America Faces No Greater Threat Than Joe Biden and the Democrat Party. Their Assault to Our Borders Is As Great As Their Assault to Free Speech and Free Elections
Saturday, January 28, 2023
THE BIDEN DEPRESSION - Time to set aside their lies!
CUT AND PASTE YOUTUBE LINKS
It's Worse Than 2009 as Delinquencies Surge and Bankruptcies are Back
Economic conditions just keep getting worse. As we prepare to enter 2023, we find ourselves in a high inflation environment at the same time that economic activity is really slowing down. And just like we witnessed in 2008, employers are conducting mass layoffs as a horrifying housing crash sweeps across the nation. Those that have been waiting for the U.S. economy to implode can stop waiting, because an economic implosion has officially arrived. The following are 15 facts that prove that a massive economic meltdown is already happening right now.
Our system of government has failed time after time, and our politicians continue to spend money on some of the most ridiculous things imaginable.
No matter who we send to Washington, the story remains the same.
As long as our politicians are borrowing and spending trillions of dollars that we do not have, Fed officials won’t be able to win their war against inflation.
The Fed can send interest rates into the stratosphere, but inflation will continue to remain high because our politicians insist on showering the nation with giant mountains of cash.
We should all be deeply, deeply offended by what is happening, but most Americans simply do not know enough to care.
But once economic conditions get even worse than they were in 2008 and 2009, the majority of the U.S. population will become extremely angry.
Of course things could have turned out much differently if we had made better decisions during the years leading up to this crisis.
Unfortunately, we have run out of time to change course, and that means that a tremendous amount of pain is ahead for all of us.
For more info, find us on: https://www.epiceconomist.com/
We Are Witnessing An Enormous Wave Of Bankruptcies And Layoffs During The Early Stages Of 2023
Is your job safe? Right now, we are witnessing so much turmoil is so many different sectors of our economy. The housing market is crashing, the cryptocurrency industry has imploded, the tech industry is laying off workers at an extremely frightening pace, and some of our most important retailers are heading into bankruptcy. The information that I am about to share with you is deeply troubling. It has become exceedingly clear that our economy is in huge trouble, and I fully expect that our problems will accelerate even more as the year rolls along.
Microsoft announced thousands of job cuts this week, becoming the latest tech company to pluck its workforce as the global economy slows.
Microsoft reported the layoffs would affect roughly 5% of its workforce, with some notifications happening as early as Wednesday.
Even more alarming is the fact that it is being reported that a bankruptcy filing for Bed Bath & Beyond has become “likely”…
Bed Bath & Beyond has been in discussions with prospective buyers and lenders as it works to keep its business afloat during a likely bankruptcy filing, according to people familiar with the matter.
The wave of layoffs that we have been witnessing in the tech industry is truly unprecedented.
Prior to this week, more than 25,000 tech industry workers had already been laid off this year, and this comes on the heels of the massive layoffs that we saw last year.
Needless to say, this could potentially completely undermine the dominance of the petrodollar.
Of course we cannot afford to have that happen, because the dominance of the dollar is one of the only things that is keeping our system afloat.
At this point just about everything is moving in the wrong direction for the U.S. economy, but most people still do not understand the bigger picture.
A lot of the “experts” assume that we will just suffer through a temporary recession and then things will eventually return to normal.
I wish that was true.
Unfortunately, our entire system is starting to crack and crumble all around us, and those that are currently running things are not going to be able to put it back together again.
For more info, find us on: https://www.epiceconomist.com/
BIDENOMICS
BANKS SEND WARNING! LAYOFFS WILL SURGE, FINANCIAL IMPLOSION, MASSES TRAPPED IN
A key measure of the health of the U.S. economy declined for the tenth straight month in December, pointing to a recession in the near future.
The Conference Board’s index of leading economic indicators (LEI) declined one percent compared with the previous month. The prior month’s figure was revised to show a 1.1 percent decline, worse than the one percent initially reported.
