CAN UNCLE SAM BE SAVED ? by The Cosmic Messenger
L ast week's "State Of The Union" address by President Bush in which he announced Social Security needed fixing, was a wakeup call for many working class citizens and retirees across America we may not be living in the same land Dorothy and her pet dog, Toto grew up in. The proposal to make the program voluntary violates core moral principles we learned in our youth and leaves some wondering about the level of humanness the man has for average people in the country. Equally important, the issue has initiated debate in families throughout the United States about what our domestic priorities should be and whether they can be fine tuned with adjustments to economic policy.Advisors to the President appear adamant our deficit problems can be resolved by slashing as much federal spending on social programs as they think the public will tolerate. The wish list for the 2006 budget plan targets cutbacks to government services for people on food stamps and farmers on price supports, children under Medicaid and adults in public housing. Additional recommendations, disproportionately effecting working class Americans will be forthcoming but as is the case with this White House the requests are staggered and made tactically to diminish their significance on public perception. No one doubts Bush will try and downsize further monetary outlays for public education and domestic infrastructure in general. Despite this, realized savings are estimated to only be a paltry $20 billion of the $427 billion shortfall the country is now burdened with. Conspicuously absent from the 2006 plan are steps to cut military spending or rescind the tax cuts passed previously. Alone, the former expenditure represents a projected $419 billion output excluding war costs.
The budget blueprint recently unveiled reflects what this Administration's priorities are and how it assumes government can get the best return on its investment of capital. Gone are the notions the path to prosperity for Americans is by empowering them through education and supporting domestic systems designed to help achieve success. These concepts have been replaced with the Bush doctrine which believes the treasury is better utilized by laying out currency to assist transnational corporations in their global pursuit of whatever resources they wish to develop. Financial aid might come in several forms. The upside would be low interest loans to foreign local entrepreneurs or elected leaders for necessary improvements to schools, water and sewer systems. Other instances, less obvious but necessary to accomplishing the objective represent the downside and could include bribery or remodeling a government with representatives more compatible to the ambitions of a corporation. In theory, the more prosperous these global companies with roots in the United States become, the better off Americans will be as profits trickle back home allowing for increased domestic consumption.
There's nothing new about Bush's philosophy. It's a foreign policy based on economic imperialism by a larger nation state (U.S.) toward smaller, vulnerable countries (e.g. Iraq) using its capital to foster a dependent relationship between the two which the United States hopes to exploit for profit. The rationale is to identify a country such as Iraq whose natural resources (e.g. oil) can be refined, extend more credit to them than they could ever hope to repay and demand the oil fields as compensation if they fall behind or default on the loans. By controlling another country's assets in this manner, a steady revenue stream is insured to service our own debt or use to invest similarly in other countries which become vassal states in their relationship to us.
Bush and his oil friends have maneuvered themselves into just such a scenario. A new, struggling Iraqi government finds itself reliant on the financial good will of the United States. In return for its generosity, Iraq will be expected to maintain the price of oil at a tolerable level for the American economy and invest their petro dollars in our Treasury securities. It's been speculated by some pundits the reason we invaded Iraq is Saddam Hussein had decided to value the price of oil he produced in Euro rather than American dollars and invest the money elsewhere for a better return on investment.
Like all conniving schemes, they end when their victims grow weary of the servitude it imposes and seek alternatives. The relationship between the U.S. and Hussein was like that of a loan shark and his mark. It was willing to tolerate atrocities committed by Hussein against dissidents as long as the price of oil remained stable and in U.S. dollars whose value we determine. Our government had the best of both worlds, loaning money or trading arms to a despot at rates we set and the ability to control the price of oil, the most valued commodity globally. With the recent regime change in Iraq, the most obvious question to be answered will be whether the new government enters into a similar arrangement out of gratitude or try and assert its economic independence ? It's an issue in which resolve must be found soon as confidence in the global economy wavers perilously on the outcome. The U.S. dollar represents the world's reserve currency and was considered until recently to be the most stable. However, Middle East strife, declining U.S. industrial output, a diminished Treasury surplus and growing federal deficit have combined to make the dollar less attractive.
The reason Bush has proposed such drastic cuts to social programs is because his economic team operates under the assumption that reduced government spending in these areas in combination with low interest rates will demonstrate to financial markets both at home and abroad the administration is making a serious effort to diminish its budget deficit. But is federal spending on domestic social programs really the problem ? It's been pointed out by some economists the planned reductions don't significantly improve our financial liability and what's needed is to rescind the tax cuts passed previously and control military spending.
Further compounding the problem is many of the transnational corporations Bush presently works in conjunction with (e.g. Halliburton & subsidiaries) manage to evade paying business taxes totally by establishing offshore addresses to deprive the U.S. Treasury of revenue. It not only decreases the budget surplus but deprives the Social Security program of business contributions towards sustaining it as insurance for our elderly and disabled populations.
A modern, civilized society is judged by how successfully it balances the social and business needs of its participants. The United States, under Bush is failing this test because he's deliberately starved the government of the money to take care of its residents and wasted the surplus on adventurous foreign policy. The consequence has been a loss of confidence by global financial markets in our country as Bush refuses to work towards multilateral political or financial solutions. The risk of such inept decision making is foreigners with investments here will cash out collapsing the American economy totally. If Uncle Sam is to be saved along with its people, someone must step forward and convince Bush a stable global political/economic community requires compromise among nations; not some cowboy remaking it the way he
desires. American children and its seniors are counting on him to arrive at the right decision.



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