From one 'cliff' to the next

Anti-worker deal on taxes sets stage for anti-worker deal on spending

By Walter Smolarek

Rep. John Boehner and President Barack Obama during fiscal cliff negotiations, Dec. 17, 2012

Poor and working people know what crises are. Being evicted, losing your job, or being sick and uninsured is a crisis. Crises have definite causes and consequences that require immediate action.

But for Wall Street’s loyal servants in Washington, crises are not all that bad. They present an opportunity to carry out on a grand scale the permanent bipartisan agenda of Congress to protect the rich and their ability to make money. Fiscal cliffs, debt ceilings and other creatively named points of no return induce so much fear that workers often find themselves paralyzed and unable to present any real resistance to the austerity schemes that are hatched in the halls of power.

These types of crises are so convenient for the politicians that they manufacture them all the time. First came the 2011 “debt ceiling” negotiations. Since 1917, Congress has periodically increased the amount of money the federal government is allowed to borrow in a relatively drama-free affair that prevented the country from going bankrupt. However, the Republican-controlled House of Representatives decided that they would refuse to raise the debt ceiling unless major cuts to vital social programs were made. Months of fear-mongering and negotiations in Washington produced the Budget Control Act of 2011.

With wide bipartisan support, this law established the “fiscal cliff” that has been dominating headlines since the Presidential election. Under the Budget Control Act, Congress set itself a deadline—conveniently after the 2012 election—to come to an agreement that would reduce the federal deficit by $1.2 trillion over ten years. If they failed to reach an agreement and “went over” the fiscal cliff, a series of tax hikes and budget cuts would automatically be enacted.

This absurd non-dilemma is the cause of the recent drama in Washington: if the politicians could not agree on how to cut social spending and increase taxes, then social spending would be cut and taxes would increase. Either way, workers lose and Wall Street successfully shifts the burden of its crisis onto our shoulders.