The Tea Pary Movement

[Joe K]

This is an excellent opinion from the NYT Outposts.

September 16, 2009, 9:30 pm

Working Class Zero

The first nine years of the new century have yet to find a defining label, something as catchy as Tom Wolfe’s “Me Decade” of the 1970s or the “Silent Generation” of 1950s men in gray flannel suits. Bookmarked by the horror of 9/11 and the history of a black president, the aughts certainly don’t lack for drama.

But last week, lost in the commotion over the brat’s cry of Joe Wilson and the shotgun blast of rage in the Washington protest, something definitive was released just as this decade nears its curtain call.

For average Americans, the last 10 years were a lost decade. At the end of President George W. Bush’s eight years in office, American households had less money and less economic security, and fewer of them were covered by health care than 10 years earlier, the Census Bureau reported in its annual survey.

The poverty rate in 2008 rose to 13.2 percent, the highest in 11 years, while median household income fell to $50,303. Ten years earlier, adjusted for inflation, it was $51,295.

Of course this reflects the ravages of a horrid recession. But the decline started before the collapse in the housing and financial sectors — and it was calculated, in the eyes of some.

Harvard economist Lawrence Katz called it “a plutocratic boom.” If anything comes close to defining the era, that would be my nomination. President Bush cut $1.3 trillion in taxes — and the biggest beneficiaries by far were the top 1 percent of earners. At the same time, Wall Street was inflated by the helium of a regulation-free economy that eventually gave us Bernie Madoff and banks begging for bailouts.

Now consider the people who showed up in a state of generalized rage in Washington over the weekend. They have no leaders, save a self-described rodeo clown — Glenn Beck of Fox News — and some well-funded Astroturf outfits from the permanent lobbying class inside the Beltway. They are loosely organized under a Tea Party movement, but these people are closer to British Tories than 18th century patriots with a love of equality.

And they have the wrong target.

Mark Williams, a Sacramento talk radio host, was speaking to CNN on behalf of the demonstrators — many of whom carried signs comparing Obama to a witch doctor, an undocumented worker or a Nazi — when he played the blue collar card.

Who is Williams? A garden variety demagogue who calls Obama “an Indonesian Muslim turned welfare thug” and the Democratic party “a domestic enemy” of America. He also refers to the president as “racist in chief.” That says all you need to know about leaders of the Tea Party movement.

Williams repeatedly invoked the “working stiffs” who feel left out. Working people are always the last to get aboard the gravy train, and the first to be used in campaigns that will not advance their cause. And with these demonstrators, and the hucksters trying to distract them from real issues, history repeats itself.

Where was the Tea Party movement when the tax burden was shifted from the high end to the middle? Where were the patriots when Wall Street, backed in Congress by Senator Phil Gramm of Texas, rewrote securities laws so that the wonder boys of Lehman and A.I.G. could reduce home mortgages to poker chips at a trillion-dollar table?

Where were the angry “stiffs” when the banking industry rolled the 2005 Congress into rewriting bankruptcy law, making it easier to keep people in permanent credit card hock?

Where were they when President Bush started the bailouts, with $700 billion that had to be paid on a few days’ notice — with no debate — to save global capitalism?

They were nowhere, because they were clueless, just as most journalists were.

But now, at a time when a new president wants to reform health care to fix the largest single cause of middle-class economic collapse, he’s called a Nazi by these self-described friends of the working stiff.

“A working class hero is something to be,” John Lennon, that product of ragged Liverpool, sang just after leaving the Beatles. “Keep you doped with religion and sex and T.V.”

As someone who had a union card in my wallet before I owned a Mastercard, I don’t share Lennon’s dark view of blue collar workers. But as long as they can be distracted by people who say all government is bad, while turning a blind eye to manipulation at corporate levels, they’re doomed to shouting at phantoms.

One more detail caught my eye in these new economic reports on the lost decade. People in their prime earning years — age 45 to 54 — took the biggest hit in the last years of the Bush Administration, their median income falling by $5,000. And the region that suffered most — the South.

Older southern whites — that’s who got hit hardest by the freewheeling decade now fading. They should be angry. But they’re five years too late.

Editors’ note: An earlier version of this piece stated that the last (Democratic) Congress rewrote the bankruptcy law, instead of the 2005 Congress; this has been corrected.

[fearless]

Couldn't agree more. Just read this today:

"Since 2001 executive base pay at Australia's top 100 listed companies has more than doubled and average bonuses have tripled."

"After a near-death experience, the world financial system is returning to business as usual - only worse.

The Group of 20 countries, meeting at the end of this week in Pittsburgh, is supposed to be restructuring the system so that it "never happens again". Or, as Barack Obama put it last week: "We will not go back to the days of reckless behaviour and unchecked excess that was at the heart of this crisis."

But we already are. Even if the G20 succeeds in every aspect of its well-intentioned agenda this week, the two greatest systemic problems stand unchanged and uncorrected.

The big investment banks, and Goldman Sachs is the biggest of them, have feasted on public money and, now, restored to strength, are throwing themselves back into the markets as recklessly as ever - only more so.

The big US investment banks are not just symbolic of the greed and excess of the pre-crisis craze. They were instrumental. They created, sold and traded the derivatives the world later came to know as "toxic assets''. But now, after restoring themselves with emergency government loans, they have repaid the US Treasury and rushed back into the markets. Goldman reported a record profit for the three months to the end of June of $US3.4 billion ($3.9 billion).

And the company - where average employee pay is $US700,000 - set aside a record $US11.4 billion for staff bonuses for the first half of the year alone. Guess where the firm made its biggest profit? From trading all the Treasury bonds the US Government issued to pay for the $US787 billion stimulus it injected into the economy to save it from the financial crisis.

Criticism of its bonuses sent Goldman's chief, Lloyd Blankfein (2007 salary plus bonus: $US70 million), out to give a contrite speech. But behind the facade, his firm was betting the bank once again.

The percentage of the firm's assets that could be wiped out in a single day - a metric known as "value at risk" - zoomed up by 20 per cent in the first quarter of this year and by a further 33 per cent in the second, to reach a new record high for the company.

This illustrates the first of the great systemic problems. It's called "moral hazard". Meaning? If you think you are completely safe from any risk, you will behave recklessly."

[Denver Toad]

Debate all you want, just so long as there's no public errr option...