The drop is steeper than expected. Analysts polled by Econoday had expected the index to fall between 0.6 percent and 0.8 percent, with the median forecast at 0.7 percent.
“The US LEI fell sharply again in December—continuing to signal recession for the US economy in the near term,” said Ataman Ozyildirim, Senior Director, Economics, at The Conference Board. “There was widespread weakness among leading indicators in December, indicating deteriorating conditions for labor markets, manufacturing, housing construction, and financial markets in the months ahead.”
The index is comprised of 10 indicators that are thought to provide information about the direction of the economy. Nearly every one of the indicators posted a decline in December. For the six months from June through December, most of the indicators made negative contributions to the index. The exceptions were the financial components, including stock prices and bond spreads, as well as new orders for manufactured consumer goods.
The index fell 4.2 percent over the second half of 2022—a much steeper rate of decline than its 1.9 percent contraction in the first half.
The Conference Board also tracks what it calls the Coincident Economic Index. This is a measure of current activity rather than one that forecasts turns in the economy. This rose increased 0.1 percent in December.
“Meanwhile, the coincident economic index (CEI) has not weakened in the same fashion as the LEI because labor market related indicators (employment and personal income) remain robust. Nonetheless, industrial production— also a component of the CEI—fell for the third straight month. Overall economic activity is likely to turn negative in the coming quarters before picking up again in the final quarter of 2023,” Ozyildirim said.
70% + OF ALL SILICON VALLEY TECH WORKERS WERE FOREIGN BORN!
The tech industry can no longer be left in the hands of billionaire private owners
like Jeff Bezos, Bill Gates and Elon Musk. Instead, these monopolies must be
transformed into a public utility, collectively owned and democratically controlled
by the working class, as part of the socialist reorganization of economic life. Only in
this way can the industry be run for the benefit of society as a whole and ensure
free, democratic access to the Internet and other critical technologies.
Google lays off 12,000 workers as tech jobs bloodbath intensifies
With the announcement by Google parent Alphabet of 12,000 layoffs, the attack on jobs in the technology industry has been taken to a new level. The number of tech jobs eliminated in the first three weeks of the new year has already reached one third of the total of more than 241,000 industrywide layoffs in 2022.
Applicants line up at a job fair at the Ocean Casino Resort in Atlantic City N.J., April 2022. [AP Photo/Wayne Parry, File]
While many of these job cuts are concentrated in the US, the assault on tech workers is global in character. In an email sent to Google employees on Friday, CEO Sundar Pichai wrote that the layoff of 6 percent of the workforce would impact jobs internationally and “cut across Alphabet, product areas, functions, levels and regions.”
Pichai also said the layoffs were made “to ensure that our people and roles are aligned with our highest priorities as a company.” In other words, as demanded by the financial oligarchy, the jobs of Alphabet employees are being sacrificed to ensure the profitability of the $1.27 trillion global technology conglomerate.
No one should underestimate the ruthlessness with which the corporate elite is pursuing its attack on jobs and living standards. While Pichai wrote, “We’ve already sent a separate email to employees in the US who are affected,” workers in New York City reported they learned about being laid off when they arrived at work on Friday morning and were denied entry into the company’s corporate offices.
With the Alphabet announcement, the number of tech job cuts this year reached more than 75,000, according to the Tech Layoff Tracker maintained by TrueUp. Among the other mass layoffs announced in 2023 are Amazon (18,000 jobs), Microsoft (10,000 jobs), Salesforce (7,000 jobs) and Cloud Software Group (2,000 jobs).
The layoffs at more than 200 other tech firms— including 1,100 jobs at Capital One, 950 jobs at CoinBase, 900 jobs at game company Black Shark and 800 jobs at Crypto.com—make up the balance of 50,000 eliminated positions.
The growing wave of tech layoffs are both shocking and devastating. A report in the New York Times on Friday said, “Millennials and Generation Z, born between 1981 and 2012, started tech careers during a decade-long expansion when jobs multiplied as fast as iPhone sales. … Few of them had experienced widespread layoffs.”
