One Year of Joe Biden's Presidency

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By ERIC TOUSSAINT*

After almost a year in office, it is clear that promises of a progressive turn towards more social justice have not been fulfilled.

Some/some commentators thought that Joe Biden's presidency would be the occasion of a Keynesian turn in the United States. The same illusions and hopes had arisen at the beginning of Barack Obama's presidency in 2009.

In both cases, the election took place at a time when the US was going through a serious crisis that could lead the government to adopt strong measures and initiate a turnaround after decades of neoliberal policies.

The Barack Obama administration could have applied coercive measures against big business and in particular against the big banks and investment funds that were largely responsible for the huge crisis that erupted from 2007-2008. In addition, Barack Obama had promised a profound reform of the health system, social security, pensions and the implementation of a tax reform with the aim of charging the wealthiest, starting with the richest 1%, a little more in taxes. None of this happened.

In the case of Joe Biden, he had announced that he would ask the biggest companies and the richest to pay more taxes, he had promised progressive measures in terms of access to health care, social protection and a legal hourly minimum wage of 15 dollars…

These promises allowed him to mobilize a part of the electorate that no longer went to the polls. Early in his term, he appointed Bernie Sanders as chairman of the Senate Budget Committee, which to some seemed like a sign of a willingness to really implement progressive measures. Others, myself included, saw this as a way to muzzle Bernie Sanders.

 

unfulfilled promises

After nearly a year in office, it is clear that promises of a progressive turn towards greater social justice have not been fulfilled. Very quickly the $15 minimum wage was dropped, and the hourly minimum wage remains fixed at $7,25.

No measures were taken to levy new taxes on big business and the richest. Worse, an additional measure that favors wealthy families is being proposed by the Biden Administration, and amazingly, this allows a number of Republican elected officials to denounce the injustice and ruse of the measure for favoring the rich. [1]. This is to increase from $10.000 to $80.000 the amount that a taxpayer can deduct from his/her federal taxes in compensation for local (municipal or state) taxes paid. According to an analysis of the Tax Policy Center [Tax Policy Center], a non-partisan body, and the Center for a Responsible Federal Budget [Center for Responsible Federal Budgeting], 94 percent of the benefits from raising the income tax allowance cap to $80.000 would go to the top quintile of the nation's taxpayers—those earning at least $175.000 a year—and 70 percent to the top five. top percent [2]. The loss of revenue to the Treasury would be $275 billion a year.

The $15 minimum wage was soon abandoned, and the hourly minimum wage remains at $7,25. The military budget was increased and is now US$720 billion with the support of the Republicans. This is the biggest budget since World War II (disengagement in Afghanistan notwithstanding). In the area of ​​public works, the Biden administration, with Republican backing, passed a budget that favors big construction companies.

It should be remembered that it was in the United States that the coronavirus pandemic resulted in the highest absolute death toll in the world: more than 820.000 deaths as of December 21, 2021. Despite the extreme gravity of the situation, Joe Biden has not taken any action that would enter in conflict with the interests of Big Pharma. While the government holds the master patent for the production of messenger RNA vaccines, it refuses to use it and to have vaccines produced by the public sector in the US or elsewhere (see sidebar «Biden Protects Big Pharma's Interests at expense of the people in the North as well as in the South"). All production is left in the hands of Big Pharma, and the patents that private companies have registered are not suspended.

The Biden administration has also not offered the patent it holds to countries that could have benefited from it and are in a position to produce vaccines on their own if given the opportunity. Although he said in May 2021 that his administration wanted the WTO to open up the patents, as requested by more than 100 countries in the South, Biden has taken no real steps to ensure that this happens.

 

The third dose of vaccine in the North and the apartheid of vaccines

Like Western European countries, the United States is organizing the mass injection of a third dose of the vaccine (a fourth dose is even being prepared, as the State of Israel is already doing) and the vaccination of children, while the WHO calls for that priority be given to vaccinating the populations of the countries of the South, which have only very limited access to it.

As for financial regulation aimed at imposing some discipline on large banks and other large financial companies, nothing has been done. On the contrary, laxism is advancing. In a clear indication of his pro-financial markets and big capital orientation, Biden extended the mandate ofpFederal Reserve resident Jerome Powell, who had been appointed by Donald Trump. He also appointed Janet Yellen, the former chairman of the Federal Reserve, as Secretary of the Treasury (the Treasury equivalent). This was yet another sign in favor of big companies.

In early December 2021, Saule Omarova, the woman who was supposed to be in charge of banking regulation as head of the Office of the Comptroller of the Currency (Secretary of the Comptroller of the Currency), was forced to resign after a destabilization campaign by Wall Street and the Republicans. The newspaper Financial Times commented thus: "She faced a backlash from Republicans and the banking industry, with criticism focused on her education and academic career with proposals including a state-run bank account system" [6]. In reality, it has not only faced attacks from Republicans, it has been demolished by a series of Democratic congressmen who are as connected to big business as their Republican counterparts.

The program Build Back Better [Build Back Better] is being sabotaged by the right wing of the Democratic Party and will very likely be abandoned. Biden had pledged to advance a major spending program for social justice and environmental protection. This program, Build Back Better, known by its initials BBB, should have been approved at the same time as the large public works expenditure plan that has become popular with big business. Biden and Congressional President Nancy Pelosi finally split the two votes, while the left wing of the Democratic Party rejected this split. The public works plan passed with Republican support and despite opposition from six left-wing Democrats, including Alexandria Ocasio-Cortez. On the other hand, the program Build Back Better it is being sabotaged by the right wing of the Democratic Party and will very likely be abandoned.

