When They Say Austerity, They're Talking About You
“When people talk about morality,” Whoopi Goldberg said, “they’re talking about yours, not theirs.”
I’m reminded of that line, for a couple of reasons, when I hear conservatives talk about austerity. One, how we address the deficit — how and where we cut — is an inherently moral issue. The other reason is that Whoopi’s observation on morality works just as well for austerity; i.e., when people talk about austerity, they’re talking about yours, not theirs.
The May jobs report proved a disappointment. The economy added just 54,000 jobs — not as bad as the losses of 2008 and 2009, but weak enough to spark concerns of a double-dip recession.
“One look at the jobs report should be enough to show the White House it’s time to get serious about cutting spending and dealing with our ailing economy,” House Speaker John Boehner said.
That’s the assessment from the speaker of a House that in five months has produced not one jobs bill. In any world, Congress should. In a saner world, they could and probably would. But in Boehner’s world, they won’t because if they passed a jobs bill they’d have to pay for it. And they can’t pay for it because Boehner, 240 other house Republicans and two house Democrats signed a pledge not to raise taxes.
As a result, the only tool they have to address the deficit and the economy (two critical issues that affect each other but are hardly the same thing) is austerity. And by austerity, they mean yours — cuts to education; substituting vouchers of limited value for Medicare; cuts to programs that help working people at a time when unemployment is high and compensation, including benefits, is declining.
Not everybody is feeling the pinch. According to a survey by the AFL-CIO, average compensation for S&P 500 CEOs last year was $11.4 million. Multiply that by 500 CEOs and you come up with $5.7 billion. What else could you do with $5.7 billion?
The AFL-CIO has an interesting app on Facebook that compares the compensation of corporate CEOs with the pay of middle-class working people.
For example, for the price of one R.W. Tillerson, CEO of Exxon Mobil, you could pay 537 teachers. For one Miles White, CEO of Abbott Labs, you could pay 401 nurses. For the cost of one Jeffrey Immelt, CEO of GE, you could re-employ 601 workers from one of the 29 factories GE shut down in the U.S. last year.
Is Immelt, at $21.4 million, worth as much to the economy as 601 production workers making $36,651? The libertarian answer is yes, because the levels of compensation are determined in the open market. But most economists would say no because, as much they might like to save, the vast majority of that production worker’s salary is going right back into the economy.
If you’re the mayor of a small town where the factory that employed those production workers had been, you know too well that those are 601 people who buy homes and cars and frequent local restaurants and markets. You understand that their patronage is the stimulus that small businesses are missing and the only stimulus that matters.
There is no avoiding the moral consequences of our economic decisions.
For all of Boehner’s bluster about the economy, Congress is incapable of helping working people. By choosing not to raise the revenues we get from highly compensated people like Immelt or the multibillion-dollar corporation he runs, Congress is left with cutting funding for public education, for law enforcement and for the social safety net that seniors and moderate to low-income households depend on.
This is where austerity lives, not in the halls of Congress or in boardrooms, but in the declining fortunes of the very people we need to be the lifeblood of our nation’s economy.
Kevin Smith lives in Aberdeen. Contact him at firstname.lastname@example.org.
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