Meanwhile, it is taking laid-off workers in all economic sectors longer to find new jobs. According to the US Labor Department, the number of unemployed workers who have been without a job for 3-1/2 to 6 months increased in December to 826,000, up from 526,000 in April.
The jobs massacre in the tech industry is the spearhead of a conscious policy by the ruling establishment to impose the inflation crisis on the backs of the working class. The Biden administration and the Federal Reserve Bank—along with capitalist governments and central banks internationally—have been raising interest rates at an unprecedented pace to instigate a recession, increase unemployment and beat back the demands of workers for wage increases that keep up with the rising cost of living.
Jerome Powell, U.S. Federal Reserve chairman, stated this policy explicitly in a speech on January 10, when he said, “Restoring price stability when inflation is high can require measures that are not popular in the short term as we raise interest rates to slow the economy.”
The tight monetary policy is being felt most directly in the technology sector because the industry is being hit by the combined impact of increased borrowing costs, collapsing stock market values and a reduction in business volume from the overall economic slowdown.
Alongside the assault on jobs is also a shift in workplace practices that attack the conditions of tech workers. In a comment in the New York Times on Sunday, entitled “The Era of Happy Tech Workers is Over,” Nadia Rawlinson, former chief people officer at Slack, wrote, “The layoffs are part of new age of bossism, the notion that management has given up too much control and must wrest it back.”
While tech workers have been considered a relatively better-off section of the labor force, the fact is, just like every sector of capitalism, the high tech industry is subject to the very same laws of the profit system as the other sectors.
As Rawlinson writes, “After two decades of fighting for talent, chief executives are using this period to adjust for years of management indulgence that left them with a generation of entitled workers.” The days of remote work, WiFi compensation, meal stipends and other incentives are over, she insists, and “tech chief executives are now optimizing more for profitability than for growth, sometimes at the expense of long-held organizational beliefs.”
Behind these changes, Rawlinson says, are “activist investors” who have taken “prominent positions in their stocks” and have “called for the companies to slash costs, reduce nonstrategic investments and, notably in Meta’s case, aggressively reduce its workforce.” There is no question that the layoffs and attack on working conditions are being demanded by the billionaires on Wall Street who are seeking to extract the combined $4 trillion in stock valuations they lost in 2022 from the working class.
As one Google employee tweeted, “Imagine being 24 years and ten months at a company that has a 5 year stock vest schedule that fully vest on your 25 year... and being let go a month and change before 25... and the company that cut you made $198 billion last year. I HATE CAPITALISM.”
In every industry, the corporate and financial oligarchy wants the working class to pay for the global crisis of capitalism. In the auto industry, the electric vehicle manufacturer Rivian has announced the layoff of 6 percent of its workforce as part of a restructuring plan. EV manufacturer Tesla has also announced a hiring freeze with layoffs to come soon.
In December, Stellantis announced the indefinite shutdown of its Jeep engine plant in Belvidere, Illinois, laying off 1,350 workers. Shortly afterwards, CEO Carlos Tavares’ threatened that further job cuts “will happen everywhere as long as we see high inflation of variable costs.” This has already started, with workers at the Dundee, Michigan engine plant informing the WSWS that more than 100 workers are being laid off.
Layoffs have also been announced at Intel Corporation, Goldman Sachs, Bed Bath & Beyond and BlackRock and job cuts are expected to be announced at the Washington Post any day now.
The pro-corporate trade union apparatus is doing nothing to oppose the jobs massacre. The Communications Workers of America (CWA), which has recently made a push to organize tech workers, has responded with nothing but a tweet decrying the job cuts. In fact, the CWA bureaucracy has spent decades collaborating in the slashing of telecom workers’ jobs.
