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The corporate sector mostly supports the stimulus package as fears of inflation have subsided and it wants the economy to expand. Many of Biden’s policies are very progressive and open a path for the left to fight to make them permanent. But have no illusions about the class character of the Biden administration or its foreign policy. Paul Heideman (Jacobin) and Paul Jay discuss what the left should do, on theAnalysis.news
Hi, I’m Paul, Jay, welcome to theAnalysis.news, please don’t forget there’s a donate button at the top of the webpage.
President Biden’s stimulus package has received strong support from some unexpected places, at least from people who only a year or two ago would have been aghast at a $1.9 trillion size of the package.New York Times conservative columnist David Brooks, who is very close to the family that owns Wal-Mart, the people that own Facebook, and a bunch of other billionaires, as revealed by a recent scandal about the money Brooks received for his foundation, which was not disclosed by The New York Times, so his readers would know that when Brooks was writing about issues that concerned his donors anyway, that’s another issue. Brooks is an old-school anti-Trump Republican who’s mostly been on the austerity bandwagon, and he wrote a piece recently in The Times calling Biden a, quote, “transformative president” and gave the stimulus package a rave review.
In an article Paul Heideman wrote in Jacobin magazine, he says, quote, “But what has distinguished Biden more than anything is his total disregard for the deficit fear-mongering that ruled both the Clinton and Obama administrations. While the Biden of the 1990s backed a balanced budget amendment to the Constitution, the Biden of 2020 is saying, and quite rightly, that now is not the time to worry about deficits. Compare that with Barack Obama, who was pledging to slash deficits even as unemployment soared in the early months of his presidency.” That was Paul Heideman in Jacobin.
The progressive the Daily Poster reports that these measures are expected to increase incomes of the poorest 20 percent of Americans by an average of 33 percent, while the poorest 60 percent could see their incomes increase by an average of 11 percent, according to estimates from the Institute on Taxation and Economic Policy.
One estimate suggests that the legislation will slash child poverty in half. The daily poster also writes that, quote, New York magazine has aggregated other outlets reporting on additional important benefits of the bill, including:
More than one million unionized workers who were poised to lose their pensions will now receive 100 percent of their promised retirement benefits for at least the next 30 years.
America’s indigenous communities will receive $31.2 billion in aid, the largest investment the federal government has ever made in the country’s native people.
Black farmers will receive five billion recompense for a century of discrimination and dispossession, a miniature reparation that will have huge consequences for individual African-American agriculturalists, many of whom will escape from debt and retain their land as a direct result of the legislation.
America’s child care centers will not go into bankruptcy enmass thanks to 39 billion investment in the nation’s care infrastructure.
Virtually all states and municipalities in America will exit the pandemic and better fiscal health than pre-Covid, which is to say, a great many of layoffs of public employees and cutbacks in public services will be averted.
So I haven’t had a chance to look into the detail of all of these reports. But even if half of all this is true, it’s probably more than anybody expected of the Biden administration. So just what pushed Biden in this direction? What happened with the terror of the deficit demons, his Biden boldly defying corporate elites or is a massive stimulus, just what they want? Joining us to discuss all of this is Paul Heideman. He’s a writer and teacher in Brooklyn, writes for Jacobin magazine and is the editor of Class Struggle and the Color Line: American Socialism and the Race Question, 1900 to 1930. Thanks very much for joining me, Paul.
Thanks for having me on, Paul.
So some progressives are claiming credit for this, that the progressive sections of the Democratic Party, Sanders strength, certainly in the House, the size of the progressive, what I call a Left-Progressive, not the Progressive Caucus, but the Left-Progressive caucus.
It’s got a little more clout, and they’re taking a certain amount of credit for this. Certainly, there were, in fact, some negotiations between Sanders and Biden before the inauguration and working out some of the platform, maybe I should say, during the election campaign.
I mean, how much do you think this has to do with the increased strength of the progressive section of the party or people like David Brooks, who represents big money, big capital? And there’s just a bit of a weird convergence of interest here, at least for a moment.
Yeah, I think I think there are three processes that you have to understand to understand why a relief bill that is twice as large as a percentage of GDP as Obama’s relief bill was able to be passed so quickly and a bill that contains some really progressive pieces of policy. I think first there is the strength of the progressive Left-wing of the Democratic Party, like Sanders in the Senate seat and in the House with their colleagues.
I think that’s absolutely a part of it and that they’ve been able to exert some pressure to win some prizes as a result of their increasing strength in the party, but I think that their ability to do so is also contingent on these two other processes, and they are first a recomposition of the common sense within the Democratic Party on both thinking of the macroeconomic thinking about the deficit and the place of large scale stimulus spending, as well as a real reevaluation of the value of bipartisanship as an independent good, which I think Obama was very committed to, and which I think the Democratic Party today has finally learned that it’s actually not worth very much and that they can do quite a bit without it.
Yeah, I should say, I mentioned David Brooks in the beginning. One of the first things Obama did when he was inaugurated, he went for a dinner with David Brooks at George Will’s house. Carl Krauthammer was there.
Three or four of the right of the right columnists, and apparently they are there for them to explain the conservative agenda, and I think for him [Obama] to say how bipartisan he planned to be, and from that day on his economics were a disaster, I think.
