Debt Ceiling Hostage Taking. The Banality of Corporate State Propaganda

On June 23rd, 2011, House Majority Leader Eric Cantor (R) Va., and Senate Minority Leader Jon Kyl (R) AZ, walked out on the federal debt limit ceiling talks in the kabuki theatre that is Washington, D.C, these days. Why would a party that relies on deficit spending to further its ideology and declares that deficits don’t matter when they are in power do this? To extract more blood out of America’s dwindling middle class, the poor, public sector workers, the elderly, and the unemployed (which further contracts, not expands economic activity) to further an American “shock doctrine” for its billionaires and multinational corporate CEOs. They will vote to raise the debt ceiling after more bloodletting. After all, Mitch McConnell (R), (KY) offered a way out of the phony debt ceiling crisis. But then Obama (always trying to burnish his Reagan bonafides) wanted the “grand deal” of the “gang of six” that offered up Medicare, Medicaid, and Social Security (of which social security has not added to deficits and by law, cannot). But the extreme House radicals led by Eric Cantor pushed through the unworkable “Cut, Cap, Balance” in the House. That led the country back to negotiating what plans to further wreck the public square for theft by rich and powerful interests will prevail. Now it appears the “bi-partisan” deal making is a system of strait jackets and triggers. The corporatists who pretend to represent freedom are ironically trying to create the ultimate state controlled economy, a corporate state controlled economy.



Since the average American is neither a billionaire nor CEO of a multinational corporation, why would so many average Americans vote for such destructiveness of America’s social contracts and the public interest by electing these representatives? They would have to believe such destructiveness of the public interest would benefit them somehow and the vehicle which provided that was the deregulation of the communications industry and broadcast media that has taken place since 1980 turning broadcast news from a public service into political “news” that broadcasts ideology 24/7.



Belief in things not real has aided implementation of the “shock doctrine” in the United States. It has prevented a more violent reaction as was the case in Pinochet’s Chile after Allende’s assassination or in Iraq after Bremer’s announcement that Iraq’s economy would be privatized by foreign multinational corporations instead of Iraqis which led to insurgency. Maybe this is because the attacks of 9/11/2001 were more of a galvanized fear those in power could exploit. It was relatively easy to get many Americans to support elimination of habeas corpus and due process which has been the hallmark of western democracies as well as their constitutional liberties under the Bill of Rights. It has allowed Americans to give up the checks and balances for imperial presidencies above the rule of law and replace freedom with a privatized security state. And in the case of Katrina, to view the failures of the privatization of FEMA as a failure instead of “big government” and cold enough hearts to view the forced displacement of New Orleans’s poor to other states as something good or positive.



The underlying premise of a “shock doctrine” is that a catastrophic shock such as a natural disaster or Pearl Harbor like a terrorist attack, military coup, or even a fabricated crisis such as the debt ceiling issue will disorient the public enough that they will allow themselves to be ushered into a new order that transforms or erases the current society into a new one. In this case, under Freidman’s model, it is a dismantling of government social constructs with its people, laws to protect citizens and their welfare, etc., for a privatized, unregulated, lower flatter tax for millionaires and corporations, free enterprise “utopian” society with no government safety nets and no rules. In other words, it is to be a society of the corporation, by the corporation, and for the corporation instead of the people.



It’s hard to argue that the quote of “creating our own reality” largely attributed to Karl Rove has not come true. The George W. Bush administration eviscerated Constitutional checks and balances, broke domestic and international laws as well as the Constitution’s restraints, and erased habeas corpus and due process and the rule of law as we had come to know it. They essentially made Nixon’s erroneous declaration that “when the President does it that means it is not illegal” reality. So why didn’t Bush meet the same fate as Nixon? The answer is corporatism made inroads in what used to be the party of the New Deal since that time.

