SELLING US OUT FOR THEIR PAYMASTERS ON WALL STREET

Goldman Sachs Bankster “King of the Foreclosures” Treasury Secretary Steven Mnuchin vows that the Goldman Sachs infested Trump Admin will hand no-strings massive socialist bailouts to Trump Hotels. Mnuchin says the welfare will exceed the Bankster-owned Democrat Party’s massive bailout of Obama crony Jamie Dimon of J P Morgan’s bailout in 2008

US Senate passes massive economic “rescue” bill

26 March 2020

Senate Democratic and Republican leaders reached agreement with the Trump administration early Wednesday on an economic “rescue” package of unprecedented dimensions—an estimated $2 trillion. The bill was passed late Wednesday night by a 96–0 margin, despite the effort of a handful of Republican senators to block it for providing too much money for those thrown out of work by the coronavirus crisis.

Vermont Senator and presidential candidate Bernie Sanders voted for the bill, despite its unprecedented transfer of taxpayer funds to corporations and limited benefits for workers.

The bill’s overall terms were negotiated between Senate Majority Leader Mitch McConnell, Senate Minority Leader Charles Schumer, Secretary of the Treasury Steven Mnuchin and two White House officials, Legislative Affairs Director Eric Ueland and White House Chief of Staff Mark Meadows. McConnell and Schumer announced the deal about 1 a.m. Wednesday morning.

House Speaker Nancy Pelosi (D-CA) talks with Senate Majority Leader Mitch McConnell (R-KY) as Senate Minority Leader Chuck Schumer (D-NY) talks with House Minority Leader Kevin McCarthy (R-CA) and House Majority Leader Steny Hoyer (D-MD) (Erin Schaff/Pool via AP)

The major change from the first version proposed by McConnell and the Republicans last week involved an expansion of unemployment benefits for the rapidly escalating number of workers being laid off as lockdown orders are issued in state after state to try to head off the spread of the coronavirus pandemic.

The number of workers filing new applications for unemployment compensation was expected to jump to more than three million this week, a more than tenfold increase over the previous week but only the beginning of what is expected to be a virtual shutdown of large parts of the US economy over the coming weeks.

Faced with the prospect of levels of unemployment that could exceed those of the Great Depression of the 1930s—and massive social unrest that would result—both Republicans and Democrats agreed on two stopgap measures to stave off an explosion of social struggle by the working class.

The first is immediate and direct federal payments to most Americans, amounting to $1,200 per adult and $500 per child. The payments are to be distributed by the Internal Revenue Service to anyone who filed an income tax return in 2018 or 2019, as well as some of those who were too poor to file, although the exact details of eligibility depend on the final language of the bill, not yet publicly available.

The second measure is a substantial temporary federal supplement to unemployment compensation benefits, which are administered by the states. The federal government will add up to $600 a week to the benefits set by the states, which themselves range on average from under $200 in Mississippi to a high of $515 in Massachusetts. The federal supplement is to last for four months, ending in early August for workers filing claims this week.

The total cost of these two measures is $550 billion—$300 billion for the direct payments and $250 billion for the increase in unemployment benefits. The still leaves the biggest share of the $2 trillion package for corporate and business interests.

Those provisions include $500 billion for corporate bailouts, with about $75 billion earmarked for specific industries, including $50 billion for passenger airlines, $8 billion for cargo airlines, and $17 billion for Boeing (although the company is not named).

Democrats objected to the $500 billion being under the sole control of Treasury Secretary Mnuchin, with even the names of the companies receiving aid to be kept secret for at least six months. They accepted a “compromise” under which auditing is to be carried out by an “independent” inspector-general—the same method employed during the 2008–2009 bailout of Wall Street—and oversight by a five-member panel appointed by congressional leaders.

While corporate borrowers are to be prohibited from stock buybacks and the payment of dividends for a year after the loans are repaid, and will have minor limitations on executive compensation, Mnuchin will have the power to waive those restrictions “upon a determination that such a waiver is necessary to protect the interests of the Federal Government.”

Corporate borrowers will have to commit to maintaining until September 30 the employment levels in place on March 24, but only “to the extent practicable,” another gigantic loophole. They will be barred from cutting employment by more than 10 percent.