Yeah. I think it’s a funny contrast between Biden and Obama because Obama was genuinely a man of ideas as president, but those ideas were often quite bad and included things like it was really important to reach out to conservatives, to bring them on board, to try and heal the divide, and, of course we saw eight years of what he got for that. It was a bad idea and it was bad politics. Whereas Joe Biden has always been someone who has not tried to distinguish himself from the Democratic Party, who has identified himself with whatever the Democratic Party thinks at a given moment, has very little independent course to his politics.
But as a result, the common sense of the Democratic Party has, I think, actually learned something from the Obama years and from the debacle of trying to collaborate with the Republicans. I think the result of that is that the Biden administration realizes that there’s nothing to be gained from trying to throw the Republicans a bone by making the relief bill 30 percent tax cuts as Obama’s stimulus bill was, for example, as a way to try and bring the Republicans on board.
I think I would differ just a little bit in that if Obama got elected now, I think he would probably do exactly what Biden is doing, because I don’t think it’s so much the difference between who Biden and Obama are, and I’m not saying there isn’t, but it’s that both of them are really at the service of the financial sector. Obama was groomed by finance and they poured money into his campaign and he did more or less he hired Summers and Rubin and these guys.
He hired Wall Street to run his shop, and it’s kind of what finance wanted. I think what’s changed is the elites, what finance wants has changed, and even if Larry Summers came out this way, he doesn’t represent the majority of what corporate America wants because the majority really seem to be on board with this. So what is that all about?
Yeah, there’s no question about that. There’s no question that without the change in the amount of resistance to large-scale macroeconomic stimulus that you find among elites, that neither the increased strength of progressives within the party nor the reevaluation of bipartisanship among the Democrats would really make a difference. I think that’s absolutely true. So that’s really the nub of it. That’s the crucial issue, is why has big capital decided that this kind of large scale spending, that’s not going to tax cuts by and large. That’s going to state and local municipal aid. That’s going into an expansion of the child tax credit.
That’s going to like pension fund bailouts. All of these things that you were listing in the intro. I think there’s a couple of things there. First, I think the experience of the last 10 years of extremely expansionary monetary policy, things like quantitative easing, et cetera, in 10 years, that has not brought a whiff of the kind of inflation that people like George F. Will were forecasting with doom and gloom as soon as Obama began talking about stimulus spending.
Right, an entire decade of policy has proven them wrong, and it also has to be said that when Trump came to office and told Jay Powell to keep the money faucet going, a lot of Democrats started to say, oh, he’s risking inflation. He’s running the economy too hot, and they were proven wrong as well.
Running the economy hot has not so far produced any of the negative consequences that both Democrats and Republicans had been predicting. So I think there’s just a brute empirical fact there.
I think it’s absolutely right that without the change in the elite stance towards macroeconomic stimulus, neither of the first two factors that I mentioned would have been able to make much of a difference, neither the new strength of progressives within the Democratic Party nor the kind of learning process the Democrats have undergone in terms of their relationship to the Republican Party, because if big capital were leaning on them to say no more money, I don’t think either of them would be able to resist it, but part of what’s happened is that we’ve had a decade at this point of extremely expansionary monetary policy.
The Federal Reserve has kept rates very low at quantitative easing, and none of it has produced even a whiff of the inflation that people like George Will were warning about as soon as Obama began talking about stimulus spending in 2008, 2009.
So basically, if you talk to any conservative economist, Larry Kudlow, any number of these people who served in the Trump administration, they would have been they would have said all of this stimulus money is going to bring inflation. It’s going to be Jimmy Carter part two it’s going to be absolutely horrible. None of that happened then when Trump came into office and told Jay Powell to keep rates low because Trump may not know many things, but one thing he knows is that low unemployment is good for him.
A lot of Democrats were starting to say, oh, they’re running the economy too hot, they’re risking inflation and this is manipulating the economy, and yet it didn’t produce any of those negative results. Trump presided over very strong job growth. So both Democrats and Republicans were wrong in their predictions of inflation as a result of expansionary policy, and so the result of that has been that among financial planners at Goldman Sachs, there’s not a lot of worry about inflation.
It just doesn’t seem like a very credible danger on the horizon, and so because of that, combined with the economic damage that’s obviously been inflicted by the pandemic, there’s just not a lot of resistance to big, bold spending proposals. So that’s one side of it is just the experience of the last decade and the way that very, very pro-expansionary policy has not generated any of the negative consequences that lots of people were predicting.
I think one of the reasons the Republicans more or less supported the previous package but did not like this package, is so much of the previous package supported the stock market, and this one, as you said, almost or maybe all of it’s actually going to ordinary people spending or cities and states and so on, which to a large extent supports people services, but even there, the David Brooks of this world, the Goldman Sachs of this world, they’re OK with that.
They don’t mind there. I’ve heard interviews on Bloomberg Radio with some of these finance people. They don’t even mind if they have to pay a little more taxes. So what is driving them?
