{"id":2719,"date":"2011-12-06T13:43:59","date_gmt":"2011-12-06T19:43:59","guid":{"rendered":"http:\/\/lavozlit.com\/?p=2719"},"modified":"2011-12-06T13:43:59","modified_gmt":"2011-12-06T19:43:59","slug":"they-got-bailed-out-we-got-sold-out","status":"publish","type":"post","link":"https:\/\/workersvoiceus.org\/es\/2011\/12\/06\/they-got-bailed-out-we-got-sold-out\/","title":{"rendered":"They got bailed out, we got sold out!"},"content":{"rendered":"

 
\nThey got bailed out, we got sold out!<\/strong>
\n\u00a0<\/em>
\nLa Voz- Bay Area*:<\/em>
\n*This newsletter is put out by La Voz and other Bay Area socialists.
\n 
\n 
\nThe world economic meltdown that started in 2008 has cost the American working class a lot of money: a total of $9.2 trillions of public money through the bailouts<\/strong>, of which $4.79 trillion went directly to Wall Street corporations[1].
\nIn the meantime, more than 25 million Americans are unemployed<\/strong> (or cannot find a full time job), 11 million homeowners have been foreclosed and there are still 20 million with under water mortgages, while the government is implementing $4 trillions more in cuts<\/strong> for the 99% and tax breaks for the rich.
\nThe massive bailouts to the financial corporations have left public institutions on the edge of bankruptcy (like it is the case of Greece), as they have generated a massive increase of the public debt <\/strong>of the Federal Reserve and Treasury.
\nIn order to be able to have money to bailout the corporations, the government needed to \u201cborrow\u201d money from somewhere and also to cut expenses (so they are able to \u201cpay back\u201d to the banks the money that they borrowed).
\nBut the current rhetoric of the \u201causterity plans\u201d is an hypocrisy: the 1% has recuperated and is making profits, while the 99%, i.e. working people, is suffering the consequences of the crisis and of those political choices, that are presented as a \u201cnecessity\u201d.
\n\u00a0<\/em><\/strong>
\nWho benefited from the bailouts?<\/em><\/strong>
\n 
\nWe can surely call the bailouts \u201cThe Big Robbery\u201d <\/strong>of working people, as they constitute the biggest transfer of wealth in history from a public institution to private corporations<\/strong>.
\nEven though Obama tried to make us believe that the bailout will \u201csave America\u201d from a total collapse, it only \u201csaved\u201d a tiny minority of Americans at the expense of the majority.
\nWorking America, the 99% who generates the wealth and profits of the US corporations, was forced to rescue without consultation the \u201cCorporate America\u201d, the 1% who does not work, but owns the corporations and banks and keeps the profits.
\n 
\nThe secondary effects of the bailouts are triggered now: they opened the door for a necessary debt crisis <\/strong>and therefore for a second assault<\/strong>: a<\/strong> new round of \u201cjustified\u201d cuts to public social services, <\/strong>which the State cannot \u201cafford\u201d anymore.
\nThe Budget Control Act of 2011<\/strong>, implemented on August 2nd 2011, besides immediately raising the debt ceiling by an additional $400 million and potentially by $1.4 trillion more to avoid bankruptcy, had a strong deficit reduction component aimed at cutting public expenses and social services.
\n\u00a0<\/em><\/strong>
\nWho is paying for the crisis?<\/em><\/strong>
\n\u00a0<\/em><\/strong>
\nThe Obama government and the two big parties share a common understanding on who is supposed to pay for this crisis: working people in the US and abroad<\/strong>, that is to say the 99%.<\/strong> This is why they present the bailouts and the austerity measures as the only and necessary solutions for this crisis.
\nBut the price working people are paying is not limited to the bailouts. We have been the ones who are being directly impacted by the economic crisis itself: through massive foreclosures<\/strong>, debt increases<\/strong>, rising unemployment<\/strong> and pay and benefits cuts<\/strong>.
\nAnd now, on top of that, we are facing an additional blow:\u00a0 the attack to public services<\/strong> and public sector workers, the most highly unionized sector of the working class that has been able to maintain living wages for its members and a relatively high unionization rate (35%) compared with the private sector (8%), which has seen a corresponding decrease in wages and benefits .
\n <\/p>\n\n\n\n
The New Austerity Measures of the Obama Administration: $4 trillion cuts<\/em><\/strong>
\n 
\n2011:<\/strong> $900 billions<\/em><\/strong> in cuts, of which:
\n–\u00a0\u00a0\u00a0\u00a0 $946 million<\/strong> cuts from construction and repairs of federal buildings
\n–\u00a0\u00a0\u00a0\u00a0 $1 billion<\/strong> cuts from prevention of AIDS, tuberculosis and other diseases
\n–\u00a0\u00a0\u00a0\u00a0 $1.6 billio<\/strong>n cuts from Environmental Protection Agency for clean and safe drinking water projects
\n–\u00a0\u00a0\u00a0\u00a0 $1.5 billion<\/strong> cuts from the high-speed rail grants
\n–\u00a0\u00a0\u00a0\u00a0 $350 million<\/strong> cuts from the Labor Department programs
\n–\u00a0\u00a0\u00a0\u00a0 $500 millions<\/strong> cuts from food aid to poor mothers and their infants
\n–\u00a0\u00a0\u00a0\u00a0 $600 million<\/strong> from community health centers
\n 
\n2011-2021<\/strong>: $ 2.8 trillions<\/em><\/strong> of additional cuts
\n <\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 
\n 
\nHere in California, the Brown administration has announced a new round of cuts (on top of the ones that have been yearly implemented since 2008). The last cuts announced by the Brown administration are going to achieve, among other things, the continued dismantling of public education system (Pre-K – 16) while simultaneously degrading a health care system and social safety net that is already one of the worst in the country. We must stop them now!
\n 
\n 
\n <\/p>\n\n\n\n
The Bipartisan cuts to social services in California 2008-2012<\/em><\/strong>
\n 
\n\u00b7\u00a0\u00a0 \u00a0\u00a0 $18.4 billions<\/strong> in cuts to public education
\n\u00b7\u00a0\u00a0 \u00a0\u00a0 $4.6 billions<\/strong> in cuts to SSI\/SSP programs (for assistance to seniors and people with disabilities)
\n\u00b7\u00a0\u00a0 \u00a0\u00a0 $3.5 billions<\/strong> in cuts to CALWORKS (assistance to low-income families with children)
\n\u00b7\u00a0\u00a0 \u00a0\u00a0 $2.7 billions<\/strong> cuts to Medi-Cal
\n\u00b7\u00a0\u00a0 \u00a0\u00a0 \u00a0$1.6 billions<\/strong> cuts to subsidized childcare<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 
\n 
\n\u00a0<\/em><\/strong><\/p>\n

