4 Ways the Sequester Worsens the Inequality that Is Killing the Economy
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Our dangerous and decrepit infrastructure costs lives while making our economy far less competitive. If we are to be a high-wage country, we need to rebuild, modernizing and hardening our infrastructure to better withstand the extreme weather that is surely our fate.
We aren’t even doing the basics in education -- from universal preschool to affordable college and advanced training. Instead we’ve decided to use testing and piecemeal privatization to substitute for investment. It hasn’t and won’t work.
We should be doing more, not less, public investment in research and development, particularly in clean energy and the green industrial revolution that is already sweeping the world. Some of this could be achieved from changing priorities -- ending obscene subsidies to Big Oil and Big Pharma, reducing our bloated Pentagon budgets -- but any progress gets sabotaged by the fixation on cutting, not investing wisely.
4. Bloated Finance. Wall Street’s financial wilding inflated the housing bubble and then blew up the economy, doubling our national debt in the process. Deemed too big to fail, the big banks were bailed out at the cost of trillions. Financial reform tried to strengthen accountability, but the big banks have emerged from the crisis bigger and more concentrated than ever. The financial subsidy they pocket from the reality that they won’t be allowed to fail makes it difficult for small banks to compete. The guarantee also encourages gambling with other people’s money, for they pocket the winnings confident that we will cover their losses. Progressive Democrats in the Senate -- Sherrod Brown, Jeff Merkley, Bernie Sanders and others -- as well as conservative Republican bankers and pundits have called for breaking up the big banks. But this barely registers in the public debate.
President Obama had it right when he said in his State of the Union address: “We just can’t cut our way to prosperity.” We need to move beyond the “vast inane” in Washington if we are to begin even to consider what must be done to revive the American middle class.
Two years ago, Occupy Wall Street showed what it took to “change the conversation,” as the pundits described it. It will take a much more powerful and disruptive movement to actually begin to drive the reforms we need.