After Reagan’s victory, in 1985, a group of primarily southern Democrats in the Senate created what was called the Democratic Leadership Council to distance the Democratic Party away from the New Deal structures, unions, and the civil rights movements that had made it the most popular party and turned the United States into an economic powerhouse which lifted people out of poverty and despair with a higher standard of living. It immediately became the policy shop of the Democratic Party and today is alive in the New Democrats, Third Way movement and the Progressive Policy Institute (which isn’t progressive in any sense of the word). In other words, there hasn’t been a political party pushing the tenets of progressivism and the New Deal with its regulations and social spending for 26 years, legislative wise for 31 years. That was probably an essential shift in removing remaining barriers to creating a corporate state. Anything democratic in nature is in itself, a barrier to corporatism or rule by a few.



The quotes by Voltaire concerning people being made to believe absurdities are probably one of the biggest bylines of the 21st century. We have all heard them. From WMD’s in Iraq to President Obama is a Muslim from Kenya, the streets of America has taken on a certain mental illness appearance. After all, what is more backward than a thought process that views removal of habeas corpus, due process and the Bill of Rights, while instituting torture, and warrantless wiretaps as preserving freedom while viewing universal cheaper healthcare for all citizens as tyranny? The belief President Obama as a socialist is a another popular absurdity since he is a president whose major proposals have been recycled Republican ideas from his healthcare plan, to charter schools, to cap and trade, and who negotiated a deal with Republicans to extend the Bush tax cuts. He also backed the “gang of six” proposal to offer up the only things remaining that are progressive, Medicare, Medicaid, and Social Security to cuts. He may even go down in history as the biggest tax and budget cutter in a history, a sort of Reagan on steroids when you throw in defense spending. But to see how the corporate state is successful in advancing, we need to take a look at the absurdities an even wider audience than just the Tea Party also believes.



If the rich and powerful (those that control a corporate state) are going to control the public’s money to benefit the rich and powerful, they need lies that convince the larger public to vote against their interests. What better way than to repeat half truths and falsehoods enough to fool the people into thinking it is in their best interests as well?

Probably the most successful one has been on the subject of taxes. There is probably no one in America, believer or non believer, that doesn’t know it by heart after 30 years of repetition. It is, of course, the claim that lower income tax rates, particularly at the top, leads to economic growth, job creation, and eventually, more tax revenues into the treasury. So let’s look at the claim and Bush’s declarations in the above and test it against the evidence since the claim of supply siders and Freidman is that it is a law of sorts of economics. As noted in a report by http://thinkprogress.org/progress-report/ten-years-of-the-bush-tax-cuts/">Pat Garofalo of ThinkProgress.org at the Center for American Progress, as we have passed a decade now of these tax cuts, growth in investment, GDP, and employment all posted their worst performance of any post war expansion. Overall, monthly job growth was the worst of any cycle since 1945, household income was negative for the first cycle since tracking began in 1967 according to the Center for American Progress. So much for the added fantasy tax cuts lift all boats. The only boats that have been lifted have been the top 1 %. And the report also showed that in June 2001 when the first Bush Tax cut was enacted, the economy had 132 million jobs and three years later in 2004, it had 131.4 million jobs. http://www.opednews.com/articles/Michael-Collins-Questions-by-Michael-Collins-110622-31.html">Michael Collins writing at OpEdNews looked at jobs from 2000 until 2011 and noted that in 2000 there were 135 million jobs for a workforce of 144 million and today, 139 million jobs for a workforce of 154 million with 10 years of tax cuts in that span. That span represents negative job growth given population increase. This is because demand increases jobs, not the tax rate. This policy behaves just the way it is designed, to redistribute the public wealth to the top. Remember, Clinton increased the top rate a few percentage points and the job growth rate under his Presidency was 16.2 %. He left office with running surpluses which led the Congressional Budget Office to estimate if there were no new legislation or rule changes, budget surpluses would be sufficient by 2006 to pay off all of the federal debt available for redemption. About the only laws of economics these tax cuts follow are running deficits and added debt to the national debt and the bad thing is they are still with us.