The Socialist Equality Party advocates the development of rank-and-file committees in every workplace, which are controlled democratically by workers themselves and committed to the needs of the working class, not corporate profit. The International Workers Alliance of Rank-and-File Committees has been established to coordinate and unify the struggles of workers in the United States and throughout the world against the attack on jobs, living standards and work conditions.
This must be connected to a struggle against the capitalist system. Google, Facebook, Twitter and other tech giants exercise enormous power and control over the Internet. They are deeply integrated into capitalist governments and have collaborated in state censorship, especially of left-wing publications including the World Socialist Web Site.
The tech industry can no longer be left in the hands of billionaire private owners like Jeff Bezos, Bill Gates and Elon Musk. Instead, these monopolies must be transformed into a public utility, collectively owned and democratically controlled by the working class, as part of the socialist reorganization of economic life. Only in this way can the industry be run for the benefit of society as a whole and ensure free, democratic access to the Internet and other critical technologies.
“More than 750 million people want to migrate to another country permanently, according to Gallup research published Monday, as 150 world leaders sign up to the controversial UN global compact which critics say makes migration a human right.” VIRGINIA HALE
The Inevitable Housing Crisis Is Killing The American Dream
Not so long ago, it was the American Dream that if you work hard enough, you can build a better, richer, and fuller future for yourself and your family. A big component of that American Dream was to own a house. Because that's how you create wealth for generations.
But just a short quick look around you would be enough to establish that today's broken market is translating into a broken American Dream. Living a better life than the previous generation, in a home you own has become a pipe dream for millions
Nearly 11 million low-income Americans are paying more than 50% of their annual income on housing. And it is still not enough because America is facing a critical housing shortage. Times of high inflation, a brewing mortgage crisis and a worsening homelessness epidemic have shattered the quality of American family life. But this is just the beginning and things will only get worse.
In today's Video, we explain the inevitable housing crisis that is killing the American Dream.
Affordable housing started to decline two decades ago, and it has only gone from bad to worse in the last few years. Just in the last two years, home prices are up more than 30 percent. And that's not the case in just a few BIG cities. In fact, the U.S. now has close to 500 cities where the average cost of a home is a million dollars. Just 12 months ago, a family that could earn $80,000 a year could afford payments on a modest home. But a year later, that income requirement has shot up to $108,000. So in one year, more than 4 million renter households can no longer buy a median-priced home.
But if the rising costs were not enough, insane mortgage rates are making sure to price out the middle class completely. Mortgage rates are now increasing faster than in any period in recorded history. And in a matter of months, the typical cost of owning a home has gone up by tens to hundreds of thousands of dollars. Mortgage rates have escalated from less than 3 percent in 2021 to nearly 7 percent - the highest they have been in 20 years.
This becomes an even bigger deal when you take into account the mass shortages of homes in America. The number of available homes today is 40 percent lower than it was just 2 years ago which means that millions will continue to be priced out. Experts connected to the housing market are warning that the inevitable housing crisis will be based on a single reality: Housing supply is at a record low and we aren't doing enough to change that. This supply shortage has left the country in need of at least 5 million housing units immediately. But the progress on that is nowhere to be seen.
The housing shortage has become a chronic problem but there's no end in sight, especially, in the current climate of economic uncertainty. Ever-increasing interest rates, fears of an impending recession, and a choked supply chain mean that home builders are hesitant to go all out. So the housing gap becomes bigger and bigger. But even if more homes are built, it will not matter as affordability is moving towards an all-time low.
And this is not a big city problem anymore. Years of neglect and months of economic chaos have ensured that home prices have soared all over the country. Even areas traditionally seen as affordable are no longer viable substitutes. The locations that were seen as alternative moving options are disappearing quickly.
Failing to find starter homes that fit the already stressed budget, many Americans are pushed into Rental properties. But it shouldn't come as a shock to anyone that things are arguably worse there.
As middle America fails to find affordable housing, millions of Americans face evictions and housing insecurity. The result is homelessness.