Well, part of it is that they’ve had it so good for so long that if it’s time for them to tighten their belts, they have a lot of notches Left at this point before they really start to feel it, because they’ve just been really in the roost the last 40 years, but the other side of this that I think is a little more sobering for the Left is that in the 1970s, the unionization rate was twice as high as it is today. There was a lot more working-class struggle going on. Strike rates much, much higher, and what that meant was that workers were much more successful in claiming a piece of the pie for themselves, and when the economy grew, workers would say, we’re going to get a piece of that growth.
Now, the de-unionization, the crushing of working-class organization since then has meant that things that are going to pump up the economy and make the economy grow, it’s much, much less likely that workers are going to be able to grab a piece of that as things go on, and so what that means is if part of that growth gets taxed off and redistributed to some poor people, that’s OK, right? They can handle that, but workers are not powerful enough to make sure that, every year that the economy is growing, they’re getting a piece of that.
Right, and what that means is that policies then that are pro-growth don’t pose the same risk, and so to understand this, you really have to go back to the 1970s when this dilemma was before the ruling class in its fiercest term, when inflation was a really big problem under the Jimmy Carter administration and inflation was when prices are rising, and you would get what were called wage-price spirals where wages would go up, and in response, businesses raise prices, and response workers demand more wages so they can buy things at higher prices, etc.
You get these inflationary spirals, and when Jimmy Carter appointed Paul Volcker to head the Federal Reserve, Volcker was very clear. The way that you stop this is by crushing the wage side of it, right. You stop workers from being able to demand more wages, and so that’s what the Volcker shock, the spike in interest rates that doomed Jimmy Carter’s presidency more than anything else. That’s what that was all about. Raising interest rates up, raising unemployment, putting people out of work, and making it so that workers aren’t in a position to grab a hold of that growth, that they’re not in a position to try and react to any price increases with wage demands of their own.
Right, and so so in the 70s, the idea was we have to crush inflation, and to crush inflation we have to crush workers’ strength. You can read the minutes of Federal Reserve meetings, and Volcker is just totally explicit about this. So that’s been accomplished, right? Unions have been ground down outside of the public sector. They’re a shadow of their former strength.
You got to add a big piece to that, which is I think because of the digital revolution, globalization went on steroids and the ability to play Chinese and other workers, low wage workers off against American workers create a structural change that made it almost impossible without serious militancy and unionization to raise wages inside the U.S. and so they’ve realized now that, if anything, I think there’s even sections of the corporate elite that understand the minimum wage should go up because, if this gets too extreme and we’re already maybe at a point where it’s too extreme, they’re not going to have a heck of a consumer market to work with here.
So the issue of purchasing power is an issue for them. They don’t want it to go out of control. But there’s a section, I think, what the Republicans are really afraid of. I mean, the Republicans oppose this package, one, because they just have to because it’s a Democratic Party package and they just have to find some way to oppose it, and talking about debt is the only way they can or the inefficiency of how it’s being spent, but who cares about that.
The real thing I think the Republicans are more seriously worried about, and this is where they represent a section of big business, is the discipline of the working-class, especially in situations where the stimulus payments are more than people were making when they were working. Inside the Democratic Party, you had conservative sectors that beat this stimulus plan down in terms of how much was going to be paid in unemployment to make sure. It wasn’t because they care about the deficit. Ask any of them the question, why did you lower the unemployment payments? Why did you have to make any of these payments smaller? They can’t honestly claim it has anything to do with the deficit.
It’s about the disciplining of the working-class. They don’t want people to get used to living at that wage level, which is ridiculous because it’s not a living wage level even at that point. So it’s a very interesting mix of politics right now.
There are some voices coming forward more than there were a few months ago starting the austerity drums. Do you think that gets stronger or does this carry on like the next big battle is going to be, is there going to be a big infrastructure plan with another two or three trillion dollars of spending?
Yeah, so I think the forces of austerity are really on the defensive right now. I was just seeing what Marco Rubio was saying about this bill and his line of attack is they’re giving stimulus payments to prisoners, which is such a pathetic line of attack. If the government’s doing something really good for you, but it’s doing something really good for someone you don’t like either. So you should oppose that. It’s just not going to sway anybody. No one is going to turn against the bill because, oh, prisoners are good in it. Oh, my God.
When people are getting checks from the government that are helping them, that’s not going to be enough to turn people against, and so it’s telling that the Republicans can’t come out right now and just say we need to discipline the working-class. We all need to tighten our belts right now. That’s their preferred rhetoric. They can’t say that, and I think I think that’s part of a broader trend in the advanced capitalist world. If you look at Britain right now, the Tories are not pursuing an austerity strategy. They’re spending.
So I think the shape of conservatism is changing a little bit in the current conjuncture, and they can’t just come out straight for deflationary austerity politics. That’s such a political dead end for them right now. So instead, we see them fight around the edges of that, and I think in terms of the infrastructure bill, I think there’s going to be huge fights around the infrastructure bill, but they’re not going to be fights that are mainly about how big the bill is, how much spending it is, how it’s paid for.
It’s going to be fights about things like the Green New Deal and how much the infrastructure bill is actually oriented at solving these huge problems of ecological destruction and how much it’s just a giveaway to construction companies. That’s what the fight is going to be. Not over the size of the bill itself, but that would be my prediction.
