How Conservatives Will Demagogue the Economic Crisis
By Jesse Singal - Sep 29th, 2008 at 3:17 pmLawrence Mishel, president of the Economic Policy Institute, sent some very astute thoughts on the economic crisis, the bailout, and what they say about conservatives’ approach to the economy to a listserv I’m on. With his permission, I’m posting his take here:
There is much to be angry about the unraveling financial system and the taxpayer rescue. One aspect that is far too rarely discussed is how the potential costs of the bailout are being used to force the next president to pare his goals, presumably for lack of money. (In Barack Obama’s case, so this new wisdom goes, he’d have to hold back on enacting his health insurance plan, his infrastructure and energy efficiency initiatives, on an early childhood education and so on.) This is what was behind Jim Lehrer asking the candidates how the financial crisis would affect their agenda. This is why the Concord Coalition says that the bailout is the next president’s major first term initiative.
This really gets to me. House Financial Services Chairman Barney Frank wisely notes that on September 10th 2001 there was no money for anything but somehow we managed to conduct two wars thereafter. So true. Now we’re readying a potentially large cost to taxpayers for a bailout and this is assumed to come out of our currently planned budgets. But the administration, the conservatives, and their business allies have told us this year that we have insufficient resources to expand SCHIP and to provide decent benefits to returning vets. What’s to give?
If the bailout is so important then why isn’t part of the deal a way to cover the costs so we can still address our nation’s other needs? After all, the business and finance community are telling us that “we’re all in this together” on the bailout. Isn’t that an argument for raising revenues to pay for whatever costs emerge? In fact, it seems a natural move to enact a financial transactions tax next year, a small sales tax (0.25% or so) on sales of stocks and bonds, that could reap $100 billion annually and not burden our beleaguered middle class. But the truth is that the ‘we’ that are in this together on the bailout is not the same ‘we’ that needs accessible and affordable health coverage, that needs help going to college, or needs a job or is suffering falling wages as a result of the steady erosion of jobs and escalating unemployment. Seems to me that the broader “we” need to make sure that this bailout doesn’t short the new direction this nation needs to take.
It’s not a one way street. Many of the same talking heads are trying to use the possible bailout to tie McCain’s hands on tax cuts. Just worth pointing out.
September 29th, 2008 at 4:34 pm