Other lies are needed to soften up the public for the shift to a corporate state from a democratic republic and we have seen them on full display. As we have seen, tax cuts framed as income and as the primary economic driver to economies had to be established instead of the sometimes limited stimulus and a contributor to deficits and debt that it is, in order to defund the public sector for control, privatization, and take over. Normal government functions have to be seen as something else and only as a cost with no real benefit. The public sector had to be relabeled as “big government” and framed as always overreaching and a threat to freedom instead of public service and benefit. Spending money and taxation which is how all governments function no matter the ideology had to be reframed as always a economic drag and the single cause of deficits and debt except for the military industrial complex and security spending (which benefits the corporate state). Public sector workers had to be attacked as if they were not American but a public enemy, their modest incomes and pensions as some sort of “socialist” attack on “freedom” and public schools and universities as “far left social engineering” that have to be defunded and privatized for profit. So far, this defunding of the public square has cost us approximately 1 million jobs (which has further contracted the economy, reduced revenues, and decreased demand this economy so desperately needs). Defunding public institutions, public safety nets, firing public employees, etc. does not help the economy as a whole, does not preserve one private sector job, does not increase demand for any private sector product, and does not increase the salary of any private sector worker.

So how is it believed it will help? Why do people believe that income taxes have reached oppressive levels though according to http://www.usatoday.com/money/perfi/taxes/2010-05-10-taxes_N.htm">Dennis Cauchon in an article in USA Today, the Bureau of Economic Analysis determined that in 2009, federal, state, and local income taxes combined consumed just 9.2% of all personal income, the lowest since 1950 and well below the historic level of 12% for the last half century? Why do people believe that business in the US is over regulated despite being one of the least regulated 1st world industrialized countries? Why do they still in spite of the collapse of the financial sector and housing market due to removal of the New Deal regulation, the Glass-Steagall Act (sorry tea partiers, it had nothing to do with ACORN, Jimmy Carter, poor minorities, or Mexicans, but with CDOs, credit default swaps, and an unregulated derivatives market)? Why do people believe “free trade” agreements instead of reciprocal trade will spur economic growth and export expansion in the United States when it has taken manufacturing in the US close to its death bed, shipped American jobs and technical expertise overseas, and taxable profits offshore? Why do people think union busting is good for the economy while it reduces wages overall and while there is no such thing as a low wage country which is prosperous? Why do people believe we can cut our way out of near depression conditions when it cannot be done? The answer is corporate propaganda and belief in things not real.



A very important key to success of the “shock doctrine” and its ability to erase the society it is replacing is to rewrite existing laws to favor Freidman’s vision of corporate utopia. Therefore, the rights of the people have to be subjugated to rights of the corporate entity. This process has reached unprecedented success in the last ten years. The Roberts court which is packed with right-wing extremists from the Federalist Society, a group of radicals who believe in an alternative Constitution and legal precedence history, delivered a powerful blow to the concept of a democratic republic in the Citizens United decision which has given the whole political process over to corporate money and influence based on a quack opinion that money is free speech. This is being followed up currently by newly minted “tea party” legislatures that are currently allowing state laws to be rewritten by corporations to subjugate rights of the people to corporate rights, a kind of counter revolution to the belief and tenants of the founding fathers and their restrictions on corporate charters. The corporate state is finalizing its shift as the supreme authority.



The debt ceiling raising, something that is normally done when this artificial economic restraint gets in the way of the nation’s ability to operate freely in matters of situation and economics, has provided the corporatists an opportunity to seize upon another shock of contrivance to further their ideological control. The debt ceiling has been raised unceremoniously many times including seven times during the previous administration and 18 times during the administration of the supply side Jesus of the corporatist movement, Ronald Reagan. Perhaps it is long overdue for people who do not want to be ruled by forced ideology to take this opportunity as well to think of alternatives of corporate rule before the door closes a final time.

So much good information...necessary reminders and a great summary of the situation as a whole.

That "create your reality" quote gets under my skin every time. Their arrogance is intolerable.

Bookmarking and sharing elsewhere.

Thank you!


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Thanks. And I'm with you on co ops. It's a way to fight back in abandoned communities and shuttered businesses. We need some viable alternatives.

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