The so-called “debt ceiling” crisis is upon us. Unless the amount the US can borrow is raised, a second financial crisis looms including partial default on our debts, the layoff of (just to start) 800,000 federal workers and contractors, cancelled checks to millions of social security and Medicare and Medicaid clients, and a host of other yet unknown evils.
President Obama has said his two young daughters are performing better on their homework, than lawmakers in the Republican dominated House are doing on theirs. He’s called for all to leave ideology at the door as he convenes congressional leaders again at the White House this week.
But the only “ideologists” are the so-called tea party fanatics.
It’s becoming a test of sanity how long it will take all reasonable people to conclude that the Republican Party has painted its teeth orange, and jumped off a cliff. Conservative NY Times columnist David Brooks calls the threat of another financial crisis and its “stain the honor of our country” over debt, and the refusal to raise any tax whatsoever, an act that voters will and should repudiate.
Brooks emphasizes, “If the debt ceiling talks fail, independents voters will see that Democrats were willing to compromise but Republicans were not. If responsible Republicans don’t take control, independents will conclude that Republican fanaticism caused this default. They will conclude that Republicans are not fit to govern. And they will be right”
Nobel Prize winning economist Joseph Stiglitz notes the problem runs deeper than psychological challenges of leading Republicans. He says the showdown over debt ceiling and the obsession of right-wing leaders with even more austerity, alongside the stubborn refusal of the rich to pay even a penny tax, “the ideological crisis of western capitalism.”
What has happened is that the entire trickle-down, free market fundamentalist premises that began with the Reagan administration and drove financialization for the past 30 years have been proven utterly false. Some call it neo-liberalism. In any event – it’s failing.
Those clinging to the hollowed out ideology appear less and less lucid and more narcissistic. If not treated, this disease can lead to sociopathic behavior – a life without conscience or sensitivity to any other beings.
The path ahead is toward more socialism to protect a fair distribution of wealth, and to restrain super high-risk private corporate behavior, and concentration, of power.
In other words, “too big to fail” means “too big to remain in private control.”
More socialism does not mean the end of capitalism or markets. Competitive markets -that regulation insures remain competitive – are democratizing. They are the key to efficient – meaning productivity enhancing – commodity production. They are an important, although not the only, factor in encouraging innovation.
Every generation re-invents and reproduces almost every facet of both public and private institutions and relations of production and exchange. The “more socialism” of the next generation will not be the same public institutions that arose in the big 20th century expansion of public sector activities across the world. It will be smarter, more scientific, more resilient and less bureaucratic or centralized.
I predict sanity will prevail. We will make it through this storm, as a people, though I cannot say what the toll may be, except that all will be changed. There are crazed Captain Ahabs on the decks of our ships, and they are obsessed with a whale of their imagination, when a real one of monumental dimensions is approaching starboard.