclear plants, and develop ANWR to bring gas prices down to reduce our trade imbalance. Increase taxes on the rich but not on small businesses. Curtail public employee union spending. Reduce military spending. It's a balance of politically unpalatable concessions.
Finally, establish a Bipartisan Coalition of citizens who will elect moderates who would be willing to negotiate such agreements.
No sensible commentator who knows the facts thinks Social Security needs to be cut at all. Some quite minor adjustments, in the future, will take care of any problems easily. The Medicare entitlement is more of a problem. But again, some sensible changes can be made that will solve its problems too. But none of these programs can be saved and solved if we don't allow our excessively low taxes to rise. We need more revenue from the rich ($250,000+ income) and from corporations. What is preventing such sensible solutions are rigid ideologies, based on contrary to fact ideas, that are propagated by parties interested in the destruction of SS and Medicare. Parties that represent only the rich who don't need SS and Medicare and who consequently would like them to disappear to protect their low low low tax rates.
Raising taxes on the rich in the United States is nothing more than applying a band-aid to gaping wound.
The United States' problem is not it's tax rate, it is it's lack of tariffs, lack of manufacturing (who who makes the products, keeps the bucks.), too war-like, too interested in paying down the interest on the debt rather than the principal, too many entitlement programs and not enough well paid jobs.
If you think the ills of America are to be cured simply by jacking up the tax rates on 'the rich' you're being a little silly. Even if we did that we would still only be paying the interest rate on the debt with little of that extra tax money even touching the principal.
And keep in mind corporations do not pay taxes, they add it to the cost of their products. I do not think that it's the time to hit the American lower and middle with additional price increases. I think that they already have their hands full with the price of Oil.
Not too mention if corps passed on, which they will, the cost of their tax to price of product - eventually it would lead to an increase of inflation, another thing you want to avoid like the black death at times like this.
US needs more manufacturing, which created wealth and other dividends in R&D. We should also raise the top marginal rate to, perhaps what it was under St. Ron. But I agree this is only a band aid. We lost a big opportunity to get single payor health care, which would have been a backdoor route to price controls, which is what healthcare really needs. Also, the government could start repurposing the postal service to operate retail banks that charge no transaction fees. Customers would stampede away from BofA et all. It's not price control, its competition. Very American. But these things will not happen. Already the concentration of wealth at the top of American society resembles that of the Roman empire, a slave economy.
The Tea Party ideas are based, if they can be said to be "based" on anything other than confused emotions, on out and out lies. The one about the size of government is central. The US government is SMALL by world standards. Of reasonably developed nations only Mexico and Chile have smaller governments. The other crucial lie is that we are overtaxed. If anything we are grossly undertaxed. Our taxes are among the lowest of OECD nations. And so on the basis of these two immense lies they construct their poisonous ideology that they then propagate via a servile media to infect millions of weak headed Americans whose knowledge and education are insufficient to protect them.
A nation that is led into stupid actions via lies almost always ends up in disaster: Germany under Hitler; Japan under the militarists; Russia under Stalin and numerous others.
Everything Rothkopf says is pertinent and correct. The clown show going on in Washington, due mainly to the control over the House that the Tea Party got from the 2010 elections, is a clear indication of a rapidly declining power. The whole charade is infected by lies and stupidity about the size of government and taxes and welfare and the rest. The TP people either don't know or won't admit the facts on these issues. I do think that the lies that are central to their ideology have been encouraged by the fact that blatant lies were so effective in getting us into the stupid wars in Iraq and Afghanistan. So the TP thinks it can get what it wants by more lying too. And so it does. If these radical ideologues are not removed from the US political scene I can easily envision a US going steadily downhill into some future one can only fear to imagine.
Politicians as liars? Oh my! I am shocked and absolutely appalled!
Seriously now, Politicians are professional liars, that's what they do... It is the name of the game.
You could be a great fiction writer...
"Indeed, for those who expect a functioning national defense, or stewardship of our national resources, or care for those who cannot help themselves, or education for our children, or the infrastructure we need to compete in the world, government is an essential part of the solution."
That is the funniest thing that I have had the pleasure to read in while. A caring Government, steward of national resources. Sprinkling radiation across the land during Nuclear experiments. Lol.
