By Ben Cohen: Listening to the rhetoric of Republicans, you’d believe they wouldn’t have the government do anything other than go to war on behalf of the American people (and sometimes even that isn’t true – Donald Rumsfeld spent years trying to privatize the military). Republicans believe healthcare, roads, education, and the environment can all be better taken care of with free markets, and they work around the clock to prevent government getting involved with pretty much anything.
The problem is, when free markets don’t work out so well for any of the industries that pay for their campaigns, Republicans become born again socialists and use government to redistribute as much wealth as they possibly can.
When the economy fell off a cliff in 2008 due to the housing market collapse, George Bush turned from free market evangelist to big government spender in the blink of an eye. “I’m a strong believer in free enterprise, so my natural instinct is to oppose government intervention,” said Bush when asking Congress to pass a $700 billion bailout package. “These are not normal circumstances. The market is not functioning properly. There has been a widespread loss of confidence. Without immediate action by Congress, America can slip into a major panic.”
Apparently understanding the concept that without government spending the nation could face, in his words, a “long and painful recession,” Bush urged Congress to pass the package without asking any questions.
And yes, the Republican plan also involved cash for General Motors and Chrysler – the bogeymen conservatives now love to hit Obama with. From the NY Times:
The emergency bailout of General Motors and Chrysler announced by President Bush on Friday gives the companies a few months to get their businesses in order, but hands off to President-elect Barack Obama the difficult political task of ruling on their future.
The plan pumps $13.4 billion by mid-January into the companies from the fund that Congress authorized to rescue the financial industry. But the two companies have until March 31 to produce a plan for long-term profitability, including concessions from unions, creditors, suppliers and dealers.
Then, when financial institutions stabilized (backed with tax payers dollars), Republicans reverted to free market militarism claiming government spending could never stop a long and painful recession. Said Eric Cantor only a year later in response to President Obama’s stimulus package request:
What the president announced yesterday, is that somehow magically, if we just continue to prime the pump of taxpayer dollars, we’re going to see magically an economic recovery.
This type of remarkable cognitive dissonance is a key trait of the Republican Party, which must now be considered an ideologically fraudulent entity that exists only to further the interests of big business and the rich (the only plausible explanation for its hypocrisy). Take for example, the amount of money handed back to the rich in the form of the Bush tax cuts – one of the biggest redistributive measures ever passed by the American government. As of yesterday (June 4th) the government has lost over $1,099,639,672,339 in revenues it could have claimed if the tax code was left as it was under Bill Clinton (and more under Ronald Reagan).
It may not be fair to single out the Republican Party on this, because the hypocrisy exists on a far broader scale, particularly within international financial institutions. Writes Noam Chomsky:
Indonesia had a huge financial crisis about ten years ago, and the instructions were the standard ones: “Here is what you have to do. First, pay off your debts to us. Second, privatize, so that we can then pick up your assets on the cheap. Third, raise interest rates to slow down the economy and force the population to suffer, you know, to pay us back.” Those are the regular instructions the IMF is still giving them.
What do we do? Exactly the opposite. We forget about the debt, let it explode. We reduce interest rates to zero to stimulate the economy. We pour money into the economy to get even bigger debts. We don’t privatize; we nationalize, except we don’t call it nationalization. We give it some other name, like “bailout” or something. It’s essentially nationalization without control. So we pour money into the institutions. We lectured the third world that they must accept free trade, though we accept protectionism.
Faced with empirical evidence that America is basically a socialist country that redistributes wealth upwards, one would have thought members of the media or political classes would stop lecturing everyone else on the virtues of the free market. But Mitt Romney, an original supporter of the bank bailouts and stimulus package under Bush, is running on an austerity platform for the Presidential election this year, because apparently, that’s best for the economy. Amazingly, Romney actually told the truth about austerity in a rare moment of candor in an interview with Mark Halperin in Time magazine. Here’s the exchange:
Halperin: Why not in the first year, if you’re elected — why not in 2013, go all the way and propose the kind of budget with spending restraints, that you’d like to see after four years in office? Why not do it more quickly?
Romney: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I’m not going to do that, of course.
Romney then walked back the statement continuing his line that austerity was the only way forward, no doubt realizing his party and financial backers would be having serious words with him afterwards.
As Upton Sinclair famously wrote, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” Sadly, in Romney case, he actually does.