By now you know the news that Americans' wealth dropped nearly 40 percent from 2007 to 2010. This is nearly all a function of the housing collapse, combined with the fact that the wages of average people have been stagnant or dropping for 30 years. And the data, being median wealth, probably understate the real damage. For all this, there's a very good chance that 50.1 percent of the voters will return the Party That Wrecked America to the White House, the last check on a federal government taken over by the extreme right. So if most of us are poorer now, just wait.
We're lectured that too many people have been living beyond their means, leeching off the public dole, racking up unsustainable debt. This is never you and me, mind you. It's someone else, but there are a lot of them and something drastic has got to give. David Brooks is one of the chief public scolds who also laments a loss of morality and dignity, even if he has spent his career supporting the jungle capitalism that has brought us low. Another is Thomas Friedman, prophet of world flatness. The government has spent decades giving and now it's going to have to spend the future taking back (but never from his pet projects, of course).
With Rep. Paul Ryan, lionized for his seriousness, we have federal budgets that put this wish into legislation. Never mind that they don't fix the deficit or debt, they do cut programs to the poor and lower middle-class. Social Security? Privatize it. Medicare? Give people vouchers worth a couple of thousand dollars (good for a low-end trip to the emergency room, if that). Military spending is "off the table," as are subsidies to big GOP donors such as the fossil fuels industry. So I hope you get a sense of this future barring a major course correction.
First they came for the public servants and I did not speak out because I was not a public servant...
The irony, of course, is that the wounded working class longs for a bygone era of "freedom" (and no black president) — and also an era when pensions and union membership were widespread. Only they don't know the latter part. They know that in this past minorities were "in their place" and The Gay wasn't "in their face." They don't know that tax rates were as high as 90 percent on the very rich, the most powerful elements of the private economy were highly regulated and big corporations didn't have the green light of Citizens United to control policy. Thus, back then income inequality was low and increasing productivity was reflected in rising workers' wages, not just corporate profits. They don't realize how much Social Security reduced poverty among the aged, and, even with its failures, how much the Great Society reduced poverty in general.
No matter. These largely white, largely older low-information/anti-information voters see the demographic change and are determined to retain power. To take their country back, as their slogan goes. In their world, we are in this low-intensity depression not because of deregulation, corporate looting, endless tax cuts and the destruction of the social compact. No, it is because of socialism, led by a president who wasn't even born here. And all those other people, who don't look like us, on welfare. And because of them, we have debt, which must be radically reduced by major spending cuts. "Hard choices must be made."
Now, let's step into the reality cone for a moment. The fiscal situation is the mess one would expect from 1) two wars, each lasting longer than American involvement in World War II; 2) large tax cuts; 3) the Medicare prescription drug benefit that was neither paid for nor allowed the government to seek competitive bidding, and 4) the costs and lost revenue resulting from the worst downturn since the Great Depression. In addition, the recovery has faded largely because too little was spent on the stimulus, too much was spent saving big banks and President Obama has presided over a huge shrinkage of public-sector employment. Paul Krugman is not wrong is writing that this is a Republican economy.
Meanwhile, we are on a two-track "recovery": Record corporate profits after taxes, a larger share of national wealth in the hands of the richest, trillions being gambled by the big banks and millions doing "all right." The other track: High unemployment, millions who may never work again, state and local governments broken by decades of tax cuts and impediments to raising new revenue. The economy is unbalanced and over-financialized and income inequality is at records not seen since the eve of the Depression.
These realities rarely seem to enter into the national "conversation." That's unfortunate, given the stakes of this election. Mr. Obama has already accepted a starting point in negotiations of a $10 reduction in government spending for every $1 in new revenue. The Republicans say no. History would say borrow at these historic low rates for major spending on infrastructure, research and education. But we don't know no history. So the path forward seems to inevitably be hard times for millions as government is cut enough to ensure failure and misery — and much worse if more Americans are forced to realize just how much they depend on government spending.
The calculus, I suppose, is that the new hard times can continue to be blamed on liberals and "socialists," who remain strangely powerful even as they lose elections and concede principles. They will still be there, in theory at least, useful enemies for the plutocracy and their operatives, as the Permanent Republican Majority presides over national decline, inter-generational warfare and the consequences of climate change that its mandarins dismiss. Who knows, after grandfathering in the old white-right voters, it may succeed in taking us back to the 1880s, only with a very large military.
One thing we know: The sacrifices will not be shared evenly.