Tension are flaring as the New York primary approaches. The candidates are getting tough with each other, and their supporters are getting even tougher. The New York debate was almost too painful to watch.
But is the fighting really that warranted? Is there something at stake that runs deeper than personality differences, the first woman president, Clinton fatigue, or pie-in-the-sky Bernie? Since both candidates are so much better than the Republican crazies, does it really matter all that much whether Hillary or Bernie gets the nod?
Yes, it matters.
We are witnessing the first campaign since 1933 that directly challenges the essential features of our economy. We are now living through a 40-year neoliberal dystopia. Finally it is under assault. Any objective observer would note that Hillary operates within that neoliberal order while Bernie is its attacker.
Neoliberalism refers to the set of theories and practices that swept through our political system (and many others) in the late 1970s. Put in its most simplified terms, it argues that prosperity for all will occur only if we 1) cut taxes (especially on the higher income brackets); 2) cut government regulations on the private sector, and; 3) cut/privatize government social programs. This combination of policies, it is argued, maximizes economic efficiency and increases economic incentives which together continually improve and expand our economy.
By the time Reagan came into office, both political parties had adopted this model. In short, order trucking, airlines, telecommunications and finance were deregulated. Taxes on the highest income earners were slashed. Cuts in welfare became the order of the day. Both parties tripped over themselves to “unleash” the private sector.
Both parties also oversaw cuts in government employment and the privatization of government services. Corporate taxes as a percent of state and local revenues fell by half. Both parties acted as if any and all jobs in the private sector, by definition, were more wholesome than those in the public sector. And both parties competed strenuously for Wall Street campaign funds by eviscerating New Deal controls on speculative activity and the size of financial institutions. Goodbye Glass Steagall — Hello too-big-to-fail banks.
That set in motion a generation of runaway inequality as the incomes of the wealthy skyrocketed while the wages of the average worker stagnated. In 1970 the gap between the top 100 CEOs and the average worker was $45 to $1. Today it is an incomprehensible $844 to $1. (All data for this article comes from Runaway Inequality: An Activist’s Guide to Economic Justice.)
Not only did runaway inequality crash the financial system in 2007-08, but by then Wall Street was so large and so powerful that it could extract trillions of dollars in bailouts. Today the biggest banks are even bigger than before the crash. And during the current seven year recovery, 95 percent of all the new income created in the entire economy has gone to the top 1 percent. Runaway inequality is the new normal.
Meanwhile, we live in a perpetual fiscal crisis as large corporations and the wealthy shift their money off-shore. The richest country in the history of the world faces a crumbling infrastructure, barely potable water, decaying schools and a deteriorating environment. We lead the world in prisoners, but are second to last among developed nations in childhood poverty and labor rights, last in paid family leave and holidays, and nearly last in upward mobility. And we’ve mortgaged the future by placing our children under $1 trillion in student debt.
Hillary’s Answer to Neoliberalism?
Her direction is clear: Make it better because it’s too strong to change fundamentally. She wants to tweak it so that it is fairer to people of color, the LGBT community, and women, not a small matter. She also wants to modestly rebuild the infrastructure, reduce student debt and ratchet up Wall Street controls at the margin.
But her economic program is pure neoliberalism — the liberal wing of it. Hillary starts by accepting ways of the world. Wall Street is there. It is powerful. Democrats need their campaign support. The conservative Congress is there. It must be worked with. She has trained herself to work from within. She believes she can deploy the many connections to the world of money and power the Clintons have amassed over the decades.
Her economic programs speaks for itself. Corporations are central to it. She wants to provide tax incentives to entice corporations to repatriate their profits and keep jobs here. She wants to build government-private partnerships to invest in inner cities. She does not want to break up the big banks. She does not want a Wall Street speculation tax. And she does not want free higher education at public colleges and universities.
This is “realistic” because some version of these proposals might pass through the established neoliberal order. However, none of these proposals are likely to dent, let alone reverse runaway inequality. Instead, they might lead to more fairness for women and people of color at the higher professional levels.
But such fairness will not and can not extend to working people and the poor, especially low-income people of color. Their plight can only improve through a more radical reversal of runaway inequality — through policies that undermine neoliberalism and therefore are deemed by the established order as “unrealistic.”
Even Hillary supporters must see that her economic proposals are not designed to reverse runaway inequality.
Bernie’s Assault on Neo-liberalism
The Sanders campaign rejects the neoliberal order. It argues that Wall Street and our campaign finance system are “rigged” and must be radically restructured. Each of his proposals is designed to redistribute wealth from the billionaire class to the rest of society and re-establish robust social services.
The emblematic proposal is the financial speculation tax to fund free higher education. It hits neoliberalism where it lives. It moves hundreds of billions of dollars from Wall Street into the expansion of higher education. Just like the GI Bill of Rights after WWII, it would produce millions of new jobs to construct, teach and administer at expanded colleges and universities. And none of these jobs could be exported.
Sanders knows that these proposals, along with campaign finance reform, massive infrastructure investments, single payer health care, and public banks will crash into a mighty neoliberal wall of resistance. Nearly every Republican congressperson, along with corporate Democrats, will defend their system and undermine Sanders proposals. Hence, the pie-in-the-sky critique.
And Sanders knows what he’s up against — what we’re up against. Nothing changes unless we mobilize en masse to take on the neoliberal machine. An election here or there won’t change it. It requires following the path of civil rights activists and labor organizers who in the past built mighty movements in the streets, in the courts and in the political arena.
Bernie is correct to say that real changes comes from the bottom up. But, oh is that difficult to do.
Do we make a perpetual accommodation with neoliberalism or do we take it on? That’s the defining choice in this election. It also explains some of the gap between Hillary and Bernie supporters.
It’s damn exhausting to think about movement building. We haven’t seen it on a mass scale since the 1960s. It takes enormous energy and hope. Without that drive and optimism it’s hard to picture a million people marching on Congress against a corrupt campaign finance system or in behalf of free higher education. That’s the work of young organizers.
It’s much easier to imagine Hillary pushing for a little change here and there, getting a few things done or maybe not getting much done at all if she decides to govern from the center. At least, she won’t do bad stuff, so the argument goes (assuming her inner hawkishness doesn’t take over in foreign affairs). And at least, she doesn’t put the burden of change on the rest of us.
Hillary cannot reform the basic approach of neoliberalism by working from within. Bernie, however, wants to reverse each component of the model. He wants to 1) increase taxes on the wealthy; 2) re-regulate powerful financial and corporate institutions, and; 3) expand the public sector and the social safety net.
But none of this stands a chance of success unless Bernie supporters keep at it after the election, win or lose. The five million, $27 buck-a-head donors must be willing to finance a new progressive populist movement, year after year. And most importantly, young people in large numbers, must be willing to dedicate their lives to it.
(Runaway Inequality on Facebook.)