What America needs is access to affordable housing as soon as possible. While millions risk falling into housing insecurity, the policymakers remain slow as ever. Unfortunately, things could get even worse. It took years to get to this point and it may take decades to get out of it.
WAGE DEPRESSION AND THE BIDEN DEPRESSION
VIDEO
15 Signs That American Family Budgets Will Be Blown Through In 2023
The systematic destruction of American Family budgets has begun. But most people have no idea what is about to come. There was a time when the average American could work hard and build a bright future for the whole family. But not anymore.
From galloping inflation and unprecedented housing bubble to exploitative health care system and soaring energy prices, evident signs show that the middle class will be unable to survive in 2023. Just like the federal budget deficit, the American family budgets are also about to become a headache for the citizens.
In Today's video we bring you the 15 indicators that American family budgets will be blown away in 2023.
Soaring inflation caused the cost of many goods to increase significantly in the past year. But the ghost of inflation is still hovering on the horizon. And this trend is likely to continue through 2023. With food prices at elementary and secondary schools already increased by 254%, egg prices by almost 50 percent and bread by 15 percent, the family budgets will definitely take a toll in the coming months.
One in 7 US households is already scrambling to pay for food right now. How are they going to live in such harsh conditions with no jobs? With the average American household budget at around $5,000, unemployment in this economic mayhem would shatter a common man.
But unemployment is here to stay just like the raging fuel prices. The United States Energy Information Administration (EIA) has rung the alarm bells that the energy crisis is far from over. Energy prices, including oil, natural gas, coal, and electricity, will remain historically high through 2023 due to geo-political uncertainties and tight inventories.
Winter from hell is here which would shake the supply and demand system. Energy crisis will not be averted unless we nip evil in the bud. But Russia is not pulling back at the moment. In fact, the ultimate endgame in Ukraine is uncertain. And it appears that muscle flexing in Ukraine would continue at the expense of food hikes and economic catastrophe. Well, American wallets will face the brunt of this senseless war. As the war continues, Ukrainian wheat prices will skyrocket along with Russian fertilizer, which means that farmers would expect an expensive crop in 2023.
These are incredibly hard times for millions of us. Most people are the victim of this long turn economic decline. The downfall has begun and it will slash the American family budgets in 2023. Prepare for the winter as the crisis will shatter everyone and it will be irreversible.
As Harvard’s George Borjas has shown, unauthorized immigration reduces the wages of American workers by more than $100 billion (DATED. NOW ESTIMATED TOBE $500 BILLION) a year. The poorest American workers, and those with the least education, are the most affected.
PAULETTE VARGHESE ALTMAIER
20 Signs That Middle Class Families Are Being Wiped Out
President Biden's mass migration crisis has bestowed such fabulous riches upon these criminal organizations that traditional drug trafficking is no longer the only prize worth dying for. Nowadays, Mex cartels are battling one another for control of an illegal immigrant smuggling boom. And the bonanza of illicit gains from it are being spent on growing and arming the ranks of the cartels' paramilitary armies - creating a economic and national security threat to the U.S. Todd Bensman
The large U.S. population of illegal immigrants helps to push down wages for Americans, push disadvantaged workers out of the labor force, reduce corporate investment in technology and training, and spike corporate sales and profits. The large population also shifts the U.S. politics from a focus on Americans’ jobs and wages, and then towards a politics focused on business demands and the 1950’s claim by elites that the United States is a diverse “nation of immigrants,” not a cooperative nation for all Americans.
Obrador’s proud Mexican-first advocacy for ethnic Mexicans — including ethnic Mexicans in the United States — is very different from the globalist, investor-first policies pushed by Trudeau and Biden.
At the Tuesday summit, Biden pushed the globalist, pro-migration “Nation of Immigrants” narrative as he described all Americans — including the descendants of Americans — as mere immigrants.
“Look, all of you know all of us in the United States are immigrants,” Biden said. “Mine go all the way back to the Irish famine,” Biden told the press conference.
