October 6, 2012
Glenn Greenwald highlights how US presidential elections are now conducted almost entirely like a tawdry TV reality show with personality quirks and trivialities about the candidates dominate coverage. There is a little room for substantive debates on many of the nation's most pressing political issues.
Greenwald identifies these issues as penal policies, drone attacks, America's steadfastly loyal support for Israel and its belligerence towards Iran, the rapidly growing domestic surveillance state, climate change, and the refusal to prosecute the Wall Street criminals who precipitated the 2008 financial crisis. He argues that the highly debatable and profoundly significant policies are excluded due to bipartisan agreement and that this agreement is covered up by a handful of disputes that the parties relentlessly exploit to galvanise their support base and heighten fear of the other side.
He doesn't mention the conflict over private markets versus government in the form of the welfare state.
If the Republicans and Democrats represent different fractions of big business---eg.,the Republicans Big oil and the Democrats Wall Street---the Republican party's main goal is to preserve low tax cuts on capital gains and dividends. There is little indication that the United States will be able to address its enormous fiscal deficit. This is now about 7% of GDP, and it is predicted to grow rapidly in future decades as an aging population and rising health-care costs increase government outlays for the “entitlement programs” that benefit middle-class seniors.
Martin Feldstein says that:
Fiscal consolidation.....requires additional revenue as well as slower growth in entitlement spending. The challenge facing US politicians after the election will be to find a politically acceptable way to raise that revenue without undermining incentives and economic growth. The task is made more complex by the large number of legislators who insist that the deficit should be reduced by spending cuts alone.
Feldstein says that slower growth in entitlement spending will probably involve slowing the growth of Social Security pension benefits for future middle- and upper-income retirees.
The tougher problem will be how to raise revenue--- I expect there to be gridlock, given the history of non-cooperative behavior, even if that results in a credit-rating downgrade of the US. True, there is the 2011 agreement on immediate spending cuts and tax increases that would automatically kick in (the “fiscal cliff”) if agreement on a comprehensive set of fiscal reforms eluded them. Why not postpone or dismantle that agreement?