More importantly, the $500 billion does not really represent an adequate measure of the scale of the bailout. Besides the $75 billion for transportation, the remaining $425 billion will be used to underwrite lending by the Federal Reserve to companies approved by Mnuchin on a much larger scale, estimated by various analysts as ranging from $2 trillion to $4 trillion.

Another $367 billion is set aside to aid “small business,” although these firms can employ up to 500 workers, a ceiling that will allow many hedge funds and private equity firms to qualify. Trump’s personal holding company, the Trump Organization, would likely have qualified but for a special provision inserted in the bill to make companies owned by the president, vice president or members of Congress ineligible.

Another $50 billion is allocated for an “employee retention tax credit” for businesses that keep workers on the payroll rather than laying them off. The details of this, including which companies will benefit, remain to be clarified.

Nearly $500 billion is to be distributed for the front-line costs of fighting the coronavirus epidemic and other social needs. That sum includes $207 billion for state, local and tribal governments, school districts and public transit agencies; $130 billion for hospitals and public health facilities; $45 billion for the Disaster Relief Fund of the Federal Emergency Management Agency; and $41 billion to pay for additional personal protection equipment for health care workers and to replenish the national emergency stockpile of such materials.

There are lesser amounts for bailouts of farmers hit by Trump’s trade war with China and for other social services, including food stamps, child nutrition, allowing students to defer loan payments for six months with interest waived, and waiving Pell grant restrictions for students forced to leave school because of coronavirus-related closures. There is even $100 million for the National Endowment for the Arts and the Kennedy Center for the Performing Arts, a provision that set off howls from the ultra-right media, although it represents 0.005 percent of the massive bill.

In sum, the spending breaks down into three major components: about $1 trillion for corporate and business interests (although with the Fed’s lending, this could climb to $2.5 trillion); about $500 billion to keep the US population from starving over the next four months; and about $500 billion more directly linked to the effort to contain the pandemic.

The money to support state governments—hit by huge drops in tax revenues just at the point when they must spend more to fight the coronavirus—is not distributed according to need, but according to a political formula that reflects the intrinsic inequities of the Senate, where every state has two votes, regardless of population.

The bill distributes $60 billion in the form of $1.2 billion for each of the 50 states, with the remaining $90 billion distributed based on population, so that New York receives less than Texas, even though it has 30 times as many coronavirus cases.

This slap in the face to the people of New York did not faze Senate Minority Leader Schumer, one of two senators from New York state. In remarks just before the final series of votes, Schumer praised the bill, claiming it would save “millions of small businesses and tens of millions of jobs.” His real concern—like that of all the other senators—was that the corporate bailout and the temporary relief checks to millions of workers would help safeguard the wealth and power of the US financial aristocracy.

One event before the bill’s passage illustrated the vast class divide between the ruling elite and the working people who are the vast majority of the American population. Four Senate Republicans began howling that the price of the bonanza for corporate America was too great. They did not object to the $500 billion for big companies. What stuck in their craw was the unemployment compensation payments to workers whose jobs have been wiped out by the lockdown of half the United States, which they regarded as excessive.

At a remarkable press conference Wednesday afternoon, the four Republicans—Ben Sasse of Nebraska, Tim Scott and Lindsey Graham of South Carolina, and Rick Scott of Florida—inveighed against the unemployment compensation payment of $600 a week. They issued a statement declaring that the payment was a “strong incentive for employees to be laid off instead of going to work.”

Graham and Scott said that with their state’s average unemployment compensation of $360 a week, workers laid off because of coronavirus would be entitled to $960 a week in combined state and federal aid, the equivalent of $24 an hour for a 40-hour work week. They complained that South Carolina employers would be unable to find workers who would take jobs at the usual pay level for the state, a notorious low-wage haven.

Ben Sasse, of a more philosophical bent, declared that the unemployment compensation provision threatened to “disrupt the employer-employee relationship”—Karl Marx called it wage slavery—and was therefore un-American.

But the most revealing comments came from Rick Scott of Florida, a former corporate CEO in the health care industry, who claimed that small businesses could not survive if workers were unwilling to work for low wages because they could make more on unemployment pay. One reporter apologized for asking him, “Do you understand how bad the optics are to have probably the wealthiest person in the Senate potentially holding up this bill for a couple hundred bucks for some of the poorest people in this country?”