I think there’s another part to this. Why the elites seem so in support of this bill. I think a lot of them, especially in New York and the financial sector and in the tech sector, other areas maybe less so, certainly less on fossil fuel and arms, but I think they got scared by this January 6th events. I think they got scared by what this Trump movement was turning into. I don’t think they want fascist crazies running the country. They don’t mind a little bit of fascism, but it shouldn’t be crazy fascism. It has to be this more slow-moving, supposedly reasonable.
The reason I call that a kind of fascism is because the way Roosevelt talked about fascism is a sector of the corporate elites get control of state. You more or less have that now with finance really having the dominant role in the state, but I think a lot of the powerful elites really don’t want to see the Trumpian hordes back in power again. They’ll get what they want because Biden is not threatening structural change, and as long as they’re not afraid of inflation, well, then everybody thinks that, OK, well, there’s another way to get at this piggy bank.
So what does this mean for people – you write for Jacobin a socialist magazine– what does it mean for people with a socialist objective when you have the elites, many of them very much on the side of a very expansionary stimulus spending? All of a sudden Goldman Sachs are Keynesian.
Yeah, I think there are two things. First, I think it’s really important that the Left not to overexaggerate its strength and take credit for why this bill is happening, and the reason for that is obviously I think it’s false, but I also think we are likely to face some significant defeats over the next few months. The Pro Act – Protecting the Right to Organize Act – that would make unionization so much easier is almost certainly going to die in the Senate, passed the House, but it’s almost certainly going to die in the Senate, will probably be defeated there.
We saw the defeats on the minimum wage. We saw the defeats on the absurd debate over $1400 versus $2000 checks and the ridiculous line in the sand that some Democrats seem to be drawing. We saw the defeat over the extension of the super dole, the expanded unemployment insurance that you were talking about. So I think if the Left goes forward thinking we really rule the roost right now and the Biden administration is implementing our policy, I think we’re likely to be very shocked and disoriented with the likely direction of policy over the next few months, next six months, let’s say.
At the same time, I think there’s a more optimistic part of the puzzle, and I think that because I think this bill actually sets up some really productive, positive fights for the American Left over the near and the medium-term future. Let’s say, for example, the child tax credit in this bill, which is really significant in that it is unconditional cash aid to even the poorest Americans, which for 30 years the Democrats have been running away from as a policy, demanding that people work whatever demeaning, abusive job they can possibly find, regardless of what dependents they’re taking care of in order to qualify for any cash aid.
The fact that whole ethos has been abandoned, at least temporarily, sets the Left up for a really good fight to make that policy permanent.
Do you think that’s the influence of Sanders and his allies?
Yes, I think that’s part of it. There have been progressives who’ve been proposing precisely this kind of bill for a long time, and I think the fact that Sanders is now chair of the Senate Budget Committee, that he was part of these negotiations, I think that’s absolutely part of of why this happened, and I think that a fight to make that permanent is as good of a fight as the American Left could want.
Working-class Americans are going to be getting checks from the government to help them pay for their kids for the next year, and then if the Republicans get their way, those checks are going to go away. That’s a fight. That’s such a good fight for the Left to identify itself with the cause of the working-class, with the interests of the working-class. It’s a good off-ramp from these totally unproductive culture wars where the Left sides itself with various trends in elite journalistic opinion, that kind thing, and to instead identify itself very simply with the interests of American workers.
It’s a fight in which the conservatives will be starting off on the back foot. Right, because people are already getting these credits, and it’s a lot harder to take something away from people than it is to not give it to them in the first place. So I’m really excited about the potential of that fight for socialists of the United States for rebuilding a Left that fights on class terms and that sees its job as advancing the interests of the American working-class, and that sees part of its job as getting the working-class involved in politics as the working-class.
So I think the fights to make those kind of things permanent, fights to keep the expanded unemployment insurance and to move towards an actual national unemployment insurance system rather than 50 state ramshackle services that are always on the verge of collapse when they’re needed most. These kind of fights are great fights for the Left, and I don’t think Biden meant to set them up like that, but I think they’re ones that can really play to our advantage if we see the terrain and see that we’re not shaping things now, but that we can actually play a really important role in coalescing the Left fight for an actual universal welfare state in the U.S.
I think just to add to what you’re saying, a couple of dangers. One, I don’t think this can go on forever, this deficit spending and when the pandemic’s over, there is going to be a push for higher wages and the economy is going to come back. There’ll be more demand for labor.
The instinct and to a large extent very legitimate of workers not to get undercut by cheap labor abroad, which is part of what a plank that supported Trump, the sort of TPP free traders are going to come back to the fore in the Democratic Party. They may want to even get that deal back again.
There’s going to be a point where the elites aren’t going to be so happy with especially any kind of direct payment. They’re never going to mind support for the stock markets, but they’ll reach a point where they’re going to say, well you know what, labor’s getting a little too expensive right now, and they got a little confident with this social safety net.
You know we had decades of disciplining the working-class where they were scared of losing their job, and right now, with all this stimulus money, they’re not going to be quite so scared and they’re going to be more likely to say, well, I quit, I’m going to go get another job, or they’re going to say, I’m going to get a union. So I think the mood is going to change here.