\n \n<\/div>\n

 
\n 
\n 
\nThe \u201cArguments\u201d and Strategy of the 1%<\/strong>
\n 
\n 
\nWho controls the Obama administration and the bipartisan system?<\/em><\/strong>
\n 
\nIf it is true that the financial corporations generated a speculation bubble that burst into the current crisis, we must not forget that the real crisis- the one the workers are facing- was created by the government in collaboration with the corporations. The Obama administration chose to bailout the banks and the big industrial corporations. Both Democrats and Republicans are allied in the austerity plans to cut social services at the state and federal level.
\nThe actions of the government and the different state legislatures since the beginning of the crisis show big contradictions<\/strong> between what our elected representatives say<\/strong> (that they represent the \u201cAmerican people\u201d and \u201cMain Street\u201d, in the case of the Democrats) and what they do<\/strong> when they are in office.
\nThe class character of the bailouts and the austerity measures is evident to many working people. Unfortunately, the majority of workers still believe that this is not the real program of the Obama government. Though it becomes increasingly evident in their actions, the majority still believes the Democratic Party is not the party of Wall Street and the big corporations.
\nWhy? It\u2019s because the two main parties (i.e. Democratic and Republican), the corporate media, many non-profit organizations, and union leaders want people to believe that Obama or the Democrats have been \u201ccornered\u201d by the \u201cgreedy corporations\u201d. Furthermore, they push the reasoning that \u201ctheir hands are tied\u201d by the Republican Party. Their reasoning \u2013 that is the Democratic Party\u2019s- is that Obama (and\/or the Democrats) would like to raise taxes and really fight unemployment but \u201cthe Republicans do not let them\u201d.
\nThe truth is that Wall Street corporations heavily financed the electoral campaigns of both parties, as the rest of the corporate sectors did: there is no doubt therefore that they will control the newly elected government. The Republican rhetoric on taxation and union busting is based on lies, but at least it is very open about the class interests it represents. The Democratic Party has always had an opportunist (i.e. scheming) position on political economy: they tail and benefit from the Republicans\u2019 public political offensive, to end up implementing the same policies. Indeed, for the last 30 years both parties have championed the application of deregulation policies to the financial system and tax breaks to the rich, as the Obama extension of Bush\u2019s tax cuts shows.
\n 
\nThe corporations\u2019 threat of outsourcing abroad<\/em><\/strong>
\n 
\nBoth the Republican and Democratic parties say that if more taxes are put on corporations, and if wages and benefits are kept the same or increase, corporations will go bankrupt or be forced to leave the country and tens of thousands of jobs will be lost.
\nThis is only true if one accepts that corporations have the right to make profits without being subject to the control of working people and society at large. It is not a fatality- it is a political choice. Corporations must be forced to pay to ensure public and adequate social services and living wages for all. If not, we will not let them make profit.
\nThe truth is that corporations have been constantly increasing their profits through the deregulation measures implemented in the last 30 years of neoliberalism by the bipartisan system. They have also been benefiting by not paying the taxes they owe to the State: \u201cBetween 2008-2010, 12 major corporations paid an effective tax rate of<\/em>negative<\/em><\/a> 1.5 <\/em><\/a>percent<\/em><\/a>, actually making billions of dollars off of the government through tax subsidies on top of their $171 billion in profits[2].\u201d<\/em>
\nFurthermore: \u201cIn 2010, U.S. corporations avoided approximately $60 billion in U.S. corporate income taxes by using a variety of devices and gimmicks to shift profits to foreign subsidiaries, while the Fortune 100 companies received some $89.6 billion in federal contracts [3].<\/em>\u201d
\nA government that really represents working people will force the corporations to pay or nationalize them and prosecute their CEOs, as the IRS prosecutes working people.
\n 
\nThe myth of trickle-down economics<\/em><\/strong>
\n 
\nThe bipartisan system wants us to believe that if we don\u2019t tax rich people, their wealth will \u201ctrickle down\u201d to working people through their active participation in the economy. This has been proven factually wrong. Rich people have indeed accumulated an unprecedented wealth in the last neoliberal period: today, the top .001% of the U.S. population owns 976 times more than the entire bottom 90% [4]<\/em>. They have chosen to invest their accumulated capital not in the productive sectors of the economy, but in the riskier sectors of the financial system, mostly buying collateral debt of subprime loans and causing the financial meltdowns.
\n 
\n\u00a0<\/em><\/strong><\/p>\n

