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Corporate Looting as ‘Rescue Plan,’ Robber Barons as ‘Saviors’

It’s quite telling who counts as “the economy” and what measures are considered “necessary” or “adequate.”

Secretary of the Treasury Steve Mnuchin speaks while President Donald Trump listens during the daily briefing on the novel coronavirus, COVID-19, in the Brady Briefing Room at the White House on April 2, 2020, in Washington, D.C.

Secretary of the Treasury Steve Mnuchin speaks while President Donald Trump listens during the daily briefing on the novel coronavirus, COVID-19, in the Brady Briefing Room at the White House on April 2, 2020, in Washington, D.C. (Photo: Mandel Ngan/AFP via Getty Images)

For a perfect illustration of how corporate media function as ruling class propaganda, watch how they spin a titanic upward redistribution of wealth as a “rescue plan” for the US economy, and paint a robber baron like US Treasury Secretary Steve Mnuchin as a “savior” of the American public.

In discussions of the (officially) estimated $2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES) Act—the largest government spending program in US history—before it was signed into law on March 27, corporate media largely abandoned the pretense of serving as watchdogs on behalf of the public in order to advocate for protecting and enriching the fortunes of their owners.

Instead of scrutinizing the bill as the robbery in progress that it is—as an understandable story with identifiable victims and victimizers—corporate media sold the CARES Act as an urgent necessity required to combat the coronavirus pandemic for everyone. Like the previous corporate bailout during the Great Recession (Extra!, 1/09), corporate media avoided raising questions about the necessity of having the government bail out large corporations, or whether the bill could be restructured to serve people rather than profits.

According to the Committee for a Responsible Budget, while the CARES Act dedicated $290 billion in direct payments to people and $260 billion in expanded unemployment benefits, it dedicated $300 billion in tax breaks and $875 billion in loans to big and small businesses—more than two dollars for corporations for every dollar for people, in other words.

When corporate media reported on negotiations and deliberations over the CARES Act, they either hailed it as a bipartisan achievement, or else shamed politicians who accurately pointed out that it overwhelmingly benefited corporations at the expense of workers. On the day the CARES Act was signed into law, NPR (3/27/20) praised the bill as “the largest rescue package in American history and a major bipartisan victory for Congress.”

Reporting in real-time, the Washington Post (3/24/20) spun the CARES Act as an attempt to “address the coronavirus crisis,” with the aim of “flooding the economy with capital to revive businesses and households.” When there was Democratic pushback over the Senate GOP bill for being “disproportionately tilted toward helping companies,” the Post described this as “partisan rancor and posturing on Capitol Hill” that blocked “the rescue bill.” The Post concern-trolled those who supported better legislation, and derided House Democrats’ putative attempts to chart their own “competing piece of legislation,” because “it could take even longer to arrive at a bipartisan consensus that can pass both chambers and get signed into law.”

The New York Times (3/22/20) made it clear that protecting workers and imposing conditions on handing out trillions in taxpayer dollars were frivolous reasons to oppose the legislation, as the Times cast Senate Democrats as villains for ostensibly opposing the bill because it “failed to adequately protect workers or impose strict enough restrictions on bailed-out businesses.” The Times described the “party-line vote” as a “stunning setback” for both the Trump administration’s “ambitious timeline” and “the rescue package,” and warned Democrats that they “risked a political backlash” if “they are seen as obstructing progress on a measure that is widely regarded as crucial to aid desperate Americans and buttress a flagging economy.”

The Times also drew parallels to the “spectacle in 2008,” when the House defeated a “$700 billion Wall Street bailout that aimed to stabilize the financial system amid a global meltdown.” Even in 2020, the Times is still spinning the upward redistribution of wealth from taxpayers to the big banks that caused the crisis as an ostensible success that saved what corporate media consider to be “the economy” (Extra!, 10/10).

Days later, the Times’ “As Coronavirus Spread, Largest Stimulus in History United a Polarized Senate” (3/26/20) spun the 96-to-0 Senate vote in favor of the bill as a heroic bipartisan compromise on legislation “intended to get the nation through the crippling economic and health disruptions being inflicted on the world by the coronavirus.” The Times leaned into corporate media’s civility fetish designed to demobilize opposition to the Trump regime (FAIR.org, 8/1/18, 12/22/19) when it depicted Democratic opposition to Senate Republicans’ “corporate giveaway” legislation as politically reckless and harmful to the country’s interests:

It was a shocking and politically perilous decision in the middle of a paralyzing national crisis, a moment when lawmakers are traditionally expected to put aside differences for the good of the country, or face a political backlash.