Biden’s use of “immigrant” demotes the status of American citizens to that of illegal migrants, because the same “immigrant” term is normally used by establishment outlets to promote illegal migrants.
Biden also called for the use of global labor to fill jobs in the U.S. economy, regardless of many sidelined Americans, and regardless of the economic impact on ordinary Americans’ wages and rents:
We cannot wall ourself off from shared problems. We are stronger and better when we work together … At the top of our shared agenda today is keeping North America the most competitive, prosperous, and resilient economic region of the world … [and creating] pathways for immigrants from Nicaragua, Cuba, and Haiti that were seeking a better life here in the United States of America.
Biden recently announced a plan to allow 360,000 people from four countries to move to the United States each year. That huge population transfer from Cuba, Nicaragua, Haiti, and Venezuela is in addition to the global inflow of illegal migrants, and Congress’s normal inflow of roughly one million legal immigrants.
In contrast, the Mexican president repeatedly boasted about how his government policies are making life better for Mexicans, and are reducing the incentives for Mexicans to migrate to the United States:
The [goverenment] budget is used for development and supporting the poorest sectors of our population, today we not only have jobs, employment, we have seen reductions in violence. We have less migration as well. And we’ve also tempered frustration. And what we can see is this flame — this flame which is alive. I’m talking about the flame of hope.
Obrador’s pro-Mexican policies include his demand that Congress give the huge prize of amnesty to Mexico’s illegal migrants in the United States:
I fully trust President Biden … I’ve asked President Biden to insist before the U.S. Congress to regularize the migration situations of millions of Mexicans who have been in the States working, living in the United States, and contributing to the development of that great nation, which is the United States of America.
As an ethnic Mexican nationalist, Obrador opposes Mexican emigration — but he also supports more ethnic Latino migration into the United States:
We do celebrate the fact that the U.S. administration has … made the decision, rather, to have an orderly migration flow in the case, for instance, of our Venezuelan brothers and sisters … Just as I was telling you that in the case of migration, first there were brothers and sisters from Central America and also from Mexico, but now, in recent times, a lot of migrants from Venezuela, from Nicaragua, Colombia, Ecuador.
Obrador also applauded Trudeau’s decision to import 25,000 Mexican temporary workers for Canadian jobs, such as helping to house and feed Trudeau’s huge wave of global migrants who have been invited into Canada. “This program is already benefiting 25,000 men and women — 25,000 Mexicans,” said Obrador.
“Prime Minister Trudeau is a great ally of Mexico,” he added.
Obrador downplayed the benefits gained by Mexico when U.S. investors moved many manufacturing jobs to Mexico, as he claimed that his pro-Mexican policies are reducing Mexican emigration:
There are less migrants abandoning Mexico now because there’s public investment; because out of 35 million families, 30 million families of Mexican families are now receiving at least a program — a wellbeing program …All the senior citizens, 65 or over, receive a pension … Eleven million students of low-income families, of poor families are getting grants [and] cholarships …. We are planting over 1 million hectares of fruit and timber trees. And we are giving jobs to over 400,000 peasants that are growing, planting those trees … So, then, all these programs help so that people may be staying in their own communities, in their towns.
The U.S. government has long operated a globalist economic policy of “Extraction Migration.” The policy extracts vast amounts of human resources from needy countries, disguised under the Cold War-era “Nation of Immigrants” narrative and deliberately ineffective border security.
The extracted workers, renters, and consumers are used to grow Wall Street and to expand the low-wage service sector in the economy.
This colonization-like policy has killed many thousands of unrecognized migrants, including many on the taxpayer-funded trail through the Darien Gap in Panama.
The migrant inflow has successfully forced down Americans’ wages and boosted rents and housing prices. The inflow has also pushed many native-born Americans out of careers in a wide variety of business sectors, and reduced native-born Americans’ clout in local and national elections, and contributed to the rising death rate of poor Americans.
