Boztopia.com

Yesterday I got in a discussion with some peeps of mine on Twitter about the heavy emphasis Obama’s team is placing on the tax cuts in his stimulus package (hereafter referred to as “stim pack” for my own amusement). The point I made was Obama’s selling the tax cuts as a way to placate nervous Congressional Republicans who may want to vote for the package, but fear reprisals from their base for supporting expanded government spending.

It looks like I was right, but this move may have some unintended consequences. Quoth the Krugman:

Look, Republicans are not going to come on board. Make 40% of the package tax cuts, they’ll demand 100%. Then they’ll start the thing about how you can’t cut taxes on people who don’t pay taxes (with only income taxes counting, of course) and demand that the plan focus on the affluent. Then they’ll demand cuts in corporate taxes. And Mitch McConnell is already saying that state and local governments should get loans, not aid — which would undermine that part of the plan, too.

John Aravosis and Josh Marshall, both very different in temperament, agree that this aspect of the plan is largely bullshit. Not only that, it reemphasizes the fundamental truth that we learned in 2008: The financial system as we know it is no longer functional. It’s a joke, a sham, and it can no longer effectively maintain a global economy.

Last year ripped the mask off the grotesque freakshow that is our “Ponzi Democracy,” as eloquently termed by Rory O’Connor. As a global culture–not just America, though certainly we shoulder much blame–we spent decades trading the idea of financial sustainability for aggressive, continual, excessive growth. You can see this in how people who should know better robotically repeat phrases like “A company has a legal duty to maximize shareholder profits” to justify buyouts, mergers, takeovers, and the continual process of taking money from people, then fooling them into thinking they’re getting something better out of it.

It’s that same kind of cultural programming that has Obama consigliere David Axelrod promoting the idea of consumer spending to jumpstart the economy–the very policies Bush has spent years espousing, to disastrous effect–when even Lawrence Summers(!) argues that it’ll take more than short-term Band-Aids to deal with the fundamental flaws of our system:

Some argue that instead of attempting to both create jobs and invest in our long-run growth, we should focus exclusively on short-term policies that generate consumer spending. But that approach led to some of the challenges we face today — and it is that approach that we must reject if we are going to strengthen our middle class and our economy over the long run.

Yet, even as Summers comes to Jesus and realizes this in one paragraph, a few grafs earlier finds him defending Obama’s tax cut plan as necessary to ensure the private sector’s cooperation. Because that’s how these guys think. It’s how everything from the fourth-tier MBA diploma mills to Harvard Law has taught people to think–that somehow, reducing the revenue the government takes in will enable it to create new jobs through more spending.

Wait, what?

Seriously, I’m no economist, but this has never made a lick of sense to me. But that’s the problem–these guys literally can’t conceive of any solutions outside their particular box. If it’s not tax cuts (but never for the middle or working class) or spending cuts (always from the middle or working class), they’re helpless. That’s why you saw Paulson and Bernanke flailing around like dying fish last fall as they struggled to justify their criminal actions in destroying their economy–they literally don’t understand anything but how to enrich themselves at others’ expense.

Obama and his team have got to think bigger than this if they’re going to succeed. They have the momentum, they have the support, and thanks to Franken being confirmed as Senator from Minnesota (finally!), they have the votes (assuming you count Joe Lieberman or one or two GOP moderates) to push through some truly ambitious legislation that can fundamentally reorient the way our country works, lives, and builds wealth. Narrowing the window to the tired old paradigm of cutting taxes and hoping that the money will flow back into the economy won’t work. It hasn’t worked for over thirty years, since the phrase “trickle down economics” entered our collective vocabulary.

The definition of insanity, it is famously said, is to do the same thing over and over again in the hope of different results. For Obama’s team to push these miniscule tax cuts and huge corporate tax breaks as some kind of economic salvation is not only change I most definitely don’t believe in, it’s a virtual echo of Bush’s demand that we go shopping as a way to serve after 9/11.

And that, to coin a phrase, is fucking nuts.