The stimulus law nothing more than ‘Trickle Down III’

ACHTUNG: This is not a “fair and balanced” article. It is an editorial by the editor.

“The purpose of government is to create a healthy bidness climate.” — A Texas state legislator, as quoted by legendary columnist Molly Ivins

“The purpose of government is to solve problems and be a fair referee.” — Me

Author-sociologist-journalist Naomi Klein some time ago wrote a book called “The Shock Doctrine,” in which she outlined the troubling process of free market capitalist takeovers during crises that resulted in totalitarianism and economic collapse.

The inspiration for her highly-regarded thesis was a quote attributed to free market conservative economist Milton Friedman of the University of Chicago. Friedman, widely recognized as the modern day guru of the free market approach, said:“Only a crisis, actual or perceived, produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.”

So Friedman was saying the best way to achieve significant structural change in any country or society is during a crisis. Klein suggested his ideas were implemented in Chile during the overthrow of Chilean socialist Salvatore Allende, during the overthrow of the duly elected Iranian president in 1953, in Argentina, and perhaps most recently and closest to home, New Orleans in the wake of Hurricane Katrina.

Now the United States is undergoing its worst health crisis ever, creating the conditions of which Friedman talked about. And now comes the federal government to the rescue, purportedly to save Americans who have been forced to stay home from work and from buying anything because of the threat of the Coronavirus.
It’s nothing less than eerie to observe socialism hating Republicans and corporate Democrats apply the principles of democratic socialism and promise common everyday working Americans $1,200 per person and $2,400 per couple in order to continue to buy goods and services in the down time of staying home.

During the onslaught of the Great Depression, President Herbert Hoover made the big mistake of funneling public money to the top of the economic ladder in the hopes it would trickle down to the working masses. The move cost Hoover the election and his successor, Franklin D. Roosevelt, was able to cut the unemployment rate in half by putting money into the hands of working people, who immediately spend it.

But in 1981, President Ronald Reagan and his budget director, David Stockman, implemented the theory of supply-side economics, once again funneling money into the top through tax cuts, hoping the revenue would “trickle down.” Unfortunately, the rich didn’t spend their money by investing back into the economy, except for things like the yachts and personal airplane businesses, and even worse, they began to put their money into tax havens overseas.

Stockman, realizing the failure of the policy, resigned in 1984 and wrote a book, “The Triumph of Politics,” insisting trickle down only benefits the rich.

The Democratic Party on the 1990s and leader Bill Clinton turned away from working class Americans and courted the professional and suburban class, along with Wall Street, to win elections. Clinton spearheaded such disasters as NAFTA and the repeal of the Glass-Steagall Act, helping to fuel the Great Recession crash of 2008.

In the aftermath of the economic crisis of 2008-09, George W. Bush and successor Barack Obama oversaw the Wall Street bailout and TARP, both of which did a lot for failed banking institutions and big business. But the average Joe and Jane really didn’t get much of anything.

The process of helping the wealthy “too big to fail” fat cats was actually an exercise in Trickle Down 2.0.
Now with the passage Friday of the biggest bailout of all time, we’re seeing a few crumbs, in the form of a one-time payment, go to working stiffs and small businesses, but massive financial aid for the big guys, the huge corporations and industries, some of which were naughty boys and girls in the leadup to the economic downturn.

Even worse, anyone with the temerity to question or oppose the huge giveaways to the rich were framed by the misleading contentions that opposing this package was tantamount to opposing much needed relief for middle class and working Americans. Yeah, it was a bit like threatening to shoot a dog if you don’t buy the magazine.

So are they all in it together? They certainly aren’t in it to help the masses of suffering people.

Our Senators and Representatives should have stripped away all of that excessive pork baggage and simply crafted a stimulus bill earmarked only to working stiffs and small businesses. As former Labor Secretary Robert Reich noted, many of the big businesses and corporations have enough money on hand to deal with the crisis, so helping them can wait.

Reich, for example, reported the airline industry got a nifty tax cut just a couple of years ago and squandered it on stock buybacks, which benefitted no one but themselves. Even worse, the cruise industry has found ways to avoid paying U.S. taxes. And why does Amazon CEO Jeff Bezos need a tax cut when he pays nothing now?
So I call this Trickle Down 3.0, and I am wildly disappointed in Republicans for spearheading the giveaways to the rich again for spearheading the giveaways to the rich again and the Democrats for rubber stamping it.

It appears Friedman called his shot. Though a crisis often can present us with a chance to make reforms to improve our political and economic systems, it seems more likely the deterioration of both will continue.

We’re going there in a hand basket.

“Who was it that set up a system, supposedly democratic system, where you always wind up voting for the lesser of two evils?” — The Fugs, commenting on the presidential election of 1968.