By contrast, in the false balance endemic in news coverage in the Trump era, the Times portrayed Senate Republicans as reasonable leaders who were “willing to momentarily abandon their small-government zeal” in the interest of “sealing a quick deal with Democrats” (GQ, 12/10/19; Washington Post, 4/27/12). Though the legislation didn’t include a necessary suspension of rent, utility and mortgage payments, or guarantee monthly payments, as advised by many economists, the Times spun it as a legislative victory for Senate Democrats:

In the end, Democrats won what they saw as significant improvements in the measure through their resistance, including added funding for healthcare and unemployment, along with more direct money to states. A key addition was tougher oversight on the corporate bailout fund, including an inspector general and congressionally appointed board to monitor it, disclosure requirements for businesses that benefited, and a prohibition on any of the money going to Mr. Trump’s family or his properties — although they could still potentially benefit from other provisions.

The problem with this triumphant Democratic ResistanceTM narrative is that it happens to be false. Politico’s report (3/26/20) on the negotiations over what it also hailed as a “rescue package” revealed that the final bill largely reflected the Senate Republicans’ “unemployment insurance and direct payments schemes” as “originally outlined,” with Sen. Mitch McConnell claiming that the CARES Act was a bill that was “largely, not entirely but largely, produced by Republicans in consultation with the Democratic minority.”

The Democratic leadership’s lack of concern with proper oversight of the bailout funds was also exposed when Speaker Nancy Pelosi chose her first-term congressmember friend Donna Shalala as part of the five-member oversight panel, despite her numerous conflicts of interest, evident lack of expertise or reported interest in the job (American Prospect, 4/18/20).

The American Prospect’s David Dayen has done some of the best reporting on the CARES Act, and he’s observed (3/25/20) how means-testing the $1,200 stimulus payments by basing it off IRS data in 2018 and 2019 was designed to limit the number of Americans who can receive it. The miserly one-time $1,200 stimulus payment will primarily reach Americans who already have direct deposit information on file with the IRS, with the unbanked (who happen to be the poorest) having to wait up to four months for paper checks, and who will be lucky to remain at the same address during that time without a suspension of rent payments.

While Democratic leaders like Pelosi opposed emergency universal basic income—and delayed payments to set up a bureaucracy ostensibly dedicated to make sure wealthy Americans don’t get anything—the richest Americans are in fact receiving an average stimulus payment of $1.7 million in the form of a millionaire tax cut.

Dayen has noted how the official “$500 billion” provided by the CARES Act to bailout large corporations is actually underreporting the enormity of the federal government’s corporate giveaway, as Trump regime officials like Larry Kudlow and Steve Mnuchin admitted their intent to leverage the Federal Reserve’s emergency lending authority to turn $500 billion into a $4.5 trillion money cannon aimed at large corporations.

What was in actuality a $6 trillion spending package had few conditions attached to the largesse given to large corporations, as the money can still go to mergers, executive compensation and paying dividends to shareholders, with no requirement that they keep employing workers to receive this handout.

It’s hard to overstate the injustice and scale of this upward redistribution of wealth. Commenting on 2008’s bailout, economist Richard Wolff (Guardian, 11/4/13) pointed out how funding the bailout through borrowing money effectively transfers wealth upward from regular taxpayers to rich bondholders, because the government is borrowing money from—and paying interest to—large corporations and the rich that it could have taxed them for instead. Rather than letting shareholders be wiped out first, according to the ostensible rules of capitalism—where they are supposed to bear the risk, instead of the government—the government is shoveling money to tax-dodging corporations like Boeing who admit to not needing these funds.

By borrowing the money for a program that prioritizes saving the rich, rather than printing money to fund an emergency universal basic income for the people like Rep. Rashida Tlaib’s proposal, the government is effectively paying the rich for saving them. The fact that these viable alternative stimulus proposals weren’t enacted is inexcusable. Especially when the Federal Reserve is hinting its willingness to increase the money supply by buying unlimited debt to fund the CARES Act, the fact that the necessary funds magically appear to fund corporate bailouts instead of necessary social programs (like Medicare for All) exposes the “How are you going to pay for it?” talking point as a fraud (Extra!, 6/12).

Pam and Russ Martens of Wall Street on Parade (3/26/20) observed how the CARES Act also allows the Fed to create “Special Purpose Vehicles” and hide this money from their balance sheets, allowing them to avoid the FOIA requests used to the expose the enormity of the $29 trillion bailout from 2008, in addition to repealing public meeting and recordkeeping requirements for Fed-related programs. This allows the Fed to evade transparency and accountability by holding meetings in secret.

But when corporate media aren’t busy spinning massive corporate robbery of taxpayer money as a rescue package for “the economy,” they’re busy spinning robber barons like Mnuchin as heroic “saviors” instead. Reuters’ “This Is No 2008: Mnuchin Borrows From Paulson’s Economic Crisis Playbook” (3/20/20) depicted Mnuchin as an unlikely hero thrust into the role of solving the US’ economic woes, as they reported:

US Treasury Secretary Steven Mnuchin has stepped into the breach as the Trump administration’s point man to rescue the economy from coronavirus devastation, taking on the role his former Goldman Sachs boss, Hank Paulson, played over a decade ago.