Then the second thing is the social base for fascism, for far-right politics. It’s there. It’s very objective, and it’s not just about Trump by any means. It comes out of both the economics of the urban and rural split and the extent to which the big cities have gained, and so much of rural America has not both whether it’s working-class or farmers or small business or whatever, and then again, as fossil fuel economy gets phased down, that’s going to affect some of these rural states very seriously, and I was a little surprised in this package that there wasn’t a promise to fossil fuel workers.
I don’t understand this. It just seems such a no brainer that this Biden administration, if they’re serious about climate and they’re going to throw money around, tell every fossil fuel worker you’re not going to lose your wages even if you lose your job, you’re not losing your wages. If you start making windmills and it pays five bucks an hour less than you were making doing coal, then we’ll make up your five bucks for ten years. If you’re going to throw money around, then start throwing money around for what people have called a just transition for fossil fuel workers, and I haven’t heard that in this package unless I missed something.
The fact that seventy-four million people vote for Trump, who’s a maniac who screwed up the pandemic, like I say, this starts with, Reagan had a landslide with very similar policies as Trump. If you look at the Reagan campaign and the Trump campaign, it’s hard to tell the difference, it’s just that Reagan smiled and Trump gets angry, but not a hell of a lot of difference. So I think the Left and progressives really have to think about how to organize, how to communicate with the rural working-class and working families outside the big cities and states that vote Republican, and the advantage the Left has in doing that is the Left can talk to Republicans without defending corporate Democrats, and that gives them a kind credibility. If you try to go in those areas and defend the Obama administration, nobody will listen to you, but much of the rural white critique of the Obama administration is quite legitimate or the Clinton administration and the Left can agree with that, but then can say, OK, but just another set of pro-corporate policies dressed up as pro-worker, go look what the policies really are. Anyway, I don’t think we pay enough attention on the Left to this issue of how to get into the rural areas.
I know some people are doing it, but I know, like in the media sphere, I operate in, the odd person shows up because they see me on YouTube or this or that, but by and large, we’re talking to urban progressive populations, and in some ways, I think there’s almost nothing more critical than targeting a few states and really working at trying to win over the working-class and to neither a corporate Democrat or a Republican position, whether it means tactically, you vote Democrat at some point. OK, but explain do so without illusions. I don’t know. What’s your thinking?
Yeah, I mean, that’s part of why I’m so excited about the possibilities like the fight to make the child tax credit permanent presents, because I think that’s the perfect issue for Leftists to be going to be talking to people they’re not usually talking to and it provides a grounds to do so. You’re getting these checks from the government. They’re making your lives better. We, the socialist Left, is the force that wants the government to keep giving you those checks.
We are the ones who are fighting for that. I think that provides just a very simple basis for campaigning in areas that otherwise it might be hard for the Left to pick out the issues that it wants to fight on. I think this is exactly the kind of issue that that makes a very direct, honest, simple appeal to those kind of areas possible, but I totally agree that it’s absolutely necessary. I mean, just the math of the Senate and the math of America’s horrible system of representation makes it clear that if the Left can’t do anything in rural areas, there’s not going to be Leftist policy on a national level. It just not going to be possible.
Well, what was accomplished in Georgia is pretty good, and if the Left could pick a small state, because it doesn’t require as much money in a tiny state, one or two of these small states, and get some real progressives to do what happened in Georgia and some small states, you could have an enormous leverage with just an extra two or three senators that were more Sandersesque.
Yeah, I’ve was just seeing some polling that among Republicans support for Biden’s stimulus bill is highly class-stratified. Working-class Republicans support it strongly. Upper-class Republicans hate it. That’s an opportunity right there for progressives who want to run on progressive economic policies, who want to run a redistribution to split those voters away from the Republican coalition. It’s not going to be easy. It’s not going to be fast.
It’s going to be difficult. They’re going to be losses, but I just think it’s unquestionable that it’s absolutely necessary if we want a progressive future in American politics and not one where this insane right-wing is running rampant because, as you said, the Republicans have in some ways slipped the corporate leash. They are they are not doing what the Bank of America wants.
They are doing what not all but most of the fossil fuel wants and certainly certain sections of the arms business and so on, but I think the other thing that’s important is that while the elites, when I said don’t like the idea of fascist hordes coming back to the White House, they don’t want them to go away. It’s an important leverage for them. They like the fact there are seventy-four seventy-five million people out there that will vote for a Trump.
They just want someone who’s not nuts as Trump as an alternative out there. So if they ever have to really pull things back again. It could be a Rubio or somebody like that who is a little more of their lapdog but maybe can play to that crowd. So, again, it speaks to this issue of organizing in these states, and I would say, again, tactically pick a few small states to really try to knock off some Republican senators.
Then I think, we have to understand that it’s not just going to be about checks and it’s not just going to be about economics. The culture war reading in the papers now that the Republicans aren’t worried about all the stimulus payments because they think the culture stuff will trump the money anyway, because they’re going to say, well, they’re just giving you back your money anyway, which the answer would be well it’s better than you taking our money and giving it to Wall Street.
