How Propagandists for the 1% Are Manipulating Christian Teachings to Rob the Middle Class
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In the endless swirl of headlines about the current global financial crisis, the dominant narrative, which is also driving the 2012 US presidential election, is that crippling amounts of public debt run up by profligate government spending have brought us to the brink of financial ruin and must be offset by deep cuts in social services and "entitlements."
It is a false narrative that masks the largest ongoing financial swindle in human history, a swindle being carried out at public expense by a small class of elite financial speculators. This speculative class has been unleashed over the past three decades by a Utopian neoliberal political project now embodied in its most virulent form in the Republican presidential ticket of Mitt Romney and Paul Ryan.
Let's start with the depth and size of the underlying financial crisis, which is almost in the realm of hyper-reality. In 1997, for example, the total value of annual financial transactions worldwide was an already-staggering 15 times greater than global GDP. Today, it is 70 times greater. (1) In 1995, the six largest US banks controlled assets worth 17 percent of annual GDP. Today, the figure is 64 percent. (2) Again in 1995, the global total of outstanding derivative debt obligations was $17.7 trillion. By 2010, at nearly $470 trillion, outstanding derivatives were 741 percent of global GDP. (3)
This wholesale financialization of the US-led global economy has burdened the public sector with the task of propping up unregulated speculative debt in the private sector that is 7.4 times our annual productive capacity. Add US deficit spending for three wars since 9/11, and major cuts in the top tax rates, and the burden becomes unsustainable. The difference is being made up in the guise of austerity, as everything we own is liquidated, from personal and retirement savings, to homes and public-sector assets that have been built up over generations.
In the US, the inexorable logic of this process is embedded in the numbers that comprise the national debt. By most estimates, the national debt is at least $15 trillion.(4) Here is one way to understand where the money went.
- The US government spent $7.4 trillion on bank bailouts. (5)
- It then spent $5 trillion for three elective wars in Iraq, Afghanistan and Libya. (6)
- It simultaneously incurred $2.8 trillion in lost revenue due to the Bush tax cuts for the top income brackets. (7)
The $15.2 trillion total of reckless government giveaways and war spending equals the national debt. Where did this money come from? It came from we the people. During the current economic downturn:
- US citizens suffered $14 trillion in lost stock market value, declining home values and lost pension fund values. (8) (9)
- Workers lost $1 trillion in wages due to long-term unemployment. (10)
The total losses to citizen wealth are also $15 trillion.
From this perspective, the ongoing financial crisis of the past few years is a giant swindle that transfers wealth from low- and middle-income citizens to bankers, defense contractors, real estate speculators and the wealthiest 1% via the US Treasury, which is acting as an agent for upward redistribution.
How did this happen?
In the 1980s, US President Ronald Reagan and British Prime Minister Margaret Thatcher set out to reconfigure and liberate Western capitalism by shrinking government's role in the economy based on the neoliberal concept that markets are "self-regulating" and would produce unprecedented societal wealth if deregulated. Using the ideas of Ludwig von Mises and Friedrich Hayek of the famed Austrian School as macro-economic underpinning, Reagan and Thatcher sought to limit or eliminate government regulation that might inhibit the actions and movement of capital.