{"id":132995,"date":"2014-11-16T00:03:37","date_gmt":"2014-11-15T18:33:37","guid":{"rendered":"https:\/\/www.colombotelegraph.com\/?p=132995"},"modified":"2014-11-21T13:20:07","modified_gmt":"2014-11-21T07:50:07","slug":"its-not-obama-stupid-the-trouble-is-global-capitalisms-gridlock","status":"publish","type":"post","link":"https:\/\/www.colombotelegraph.com\/index.php\/its-not-obama-stupid-the-trouble-is-global-capitalisms-gridlock\/","title":{"rendered":"It\u2019s Not Obama Stupid! The Trouble Is Global Capitalism\u2019s Gridlock"},"content":{"rendered":"

By Kumar David<\/span><\/a> –<\/span><\/strong>\u00a0<\/span><\/p>\n

\"Prof.<\/a>

Prof. Kumar David<\/p><\/div>\n

It\u2019s not Obama stupid! The trouble is global capitalism\u2019s gridlock:\u00a0<\/span>Sometimes turkeys vote for Christmas<\/span><\/strong><\/em><\/p>\n

If Lanka\u2019s voters elect President Mahinda Rajapakse<\/span><\/a> for a third term I guess you can say the turkeys have voted for Christmas; they are in for a battering, basting and roasting. However, my focus today is on the US Congressional poll of 4 November where a Republican wave gave it majorities in both Houses (Senate and House of Representatives) after many years. Obama\u2019s legislative plans are dead in their track for the remaining two years of a now lame-duck term, budgets will be deadlocked, the US will be disadvantaged in foreign interventions, and I won\u2019t be surprised if the Tea Party lunatic fringe, though its clout has shrunk, tries to impeach Obama on trumped up charges. Unlikely, but I don\u2019t put anything beyond the ravings of these weirdos.<\/p>\n

The Republicans won big; they have secured 52 Senate seats and may pick up one more when the run-off vote is held in Louisiana in January. The GOP majority in the House has increased and it defeated several key incumbent Democratic Governors in unexpected overturns. There was class bias embedded in the voting, but layered under a general swing, it was less visible. Exit polls show 89% of blacks and 63% of Hispanics voted Democrat, while 64% of non-white graduates and 57% of over 65s voted Republican. What inflicted greater damage on the Democrats was that the angry well-heeled made it to the polls, while a sizable number of middle-class Democrats stayed home. The swing was based more on disillusionment than, as one BBC commentator put it, \u201cOn any distinctive agenda painted by the Republicans; there was no Contract-With-America that voters endorsed or were asked to endorse\u201d. This is perhaps the most negative election in American history; nobody was for anything, everybody was against someone or something; billions were spent in lurid negative advertising; only 40% of the electorate even bothered to vote.<\/p>\n

However there is a silver lining. Two years is time enough for this gosling public to behold wacky rednecks in action and to chew on its own plight at the oven door; this could smooth Hilary Clinton\u2019s passage to the White House. Incoming Senate Majority Leader Mitch McConnell vowed to work with Obama on issues where they can agree such as trade agreements and tax reform. He also promised to make the dysfunctional Senate pass bills. Republican leaders are acutely aware of their dilemma but can they control their wild bulls in the House even though leaders breathe a sigh of relief that \u201cmost wacos have been cast aside\u201d? The usually manageable Senate will also be somewhat troublesome this time since three Tea Party oddballs are in the GOP cohort (Rand Paul of Kentucky, Marco Rubio of Florida and Ted Cruz of Texas). All have presidential ambitions, albeit unrealistic, so this will not be an easy circus for GOP leaders to keep in harness.<\/p>\n

A superficial story<\/b><\/p>\n

Is it fair to call the US voter chicken brained when the economy has been in doldrums since 2008? Obama was first elected in November that year. Should not incumbency bear the costs of economic failure on so grand and global a scale? According to exit polls the biggest reasons for the swing were disappointment with the economy and disillusionment with Obama. However, I believe the reasons for the economic flop are not subjective errors of individuals or group. Crisis was as inevitable as night follows day, given the drift of global capitalism over the previous decades. The decline of production (the real economy), the new hegemony of vapid finance capital, asset and housing bubbles, and China\u2019s economic assent, all this could not have been prevented. It\u2019s not Obama stupid! The trouble is global capitalist gridlock.<\/p>\n

