Billions Of Reasons To Be Afraid

When you are talking or writing about America, it is customary to use superlatives. We are the “greatest nation” in the world. We have the “largest economy” in the world. We are protected by the “greatest military” in the world. Many writers could go on for paragraphs on these themes, but the basic point is as simple as our country is large. Yet when it comes to accurately reporting on issues facing our democracy, these same writers set aside the scale and focus on sticker shock.

Such is the nature of our politics that the pundits and policy makers use big numbers to scare normal folks. Like Carl Sagan and his “Billions and Billions of stars”, political reporters and the policy makers they increasingly serve, use the zeros to the left of the decimal point as political ammunition. The political battles now being fought over Social Security, the federal deficit, and earmarks are being waged in front of an audience wholly unaware of the real scale of the national economy. The consequence is an electorate easily cowed into the most counter-productive policy choices, and the most self-defeating strategies.

This math-deficient media message isn’t the province of the right-wing noise machine alone; today’s NBC Nightly News Report featured a vignette on orphan earmarks for highway programs (items where the money remains unspent due to some error). Breathlessly, the reporter told us that the “special investigation” revealed some $7.5 billion in unspent earmarks related to highway programs over the last two decades. For regular folks like myself, $7.5 billion is a massive sum. The number is large enough to eclipse the gross revenues of most of the biggest companies in the world. While it is certainly a big number on the scale of individuals and their businesses, $7.5 billion pales in comparison to the scale of the greatest democracy in the world.

But what is the scale of the greatest democracy in the world? What is $7.5 billion in 20 years to the U.S.A.? According to the NBC/USA Today report, the United States government has been unable to spend about $1.25 per person, per year over the last twenty years in highway earmarks. Put in those terms, the orphan earmarks aren’t nearly worth a front page story in a local newspaper, let alone a two minute segment on the national news. And those terms explain much of the off-kilter political discourse of our times. How is it that President Obama was burned in effigy as an oppressive tax raiser by the Tea Party in 2009, when he had just finished signing a bill including a $287 billion tax cut? Because that massive number was worth less than $3.00 per day for the average citizen, which much of that benefit coming via indirect means. Big numbers always look “more” (either worse or better depending on context) on paper than in practice.

So much of the news coverage and rhetoric that is now commonplace is quick to mention words like “massive”, “huge”, “debilitating”, and the like, without ever stopping to consider whether the terms are accurate. And why should anyone pause to consider financial or mathematical accuracy in a world where numbers and related details are looked on with derision by the bulk of the population. Politically in touch liberals are driven to blithering distraction by Sarah Palin’s popularity, because they rarely accept the reality that the ex-half-term’s knowledge of economics and finance is nearly analogous to the average politically out of touch American. She at least, given her record in municipal government, was able to discern the positives of “massive” federal spending on a local level.

And so our democracy is hell-bent on the adoption of a series of measures that make no mathematical sense. U.S. corporations, state and local governments, and Medicare are all at risk because of the unprecedented inflation in health care costs in this nation over the last three decades. A law was passed last year that actuaries have found will, at least, flatten that cost curve while pushing the rates of privately insured Americans back above 90%. Multiple studies have found that the law will reduce the federal deficit over its projected life. Despite this, the party of fiscal responsibility is determined to roll the measure back because of its “cost”.

The Great Recession bled the country of jobs, destroyed the property values that serve as foundation to local governments (via property taxes), and destroyed the income base for state and federal income taxes. These are the principal drivers of short term deficits in both states and the federal government. Rather than doing what responsible businesses do (borrow to cover the short term emergency and come out fighting), the party of fiscal responsibility (and most of the media) is determined to reduce spending AND cut taxes. Reduced spending means lost jobs…period. All of those “overpaid” teachers, firefighters, postal workers, flood control engineers, military logistics specialists, and police officers that lose their jobs to budget cuts will stop paying taxes and patronizing the small businesses that “create” wealth.

As we move into the new Congress, we do indeed have billions of reasons to be afraid. They are not the earmarks (which are nothing less than absolutely transparent government spending that is easy to track) or debt totals of our government. The billions we have cause to truly fear are the dollars that Wall Street stands to gain from the dismantling of state and federal infrastructure. Whether it is retirement security and health care for seniors that isn’t dependent on a trader’s computer program, or the real return our democracy sees from investments in commercial infrastructure in the minds of our children, the structure of our welfare state is never as important to powerful interests as the structure of their personal accounts.

We must contemplate the scale of our democracy, its timing, and the placement of its investments. Is $7.5 billion a large number, and is it better allocated and spent on local projects, or lost to the tribal nonsense in Afghanistan? Are tax cuts ever large enough to appease our appetite for a discount, or are they just large enough to destroy our commercial infrastructure? Is a free ride for industries unwilling to embrace the future a boon to our economy, or would sensible investments in a 21st Century energy infrastructure, in today’s dollars, produce more working class jobs?

It is at once ironic and painful that Republicans elected on the strength of a lousy employment picture are eager to get in and strip out the regulatory improvements of the last two years. One might think they would be motivated to take steps proven to create jobs. For eight years covering four Congresses, taxes on higher income brackets and businesses were slashed. Rules on corporate cash off-shoring were relaxed. Regulatory structures were gutted. All of these steps were taken in the (benefit of the doubt here) honest desire to improve the business climate and so generate a more dynamic economy.

There are those who say that cause and effect are impossible to prove; that I can’t say the eight years of supply side economics caused the recession. What I can do, is point to a massive recession that began in 2007 and reached its peak the month before President Obama’s first fiscal year began. I can point to the fact that the Bush years saw less jobs created than the term of any other administration (to include the one term presidencies of Ford and Carter). So as we proceed through the early part of 2011, and wade through the billions of fearful statements demanding regulatory cuts and tax relief in order to “drive the economy”, we can remember where the economy was “driven” the last time.

The Rational Middle is listening…