As Republicans discuss attacks on Social Security and Medicare
Debt ceiling “clash” will lead to major cuts in social spending
The Biden administration and the Republican-controlled House of Representatives have begun a series of political maneuvers and backroom discussions on raising the federal debt ceiling, which now stands at $31.4 trillion. Federal authority to borrow has run out, and the Treasury will exhaust short-term financial manipulations to avert a default on debt by early June, according to Treasury Secretary Janet Yellen.
A public debate has ensued in Washington and in the corporate media, with House Republicans demanding that any resolution to raise the debt ceiling be accompanied by severe cuts in domestic social spending, reportedly in the neighborhood of $130 billion, about 8 percent of current levels. The White House and congressional Democrats, who control the Senate, are demanding a “clean” bill to raise the debt ceiling, one that does not include any cuts or other extraneous provisions.
The Washington Post reported Tuesday that the discussion in the Republican Party has gone well beyond the immediate cuts that are likely to accompany a bipartisan deal to raise or suspend the debt ceiling:
In recent days, a group of GOP lawmakers has called for the creation of special panels that might recommend changes to Social Security and Medicare, which face genuine solvency issues that could result in benefit cuts within the next decade. Others in the party have resurfaced more detailed plans to cut costs, including by raising the Social Security retirement age to 70, targeting younger Americans who have yet to obtain federal benefits.
“We have no choice but to make hard decisions,” said Rep. Kevin Hern (R-Okla.), the leader of the Republican Study Committee, a bloc of more than 160 conservative lawmakers that endorsed raising the retirement age and other changes last year. “Everybody has to look at everything.”
These comments reveal the direction of ruling class policy as a whole. Hern is not an outlier but a top ally of House Speaker Kevin McCarthy. In the mechanism of capitalist politics, the fascist Freedom Caucus, which blocked McCarthy’s election as Speaker for 15 ballots, pushes the Republican House majority further to the right, as signaled by the concessions extracted, particularly on debt and spending. The House majority in turn pushes the Biden administration further to the right, expressed in McCarthy’s demand for direct negotiations with the White House over the debt ceiling. Biden has already made his first concession, agreeing to meet with McCarthy before the February 7 State of the Union speech.
In all of the public commentary on the debt ceiling, neither of the two capitalist parties nor the media deal with the more fundamental questions: Where did the national debt come from, and who is to pay for it? That is because they seek to conceal the basic class issues in the fiscal crisis. It is true that American capitalism faces bankruptcy. But why should working people, who did not cause the crisis and are not responsible for it, be made to pay the price through the evisceration of social benefits?
The debt crisis is real enough, as the accompanying graph demonstrates. Total US government debt was $5.6 trillion in 2001, when George W. Bush entered the White House. Eight years later, after a massive tax cut for the wealthy and the launching of major wars in Afghanistan and Iraq, the national debt was $11.7 trillion, more than double, an increase of $6.1 trillion.
The rise in the US national debt, from 2001 to 2022 [Photo: Treasury Department]
The national debt increased another $8 trillion under the Obama administration, from $11.7 trillion to $19.8 trillion. Major extraordinary outlays included the bailout of the US financial system and the auto industry in 2009, after the Wall Street collapse, the continuing wars in Afghanistan and Iraq, and the new wars in Libya and by proxy in Syria. There was also the continuing cost of the Bush tax cuts, most of which were retained as part of a bipartisan deal between Obama and the Republican-controlled Congress.
The Trump administration racked up as much debt in four years as Obama had in eight years, largely due to further tax cuts for the wealthy in 2017, as well as a continuing gusher of new spending for the Pentagon to prepare for future wars with Russia and China. A huge round of corporate bailouts during the first year of the COVID-19 pandemic brought the total new debt to $8.3 trillion.
In the first two years of the Biden administration, the national debt has risen by a further $3 trillion, mainly through the continuing COVID-19 bailouts and other spending to prevent economic collapse, now supplemented by a rapid rise in military spending, focused on the proxy war against Russia in Ukraine.
