This article discusses the excesses of free market capitalism in the United States.
The rule of law, and the so heralded “invisible hand” of the market seems to apply to everyone in America. That is unless one owns a large corporation, manages a hedge fund, or finds oneself sitting at the top of the food chain wealth wise. Then reality looks something like this:
A company is in trouble because the CEO made bad business decisions? It’s too big to fail and is given billions of taxpayer dollars to avoid bankruptcy. The CEO doesn’t feel like paying taxes this year on the billions made? Hire a team of tax lawyers to find every loophole possible to avoid paying, and still get a return from the government. They don’t feel like hiring the corporate lawyers? Avoid American taxes all together by stashing the money away in another country. Cost of manufacturing any product too high in America due to workers’ rights? Close up shop and head to China where workers are paid a fraction of the American minimum wage and have no rights. They don’t feel like doing any of this? Get a business degree, invest every penny, and pay only a 15% Capital Gains Tax on the return, even though the return would likely be more than a middle class family would make in a year.
This is the reality in modern day America. The interests of the few far outweigh the needs of the many on a despicable scale. There are crumbling bridges and roads, water pipes that haven’t been touched since they were first laid a hundred years ago, and a railroad system that has fallen into disrepair and has been rendered obsolete by other developed nations. Despite this, in the later part of last decade the American government bailed out large banks who made poor business decisions with taxpayer dollars because they were “too big to fail.”
What exactly allowed them to become too big to fail in the first place? The repeal of the Glass-Steagall Act and the implementation of Gramm-Leach Bililey unquestionably played a tremendous role in this. The intermarrying of investment banks, commercial banks and large insurance companies concentrated financial power in the hands of a few, large entities who simply became “too big to fail.”
While this is somewhat understandable, how can it be that the money was handed to these institutions with no demands attached? The least that could have been done was to demand that banks would need to make loans to small businesses more accessible. The money, as pointed out by Senator Bernie Sanders in his historic filibuster on the floor of the Senate on December 10th 2011, should have been given out by the Fed as a way that actually stimulates the economy. “Start providing affordable loans to small businesses [1].” This however, must be un-American or too socialist, so it was not seriously considered. The institutions receiving the bailout could simply spend as they pleased, and as seen in the example of A.I.G, planned on paying out huge bonuses to their employees [2]. Corporate welfare, as seen with the bailouts, is fine and apparently different from social welfare, which is simply labeled “socialism” or a “handout” for people who are “lazy.”
Yes, in a country with both the highest per capita spending on health care and some of the poorest health statistics in the industrialized world, a public option is looked at as a threat to the very fabric of America [3]. Some view Social Security as a drain on the country and would be happier if it were done away with completely. For example, in the budget compromise that is taking place right now, the cuts include “$5.5 billion from labor, education and health and human services budgets, $3 billion from agriculture programs, $1.7 billion from energy and water programs, $784 million from homeland security and $2.62 billion from interior and environmental programs [4].”
Included in this, what seems like the only effort to improve the infrastructure, the High Speed Rail development project that Barak Obama pushed for, has been all but annihilated. Programs that would create jobs such as the Rail development project, as well as others that could improve bridges, tunnels, water services and the like have been decimated while the Bush Era Tax cuts have been extended until 2012.
As Senator Sanders explained in his filibuster speech, the tax cuts looks like they will be extended again when that date rolls around due to it being in the middle of a Presidential election. But don’t worry; Americans will be kept safe from terrorism for another year due to the $5 billion dollar increase the Pentagon will get from the budget deal. What is most absurd is that many Americans see nothing wrong with this situation. Many view progressive taxation as a punishment rather than a duty to ones country. Indoctrinated with the failure of Socialism, educated on the wonders of free market Capitalism and fueled by the American dream from a young age, this system is all Americans know. Perhaps an unsourced quote, often attributed to John Steinbeck, puts it best: “Socialism never took root in America because the poor see themselves not as an exploited proletariat, but as temporarily embarrassed millionaires.”
In any event, the hypocrisy and blatant disregard for the welfare of the average American shown by representatives across the country is startling, deplorable, and shines light on just how out of touch they’ve become. Instead of doing what would be best for the country, they hold on to theories that have been shown so false that they’ve taken on the name once used to criticize them. They threaten to shut down government over funding to abortion clinics and NPR, neither of which would make a dent in the spending of our country, but simply because they disagree with the ideology of the programs. Politics is an understandably dirty game, but the Nation has hit a new low at the start of this century, and the ones who will suffer most are middle class/working class Americans.
Works Cited
[1] Sanders, Bernard. The Speech: a Historic Filibuster on Corporate Greed and the Decline of Our Middle Class. New York: Nation, 2011. 34. Print.
[2] Andrews, Edmund L., and Peter Banker. “A.I.G. Planning Huge Bonuses After $170 Billion Bailout.” The New York Times. 14 Mar. 2009. Web. 14 Apr. 2011. <http://www.nytimes.com/2009/03/15/business/15AIG.html>.
[3] Ryan, Dan, and Thomas O’Rourke. “Opportunities Lost: The Opportunity Costs of U.S. Healthcare.” American Journal of Health Studies 23.1 (2008): 47-53. Academic Search Complete. EBSCO. Web. 14 Apr. 2011.
[4] Lightman, David, Margaret Talev, and William Douglas. “House Approves Full Budget Compromise, but Some Grumble | McClatchy.” McClatchy | Homepage. 14 Apr. 2011. Web. 14 Apr. 2011. <http://www.mcclatchydc.com/2011/04/14/112184/house-approves-full-budget-compromise.html>.