Allow me to cast doubts about two oft accused culprits. First is, low interest rates, easy credit, rising debt and above all encouragement of the shift to a finance economy, all on Alan Greenspan\u2019s long watch. True all this contributed to the transformation of the US from a production power-house to a land in a finance capital trance. However had Greenspan as Fed Chairman, not gone along, he would have been replaced by a pliable person. It was not Greenspan, Bluespan or any other individual who drove these processes; in the 1990s and 2000s US capitalism was going through these mutations as the only way in which it could to prolong its death rattle, albeit temporarily.<\/p>\n

Secondly, purists pour imprecations on Greenspan\u2019s successor, Ben Bernanke, and Treasury Secretaries Henry Paulson and Timothy Geithner for shoving loads of cash at a palpably moribund economy, holding interest rates down to near zero, and bailing out all the great corporate names. But had they not done so half the banks, finance houses, mortgage trusts and many of America\u2019s famous brand names would have gone bust leading to massive layoffs, evaporation of life-savings, evictions from homes and therefore social unrest. Figuratively, the revolution would have come to America. I reckon it pretty contradictory that some who want these bastions of capitalism thrown under the train are themselves staunch devotees of capitalism in the abstract; an inconsistency I never could fathom.<\/p>\n

There is a paradox to this mid-term election; the backlash on the economy hit Democrats and Obama just as the economy had began an upturn. The unemployment rate is down to 5.8% and over 200,000 jobs are being created each month, well above the normal need of 200,000. GDP growth at 1.7% is better than Europe, which teeters on the brink of yet another recession, and energy prices are way down. Conversely the income and wealth gap shows no sign of closing, wages are stagnant and the benefits of the mild and maybe temporary upturn are not filtering down.<\/p>\n

I have no intention of defending Obama<\/span><\/a> or the august gentlemen named in the paragraphs above, and to read me in this way would be to misunderstand what I am trying to say. My point is that to blame team-Obama for the economic despair in America is about as intelligent as faulting meteorologists in the littoral states for the occurrence of a tsunami. In so far as they voted against Democrats because Obama didn\u2019t (couldn\u2019t) fix broken capitalism, American voters were baying at the moon. To put it bluntly, there is nothing magical under pluperfect heaven anyone can do to plaster over moribund capitalisms recurring crises. The mass of voters all over the world are a on the dumb side; emerging trends don\u2019t affect polls till six to twelve months later.<\/p>\n

The deeper reality<\/b><\/p>\n

Though both Obama (\u201cI have heard you\u201d) and Republican leaders (\u201cWe will work with the President\u201d) vow bipartisan sincerity, will it succeed or will it unravel before you say \u2018Obamacare\u2019? I fear there is too much ill-will, too many personal vendettas, and undue partisan angst on both sides to make optimism sanguine. More important, there is deep divergence on core issues such as class and economy, health-care, and moral issues (abortion, homosexual rights), though it may be possible to get some bipartisan overlap on immigration reform and foreign policy \u2013 but don\u2019t bet even on that.<\/p>\n

The central conflict is: Should America allow big business free reign to flourish in the expectation that this will drag the whole economy up with it, or should it be managed capitalism with a fair share set aside for the middle and more menial orders. The former road entails big business and finance capital friendly policies (tax cuts or further concessions for the financial and corporate sectors and prosperous classes, labour market reforms, and deep amputation of legacy sectors \u2013 social welfare and health-care in particular). The second approach implies robust measures to correct America\u2019s obscene wealth and income gap, ironing out \u2018Obamacare\u2019 with the intention of moving to a universal public health-care system, minimum-wage legislation, and active intervention in education policy. The chasm is deep and I doubt if it can be bridged.<\/p>\n

Listening to Obama\u2019s one hour post-election speech, I read as follows between the lines. Yes, superficially he will play bipartisanship, but deeper he has decided \u201cScrew You!\u201d He will push what he thinks is good, paying little heed to Republicans. He is fed up with a Congress which repeatedly and calculatedly sabotaged everything he sought to do. Now it\u2019s revenge time. He will inflict PR damage on them to aid Hilary\u2019s presidential bid. Republicans now in control of both chambers bear full legislative responsibility for the economy and the budget; the President\u2019s role is executive (not entirely since he holds veto powers). If the economy stumbles, or there is gridlock in Washington, it\u2019s mostly Republican backsides that get burnt. Good!<\/p>\n","protected":false},"excerpt":{"rendered":"

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