But the cultural side of this, it’s partly the legacy of a racist culture. It always hit me that poor farmers fought for the Confederacy in the Civil War, and what did they fight for? They fought for “at least I’m white.” And that’s about all you could say that they would gain from a Confederate victory, but it was enough to die for. So that that idea that “at least I’m white.” A check ain’t going to fix it if you’re willing to die for that.
Now, we’re not back in slave society, but this weighs on the brains of the living like a nightmare, right? I don’t think we understand that we being us urban Lefties, understand that part of the American psyche well enough.
It used to be in these religious areas, they were Left, it’s actually the abortion issue that really split religious people from the Left, because it used to be a lot of the populist movements in the late 19th century and early 20th century were quite religious. I’m in Toronto right now. I go back and forth between U.S. and Canada. In Toronto the rebellion here were religious socialists, Christian socialists that led a rebellion against the elites here I guess late eighteen hundreds.
I don’t think we have yet to figure out how to deal with the abortion question and talk to religious people where this is a litmus test for them. We may not like it, but it is, and then there’s other key issues there. Even the way the hatred of government, Reagan’s thing, it really played to people.
I lived in Baltimore for nine years and people hate the police, but they don’t hit the rich people of Baltimore. The elites of Baltimore aren’t the enemy, it’s the police that are the enemy, and I would say, well, the police are just a buffer between people that own stuff and people that don’t, and if you don’t get at the ownership side of this, I’m not saying you can’t have a little bit of reform of the police, but you won’t change the basic role that the police are there to enforce laws that perpetuate poverty if you don’t deal with that.
So we have to figure out how to have these kinds of conversations. For me, I’m going to try to do it from the media side, but here it’s a problem of distribution because how do I get anybody even know it’s there? So a lot of it is, once Covid is over, you’re got to get out there and knock on doors and this sort of stuff.
Yeah. That’s one thing that’s made me very hopeful about this kind of electoralist turn on the American Left is you can’t do electoral politics without getting out there and knocking on doors and talking to people, and that’s such an important thing for the Left to be doing, and I think as important as, for example, the anti-war movement was, the movement against the Iraq war, that wasn’t what the anti-war movement was doing.
It wasn’t just going through neighborhoods, knocking on doors, and talking to people by and large. So I’m really happy to see that all over the country, DSA chapters and things like that are just organizing, going out and talking to people, trying to win them to politics, because I think the problems you’re talking about are going to be problems that the solutions to which are going to be only found in practice. We’re going to go, we’re going to try and talk to people, and we’re going to fail and we’re going to figure out how to do it better.
That’s the only way we’re going to find those kind of solutions. So the fact that so much of the Left is like, look, let’s go run someone, right, let’s run someone for city council here. Let’s see what happens. I think that can only be a positive development in our quest to address these much longer-term issues of culture and politics in the U.S. and the splits that have really worked to the detriment of the Left.
Just before we conclude, I don’t think we can have a conversation about the Biden administration and the elites and all that without talking about in spite of the sort of change of mood on stimulus spending and deficit and all the rest, there hasn’t been much of a change on foreign policy issues. The Biden administration seems to be more or less the Obama foreign policy. I just posted an article, an interview I did with Charles Freeman, who says the Biden policy on China is simply a more polite Trump.
There’s no real attempt of any kind to reduce the military budget and so on. So this isn’t like this administration has taken on some magically new progressive character. It’s what we said earlier. The elites are going to benefit from this. What are progressive policies, no doubt these are progressive reforms, and some of them, like you said, are important ones, but it’s not really changing their approach to foreign policy. Right now the only good thing will be if they get back into the Iran agreement and even that’s they’re pissing around and on China, they’re no less vociferous than Trump has been, except in language a little less, that’s all.
Yeah, I think the Biden administration in some ways has really benefited from the longer-term marginalization of foreign policy in American politics. The last time an election was really fought on foreign policy was 2004. If you survey Americans the number who say foreign policy is one of their most important issues has gone way, way down. If you look more longer-term in the 20th century, and so there’s a way in which I think the Biden administration has been able to get away so far with deferring to the old and empowering the old foreign policy establishment of Obama and Clinton to a lesser extent, because there’s just not that much attention on it.
That’s the case for progressives. It’s the case for the mainstream media. It’s really shifted from attention in a way that I think has advantaged the powers that be in those areas. Right. The Blob, as it’s called, of the foreign policy establishment. So, yeah, if you’ve been paying attention to it, it’s just item after item of news of how little is going to change, actually.
Well, if they do go back into the Iran nuclear agreement, that’s a big deal, and if nothing else happens, no other big wars, then I would say, well, that’s a plus for them to at least they did that because when Obama got elected, that was my only hope for that administration, that they would do the Iran, he’d be rational on Iran. Biden’s always been more or less rational about Iran. So I’m hopeful on that.
With the stimulus, right, that’s that is once again something that is firmly within the umbrella of elite opinion on foreign policy. The Iran deal is what the most sensible American elites want.
Just the other day, yesterday, something a bipartisan letter on Iran of was it 40, 50 members of Congress or more saying that they should reopen the negotiations, which means they’re going to try to go way beyond the nuclear and include non-nuclear ballistic missiles, which Iran has every right to have, and Iran will never agree, and it will scuttle the agreement, and certainly this is what Israel and Saudi Arabia want. So. This ain’t so unified on that one.
