Over the next few weeks, the manufactured crisis over the “debt ceiling” will reach its boiling point. But this is pure melodrama, badly overacted with the outcome already known. The real question is about our priorities – and about who gets the gold and who gets the shaft.
On the debt ceiling, President Biden says he won’t negotiate over raising it. House Speaker Kevin McCarthy says Republicans won’t raise it without negotiations. This is like teenagers playing chicken in cars racing toward each other – only in this case–a crash would blow up the world economy. That can’t happen – and so it won’t. The United States will pay the debts it owes. Our full faith and credit will not be trashed.
That will still leave the question about our priorities and the national budget. Who pays, and who benefits? Here – beneath the posturing – is the real deal. Here’s a handy guide to what’s in the deck.
First on our annual deficits. The best solution to the deficit is economic growth. When the economy grows, more people get jobs and raises. As wages and profits rise, the government collects more in taxes and pays out less in support – on everything from unemployment insurance to welfare to food stamps. Deficits come down.
How do we get growth? For years, Republicans have passed tax cuts – largely for the rich and corporations – saying that would lead to more investment and more jobs. Turns out it mostly led to more inequality, slower growth, and thus more deficits.
Biden argues that we need to invest in areas vital to our economy – in modern infrastructure, in research and development, in subsidies that get companies to locate plants in the U.S. and not abroad. Although his program has just begun, it seems to be working – with unemployment down, wages up, and deficits getting reduced.
That said, politicians in both parties still want even faster deficit reduction. The big question is one of priorities. Here common sense should apply.
Over the past years, the richest Americans have captured more and more of the nation’s income and wealth. The middle class has struggled, and the poor haven’t kept up. Common sense would suggest that the wealthy should pay more in taxes–rather than the middle class or the poor.
On the spending side, the military budget has been rising – and now is at levels not seen since the height of the Cold War. We spend as much on the military as the next (10) nations combined. Healthcare costs have been rising even as life expectancy has been declining. We spend nearly two times per capita than other advanced countries with far worse results.
We can reduce our military budget and still have the most powerful military in the world. And we can transform our medical system – moving as other advanced countries have done to the equivalent of Medicare for All, providing more service for less cost. Biden has taken a small step by controlling the price gouging on some prescription drugs, but much more can be done.
But common sense rarely surfaces in the Washington debate. Consider the Republican debt ceiling “proposal” that passed the House. Republicans oppose asking the rich and corporations to pay more. They oppose cutting the military budget (and, in fact, want to raise it substantially). They oppose controlling drug prices, or moving to Medicare for All, or even having a public option in health care that would limit insurance company excesses. Trump and Biden have convinced them that they shouldn’t touch Social Security or Medicare – at least before the election.
That leaves all the cuts to come from domestic programs – and the pain to be borne primarily by the most vulnerable – and by the middle class. Low-income families will see cuts in food support, in affordable housing, in health care through Medicaid, in infant nutrition, and in childcare. The poor and middle-income families will suffer cuts in public education, in clean water and air, in safe workplaces, and in childcare. The country will suffer with the slashing of investments in renewable energy, energy efficiency, and electric vehicles. All of us will pay more from extreme weather as climate change goes unaddressed.
All the fulminations about the debt ceiling come down to this. Will the wealthy pay a little more in taxes or the poor a lot more in pain and hunger? Will we invest in more smart missiles or more smart children? Will we support the obscene profits of the private health insurance companies or the essential health care Americans need? Will we fund wars abroad or curb the extreme weather that threatens our communities at home? Don’t be misled by the sound and fury over the debt ceiling. The real question is who pays and who benefits.
You can write to the Rev. Jesse Jackson in care of this newspaper or by email at jjackson@rainbowpush.org. Follow him on Twitter @RevJJackson.
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