There is no earthquake shaking the foundations of our monetary system. There is no landslide threatening to bury us and no wildfire about to incinerate us. Godzilla is not about to destroy Tokyo. Mothra is not real. There is no “sequester.” The “crisis” we are facing, what this week we’re calling “the sequester,” is an illusion sustained by a compliant media who dutifully parrot choreographed memes and metaphorical names while otherwise remaining asleep at the wheel. There is no phenomenon either in the natural world or in the history of our economic structures that goes by the name “the sequester.” There is no hurricane or typhoon blowing through our economy.
“The sequester,” like “the fiscal cliff” and the recurring “debt ceiling,” is an intentionally crafted, make-believe crisis. Climate change and nuclear proliferation, in contrast, are bona fide crises—meaning they pose grave threats and defy easy solutions. By comparison, we can easily cancel make-believe sequesters, cliffs, and ceilings and get on with the business of governing the country. If the deficit really needs immediate attention, the simplest and quickest fix would be to roll back a few of the massive tax cuts we’ve gifted to the richest Americans, so that those who have benefitted the most from our economic system can pick up the tab for some of its operating expenses.
That’s if we really had a deficit emergency. But we don’t.
The sequester, like the cliffs and ceilings, is this decade’s terrorism threat level—Code Orange. Be scared. Be very scared. And stop thinking for yourself. The effects of the sequester, the cliffs and the ceiling, however, are real. Unlike terrorism, where the threat is external and unpredictable, the sequester is predictable and the culprits are our own leaders.
This thing we call the sequester is an automatic, $85 billion, mid-budget, across-the-board federal reimbursement cut created by a previous act of Congress to tick like a bomb and finally go off last Friday. Once unleashed, it started snaking its way through government agencies like a freshly released contagion, creating operating budget deficits and degrading public services in an almost random fashion. When it completes its work, the sequester will not only have cut services but perhaps a million jobs as well, further depressing the wage floor for those left working.
The dogs of chaos
Despite its supposedly monstrous character, Wall Street rallied with stock market indexes tickling all-time record highs on the day the sequester was unleashed. This confused the pundit class. What was going on? Weren’t we just sequestered off the cliff or tossed against the ceiling? Why the giddiness among corporate titans and investors?
The giddiness is because the sequester monster is their monster—an attack dog whose sole purpose is to escalate the war on the public sector, hopefully crippling the government’s ability to efficiently function. This is the dark side of “sequestration.” And this is where this seemingly misused word actually starts to make sense.
Let’s look at the word “sequester.” It’s a transitive verb, not the noun it’s made out to be. It’s not a thing, as in “the” sequester. Hence, it’s not a real flesh-and-blood monster. Definition one reads, “to remove or withdraw into solitude or retirement; seclude.” But the sequester is an accounting gimmick, not a monk. Definition two states, “to remove or separate.” Definition three is legal terminology meaning to seize as collateral, eventually to be returned. Definition four is also a legal term, meaning to “requisition, hold and control enemy property.”
It’s this last definition that comes the closest to making sense, though I doubt clarity was anyone’s intention.
Let’s look at the effect of the sequester, which degrades government’s ability to both maintain jobs and provide services. And let’s look at how this degradation affects corporate profits and hence the plutocracy. When we cut government services to poor, working, and middle-class people, we cut government spending, which allows us to maintain tax cuts that overwhelmingly benefit the rich. Stuffing little Johnny into a classroom with 50 other kids would sustain such a tax cut, stuffing Daddy Warbucks’s pockets. Cutting Johnny’s government-funded nutrition program would sustain more tax cuts. All good for the one percent. Knock a homeless person out of a shelter or shut down a soup kitchen—even better. Decimate the Environmental Protection Agency’s ability to monitor smokestacks or the Food and Drug Administration’s ability to inspect food processing facilities, and you’ve reached corporate nirvana, starving regulators while sustaining more tax cuts. The sequester is working.
The corruption deficit
But there are certain aspects of government—like most of them—that disproportionally benefit the rich. Government maintains highways, upon which commerce flows. Government maintains police, protecting the property privileges of the rich. Government air traffic controllers prevent chaos in the skies, allowing vacation and business travel for those who can afford it. Public education trains workers, whose labor can be exploited. Government prisons lock up those who don’t respect privilege, who consume unsanctioned products, or whose very being disrupts social order. Public health services prevent pandemics and the possible eradication of humanity, and more importantly, the free market. While home heating programs for the poor are expendable, the rich want to maintain these essential services.
The problem for the plutocracy, however, is that despite what the corporate media claims, government generally provides these services with more efficiency, more accountability, and far less corruption than the private, for-profit sector controlled and owned by the plutocrats. Hence, government for the people by the people is the enemy. And true to definition four, the sequester seizes its—our—property. In the corporate mind, our government, owned and operated by the public, is the enemy.
