Deficit reality: Income inequality is the problem


The drumbeat of austerity and budget cutting is nearly deafening. One would think that the country is on the verge of bankruptcy, about to go "belly up."

It is loud enough to make even levelheaded people forget that we are the richest country in the world.

We no longer sit unchallenged at the apex of the global economy for sure, but we still generate enough wealth to provide every American with a decent standard of living as well as solve the so-called crisis in state finances.

But listening to the dominant media and the Republican right, one would never guess this is the case. In their view, we can't live as well as we did in the past, and what's more, we can't aspire to live better in the future.

Sacrifice is the order of the day, they say, although not sacrifice in general. None of them asks the wealthiest corporations and families to "give back," not even to share the pain.

No, that isn't on their agenda. Rather, the crisis of state finances is to be solved at the expense of public sector workers and working people in general, period. They are the ones who have to "share" all the pain.

But where is the logic here?

First of all, working people - whether the "middle class" or the poor - did not cause this crisis. They were not the architects of the political and economic policies that triggered the crisis.

Second, you don't ask working people, employed or unemployed, who have few or no financial reserves, to solve the problem of exploding deficits.

Get real! Go where the money is! Take money from those who have plenty of it and who caused the crisis in the first place, that is, the wealthiest families and corporations.

For the past three decades, the U.S. wealth gap has widened by leaps and bounds. And the reasons are incontestable: an increasingly regressive tax structure, deregulation, union busting, offshoring, wage repression, casino-like speculation, and so on.

While both parties have been accomplices in this robbery by the capitalist ruling elite, the Republican right has done the heavy lifting ideologically and politically. Going back to Reagan, it has not only facilitated the transfer of massive amounts of wealth to the wealthiest corporations and families, but also attempted to destroy the political and organizing capacity of the working class and its allies.

By 2008 this (legal and illegal) theft of the riches of working people reached extreme and obscene levels. And yet neither the Republican right nor the top tiers of our capitalist society were satisfied with their ill-gotten gains. For the first two years of the Obama presidency, they opposed even the most minor measures to stem and reverse this process. And with the GOP victories at the state and federal level in last fall's election, the Republican right is again ramping up its offensive.

Falsely claiming a mandate to slash people's programs in the name of fiscal responsibility and reinvigorating the economy, it is insisting on more sacrifice from the very people who have the least to sacrifice, while letting off the hook those who have trillions of dollars of unearned wealth that could, if radically redistributed, easily solve budget deficits, eliminate poverty, and provide economic security for all.

The overarching problem facing the country isn't fiscal irresponsibility, but gross income inequality.

Getting our fiscal house in order and setting our economic ship on a new course is doable, but only if we massively transfer trillions of dollars of unearned income of the richest families and corporations back to the pockets of working people and the government treasury at every level - city, state and federal.

The actions of the people of Wisconsin are showing us what it will take at the local, state, and national level to effect such a radical change.

Nothing short of a vast and sustained mobilization of labor, the racially oppressed, people of all ethnicities, women, youth, seniors and others, will reverse the assault coming from right-wing extremism and place our country on a trajectory that puts people before profits.

On Wisconsin!

Photo: Kaptain Karrot CC 2.0 


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  • This is a fine piece, hitting the nail right on the head! What is badly needed is a natl mvmt to support, push for exactly this approach. This is the ONLY way out of the crisis created by the billionaires, & which the billionaires are now using to steal even more of the people's wealth. It is outright theft, and the people DO understand the solution, if it is given to them. Perlo's piece, reporting on the emerging coalition in Conn., is potentially very important. I believe it shows a way that all can be involved in the fights supporting embattled workers in the midwest & bldg the struggle throughout the nation.

    A natl conference, called by the CP & allied left/progressive forces within and around the labor mvmt, is what is so badly needed to build this very fight.

