Let Them Eat Krispy Kreme Krullers

According to John Snow, the Treasury secretary, the global economy is in a "sweet spot." Conservative pundits close to the administration talk, without irony, about a "Bush boom."

Yet two-thirds of Americans polled by Gallup say that the economy is "only fair" or "poor." And only 33 percent of those polled believe the economy is improving, while 59 percent think it's getting worse.

Is the administration's obliviousness to the public's economic anxiety just partisanship? I don't think so: President Bush and other Republican leaders honestly think that we're living in the best of times. After all, everyone they talk to says so.

Since November's election, the victors have managed to be on the wrong side of public opinion on one issue after another: the economy, Social Security privatization, Terri Schiavo, Tom DeLay. By large margins, Americans say that the country is headed in the wrong direction, and Mr. Bush is the least popular second-term president on record.

What's going on? Actually, it's quite simple: Mr. Bush and his party talk only to their base - corporate interests and the religious right - and are oblivious to everyone else's concerns.

The administration's upbeat view of the economy is a case in point. Corporate interests are doing very well. As a recent report from the Center on Budget and Policy Priorities points out, over the last three years profits grew at an annual rate of 14.5 percent after inflation, the fastest growth since World War II.

The story is very different for the great majority of Americans, who live off their wages, not dividends or capital gains, and aren't doing well at all. Over the past three years, wage and salary income grew less than in any other postwar recovery - less than a tenth as fast as profits. But wage-earning Americans aren't part of the base.

The same obliviousness explains Mr. Bush's decision to make Social Security privatization his main policy priority. He doesn't talk to anyone outside the base, so he didn't realize what he was getting into.

In retrospect, it was a terrible political blunder: the privatization campaign has quickly degenerated from juggernaut to joke. According to CBS, only 25 percent of the public have confidence in Mr. Bush's ability to make the right decisions about Social Security; 70 percent are "uneasy."

Please, read it all. Again, Paul Krugman is one of the few mainstream media voices you can hear that speak plainly. Visit his own site here; visit a comprehensive compilation of his work here.

It's because his day job is tenured full professor of economics at Princeton.

How do they get away with it?, you may ask.

Simple: they own the voting machines and the mainstream media that reports all the news.


Another excellent essay can be found at the Truthout site by Stirling Newberry.

There are three basic pillars of constitutional order: the mandate of the government, the meaning which binds the people and the government together, and the mechanism by which the government pursues the mandate given to it by the people. Of the various mechanisms, money is the most important, though not in the crude sense merely of who gets money, but how money works, how it is created. Money determines, to no small extent, the incentives and range of actions that an individual has available to him.

The New Deal instituted a new kind of money, money based on assets that banks could show on their books, and backed by the Federal Reserve and deposit insurance. One of the key programs that the New Deal used to make this new kind of money work was Social Security. This money replaced the gold-backed money of the previous constitutional order, and changed, fundamentally, the way America worked as a nation. The mandate of the government was to balance the economy; the meaning was based on consensus for action; if there was a problem, or even a potential problem, then the public sense was that it had to be met head on.

Karl Rove has, more than any other single political operative, been responsible for designing a means of attacking that political order, and he has, in no small measure, accomplished this. Gone is the great spirit of bi-partisanship that dominated government from the chaotic early days of 1933 when "we weren't Democrats or Republicans, just Americans trying to save the banking system," in the words of one treasury official.

This cycle of American constitutional change, in which financial crisis leads, first, to a reactionary attempt to force the old system to work, has been seen three times before. Before the Constitution of 1787 was the financial crisis of the 1780s and the Articles of Confederation. Before the Civil War was a massive financial panic, and the infamous Dredd Scott decision, which overturned the Compromise of 1850, and opened the Great Plains to slavery. And before FDR were Hoover's futile attempts to save the gold standard and a government which was less involved in the economy than in religion.

This reactionary order has always failed in the past, because it must consume every cent of the economy. That is its nature: it is an attempt to preserve rent, which is any economic advantage that comes from position in time or space, even if it must sink the entire national surplus in the attempt. This is why the Republicans must borrow to effectively abolish Social Security; Rove knows that in order to secure Republican domination for a generation or more, he must place a weight on the back of government so heavy that no one can remove it. Should a Democrat manage to take the White House, then all that need happen is that a Republican Congress stop doing the behind-the-scenes juggling that keeps the economy going, a recession will ensue, and the Oval office will return to Republican control.

In the past, similar attempts have resulted in the bottom falling out of the economy, and a new political mandate, often one born of fire and crisis. The Civil War was such a crisis; the Great Depression was such a crisis.

Rove's strategy is to create a three-tier attack on the old order, and on anyone who would prevent his new order. That three-tier attack unifies the reactionary elements in society, by providing each one with a specific role to fulfill. His plan can be stated in three words: Bash, Break and Borrow.

Read it all, and think.