Huge deficits in foreign trade and the federal budget are hampering U.S. imperialists’ ability to pay for the widening wars they need. The trade gap sucks $44 billion out of the U.S. every month, as the U.S. imports more than it exports. The federal budget deficit jumped from $960 billion in 2008 to $1.42 trillion in 2009. The growing division among U.S. capitalists, evidenced by the Tea Party phenomenon and its proclaimed “anti-tax” and “anti-big government” advocacy, makes it more difficult for the rulers Obama represents to tackle the federal deficit in the U.S.. Meanwhile, the total cost of U.S. military operations in Iraq and Afghanistan (and now Yemen and Pakistan) has topped $3 trillion.
Obama’s recent Asia trip, intended to address the trade problem, was a failure. “Confidence in U.S. global economic leadership continues to wane,” was how the Council on Foreign Relations (CFR), U.S. imperialism’s top think-tank, summed up the G20 summit. (CFR website, 11/12)
Seoul G20 Meeting Showed Imperialist Rivalry Driving Force in World
Open conflict prevailed in Seoul. Chinese and U.S. bosses charged each other with devaluing their currency to boost exports. “A 7.5 percent drop in the dollar over the past four months is making American goods cheaper overseas as demand in emerging economies propels sales for companies like General Electric Co.” (Bloomberg, 11/11/10).
The Federal Reserve’s printing of 600 billion new dollars, dumping them into circulation — announced during the G20 summit — only intensifies the trade war. It cheapens U.S. currency and lowers prices of U.S. exports, and makes foreign imports more expensive.
Host South Korea flatly rejected increased imports from the U.S., despite Obama’s diplomacy and the presence of 30,000 GIs in the country. In general, the heads of the world’s wealthiest countries told Obama what he could do with his plan to double U.S. exports: “G20 members rebuffed U.S. efforts to set firm targets for current account imbalances” (CFR).
The glaring lack of cooperation in Seoul proves that nation-states are essentially the instruments of separate, profit-driven ruling classes bent on selling their wares at one another’s expense. And, with profit margins slashed by the economic crisis, the competition is becoming more cut-throat. “The fractious Seoul summit suggests that policy divergences are the shape of things to come” (CFR). Divisions within the U.S. also undermined Obama. Following Democrats’ election losses, leaders in Seoul doubted his ability to get Congressional backing for the trade deals he promised.
Obama Deficit Plan #1: Attack Workers’ Social Security, Medicare
While Obama was in Asia, his commission studying ways to reduce the budget and put the U.S. economy on a fiscally sounder war footing (see below), released its proposals: domestically, cut back Social Security and Medicare, raise the retirement age and raise taxes.
(The kind of thinking that went into this panel is reflected in Obama’s appointed co-chairman, Alan Simpson, who referred to the retiree organization AARP as “the greedy geezers of America” and called Social Security “a milk cow with 310 million tits.”)
Raising taxes, however, has become political poison in an increasingly Tea Partying Congress, whose candidates just bought dozens of seats in the recent elections. These capitalists profit far less from the imperialist wars the Rockefeller forces need to control foreign oil supplies and pipelines on behalf of the likes of ExxonMobil and Chevron.
Obama Deficit Plan #2: Make War Machine Leaner and Meaner
The supposedly bi-partisan Obama budget panel that proposed the deficit plan has sterling imperialist credentials. Co-chairmen are Bill Clinton’s old chief of staff Erskine Bowles and conservative ex-senator Simpson, who’s ready to impoverish elderly workers. Bowles sits on Morgan Stanley’s board (his wife is on J.P. Morgan Chase’s board). Simpson served on the 2006 Iraq Study Group that led to Robert Gates replacing Donald Rumsfeld and the consequent deadly U.S. surges in Iraq and Afghanistan.
As for military savings, Bowles-Simpson targets GI health benefits and costly weapons systems that are useless for the wars the Pentagon is actually waging and planning. It also urges the closing of lavish U.S. bases in Europe and Japan in favor of Spartan “forward operating bases” closer to potential flashpoints. Troop strength, however, remains unscathed in the proposed cuts. So much for beating swords into plowshares.
Nowhere do profit-saving Bowles and Simpson mention saving workers’ lives by ending U.S.-led genocide in Iraq and Afghanistan. These wars, and far bloodier ones to come, are central to U.S. imperialists’ schemes to save themselves in the face of sharpening global rivalry.
What the working class needs is the kind of fight-back PLP is helping to organize among transit workers (p. 5); teachers, parents and students (pp. 3, 4); Mexico (p. 1); and GM (p. 7). PLP is bringing our communist ideas to these class struggles, the basis for growing the Party into the force the working class needs to destroy the profit system and its mass racist unemployment, poverty-producing crises and worker-killing imperialist wars.
Only a communist revolution can create a worker-run society that can eradicate these evils.