Friday, April 12, 2013

Miracles of the Market: Social Insecurity

During the twentieth century near collapse of capitalism - the Great Depression - relatively enlightened forces of wealth initiated programs to prevent total breakdown and possible revolution. Among these was the origin in America of what already existed in Europe: a proposal to help elders from entering the poorhouse when they were no longer able to work. Known as “social security” it became one of the most popular of the New Deal programs of the FDR administration.

These programs all helped free market capitalism survive by humanizing its most obvious forms of economic savagery and placing the expense for what was called social democracy on the great body of taxpayers, with slight tax increases for the richest americans who could easily afford them. Only the most slack-jawed reactionaries opposed these policies but even some critics grudgingly accepted that older people dropping dead in the streets wouldn’t look good and might even cost private insurers far more than would make it a profitable investment for venture capital of the day. That support from the past has been fading in the present as everything that tried to humanize capitalism is under attack in a revival of fundamentalist free market policies. Worse, the supposed representative of the common people, a corporate hype called the Democratic Party, has a leader even more gutless than the usual occupant of subsidized housing at 1600 Pennsylvania Avenue. This purveyor of twisted tongue speeches that sound good until analysis reveals their hollow rhetoric and whose practice amounts to no material substance has turned against that program. As in all present assaults on capitalism’s really anti-social safety net, he professes to improve the program by cutting it, the way a hospital life support system is improved by cutting off the air supply of the patient.

Not only does the social security system have none of the problems alleged by panic mongering billionaires and their political and media servants, it would remain solvent for generations if the tax system were adjusted to become progressive instead of harshly regressive. At present, income is taxed only up to 113 thousand dollars, which means a person making 226 thousand pays half the rate of someone earning that figure, and far less than someone earning only ten thousand. Billionaires and their servant millionaires pay a rate infuriatingly lower than that paid by laborers, service workers, and almost all of the professional class. If we simply removed the cap and taxed all income, the social security system would be safe and secure beyond its present condition, which even its most dishonest critics admit that even if unchanged will not threaten anyone for many years. In fact, the system will run a surplus for many years, as it has in the past, with those excess funds invested in government paper that makes the economy look slightly better than its actual condition. So why are all these nervous nellies, now led by the most dishonest nelly of them all in the half-white house, proclaiming the need to cut these benefits?

Supposedly because the national debt is so high that steps must be taken to cut government expenditures before Armageddon is at hand, or profits vanish for the 1% we are totally dependent on for our life, liberty and pursuit of happiness, whichever fable sounds more acceptable depending on the gullibility of the listener.

Among the many things left out of the scare story being peddled by the rich and their servants: the national debt has jumped recently because of the taxpayer bailout of the very banks whose practices brought on the 21st century Great Recession. It’s not a depression, yet, we’re told, and in fact we’re supposedly coming out of it by slashing the public sector to benefit our economic private parts in the masturbatory practice that passes for free market capitalism. That multi billion dollar gift from the taxpayers wasn’t enough. Now we are supposed to give up every minimal service that once saved capitalism and now makes some angry that they ever allowed their peasants to become – even if only in advertising jargon and principles of unpaid debt - a middle class. If the rich are overfed and the poor are starving, those who eat one meal a day are in the middle. Feel better?


Unknown said...

Fucking Awesome. Those who need to see see this won't. They are blinded by their delusions and opinions. I really appreciate your insight.

Unknown said...

One of Frank's most penetrating and illuminating articles... albeit reflecting only the American experience. A pity Americans have yet to discover the other world... the 80% other world. FDR merely copied what had existed for half a century in the developed world.

If Americans glanced at experiences elsewhere, what is now dismissed as theory would in fact be ascribed its true empirical genesis: Australia's debtless civil developments and Commonwealth Bank; the UK's National Health Service; Denmark's Social Security; Australia's Social Services Act (1946); and so on.

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