US Senate — Working for Wall St., not us

Jerry Silberman, Oct. 2, 2008

The Wall St. Rescue bill which gained new life with the Senate rubber stamp yesterday will neither halt the decline of the US economy nor penalize the financial gamblers who have been the most immediate cause of this disaster.

Here are two important historical comparisons —

In the late 70’s and early ’80’s, the offensive by big business against workers took the form of demanding concessions in wages and benefits mostly from industrial unions, claiming that if factories weren’t made more “competitive” through reduction of labor costs, they would go out of business. Of course, no employer guaranteed the future of the plant of the job, we were supposed to trust them. Of course, it was a scam. Plants that took concessions closed. Plants that didn’t closed. The economic transformation was based in much larger issues. In plants that closed after concessions, the bosses simply walked away with more, and the workers were left with less. The money stolen by the bosses as a result of concessions helped fund the elimination of thousands of jobs through automation, as well as the transfer of manufacturing plants out of the country. The labor movement at the time was unprepared to fight back, since it bought into the general principles of the bosses, and is still suffering, despite renewed energy in certain unions.

The several “bail outs” that have happened over the past year are identical to those concessions — big business is threatening us with dire consequences if we don’t protect them, while making no promise that anything will get better if we do. Each bailout is bigger than the last, and more futile — except for the corporate executives who are continuing to stash the cash. Each bailout imposes more costs on us, now and in the future, as positive government programs are sacrificed and more debt is imposed on our tax dollar. Right now about 51 cents of every tax dollar goes to the military. Interest on the national debt, that is tax dollars which go directly to pay the government bond holders is the third largest item in the federal budget, right now one half trillion per year. Since about 140 million people file federal income tax returns annually, this means that on average, about $2000 of your taxes are already going to pay off bondholders on Wall St, in Saudi Arabia, China, and many other countries. This number will jump as a result of this bailout. That’s all money not available for schools, health care, environmental protection, etc.

In the early ’30’s the economy collapsed in what is commonly referred to as the Great Depression. Unlike this collapse that began early in the term of Herbert Hoover. By the time of the next presidential election, millions of Americans were impoverished and beginning to organize to fight back. They were marching in the streets for unemployment insurance, refusing to allow people to be evicted from their homes by blockading homes from the sheriff, WWI vets marched on Washington demanding relief and were fired on by current troops under the command of Gen. MacArthur (later of WWII fame) Radical political movements were growing. The new president recognized that some concessions had to be made to the working class by big business or the US would risk a revolutionary situation. Roosevelt, pressured by those movements of ordinary people who couldn’t take it any more, finally convinced Congress to enact several reforms, including unemployment insurance, Social Security, and tough banking regulations (repealed in the Reagan and Bush administrations) to stabilize the economy.

Although there are many very important differences in the current situation from those historical times, there are some very important common threads, the most important being that collective action by working people to challenge the rich and powerful is the key to any change which can create a more stable, secure and healthy life for us. And our goal must be based on a comprehensive vision of a just society, not just trying to protect a niche for ourselves.

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