Mnuchin has closely followed the financial crisis playbook used by Paulson when he led the Treasury Department in 2008, reactivating Federal Reserve credit market backstops and asking Congress for $1 trillion to prop up companies and consumers as the economy grinds to a halt due to the spread of the virus.

Apparently, for Reuters, there is only one “playbook” to be followed for all economic crises: massive taxpayer-funded giveaways to large corporations, and crumbs for everyone else. The report contained praise from official sources praising Mnuchin for being “pragmatic” and “rising to the occasion,” with few questions beyond whether he can succeed in his noble mission, as Reuters wondered whether Mnuchin can “strong-arm executives or influence President Donald Trump to take the drastic steps the unprecedented crisis may demand.” Whether Mnuchin and the Trump regime are actually trying to “rescue the economy” is apparently unquestionable, even though Mnuchin would dismiss record-breaking levels of unemployment as “not relevant” only a few days later (Common Dreams, 3/26/20).

The Wall Street Journal’s “How Mnuchin Became Washington’s Indispensable Crisis Manager” (3/31/20) also peddled this fictitious savior narrative when it reported that “Mnuchin has become Washington’s indispensable deal-maker in trying to keep the crisis from throwing the world’s largest economy into the deepest downturn since the Great Depression,” while shepherding “a pair of rescue bills through Congress.”

The Journal depicted Mnuchin’s ability to retain Trump’s confidence while working with Democrats as something that will be “all the more needed in the weeks ahead as the pandemic is expected to worsen,” in order to “get things done in partisan Washington.” Those “skills” didn’t seem to manifest when additional funding for state and local governments, and expanded food stamp benefits needed to rescue people, were left out of the “Phase 3.5” coronavirus legislation last week (Intercept, 4/22/20).

The Washington Post’s “The Dealmaker’s Dealmaker: Mnuchin Steps In as Trump’s Negotiator, but President’s Doubts Linger With Economy in Crisis” (3/27/20) also praised Mnuchin’s efforts to “bridge divides” and forge bipartisan “agreements.” While to the Post’s credit, the piece noted how the “Treasury Department’s demands have often appeared to represent the interests of big business rather than workers,” its overall thrust was encapsulated by its subhead: “Can his economic rescue plan quickly stabilize an economy headed toward calamity?”

The New York Times’ “How Powell and Mnuchin Became the Duo in Charge of Saving the Economy” (3/31/20) reported on Mnuchin’s “vital partnership” with Fed chair Jerome Powell, echoed the “unlikely hero” narrative, and described their efforts as “critical not only to workers and businesses,” but also to Trump’s “re-election” chances:

The coronavirus poses the most significant economic threat since at least 2008, thrusting Mr. Mnuchin and Mr. Powell into key roles in determining whether the United States economy suffers a short, manageable slowdown or enters a deep and painful recession.

When the Times briefly acknowledged concerns about the massive concentration in power and newfound influence in Powell and Mnuchin’s hands, and questions about the integrity of the “oversight” process, it treated the CARES Act favoring big corporations over workers as a hypothetical scenario, rather than a plain fact.

In a unique situation where workers and small business owners have the shared interest in not being wiped out by the pandemic, how else does one characterize the disproportionately stricter conditions placed on small businesses to retain workers to receive bailout money—while big corporations have no such limitations—except as a plan to save big corporations over workers? The Times’ later reports (4/22/20, 4/26/20) on big corporations receiving bailout money intended for small businesses, and receiving concierge service for coronavirus aid at their expense, should’ve been predictable—as it was to some observers in real time (American Prospect, 3/25/20).

Throughout this coverage, it’s quite telling who counts as “the economy” and what measures are considered “necessary” or “adequate,” because it reveals who corporate media consider to be disposable (working class America), and who needs “saving” (large corporations and the American oligarchy). With the CARES Act, corporate media reversed the narrative in a truly Orwellian fashion, portraying corporate looting of the Treasury as necessary to “rescue the economy,” while the main questions regarding “savior” officials like Mnuchin are whether his plans to “save the economy” can succeed. When 26 million Americans lost their jobs between March 18 and April 22, while the wealth of US billionaires increased by $308 billion (more than 10%), there’s no other way to look at corporate media spin as anything but ruling class propaganda to legitimize saving capital while letting people die (In These Times, 4/6/20).

Joshua Cho

Joshua Cho

Joshua Cho is a journalist, recent graduate of Boston College, and former intern at Fairness & Accuracy in Reporting

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