The ability of the Tea Party movement to profit from the deep economic crisis poses the need to provide real solutions to these problems. Below, Alton Sierra critiques the Tea Party’s policies and provides a socialist solution.
Q: Isn’t the Tea Party a “grassroots” movement? Is it not the product of angry citizens making their voices heard?
A: This is how Tea Party members describe it. However, most Tea Party events have been sponsored by powerful, established right-wing groups such as FreedomWorks and Americans for Prosperity, both with deep connections to the Republican Party and big businesses. Fox News is also a powerful, not-so-behind-the-scenes organizing force for the Tea Party, permanently or sporadically employing mouthpieces like Glenn Beck and Sarah Palin at large salaries.
Fox has also provided free publicity for the Tea Party and has misreported events to be much larger and farreaching than is true. Even the “liberal” networks give undue coverage to the Tea Party, providing it with more free publicity and prestige.
Q: Isn’t the general ideology of the Tea Party correct that government meddles too much in the free market, and that this interference with the economy is what caused the crisis?
A: This debate has been deliberately framed in reverse. The real cause of the ongoing economic crisis is big business’s short-term drive for profit. Government is not an independent force. The role of government is to use public money to help corporate America achieve its agenda.
Both Republicans and Democrats have pursued policies that promote free trade and have made treaties to secure market access for corporate exploitation. This crushes local industries that must compete with imported goods and agriculture made cheaper in the U.S. The destroying of jobs in these markets drives down wages, an ideal situation for U.S. investment to replace the relatively high wage jobs in the U.S. with products made by cheaper labor in these overseas factories.
Over the past forty years, factories, plants, even technical centers based in the U.S. were closed and reopened in low-wage markets overseas and in Latin America. This has shifted the American economy from consisting of 53% manufacturing sector jobs in 1965 to only 12% today (Financial Times, 7/31/10).
Also, the two corporate parties opened the door for speculative gambling on a massive scale by deregulating the finance industry and eliminating rules put in place after the Great Depression. One example was the repeal of the most important part of the Glass-Steagall Act by President Clinton in 1999 that allowed the merger of investment banks and deposit banks. This allowed banks to secure super-risky speculation with the safety of domestic deposits. Huge investment bubbles grew and collapsed, facilitated by a corporate-dominated government.
Yet once the bubble burst, under a bipartisan deal in the fall of 2008 the government doled out trillions of dollars in bailouts to these same Wall Street banks and financial institutions, who had ruined themselves by overly investing in market bubbles and caused such devastation in the housing markets. But the government ignored the plight of thousands of home owners facing foreclosure, letting them fail while protecting the mortgage companies and the “toxic assets” held by banks.
Now at a state level, both Democrats and Republican politicians are making sharp cuts in social services such as education and infrastructure, cutting other public spending and cutting hundreds of state jobs. This piles extra costs onto students and their families and the poor. But raising taxes on the rich and corporations to pay for state deficits is off the table.
Q: Doesn’t immigration contribute to our economic problems as the Tea Party says?
A: The corporate-friendly free trade policies such as NAFTA have destroyed industries in Mexico, leaving millions searching for decent work. NAFTA opened Mexican markets to American agri-business, so food grown cheaply with expensive farming technology could be sold in Mexico, easily outcompeting small Mexican farmers, forcing them to look for work elsewhere.
These immigrant workers would surely work closer to their families if work that could provide for them was available. American corporations have made huge profits hiring them at lower wages than American workers, and they really don’t want to cut off this cheap labor force. Also untrue is the notion that immigrants collect services but do not pay into taxes. In actuality, according to the People for the American Way, undocumented workers pay over $90 billion in taxes annually and receive only $5 billion in public welfare. In fact the work of immigrants is a boost to the economy, by producing food and performing important labor that is creating wealth in the economy.
Q: The Tea Party claims that we need to lower taxes and eliminate government restrictions to allow free enterprise to thrive. Can this really create a situation where small businesses can once again start and grow, put millions back to work, and spur the economy to a new boom?
A: Today, big business and the big banks dominate the economy and the rest of society, including the government. They use this leverage to strangle any small business competition, whenever and wherever necessary. Any sizeable successful company that challenges this corporate domination gets gobbled up. Microsoft is the best example of this, devouring any small innovative competitors.
The time when competitive capitalism was a progressive driving force is long gone. The utopian idea that conditions for small businesses to flourish again can be re-created with lower taxes is really just a fairy tale used to justify giving tax breaks to the super-rich and big business. The economy will not begin to recover from the initiative of small businesses.
Under the sway of the two corporate parties, the government has no interest in helping them grow and compete with big corporations. Despite receiving massive tax cuts and low-interest loans, the largest 500 corporations created no increase in net jobs in 2009. Instead, they cut 821,000 jobs and yet still made record profits of $391 billion collectively. This stranglehold of the economy by big business is the key problem facing U.S. society today.
These massive profits are a direct result of the twisted outlook of capitalism, with its singular pursuit of profit despite the disastrous social consequences. Massive layoffs and cost-cutting demanded by the logic of capitalism - even though that money could easily have been more usefully reinvested to create new jobs. But such an action is deemed less profitable then speculation or creating jobs in a lower-wage market.
As socialists, we believe that the solution to fixing the economy lies in challenging the domination of society by big business and the system of capitalism.
The two corporate political parties will do nothing to defend the interests of workers and the poor from the realities of capitalism. The 500 largest corporations that dominate our economy and hold so much power in our society must be brought under democratic public control. Only then could they be run in the interest of society in general instead of for the privileged few at the expense of the vast majority.
The technology exists to create a new worldwide integrated economy that can provide for all our needs. The amazing systems of communication to coordinate this already exist, but the reins to the economy are in the hands of the corporate elite.
If the economy were run for the enrichment of the whole instead of a privileged few, then full employment, education, health care, housing and more could be provided for everyone. Workers organized in the workplace, people organized in their community and students at college could form the foundation of a new kind of economic system, democratically making decisions to ensure that all needs are met. This kind of economic system is called socialism, a word that is fairly common but often misused these days.
A left challenge to the agenda of the Tea Party, which serves the agenda of big business, must be made! Alternative solutions to fix the economy and government must come from challenging the idol of corporate profit: People must come first. The economy is currently a tool for the rich to make themselves even richer. Democratic public control of the economy and society is necessary to provide full employment. Big business will not provide jobs as long as it is not profitable.
We demand investment in renewable energy and infrastructure and other sustainable job creation programs. We also demand a higher minimum wage and inexpensive access to quality education and health care, not from loans and insurance but as a right. Small struggles are breaking out in reaction to layoffs, cuts in social services, cuts in education and increases in tuition. Workers, unemployed and youth should link together and fight for their common interest against the corporate control of our society. Fight for a socialist alternative!