It will take some real push and fighting and I don’t know whether Blinken is the guy that’s going to do it, but I guess we’ll see. The other thing, and I think I already said to end with so I’m going to end with the one other ending thing, because this one really is the end, the nuclear weapons policy. The Left doesn’t talk about it hardly at all. They’re going to have a massive new expenditure that Obama initiated. Now, apparently Biden was against it.
I think the guy’s name is Kaplin that wrote a book on American nuclear war strategy, and according to him, when Obama committed to this trillion dollars over 30 years for nuclear weapons, that Biden was in disagreement with it, but I don’t know if that’s true and I don’t know whether it means anything, because so far there’s certainly not been a pipsqueak out of the administration that they’re going to cut back on a massive new expenditure of nuclear weapons, and because of that, of course, it’s now the Chinese military-industrial complex is jumping in on it and the Chinese state isn’t going to get so out nuked.
The Russians have already committed their own trillion dollars. So we’re back into a nuclear arms race, and the danger of that is that it’s imminent. Most of the people that understand this stuff, they don’t think if there’s an accident that’s misread as war and starts a war, it’s when. I mean, we’re looking at almost certain, according to people like Daniel Ellsberg, but also lots of retired generals and other people, the more you’ve got, the higher the risk of accident.
I don’t think the Left talks about it very much, and I know it because, you’ve got climate, you’ve got poverty, you’ve got this, you’ve got that. My grandmother used to have this thing that when somebody was going on and on about how terrible things were, she’d go, oh yeah, and then the baby died, and she’d call it “then the baby died story” and nuclear weapons seems like just one too many things to think about, but Jesus, it is, in fact, the one thing that could make everything else quite irrelevant.
And it’s one of those parts of American policy that is just not subject to contestation in official politics. There’s no one who’s going to say boo about it, maybe Bernie will raise it, but other than that, it’s something that just is not. It’s rude to bring it up as an issue to be actually debated.
It’s crazy. It’s just crazy. I’m working with Daniel Ellsberg on a documentary film series based on his book Doomsday Machine, and I was just as much guilty of putting this on the back burner as anybody else until I started talking to Ellsberg and read his book. I really encourage people to read that Doomsday book. It’s brilliantly written and will scare the shit out of you.
One of the things we’re hoping to do is get a congressional hearing on nuclear war strategy and get Ellsberg invited to speak there. So we’ll see. Anyway, thanks very much, Paul. Let’s keep having these conversations.
Absolutely. Thanks for having me on.
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An extended era of stagflation is absolutely in the cards here. Make no mistake the US will make good use of their influence over the BoJ and ECB to act as buffers shielding the American economy mothership. I have to disagree a bit about the elite focus or worry about basically “killing the goose laying their golden eggs” by pushing labor, that is all of us working stiff plebs, all us little people, too far past a breaking point. I don’t think much of the plutocracy has any sense of this balancing act at all or what could happen. I don’t think they take the prospects of anything like that seriously at all. They think they’re too smart and the people are too stupid, easily manipulated, to weak. They’re probably not wrong about that, in my opinion. They’re just going to keep pushing and pushing until stuff starts breaking. While there is a more enlightened segment of the lite, and they did recognize with Trump, “ok populism is starting to break out” plus you have a rising China which is can actually be great news for working Americans. Think about the pressure which competing with the USSR put on Europe and the US. The US had to prove itself and thus the people got a better deal out of that. They couldn’t be showed up. I mean just look at Korea. For a long time after the war, North Korea had higher standards of living than the South, it wasn’t until the US leveraged their Japanese vassals to help rapidly industrialize Korea, partly to take Japan itself down a peg, Japan has to go along with this against their own interests, Plaza accords and all that. I digress and can’t stay coherent today. Don’t get twisted though. The more enlightened segment of the elite very well might not win out. The reactionary segment has always been quite large and extremely powerful particularly in the US. They have no sense of this balancing act. Populism is breaking out? They don’t care. They’ll keep pushing and pushing until things get really bad. This is why some have speculated in jest that perhaps some of them are secretly revolutionaries, trying their best to create ideal conditions for something akin to the Russian revolution.
I just have to stop your guest for a minute here. While none of the arguments coming from, 1, either the charlatans who genuinely don’t even seek to understand macroeconomics and don’t know any better, and there’s no shortage of these people in and around finance, especially with the explosion of financial entertainment media, and then you have, 2, those who make such claims but probably don’t believe it themselves, it’s just part of a cynical public relations strategy and whatnot. What I’m saying, and sorry for being somewhat incoherent here, is that while the repeatedly debunked predictions of what a this very lax monetary policy would bring in the long term has never came to be, that’s not to say that such policies are not without consequences. While there’s no core inflation as we measure it there certainly has been boatloads of inflation in asset prices, which has ballooned the already preposterous wealth gap. Everyone knows that the rate of return on capital far outpaces the rate of economic growth. Well when you create a dynamic with for starters such low interest rates, you’re creating and quite intentionally all sorts of massive missallocation of capital. The poster child of this entire era is basically Tesla and Elon Musk. This is what happens when central bankers make money into toxic waste with effective negative rates. It’s not just free money at that point, it’s toxic waste, you can’t get rid of it fast enough. Musk became the richest man in the world on the back of running a company which never made any money, probably never will. Think about how obscene and just absurd that is.