Really, do write novels, you would do good. Very good.
As for the credit increase, unfortunately I must agree with the Republicans. It's time to put an end to the ceaseless borrowing. We will have to pay it back one day, so why not start now?
Mr. Rothkopf, would you be so reckless with your own credit?
Entertainment for Titanic Passengers
I really regret that US politicians seem to be more of entertainers rather than pragmatic problem solvers working for the general public interest.
For many years "communism / government controlled economy" was the ideology to resist but somehow TP fell so easily for its mirror-twin ideology of "libertarianism / laissez faire government." It is clear that neither total government control over the economy nor totally unconstrained markets are workable solutions. Why criticize a failed XIX century ideology and embrace a failed XVIII century ideology?
US is quickly becoming a failed nation - leading the industrialized world in child poverty, infant mortality, number of uninsured citizens, percent of population below poverty line, reported rapes, incarceration rates, and percent of elderly in the workforce. Yet the people supposedly in charge of the country choose to engineer another self-inflicted crisis and avoid working on solving the real issues.
I'm starting to sound like my dad
Dylan Ratigan was right the other day when he said that the problems in Washington reflect the problem with Americans themselves. We now live in a society of instant gratification in which its all about me and sacrifice is no longer a virtue. Americans want tax cuts, government benefits, low taxes, a big military budget, small government for other people better you better not cut my benefits, balanced budgets and little regulation of business until something goes wrong and Americans are outraged that the government agency wasn't capable of doing its job because of its budget keeps getting cut. There is a major disconnect between what people are willing to pay for and what they expect out of government. They elect politicians who don't believe in government to run the very body they detest and wonder why everything is so screwed up. Like a great man said," you know what really grinds my gears? You America..."
Mr. Boehner mused this week that negotiating a debt deal acceptable to President Barack Obama, the Republican House majority and a Senate that is nearly evenly split between the parties is like solving a Rubik’s cube. But that is only partly true. At least every side moves on a Rubik’s cube. “John Boehner is an old-style Republican. He’s conservative, but he doesn’t breathe fire,” said Randall lisa ann, emeritus professor of political science at Ohio State University. “He was not prepared for just how far to the right these freshmen are, or for the extreme inflexibility of these people.” Some House GOP freshmen have indicated they will not vote to increase the debt ceiling – period. Others have made their vote conditional on trillions of dollars in spending cuts over the next decade - and no tax increases.
Considering she left her town $20 mil in debt and made the women of her town pay for their own rape kits if they were attacked..... RIO I think Obama and Biden are going to be just fine..
It is time for the people to take a proactive role in shaping our future of the United States of America - it will start somewhere. George Washington warned the nation of the impact of political parties have on our nation in his Farewell Address. Obviously we see that impact today. We only vote them in and out. Though easy deductive reasoning - He was hoping the people would do what private parties do for us. Therefore we would have a public service. A non-partisan political service that brings individuals forward for candidacy. I have petitioned for this very service in Georgetown County, S.C, County Council. This is how I feel we, as the people would naturally bring forward our candidates in the most fair way possible in a public service to take care of the people's business that would compete with private political parties. shyla stylez might say "Why would we want to add more government?" We as a nation can privatize almost anything but one thing we as a nation can no longer afford to privatize is our representation! If we create such a public service, then the people can set preconditions to those who we elect though bi-laws. The people within that county have complete control of this new entity because we vote on the bi-laws along with a president. Our current politicians seek donations from private individuals and private companies. With trillions of dollars spent on campaigns, the people cannot resolve any problems that contradict what our private businesses want. Ironically those same businesses we buy goods from would rather see a politician that puts what they say in writing. Therefore they can use this information along with a business plan to get loans and further their companies. The companies only invest in our representatives because of the conditions of using political parties. Companies are by nature non-partisan.
Americans should stop kidding themselves. A ten day trip to East Asia would be enough to convince +95% of Americans that their country vacationtips is already 20-30 years behind the world's industrial core. Worst of all, the US isn't even trying to catch up.
David Rothkopf is the CEO and Editor-at-Large of Foreign Policy. His new book, "Power, Inc.: The Epic Rivalry Between Big Business and Government and the Reckoning that Lies Ahead" is due out from Farrar, Straus & Giroux on March 1.
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