When government provides these services, there is little opportunity for the plutocracy to take its skim from these massive expenditures, leaving the bulk of economic activity out of their reach. This is the problem the sequester (or “sequestration,” to show some minimal respect for the language and use a noun) is designed to attack, much like an antibiotic attacking bacteria.
Corporate executives, including those administering “non-profits,” regularly loot the coffers of the very organizations they are charged with protecting, taking home paychecks in the hundreds of thousands, or millions, of dollars, while gifting themselves with even larger bonuses running into the hundreds of millions of dollars. This is technically legal, but it is also corruption, plain and simple. An executive taking a four million dollar salary underwritten by the exploitation of his or her own workers, who aren’t earning a living wage, is blatant corruption—greed run amok. They are stealing the wages of the people who populate and do the work of their organizations, creating far more victims than, say, the petty criminals who swell our prison populations.
Breaking the legs of government
In the public sector, if a public employee earns more than you do, no matter his or her profession or skillset, the tendency is toward corporate-media-inspired hysteria. And we know exactly how much public workers earn because their salaries are public record, and hence, the government must justify them. We know how public agencies operate because their records are also public.
By contrast, in the corporate/private sector, there are no freedom of information laws making records public. The internal machinations of private businesses are protected “trade secrets.” When we do find out how much private sector executives pay themselves, rather than be outraged, we celebrate their corruption and excesses, with their media transforming their obscene conspicuous consumption into “reality TV” entertainment for the masses. As bad as government corruption sometimes seems, it’s the private sector where corruption is the norm—where it thrives and where it is actually celebrated.
The problem for the plutocracy is that the government still dominates the economy and provides the bulk of our services, outside of the reach of private corruption and looting. That’s where the cliffs, ceilings, and sequesters come into play. These are all tools to starve the public sector into collapse, opening up opportunities for corporate/private pillage. All of these fake crises lead to the same end—smaller government and larger corporations, with private take-overs of lucrative to plunder industries such as education and public infrastructure. The end goal is to replace accountable structures of government with endemically corrupt and corrupting corporatism.
The fruits of this corruption defile our political culture, underwriting political campaigns and buying compliant politicians. These quislings, in turn, dutifully serve their plutocrat masters by creating ersatz crises like the sequester.
Ostensibly the sequester is supposed to address the deficit, which is the alleged crisis behind the crisis. So let’s look at the deficit, which is not to be confused with the debt. First, let’s define the words. “Deficit” represents the difference between what an entity such as the federal government receives and what it spends. Spend $10 but only collect $7 in revenue, and you are running a deficit of $3. You meet your obligations by borrowing these $3, putting you in “debt” to a lender for $3. Regularly run a deficit and your debt will grow.
Now let’s look at the numbers.
Boring stuff confuses us
The Iran and Iraq Wars (increased spending), coupled with a regimen of tax cuts (decreased revenue), turned the budget surpluses of the Clinton administration into the record budget deficits and ensuing debt bubble of the George W. Bush administration. The Bush budget for 2009 was running a $1.2 trillion deficit, meaning it was adding that amount to the national debt. Add in the Obama administration bailouts of what was then a collapsing economy, and the 2009 deficit hit $1.4 trillion by the end of that year.
Deep Obama administration cuts in government spending, coupled with comparatively miniscule tax increases on the rich, have reduced that deficit to $845 billion for fiscal 2013 and, according to the nonpartisan Congressional Budget Office, will continue to cut the deficit, down to $433 billion at the end of 2016. Barring any new wars, this Obama administration austerity reduces the annual budget deficit by a historically unprecedented three quarters of a trillion dollars over the deficit of the previous administration—while starving education, health, infrastructure, and social program funding.
The numbers game comes into play when propagandists purposefully confuse the declining deficit with the increasing debt, often switching the words. The debt is a multi-trillion bill which was largely incurred under the George W. Bush administration and during the fiscal bailout. And it wasn’t the largess of social and environmental expenditures that caused the debt—it was the largess of tax cuts for the rich and increased military spending that gave us the debt. Reverse that trend and you reverse the debt. Reverse it strongly, for example, by returning to the tax rates we used to pay down our World War Two debt, and you can afford to fund government services like education and infrastructure, and regrow the economy.
Even if the Obama administration totally eradicates the deficit, the debt will still be there, but it won’t be growing. Right now, historically unprecedented deficit reduction is doing its job, keeping the growth of the Bush debt in check.
The bottom line is the deficit is in sharp decline. The sequester monster has little to do with the deficit or even the debt. And it’s not even really about taxes. That’s a smokescreen. The sequester, and all of the related fiscal “crises,” are really all about sabotaging our government’s ability to function and creating opportunities for private/corporate corruption and pillage.