\n \n<\/div>\n

 
\n 
\nWhat next for the Occupy Movement?<\/em><\/strong>
\nLet\u2019s build the Occupy movement with a working class perspective!<\/strong>
\n\u00a0<\/strong>
\n\u00a0The strength and limitations of the 99% rhetoric<\/em><\/strong>
\n 
\nThe Occupy movement has helped shift the political discussion and reminded us all that there are actually 2 Americas:\u00a0 one for the top 1% of our society, who makes all the decisions and accrues all the benefits, and the other 99% (the rest of us) who pay the price of their largess in the form of low wages, cuts to social services and health care. Many working people believe in the myth of the \u201cmiddle class\u201d, that is to say, those that are able to miraculously escape class struggle and the conditions of exploitation.\u00a0 The current crisis shows that the middle class shares its fate with the rest of the working class.
\nThe 99% rhetoric has been successful in potentially uniting the vast working class<\/strong> that is divided across racial and gender lines, but also across different professions- with different salaries, levels of organization, and of course, different levels of consciousness.\u00a0 If we are the 99% (and we are!) does that 99% include immigrants who do not have documentation?\u00a0 Does the 99% include Muslims and Arabs?\u00a0 Does the 99% include the LGBT community?\u00a0 Does the 99% include our working class brothers and sisters locked away in America\u2019s vast prison system?\u00a0 The Marxists\u2019 answer is an unequivocal \u201cYes!\u201d and unless the Occupy movement is clear on these questions, the 1% we oppose will always be able to divide us and keep us from building a movement united to defend our interests.
\nThe Occupy movement has the potential to go beyond the traditional liberal rhetoric that focuses only on \u201cthe negative effects of Prop. 13\u201d and on inequality of income and distribution of wealth<\/strong> (i.e. spreading the rhetoric of \u201cfair share\u201d). It can address the real core issue: how value gets generated under capitalism and who keeps it<\/strong>. This is not just a crisis of \u201cbad management\u201d or \u201cirresponsible businessmen and politicians\u201d, nor is it a crisis confined to the financial sphere and the banks.
\nCapitalism is not a \u201czero-sum\u201d game. There is not a fix amount of wealth out there to be distributed, there is a relation of production, that under capitalism, condemns the working class to sell its labor power for an hourly rate to survive, and allows the capitalist class to keep the wealth created by the work of the 99%.
\nThe liberal rhetoric does everything to avoid getting at the core class contradictions inherent to capitalism<\/strong>– that is to say to mention exploitation and oppression as evils of the system we need to eradicate.
\nIn fact, the system cannot be simply \u201cfixed\u201d, because it is not just about reshuffling the wealth around, it is about challenging the relations of production and of political power. Capitalism is a system of production for profit<\/strong>, it is a system that puts profit before people. This is the real engine of the system and there lies its major contradiction.
\nThe Occupy movement will soon be confronted with that same contradiction: the fact that the 99% creates<\/strong> the wealth the 1% has. The reality is that some who belong to the 99% represent the interest of the 1% (like the police, the judges, the senior managers etc), so the class interest of the 99% needs to be clarified<\/strong> and made public<\/strong> as soon as possible- for example, through clear demands<\/strong> that challenge the profits and power of the 1% and the politicians that rule for them.
\nCapitalism and its crises cannot be fixed. On the one hand, economic crises<\/strong> are not an accident; they are embedded in the functioning of the capitalist system <\/strong>in the race of the 1% for increased profits. On the other hand, \u201cfixing\u201d the problems means different things for different sectors of society as long as the current class contradictions <\/strong>continue to be reproduced. The only way of \u201cfixing\u201d the system for the 99% is to\u00a0 dismantle capitalism and overcome it with another system of production- one to fit our needs, that is not for profit, and that will have new social relations among human beings: a new and democratic form of socialism<\/strong>!
\n 
\nOur solutions to fight back the crisis:<\/strong>
\n <\/p>\n