In his third State of the Union address President Obama drew a picture of cooperation between government and business for an America that is “built to last”—a phrase he repeated frequently that was intended to remind listeners of his successful plan to bail out America’s auto industry. The President pointed to Detroit as a prime example of what government can do when it works with business to keep America’s factories and jobs from going under or being shipped overseas. He rightly claimed a victory here that did more good for Americans than settling our score with Osama bin Laden: “We bet on American workers. We bet on American ingenuity. And tonight, the American auto industry is back.”
The picture of cooperation is starkly different than the antagonism between government and business painted by the “loyal” opposition of the Republican Party. In his televised response to Obama’s address, Governor Mitch Daniels of Indiana laid the blame for America’s economic downturn squarely at the President’s feet despite acknowledging that the recession began under his party’s own watch. (He did not mention that Republican-style economic policy was almost entirely to blame for America’s economic mess.) The tepid speech was out of touch with basic facts and did nothing but rehash the same time tired rhetoric this party has been jabbering for years: smaller government, no taxes, less regulation and oversight of the economy.
Take the following assertion Mr. Daniels made about spending under the Obama administration: “In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt.” Or again, the assertion that the “grand experiment in trickle-down government has held back rather than sped [sic] economic recovery.” The claim that the debt has increased under Obama is true, but the assertion that it comes from new spending, or that government stimulus like that from the Detroit example failed, are shameless lies that stink of political desperation.
The fact is that federal spending was already on pace to “explode” the national debt, and not because the President had the power to spend more money on new programs. Rather, the debt spiraled out of control for two reasons: first, the Bush-era tax cuts dried up revenue to keep pace with spending; and second, the financial collapse, and subsequent shrinking of growth and income, scorched the earth of what was left of tax-based revenue sources. Since most revenue goes to servicing the national debt it exploded once the principal source of revenue was destroyed by the Republican give-away of tax cuts to the wealthiest 1 percent of Americans. Republican attitudes and policies on taxes and deregulation are more to blame for the skyrocketing debt in the last three years than anything the President has the power to do.
The starkly different pictures of the relationship between government and business are apparent, but the picture painted by the Republicans reveals economic fantasizing that lacks common sense. Like a work by Monet, this picture looks good from far off but closer inspection reveals the outlines lack a coherent shape and details are fuzzy. Here is a soundbite that feeds such fantasizing because it lacks any grounding in real facts about our present economic problems: “We do not accept that ours will ever be a nation of haves and have nots; we must always be a nation of haves and soon to haves.”
Never mind that economic inequality has grown significantly in the last two decades, much of it in the last several years, and is now at its greatest point since the Great Depression. Never mind that the rate of poverty, in which individuals and families live on approximately $10,000 annually, has grown by 30 percent in the last three years. These economic facts are ignored by the “loyal” opposition in favor of talking points that are seemingly designed to reassure themselves of a world picture that never was, isn’t now, and never will be. Republicans are not interested in what’s true as a matter of fact, they are only interested in what sounds true to millions of unskilled listeners who, like them, paint in big brush strokes, but can’t keep between the lines when it comes to drawing a coherent picture that remotely looks like reality.