The four threatened to use procedural obstacles to slow passage of the bill, thus giving Vermont Senator Bernie Sanders the opportunity for a bit of “left” demagogy. He threatened that if they objected to the unemployment compensation section of the bill, he would raise objections to the corporate bailout. In the end, the four settled for a recorded vote on an amendment by Sasse, which was defeated, and Sanders joined in the bipartisan vote to approve the bill.

How many must die for Wall Street?

26 March 2020

Deaths from the global coronavirus pandemic soared past 21,000 on Wednesday, continuing on an exponential trajectory. In the United States, at least 247 new deaths were recorded and the number of new cases grew by over 13,000.

Every day, more than 2,000 people are dying around the world. “It took 67 days from the first reported case to reach 100,000 cases, 11 days for the second 100,000 cases, and just four days for the third 100,000 cases,” said Tedros Adhanom Ghebreyesus, the director-general of the World Health Organization.

Within a matter of days, the United States will have more cases of COVID-19 than any other country, including China and Italy, the initial epicenters of the disease. In New York, lines of ill people snake around city blocks, while a makeshift morgue is being constructed outside of New York’s Bellevue Hospital. In other New York City hospitals, refrigerated trucks are being used to store bodies in conditions doctors call “apocalyptic.”

Experts have repeatedly warned that the United States is at only the beginning of its outbreak and that cases will continue to soar. But already hospitals throughout the country—including those far away from the main centers of infection, such as the Beaumont and Henry Ford Health systems in Detroit—are filled to capacity.

Despite widespread claims that the pandemic afflicts only the elderly, the disease has proven dangerous to broad sections of society. Thirty-eight percent of people hospitalized in the US are between the ages of 20 and 54.

Meanwhile, despite the pleas of health experts, many workplaces throughout the country remain open. It is becoming increasingly clear that the disease is rapidly spreading in American workplaces, many of which do not have even the most basic safety measures in place to protect workers.

Two US Fiat Chrysler workers, including a worker at the Sterling Heights Assembly Plant north of Detroit and another at the Kokomo Transmission Plant in Indiana, have died after becoming infected with COVID-19.

Nine workers in Amazon warehouses have tested positive for the virus. But despite the mounting toll, Amazon has made clear that it will neither shut down warehouses nor provide warehouse workers and delivery drivers with necessary protective equipment.

Even as the pandemic gathers strength, the Trump administration is escalating its campaign for a prompt return to work. Trump, disregarding the warnings of his own health experts, has called for America to be “open for business” by Easter, demanding to see “packed churches all over our country.”

In perhaps the most deranged expression of the outlook shared by Trump, the far-right Federalist online magazine, whose content Trump has repeatedly promoted on Twitter, published an article urging its readers to deliberately infect themselves and their children with the virus in order to generate “herd immunity.”

But the denial of the dangers posed by COVID-19 and the urge that lives be sacrificed for the sake of the “economy” extends far beyond Trump and his supporters in the United States.

Trump’s points were echoed by his political ally and far-right ideologue Jair Bolsonaro, the president of Brazil, who declared, “The people will soon see that they were tricked by these governors and by the large part of the media when it comes to coronavirus.” He called the disease the “little flu.”

In Germany, the daily Handelsblatt ran a prominent interview with hedge fund manager Alexander Dibelius, who declared that the “collective shutdown of the economy” is “more frightening than this viral infection.”

These demands echoed similar statements among American oligarchs, including former Goldman Sachs executives Lloyd Blankfein and Gary Cohn. Cohn, formerly Trump's chief economic adviser, declared that it was time “to start discussing the need for a date when the economy can turn back on.”

Wells Fargo CEO Dick Kovacevic, referring to “healthy workers below about 55,” stated, “We’ll gradually bring those people back and see what happens. Some of them will get sick, some may even die, I don’t know.”

Billionaire Tom Golisano, “smoking a Padron cigar on his patio in Florida,” complained to Bloomberg News, “The damages of keeping the economy closed as it is could be worse than losing a few more people.”

“You have to weigh the pros and cons,” he said.

According to researchers at Northwestern University, the “cons” of reopening businesses before the pandemic is under control could be 600,000 lives nationwide.

