John Boehner, the Republican House leader who
will become Speaker if Democrats lose control of the House in the
upcoming midterms, recently offered his solution to the current economic
crisis: "Liquidate labor, liquidate stocks, liquidate the farmer,
liquidate real estate. It will purge the rottenness out of the system.
People will work harder, lead a more moral life."
Actually, those weren't Boehner's words. They were uttered by Herbert
Hoover's treasury secretary, millionaire industrialist Andrew Mellon,
after the Great Crash of 1929.
But they might as well have been Boehner's because Hoover's and
Mellon's means of purging the rottenness was by doing exactly what
Boehner and his colleagues are now calling for: shrink government, cut
the federal deficit, reduce the national debt, and balance the budget.
And we all know what happened after 1929, at least until FDR reversed course.
Boehner and other Republicans would even like to roll back the New
Deal and get rid of Barack Obama's smaller deal health-care law.
The issue isn't just economic. We're back to tough love. The basic
idea is force people to live with the consequences of whatever happens
In the late 19th century it was called Social Darwinism. Only the
fittest should survive, and any effort to save the less fit will
undermine the moral fiber of society.
Republicans have wanted to destroy Social Security since it was
invented in 1935 by my predecessor as labor secretary, the great Frances
Perkins. Remember George W. Bush's proposal to privatize it? Had
America agreed with him, millions of retirees would have been
impoverished in 2008 when the stock market imploded.
Of course Republicans don't talk openly about destroying Social
Security, because it's so popular. The new Republican "pledge" promises
only to put it on a "fiscally responsible footing." Translated: we'll
Look, I used to be a trustee of the Social Security trust fund.
Believe me when I tell you Social Security is basically okay. It may
need a little fine tuning but I guarantee you'll receive your Social
Security check by the time you retire even if that's forty years from
Medicare, on the other hand, is a huge problem and its projected
deficits are truly scary. But that's partly because George W. Bush
created a new drug benefit that's hugely profitable for Big Pharma
(something the Republican pledge conspicuously fails to address). The
underlying problem, though, is health-care costs are soaring.
Repealing the new health-care legislation would cause health-care
costs to rise even faster. In extending coverage, it allows 30 million
Americans to get preventive care. Take it away and they'll end up in far
more expensive emergency rooms.
The new law could help control rising health costs. It calls for
medical "exchange" that will give people valuable information about
health costs and benefits. The public should know certain expensive
procedures only pad the paychecks of specialists while driving up the
costs of insurance policies that offer them.
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Republicans also hate unemployment insurance. They've voted against
every extension because, they say, it coddles the unemployed and keeps
them from taking available jobs.
That's absurd. There are still 5 job seekers for every job opening,
and unemployment insurance in most states pays only a small fraction of
the full-time wage.
Social insurance is fundamental to a civil society. It's also good
economics because it puts money in peoples' pockets who then turn around
and buy the things that others produce, thereby keeping those others in