Proposals to reduce the deficit by raising taxes on the superrich have gone nowhere in Congress. As Biden promised an audience of wealthy backers before the 2020 election, they would not suffer with a Democrat in the White House, despite his populist rhetoric. “No one’s standard of living will change. Nothing would fundamentally change,” he said.
To sum up: The US national debt has risen from $5.6 trillion to $31.4 trillion since 2001. Of this massive $25.8 trillion increase, the wars in Afghanistan and Iraq and the overall “war on terror” account for $8.3 trillion, according to the “cost of war” study by Brown University. The tax cuts by Bush and Trump, largely retained under Obama and Biden, cost at least $5.3 trillion. The bailouts of Wall Street in 2008-2009 and 2020 cost an estimated $8 trillion more.
How is any of this the responsibility of the working class? The American people were not consulted on the wars, which were launched without even a formal declaration. They were not consulted on the two massive financial bailouts, pushed through Congress as “emergency” measures in only a few days’ time. They were not consulted on the tax cuts, which were presented as benefiting all Americans, although 90 percent of the financial windfall, or even more, went to the top 1 percent.
While the Democrats and Republicans focus on Social Security, Medicare and other “entitlement” programs—so-called because their recipients are entitled by law to receive the benefits—these are not the cause of the nearly six-fold increase in the national debt over the last two decades. On the contrary, as this graph shows, the assets held by the Social Security Trust Fund have increased steadily over a 30-year period, only turning down slightly in the last two. These assets remain close to $3 trillion.
Assets held by the Social Security Trust Fund, 1987-2022 [Photo: Treasury Department]
The incessant calls for “reform” of Social Security stem from the desire of the financial vultures on Wall Street to get their hands on this pile of cash and turn it into a source of profit. George W. Bush tried to do this in 2005 but faced such a political firestorm, accompanied by rising opposition to the war in Iraq, that he had to abandon the effort. In the present crisis there are renewed efforts to loot the Trust Fund and place 66 million retired Americans at the mercy of the financial markets.
Even more endangered is the younger generation of the working class. This is the real meaning of the language now used by Republican leaders in the House, like Majority Leader Steve Scalise, who claims that his party wants Social Security “strengthened for seniors who paid into it.” That means non-seniors, and particularly young people, should not expect benefits and will not get them.
Right-wing Democrats like Senator Joe Manchin use similar wording. He called for the establishment of a special committee of the House and Senate to review options for “strengthening” Social Security, while ruling out cuts in current benefit levels. So future benefit levels for future retirees are on the table, as well as the retirement age, now 67 but likely to be pushed higher, and changes in how the program calculates the amount of cost-of-living rises.
Neither party will discuss a solution to the financial crisis that makes the capitalist financial oligarchy, not working people, bear the burden. This is a cost they are eminently able to bear. A report by Oxfam published earlier this month, on the eve of the World Economic Forum in Davos, Switzerland, which brought together billionaires and leading capitalist politicians from throughout the world, gave a glimpse of the enormous accumulation of wealth by the superrich.
In what it called an “explosion of inequality,” Oxfam reported that since 2020, the richest 1 percent have captured almost two-thirds of all new wealth—nearly twice as much money as the bottom 99 percent of the world’s population. Billionaire fortunes are increasing by $2.7 billion a day, even as inflation outpaces the wages of at least 1.7 billion workers. The pandemic, while a catastrophe for working people, the main victims of infection, death and economic collapse, has been a bonanza for the rich.
Working people should oppose all attempts by the politicians of both corporate-controlled parties, the Democrats and the Republicans, to make them pay for the debt crisis, which is one expression of the colossal decline in the world position of American capitalism. And they must reject all efforts by the unions and their pseudoleft allies to straitjacket this opposition within the confines of the Democratic Party. Only the independent political mobilization of the working class can defend the social benefits which are the byproduct of many decades of working class struggle.
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