New budget a good deal - for the rich

by Gus Hall

This article was reprinted from the August 9, 1997, issue of the People's Weekly World. For subscription information see below. All rights reserved - may be used with PWW credits.

President Clinton signed into law this week a bill to balance the federal budget by the year 2002. The budget and tax bills, passed by the majority of both Republican and Democrats, are a victory for the very rich.

The mass media totally glosses over the class nature of the bills. They say things like it is "the largest federal tax cut since President Ronald Reagan signed a tax reduction bill in 1981." They neglect to say it is a windfall for the rich and corporations, which was also the nature of Reagan's "trickle-down theory."

The 41 Democrats and one Republican who voted against the tax bill complained that "most of the tax cuts benefited the rich."

Even the New York Times had to report that the tax bill "includes many narrowly focused provisions that benefit just a few individuals or businesses." Computer giants like Microsoft, many agribusinesses, the tobacco and the oil industries are all major beneficiaries.

As a result of these bills, the very rich will get richer and the poor will get poorer.

Signing the Welfare "Reform" Act was Clinton's first step in joining the right-wing Republicans on most issues. With the budget, both Gingrich and Clinton paid off the very rich. Even though Clinton trumpeted turning over some of the more extreme welfare cuts, this budget did not change the welfare act which did away with the concept of a government safety net.

Wall Street reacted favorably. After the budget agreement was announced the stock market rallied and set a new record. That's corporate America's way of celebrating. You could just hear the champagne corks popping.

There is very little difference left between Gingrich and Clinton. Gingrich has moved toward the center and Clinton has moved to the right. Together they supported tax cuts for the rich. But that's the nature of bourgeois politics. Top politicians are there to serve the ruling class.

But Newt Gingrich is no longer riding high. The day before Richard Nixon was forced out of the presidency his popularity rating was 25 percent. Gingrich now "enjoys" that same dismal rating - actually it is even below 25 percent.

Two years ago Gingrich was the most popular Republican. He headed the "Freshmen 73," the gang of the most extreme right-wing congressional representatives. He orchestrated the "Contract with America," more commonly - and accurately - known as the "Contract on America."

With the Contract's fascist-like ideas and the Republicans' fascist-like tactics, they pulled off shutdowns of the federal government and pushed disastrous cuts in entitlement safety-net programs.

Gingrich was the best money raiser for Republican candidates. He raised millions in corporate PAC money. He offered workshops and training sessions to Republican candidates and potential recruits to the "Gingrich Revolution."

Now Gingrich is unpopular and is not trusted with money.

While Gingrich is a problem for the Republican Party, Clinton has become a problem for the Democratic Party. The House Minority Leader, Richard Gephardt of Missouri, said, "We in the Democratic Party feel strongly that the people in the middle, the people stuck on the bottom are the people we need to be giving the majority of this tax cut."

Because Clinton doesn't have to run for reelection he keeps moving to the right. And the more moderate Democrats are reacting to the fact that they will have a lot of pieces to pick up if they want to be reelected.

Big business and the corporations have no problems. Their sky-high profits keep going up.

The banks have no problems. Their profits keep going up. Their capital gains, cut from 28 percent to 20, will help continue that trend.

Workers have problems. Their wages keep on going down. According to one bourgeois economist real wages for workers have fallen 21 percent since 1979. Corporations keep coming up with new schemes and policies to push workers' standard of living down and their profits up.

The most recent scheme is the part-time vs. full-time status. Corporations hire part-time workers at sometimes half the wages of full-time workers.

The promise of a full-time job is held up for these part-time workers as some distant possibility. The UPS strike, with 60 percent of its employees part-time, has brought to light this very deliberate policy of big business.

The African American community has problems. Racism is alive and their standard of living continues to fall. The budget and tax cuts will have a sharp impact on African Americans because of the racist and anti-working class nature of the budget package.

The Mexican American and Latino communities have problems. Chauvinism and anti-immigrant discrimination is continuing. Even though some of the worst anti-immigrant features of the welfare bill were reversed, harassment and hunger will continue.

State after state is cutting food stamps. As a result, an increasing number of people are homeless, hungry and starving to death. Many of them are children, the elderly and disabled. So the impact of this budget will be disastrous.

Both the national budget and the state budgets have "dead end" ultimatum days. Like "two more months and your food stamps will be cut-off." Or "after 18 months your welfare will be cut off."

There are no ultimatums in these budgets saying in two months there will be 200,000 new, union wage jobs created or in 18 months there will be three million new union-wage jobs created with those in greatest need getting priority.

These cuts and ultimatums are all done while an emergency jobs bill - the Job Creation and Infrastructure Restoration Act (HR-950) sits in committee. This is a $250 billion emergency job creation bill with 53 Congressional co-sponsors - and still it just sits.

HR-950 is an answer to the Welfare Reform Act. It could immediately put welfare recipients, victims of layoffs and plant closings to work at union wages. These new jobs target building schools, roads, hospitals and cleaning up the environment.

These are the kind of bills which need to be passed as an emergency answer to the drastic cuts.

-Gus Hall is Communist Party USA national chair.