Socialist Party USA: Info & News

Statement Against Budget Defecit Deal

Mobilize to Stop Cuts to Medicare, Medicaid and Social Security

by Billy Wharton, co-chair, Socialist Party USA

On May 1, 2003 then President George W. Bush emerged from a fighter jet on the deck of the aircraft carrier USS Abraham Lincoln to make his famously absurd “mission accomplished” speech. Today’s announcement of an agreement on a budget deficit package provides current President Barack Obama with his own “mission accomplished” moment. Much like that of Bush, Obama’s completed mission will lead to mass suffering and more than a few deaths. Bush’s victims were Iraqis and the American soldiers sent to kill them. Obama’s will be poor, working class and elderly Americans cut off from vital social programs as a result of budget cuts.

Since his election in 2008, Socialists have been clear about what the Obama administration represented. We often referred to him as a “hedge-fund Democrat.” This tag was laughed off by the Progressives for Obama crowd as being over-the-top and out of touch with the possibilities of the new Presidency. However, like any good hedge-fund operator, Obama has effectively managed risk for the richest 5% of Americans and the banks and corporations who funded his campaign. Their main fear was that the mass unemployment and deep poverty caused by the economic crisis of 2008, which they created, would force the government to take on long-term relief efforts – like an extension of anti-poverty programs and a public works project for the unemployed.

The budget deficit announcement delivered by Obama is a “mission accomplished” for his elite benefactors. The welfare state will not be extended. The unemployed will not be put back to work. In fact, the existing anti-poverty programs such as Medicaid, Medicare and Social Security are now targeted for $1.5 trillion in budget cuts by a “Super Committee” made up of Democrats and Republicans. These cuts are sure to increase the already rising misery felt by poor and working class people all over this country. Wall Street corporations might have returned to profitability, but, in poor and working class neighborhoods, the economic crisis continues on and will be deepened by further cuts.

The fact of the matter is that the source of the budget crisis is the immense amount of money, nearly $1.3 trillion last year, spent on the US Military and the sharp reductions in the taxation of the rich and corporations. Military spending has increased rapidly since World War II as the American military expanded its presence into nearly 1,000 bases worldwide. Recent military adventures in Iraq, Afghanistan and Pakistan have sent these costs even higher – siphoning off desperately needed public funds from social programs.

Simultaneously, elites and corporations have used the Democratic and Republican parties as vehicles to reduce and, in some cases eliminate entirely, the need to pay taxes. Taxation on the highest earners has declined from a rate of around 90% in the 1960’s to 35% percent today. Corporate tax rates have had a similar decline, from 50% in the 60s to around 30% today, and Capital Gains taxes have been reduced from a late 70s high of around 40% to current rates, close to 15%. All of this means that the rich and corporations have pocketed trillions of dollars, while necessary state services are driven to the brink of bankruptcy.

The soaring military costs and declining tax rates over the past few decades were only a pretext for this moment. These trends, in addition to the defeat of the labor movement in the US, have left what were once untouchable public support programs open for attack. And Obama was specifically selected as a candidate with the popular appeal to carry out these cuts that aim at eventually eliminating Medicaid, Medicare and Social Security regardless of the human suffering that will be caused. This is the sick logic of neoliberalism brought to life in a progressive garb.

The simple fact of all this is that it will take a revival of Democratic Socialism in America to defend these programs. Why socialism? It’s simple. Socialism places the needs of human development at the center of politics. More concretely, we believe that budgetary decisions like the ones being made behind closed doors in Washington should be made in a democratic manner. We aim to create a system of participatory budgeting – where the vast majority of people, instead of a just a few corporate-financed politicians, make decisions on how public funds are spent.

Such a process would certainly build support for a Socialist plan for immediately dealing with the current budget inequities. We propose cutting the military budget by 50% and creating a progressive taxation system where the rich and the corporations that have swindled us for generations are made to pay. New revenues will be put to work to build a solidarity economy that guarantees healthcare for all through a socialized medical system, jobs for all through a full employment economy and guarantees that the elderly will live with dignity through a Social Security program that provides livable support. We consider these to be the basic building blocks of a human society – the fundamentals of socialism. Capitalism is the only thing preventing this.

We therefore call for resistance to all of the cuts formulated by the Democrats and Republicans and being delivered by President Obama. No cut to Medicare, Medicaid and Social Security is acceptable. Poor and working people all over country need to mobilize against these proposals in order to express our democratic will and demand that the rich pay for the crisis they created. Once we are mobilized we will not stop at just the defense of current programs. We will demand that the great wealth stolen from those who created it be returned to be put to the use of improving human life all over the globe. Doing so will make Obama’s “mission accomplished” moment ever bit as hollow as that of his predecessor.


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