Under conditions in which the number of cases in much of the United States is doubling every day, and where there is no indication that the pandemic is under control, such proposals are totally reckless, displaying both ignorance and contempt for human life.

Indeed, the “value” of human life has become a major topic of discussion in the American press. The New York Times published an article Thursday headlined, “Shutdown Spotlights Economic Cost of Saving Lives.” The article cites former Obama adviser Cass Sunstein, who stated, “A program that saves younger people is better, in this sense, than an otherwise identical program that saves older people.”

Another Obama adviser, Ezekiel Emanuel, has repeatedly appeared as a media commentator during the pandemic, despite his having argued in 2014, in an effort to justify cuts to health care, that people should not live past 75 because “society and families—and you—will be better off if nature takes its course swiftly and promptly.”

Society’s first and only concern must be to contain the pandemic as rapidly as possible. Social distancing measures, such as the closure of schools and workplaces, are a critical element of containing the disease, allowing for testing and contact tracing measures to be put in place, and spreading out cases so they do not overwhelm hospitals.

The United States and much of Western Europe, however, are not carrying out the practices recommended by the WHO. Hospitals throughout the United States are refusing to test all but the critically ill, making it impossible to track down the majority of cases and informing people who have been in contact with those infected.

And with hospitals already at capacity in much of the country, most cases are not being hospitalized, again contrary to WHO guidelines, exposing family members to infection.

In demanding that states lift mandatory quarantine orders, Trump, speaking for finance capital, raises the prospect of employees being compelled to work by means of threats and sanctions. Those who refuse to work in unsafe conditions risk being fired, and thus becoming ineligible for unemployment benefits. Workers will have to face the devastating choice of sacrificing the health of their own families and facing hunger, eviction and homelessness.

Even as the oligarchs demand that workers toil in unsafe conditions, workers are beginning to fight back. A wave of walkouts forced the closure of the Detroit automakers earlier this month. Workers across the logistics industry, including Amazon, have demanded safer working conditions, and postal workers in Brooklyn have reportedly refused to deliver mail. The hashtags #notdyingforwallstreet and #generalstrike have trended across Twitter.

No expense can be spared when it comes to reducing the number of infections and saving lives. The working class must demand that governments and employers take emergency action to address the crisis:

• Close nonessential workplaces! All workplaces not directly involved in medical care and the manufacture of medical products, or vital social necessities, must be shut for the duration of the pandemic! Workers out of work must receive their full income, and all resources must be made available to those affected by school closures, including paid time off and food assistance.

• Safe working conditions! All workers must have a safe work environment and be protected against the spread of the virus.

• Accessible and universal testing! No expense can be spared in making available free testing to all those who show symptoms.

• Free high-quality treatment and equality of care! The most advanced medical care must be made available to everyone, regardless of income or insurance coverage.

• Protect refugees, prisoners and the homeless! Everyone must have access to high-quality and clean living conditions to prevent the spread of the disease.

Workers should form rank-and-file workplace and neighborhood committees to coordinate their activities, mobilize their collective strength, ensure that those who are sick receive social support, and monitor working conditions to ensure a safe environment.

The response to the disease cannot be left to the capitalist politicians, Democrats or Republicans. Their primary concern is to maintain the profits of the ruling elite through the inflation of the stock market.

On Wednesday, White House advisor Larry Kudlow made clear that the $2 trillion “stimulus bill” that will soon be passed by the US Congress is in addition to some $4 trillion in asset purchases, aimed at lifting the values of financial assets. The bill, supported by both Democrats and Republicans, includes tens of billions in direct subsidies to major corporations, and hundreds of billions more in loans.

The claim that society must choose between letting workers die and subjecting them to economic destitution is false. It assumes the permanence of the present capitalist form of social organization, in which the state gives trillions to the corporations but cannot ensure a livable income for workers if they do not work during an emergency.

Millions of lives can be saved if society allocates the necessary social resources to combatting the COVID-19 pandemic and ensuring that all workers have the social support they need to stay home to preserve the safety of their families and the public. Instead of being bailed out with trillions of dollars in public funds, the major banks and corporations should be put under the democratic control of the population to ensure the health and safety of their workforces and all of humanity.

The alternative to the dystopian world of capitalism, in which the “cost” of human lives is measured against the drive for profit, is socialism, a global society based on the reorganization of world economy to meet social need.