Anyone who has been watching the news or reading newspapers lately will admit that it’s nearly impossible to escape the endless barrage of arguments coming from the Republican party about how we have to “tighten our belts” or the mild demands of the Democrats to raise corporate taxes. While the latter argument has far more legitimacy than the former, both arguments are overlooking the larger, more fundamental point.
The fundamental point to be made is that the economic catastrophe that we find ourselves in at this moment can be traced back to a tradition that has been an integral part of the American economy since the 1970s. Alongside the rapid growth of corporate control in the US was a rapid decay in public spending.
This dramatic decrease in public spending–investments in infrastructure, education, etc.–signaled a paradigm shift in the way the American economy operated. In addition to the adoption of neoliberal economic models which decimated the domestic workforce via rapid de-industrialization (and the shameless exploitation of Third World workers), a new ethos of “trickle-down”, efficient market economics began to dominate the intellectual landscape.
As the end of the 20th century approached, President Bill Clinton obliterated the distinction between the neighborhood bank and Vegas casinos by repealing the Glass-Steagall Act effectively allowing investment banks to merge with depository banks. All these events, not excluding the horrifying trail of blood that accompanied our imperial adventures abroad, led us to the crisis that torments the majority of the American population today and illuminates the real cause of this international scandal.
Strangely, this real cause of the economic downturn was articulated in succinct terms by the late American philosopher and scholar John Rawls. In his great work, A Theory of Justice (1971), he applies the contractarian approach of Immanuel Kant to show that “the principle of efficiency cannot serve alone as a conception of justice.” This simple observation challenges the unfounded belief of Wall street executives and Washington politicians that markets could regulate themselves and invariably produced outcomes to the advantage of the “greater good”.
Rawls’ statement should resonate as a message to all the unemployed and under-employed citizens of the world that any policy of deficit reduction or austerity carried out under the banner of “job growth” is completely baseless and what’s actually needed is a more robust policy of social justice in the form of public spending.
From reputable organizations like the Economic Policy Institute to Nobel Laureates like Joseph Stiglitz and Paul Krugman, it is an uncontroversial fact that the most reasonable course of action is to adopt an expansionary fiscal policy in the form of debt spending. Basically, we need another stimulus package, one that is able to support the larger slices of the American population through unemployment insurance, food stamps, and direct spending. All these simple solutions, which Republicans ludicrously refer to as “entitlement programs”, are vital to any sustained economic recovery. Josh Bivens of the Economic Policy Institute wrote a phenomenal report on this topic titled Abandoning What Works. I highly recommend it.
Lastly, I would be remiss if I did not mention our international system of aggression (the Pentagon) that is not only robbing decent people of their natural resources but destroying their families and culture in the name of democracy. The “defense” budget of the United States is a reflection of the worst kind of vice that can exist in a so-called civilized society, a vice that rivals the “evil” warned against in Biblical narratives. Because at least the evil found in the Bible could be attributed to metaphysical forces like Satan whereas the misdeeds of the American empire are the embarrassing results of intellectual and moral spinelessness. We should all take these grave assaults on human rights seriously, taking firm resolve in Professor Rawls’ maxim that “in a just society the rights secured by justice are not subject to political bargaining or to the calculus of social interests.” In short, the prospects for authentic democracy are not for sale neither are the honest, hard-working people who have had the honor to struggle for them.