KENNEBUNK — As both parties agree on the need for deficit reduction, there is no excuse for America to default, refusing payment to seniors, soldiers and bondholders.
Our net indebtedness, as a percentage of GDP, is where it was in the 1950s and 1990s. The crisis our country faces this week, therefore, is a political one, not an economic one.
Elected with a margin of nearly 10 million popular votes, the president inherited two wars, a financial crisis and a Republican administration’s request for a government bailout of the economy.
The last three Republican presidents, none of whom proposed a balanced budget to Congress, are responsible for two-thirds of the national debt.
Now Republicans use the debt problem as the vehicle for attack on social programs that help middle- and lower-income Americans. The real purpose of this argument is exposed by the refusal to have the wealthiest Americans participate in debt reduction.
From their own rhetoric, it appears that the Republican Congress prefers inflicting pain on the most vulnerable Americans, or risking our nation in default, rather than eliminating tax loopholes for the wealthy.
Nearly 3 million Americans now have portfolios in the millions, excluding wealth such as primary homes, collectables and consumables. While average Americans have severely devalued homes and face job insecurity, and millions of others are unemployed and even homeless, these millionaires increased their bottom line by 28 percent in these last two recession years.
Yet the numbers show these presumed “job creators” took the money and still failed to add to their payrolls.
Meanwhile, oil companies continue to prosper while fighting tax obligations. Exxon Mobil’s fourth quarter profit was more than $9 billion, and its after-tax profit for 2010 exceeded $30 billion. The five largest oil and gas companies had net profits approaching $75 billion last year, yet they received more than $2 billion in government subsidies.
When it begins with a “b” it’s thousands of millions, real money that they’ll fight tooth and nail for. Struggling American taxpayers have reason to be angry about this, so the industry’s American Petroleum Institute continues its television ad campaign.
These are the special interests protected by the Republican Party, fighting to protect their tax breaks in this time of national need, when less-fortunate taxpayers can use all the help they can get.
The Economist is a self-proclaimed anti-big government, pro-spending-cuts British newsweekly. In an article entitled “Shame on Them,” it criticized Republicans for playing a “cynical political game with hugely high economic stakes” by calling the refusal to permit taxes to be part of the deficit-reduction solution both “economically illiterate and disgracefully cynical.”
It quoted the party’s very own House Republican report that an 85 percent-15 percent split between spending cuts and tax rises was average for successful fiscal consolidations, and these economists said that the White House proposal of an 83-17 split, with none of the revenue coming from higher rates but only from eliminating loopholes, is an offer real tax reformers would seize.
The Economist criticizes both political parties for fiscal recklessness, but states, “right now, though, the blame falls clearly on the Republicans.”
The shame is putting the national welfare at risk to achieve partisan goals. As speaker, Newt Gingrich did this when he championed spending cuts, yet when President Bill Clinton was able to propose the first of many balanced budgets, Gingrich’s assaults continued as his now-exposed intent was dismantling the Great Society.
The Republican penchant for cuts is, at this point, less about practical accounting (Obama is proposing trillions in cuts) than about achieving political victory by eliminating the government programs that do not benefit their base. To do this, they flirt with default.
Where are the moderate Republicans? Even Reagan and Bush raised taxes when they needed to. We need revenue to pay our bills, and ending tax loopholes for the most prosperous among us makes sense.
Where are the statesmen who put bipartisan national progress above personal victory? One doesn’t have to be a Democrat, or apparently, even an American, to see the exposed Republican cynicism of needlessly holding America’s good name hostage and using debt reduction as a ruse to achieve ideological goals and protect their base.
As long as Republican leaders prioritize weakening the president above the common good, and as long as tea party enthusiasts remain the dupes of Wall Street and the Fortune 500 companies by attacking all taxes and regulations, the Republican Party will remain the party of the privileged minority.
- Special to the Press Herald