So the point is while the assorted basket of charlatans with meaningless buzzwords like “free markets” and “hard money” in their twitter bios were shouting from the rooftops about hyperinflation which never came or predicting 20 the of the last 2 crashes, or while those with a more sophisticated understanding were making similar claims for political purposes despite actually knowing better, all that is not to say that there weren’t actual consequences of these policies. Conventional monetary policy is essentially at it’s breaking point now. This is why you have even the avid supply side fundamentalists starting to embrace concepts like UBI, effectively helicopter money. That’s where this is going, that’s the only place left to go. Where’s someone like Mark Blyth when you need him. Get him or Yanny on here. They can explain it all quite artfully.
There’s a certain type of people in and around economic and finance who insist on changing reality to come in line with their ideologies rather than actually ever embracing reality as it is, admitting fault, learning, improving, etc. It’s always reality which is wrong for these people, never their own rigid models or ideology. So much of economics resembles a religious cult, and there’s plenty to go around in finance as well. There are some really well paid morons in finance, I’ll tell you.
It is not the job of progressives or socialists to cast a blind eye to the corporate fingerprints on Biden’s COVID relief bill. Your guest is intelligent, a professor, and editor of a self-professed socialist journal but he did not provide that much needed critical analysis. The task is time consuming but not all that complicated. You start by doing the math: Who is getting what from this bill? ‘Follow the money’ for starters. We are told that there is relief $ for Black farmers, Native Americans and poor children. Are we being sold a used car or do we want the whole story?
No other advanced capitalist country provides so little relief to its citizens. Biden’s bill is better than nothing but so is a bone to a starving dog. President Lyndon Johnson’s passage of Medicare, Medicaid the War on Poverty, the Civil Rights Bill and The Voting Rights Act was, if only for a moment before Vietnam, truly “transitional.” Biden’s COVID relief bill pales in comparison.
The current Democratic Party is not viable under the uncontested leadership of a demented President, a totally phony VP, a Senate Majority Leader who is a mouthpiece for Wall St and a House Speaker who rejected a better bailout bill when Trump was in office. A more pathetic grouping of so called leaders could hardly be devised. This is not a group with mass appeal let alone a strategy to deal with the numerous crises that beset the people. They may do the bidding of their corporate masters but they are desperately in need of legitimacy to continue their service.
Why no mention of the bailout of the private health insurance industry in Biden’s bill? Medicare for all would have been cheaper. The campaign promise to pass the $15 minimum wage has already been broken by the Democratic leadership. That would have ended more poverty than the child tax credit. Child poverty in the richest country in the world? A socialist should not hesitate to describe this bill as grossly inadequate. Sure, our newly elected socialists will vote for it as they should, but for progressive and socialist intellectuals and media folks outside of congress to even dignify Biden’s bill as “transformative” or even hint that it might be going in that direction is ‘lipstick on the pig.’ We may be stuck with it for the moment, but don’t sugar coat it.
There is unlimited $ for endless wars, for 800 military bases outside the USA, for Saudi Arabia, Israel and other proxy terrorists supported by the CIA et al, but we expected to applaud the fact that Biden’s bill may reduce, (not eliminate) child poverty at home, for Americans? Money for death but not for life. This is patriotism?
Either a true progressive voice emerges in contrast to the current leadership of the Democratic party and conjoins with a resurgent mass working class movement or the Republicans will retake the Senate in 2022 as progressives and large numbers of working people will just give up on the Democrats. As much as I can’t stand the current leadership of the Democrats, I don’t want a return of the Trumpers. If socialist politicians are going to enter the electoral fray, and take the struggle to the next level they will have to devise tactics and strategies that bring the fight to the halls of government in a way that connects with the people.
I supported Ocasio Cortez when she first ran. As a NYC public school teacher I know that Jamaal Bowman truly is a voice for the people and a tested leader in reality based struggles in NYC public schools. I want to support our newly elected political leaders while at the same time I urge them to devise methods and tactics to make themselves heard above the cant and fluff of the mass media and party leadership. We must all prepare for the next wave of mass struggle. A mass movement together with enlightened leadership will set the nation on a truly transitional course. There are no clear answers or paths to follow save the one course we create based on facts, clear thinking, sober judgement and courage as we face the unknown.
Paul I love your work and supported it for years when you were the RNNet but please do not go on too long. In the interview with the Jacobin journalist on the Biden package and the left, you talked an awful lot. You might want to do a word check on the transcript. I admire your inspired grinding and I like your commentary but today I turned off the interview to write this email. Not saying no commentary but a few more pointed questions mixed with your commentary and the request for a reaction from your guest would be great. I hate to admit it, while I was making supper I told you to shut it more than once. All te best. I believe I was one of the early supporters of this be effort.
Don’t agree with this. I tune in as much to hear Jay as the guests.