    Posted by, 03/15/2011 9:42am (5 years ago)

  • Sam,
    We really need BASIC articles like this, especially now that folks across the country are really beginning to wake up.
    I'm really using your articles to submit to local newspapers. And I'm taking all the credit. Thanks.
    Love Carole

    Posted by Carole Marks, 03/13/2011 6:20pm (5 years ago)

  • Years ago, my good D.O.
    said "The most revolutionary step is the
    most progressive [toward socialism],
    scientifically identified step
    the people are ready to take.

    I think Sam is right, the people are ready to demand that the gov get the money from them that got it.

    Posted by Peggy Dobbins, 03/11/2011 5:40pm (5 years ago)

  • As always, excellent analysis.

    I keep thinking about all the things I relate to Winsconsin, like cheese, beer, the Brewers and the Packers. Funny, since this fiasco has unfolded, I'm also thinking pitchforks.

    The sleeping giant of labor has been stirred and hopefully this moment will awaken workers nationwide to the ugly truth of the ruling class. Pitchforks indeed!

    Posted by Mike Greer, 03/11/2011 6:39am (5 years ago)

  • The only group who refuses to melt in our great American melting pot are the extreme right and their super rich masters of which are represented by the Republican Party.
    Our hope is solidarity, mobilization, and the ballot.

    Posted by William Hart, 03/10/2011 3:37pm (5 years ago)

  • This article tells the American people exactly where the money has gone and where the money to fix the deficit can be found. Those billions in lost tax revenue need to be recovered to provide the many jobs we need to fix our decaying infrastructure, plus jobs for teachers, health care and sanitation workers, firefighters and police, and many other government and non-government workers.

    The Republican attack on workers is funded by the big corporations and the wealthiest among us - and their riches have grown by leaps and bounds in recent decades, as you note. Tthe tide now seems to be turning. It started in Wisconsin and quickly spread nationwide, sparking a very broad coalition of people.

    With their ideology-driven disdain for the working people of Wisconsin and the the entire country, the Republicans appear to have seriously overreached. Most Americans still respect the basic democratic (and moral) right of workers in both the public and private sector to join a union and bargain collectively about the wages they receive, health and retirement benefits, and job conditions. We all need to do everything we can to strengthen and sustain this fightback against the Republican Party, the tax-dodging corporations, and the astronomically rich. Thanks for telling it like it is, Sam.

    Posted by Peter Zerner, 03/09/2011 7:16pm (5 years ago)

  • I think the idea of the inequality gap is still too abstract for most of us. Right now too many still believe that everyone has to sacrifice. The problem is the scale of the theft from the working people by the super rich is unfathomable. It's just hard to believe that this theft exceeds all the budget deficits - federal, state and local PLUS the difference between poverty wages and decent wages for all the underpaid workers in our country, but it does! Calling out the Koch brothers for their role helped put a face on what is really the wealthy/ultra right. This will help the American people see that there truly is plenty in our country for everyone to live a full life.

    Posted by , 03/09/2011 5:52pm (5 years ago)

  • How do we organize in the wake of the struggle in Wisconsin?
    Do we set up support councils among all public workers to push for progressive tax systems?
    Do we consult the main actors in organized labor,AFSCME,SEIU,IBEW and others,for instance to cooperate in unity and support work to increase minimum wages and wages in general?
    Do we solicit for the support of all labor,unorganized and organized,if so,how?
    Do we emphasize the election fight of 2012,now,while people or in motion,why not,repealing Citizens v Federal and a massive insurgency to the polls to encourage expansion of labor rights?
    We must share the experience of this successful fight back to attacks on labor,unions and workers in all states,and especially in states like Missouri,where the effort to impose the Right to Work for less and destroy all worker protections against virulent forms of discrimination and terrorism are afoot.
    We need to start this consciousness with structures now,to have them up for November,2012.

    Posted by peaceapplause, 03/09/2011 4:28pm (5 years ago)

  • I do agree with you, but how do we overcome the grip corporate media has on the average American? Americans are taught everyday that corporate profits are the highest aim of society and that unions prevent progress. Americans are still being taught trickle down economics regardless of how false it has proven to be.

    Posted by Rich Miller, 03/09/2011 2:21pm (5 years ago)

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