Money For Nothing
Looks like there are a few Republican complaints about the American Rescue Plan, a plan that polls with a 75% approval rating. Most of their complaints focus squarely on all the “free money” that people will receive under the plan. They’re worried that the new law is not just about COVID, that it’s just a grab bag of toys for Democrats. Some Republicans have even made comparisons between the latest COVID rescue plan and socialism or communism. And there are some who have drawn comparisons with China and authoritarianism, I’m thinking Tom Cotton here. The pandemic has cast a bright light on the true cost of conservatism.
Just last month, Tom Cotton release a 64-page report called, “Beat China, Targeted Decoupling and the Economic Long War”. I have to wonder just what, exactly is Mr. Cotton fighting against. Is it authoritarianism? Yes, China’s government can be brutal, no doubt. But if Mr. Cotton is looking for a fight against authoritarianism, he must not have noticed that police in America kill roughly 1000 people every year. They killed 1100 people just last year. I guess to Mr. Cotton, that’s not authoritarian. And that just one example.
We’re pretty authoritarian around here, and we have been that way long before the pandemic. So I‘m still a little confused about what our conservative friends are fighting against in China. Maybe they’re unhappy with China because they spend about 4% of GDP every year on infrastructure — that’s ten times what America spends in GDP. You know, the government of China spends a lot of money on stuff like bridges, roads, airports, and even telecommunications.
Maybe conservatives are unhappy about the fact that a communist country makes almost all of the electronics that we use every day and take for granted. That report by Tom Cotton sheds a bucket of crocodile tears over our trade deficit with China. Our computers, TVs, phones, pretty much anything with a screen that we use every day, was made somewhere else, mostly in China. Who consented to that? Wasn’t the great unwashed. We want those manufacturing jobs. Maybe it was those really smart MBAs back in the 1990s who thought it’d be so great to let China build our stuff. They shipped our shop know-how offshore with the blessing of both parties.
Maybe conservatives are upset with China’s public banking system. Most of the financing going on in China is from a public bank. Public banks charge interest on loans and the interest on the loans goes back into the treasury. We do something like that here too, but not as much. Public banks are supposed to be “communist” except for the Bank of North Dakota. Isn’t it strange that we include interest on debt as “GDP”?
If Tom Cotton is looking to root out authoritarianism, he need only look in the mirror. Take note of the following text on Wikipedia about just some of Tom Cotton’s statements:
Following the killing of George Floyd, Cotton rejected the view that there is “systemic racism in the criminal justice system in America.” Amid the following protests, Cotton advocated on Twitter that the military be used to support police, and to give “No quarter for insurrectionists, anarchists, rioters, and looters.” In the military, the term “no quarter” refers to the killing of lawfully surrendering combatants, which is a war crime under the Geneva Convention. Cotton subsequently said that he was using the “colloquial” version of the phrase and cited examples of Democrats and the mainstream media also using the phrase.
A few days later, an opinion piece by Cotton entitled “Send in the Troops” was published by The New York Times arguing for the deployment of federal troops to counter looting and rioting in major American cities. Dozens of New York Times staff members sharply criticized the decision to publish Cotton’s article, describing its rhetoric as dangerous. Following the negative response from staffers, The New York Times responded by saying the piece went through a “rushed editorial process” that will now be examined. Editorial page editor James Bennet resigned days later.
No quarter? Send in the troops to stop the looting and the rioting? Isn’t that authoritarianism? Whatever happened to community policing? Oh. That doesn’t make headlines.
Tom Cotton and his friends like to talk a lot about free markets. They seem to think that if you just leave businesses alone, they’ll keep the market free. But one thing they’re awfully quiet about is the lack of transparency in our markets. Especially when there are monopolies or duopolies hanging around, you know, the donor class. This a problem we have in the Internet Service Department. Pricing is not transparent. Availability is not transparent. Mr. Cotton says not to mind, the market is free.
We all know the drill with our ISPs like Comcast, AT&T, Verizon, Time-Warner/Spectrum, and the lot. Every year they raise prices, every year we call them to negotiate a return to the lower price, even though there is no real competition. And if we want to move, it’s hard to tell if the service we want is available. There are no solid or proven maps that will tell us for sure if the service we want is where we want to move to.
The Accessible, Affordable Internet For All Act was written to fix much of that. But the GOP and centrist Democrats (think Joe Manchin) will vote against it in the Senate just to appease their big donor monopoly friends. Did you notice that Mr. Cotton is really quiet about the giant monopolies in America? Oh sure, he’ll rage about Google and Facebook, but he’s really quiet about telecom monopolies and the ten companies that own the entire food industry. I wonder if those ten companies have interlocking directorates. I bet if he’s pressed, he’ll tell us that a private monopoly is still so much better than a public monopoly. Maybe monopolies are better if they are owned by conservatives.
I suppose the biggest problem I have with the pretended congressional conservatives is that their friends in Wall Street don’t believe in free markets. They don’t talk about the perils of free money if we give it to rich people. We’re supposed to believe that it’s safe to give rich people money because they’re responsible. Besides, luck had nothing to do with their wealth. Anyone who watched or read about the 2008 bailouts for the top 1%, may beg to differ. And few members of Congress who were there during the 2008 bailout will tell us that business as usual never really stopped.
I find it interesting that conservatives in Congres are more worried about giving money to ordinary people like you and me, but are not so worried about what happens when you bail out investors who bet on asset bubbles. I have this opinion about most Republican politicians. They’re fine with asset bubbles that generate free money for wealthy people with generous financing from the Federal Reserve, but not so fine about the government giving money to regular people.
Most regular people have seen wage stagnation for 40+ years. Those regular people are insecure about their health, their food, and where they’re going to live. None of the senators in the US Senate are insecure about anything beyond their next campaign. Republican senators have expressed concern that the latest stimulus payment and the expansion of the Child Tax Credit from $2000 to $3000 ($3600 for kids under 6), and setting that up as a monthly stipend might reduce the incentive to work. With the new arrangement, parents will receive $250 a month per child as an advance tax credit. That steady payment will add stability to the finances of millions of Americans.
It seems like the motive of Republicans in the US Senate is to keep Americans in a steady boil about insecurity. Maybe they intuitively understand that those asset bubbles aren’t worth anything unless people are willing to work for money.
To boil it down to very simple terms, American finance is all about financing asset bubbles. If you want to buy a house, it’s not terribly hard to get a loan for a house. The bank is going to create money to loan to you to pay for the house. The house will still be there when you’re gone but the value will always go up in the long run. But if you want to create a new means of production, well, that’s going to come out of your checking or savings account. Banks won’t loan money for production because that’s too risky, and that might improve your chances of paying debt off early.
Conservative politicians wax on about government debt but don’t talk about private debt, as if private debt won’t strangle the economy. They worry that public borrowing will crowd out private borrowing. I don’t think I’ve ever seen or read of that happening. Bankers are always ready to loan money to the government.
The message I get from bankers and conservatives is this: We’ll loan you money to pump your company stock, but you can’t use that money to create a new means of production or give people a raise. That might put more people to work and make it easier for them to pay off their loans. Heck, if people don’t have loans to pay off, what will we use for social control?
Remember what I was saying about the Accessible, Affordable Internet for All Act? The Act also includes about $90 billion to expand internet access for unserved and underserved areas of the United States. Do I hear any conservatives talking about why internet service providers are so reluctant and so slow to invest money for the expansion of their networks or increasing their speeds? The business model of our national ISPs is one of scarcity. Just like the GOP.
These are just some of the things that I think about when I vote.