This abandonment of the program Build Back Better it shows the real nature of Biden administration policy, which is largely, economically and socially, in continuity with that of Republican presidents, whether GW Bush or D. Trump. In 1891, Friedrich Engels, in his preface to Karl Marx's texts on the Paris Commune, described very well the political system in the United States dominated by the Democratic and Republican parties, which alternate in power and defend the capitalist order.

The Biden administration has also failed, despite well-meaning rhetoric, to take steps to reduce gun access at a time when homicide rates are rising sharply (30% increase in 2021). There are 400 million firearms in circulation in the US.

With regard to states that Texas passed hyper-repressive abortion legislation, the Biden Administration is not taking steps to defend federal legislation decriminalizing abortion and is confining itself to voicing its dissent. While the states, again including the Texas decide to change election laws to limit voting rights of the popular classes and especially their racialized parts, the Biden Administration does nothing.

On migrant rights and refugee reception, the Biden Administration's policy is really no different from Trump's. In September 2021, US envoy to Haiti Daniel Foote resigned in protest against the "inhumane" expulsions by the United States of thousands of Haitian migrants. His resignation was a blow to Joe Biden: his policy of mass expulsions of Haitian migrants to his country is publicly denounced by his own emissary [8].

In terms of international policy, Biden's administration extends and confirms that adopted by Trump's on central issues: full support for the Zionist regime; aggressiveness towards Cuba and Venezuela. Recently, an investigation by the newspaper New York Times revealed that the use of drones in Syria, Iraq and Afghanistan has officially resulted in the deaths of over 1.400 civilians. The real number is certainly much higher. The Biden Administration continued D. Trump's policy in this regard. At the end of August 2021, in Kabul, 10 civilians were killed by a drone strike and it became known in December 2021 that those responsible would not be punished [9] "There was not enough evidence to define individual responsibilities", explained in Washington the spokesman for the Pentagon, John Kirby, to justify the lack of sanctions. The Biden administration also supports the military regime of Marshal Al-Sissi, annually providing its army with 1,3 billion dollars in aid. Likewise, Biden maintains close relations with the ultra-reactionary Saudi regime.

The return to the Paris Climate Agreement and nuclear talks with Iran did not translate into strong measures. On the contrary, Biden has just increased subsidies for oil and gas extraction in the US in order to increase the volume of extraction. On Iran, the US is not making any real concessions, which contributes to the festering situation.

 

Why is there no Keynesian Return?

The main factor is the state of the class struggle. The popular classes and, in particular, salaried workers did not have an increase in their degree of organization and their capacity for action. This is different from the 30s, when the labor movement was booming in the US, with a wave of strikes and factory occupations, especially in the automobile industry. Radical unions were on the rise. As well as socialist ideas. The USSR was a pole of attraction, and public planning and control of the means of production seemed to be a better solution than capitalism. laissez-faire.

To complete the picture, we should add that in 2020-2021 the government (whether Trump or Biden) put a damper on the table, paying important indemnities to the popular classes and postponing the payment of a significant part of the debts (mortgage debts, student debts, debts rent…). In 2020 and 2021, poverty has decreased thanks to social assistance of various kinds. This played a real role as a social buffer. The popular classes were not forced to act. Obviously, some sectors mobilized and in some cases achieved victories, but this is far from representing a milestone.

The "social" measures taken by Trump and then by Biden are not structural, they do not constitute new rights, they are not perennial. if the program Build Back Better were adopted, we could consider that some social progress would be achieved, but obviously, at best, it would be very limited. This shows that we are not in a new Keynesian-type cycle where the government and the capitalist class would have to make big concessions to the working classes, who would see their social rights progress and their real wages increase.

The capitalist class continues to get rich, although the profit rate is not at its highest level and a large part of the accumulated capital is fictitious and could collapse like a house of cards in the event of a new financial crisis.

Inequality continues to rise, with greater concentration of wealth to the benefit of the richest 1%.

 

The debt issue

In the third quarter of 2021, public debt America exceeded 28 trillion dollars, or 125% of the TAX ID No from the country. Whether after 2008 in response to the financial crisis or from 2020 onwards in response to the crisis exacerbated by the coronavirus pandemic, the US government increased public debt very significantly. No crisis taxes were levied on large companies. So far, the increase in public debt has been painless because interest rates are close to zero. Currently, the real interest rate on the public debt is even negative, since inflation is above 5%. The Federal Reserve will gradually raise interest rates, but there will be no serious problems in the short or medium term. In the United States, the volume of public debt will continue to rise without causing major disruptions.

The issue of abusive debt collections on the working classes will become increasingly important in the coming years.

Debts for working-class families have risen over the past 10 years, but welfare checks sent out by the government in 2020-2021 have temporarily eased the burden of paying. Additionally, both the Trump administration and Biden have temporarily suspended payment on a number of debts: student debt, mortgage debt in some cases, some rent debt as well, not forgetting some small business debt. But these measures will end and gradually the situation will become more tense. Some maturities are known: May 2022 for student debt, which totals over US$1,6 trillion. Bernie Sanders and Alexandria Ocasio-Cortez are asking for a total annulmentMovements to cancel these debts are in progress or being organized.

As far as student debt is concerned, Barack Obama has made some partial write-offs (the cost of which was borne by the government rather than funders), and it's possible that Biden will do the same. This will depend on the mobilizations. We'll see.

The debt of large private companies has increased sharply in recent years. If interest rates rise, it is possible for bankruptcies to occur and a new financial crisis to be triggered.

 

Conclusions

The policy of the Biden administration, beyond the effects of announcements and broken promises, is largely a continuation of capital's offensive against the popular classes. There is no social turn that has really started and breaks with 40 years of neoliberal policies. No one on the left is going to miss Trump, but having illusions about Biden is a line we cannot cross.

Biden and the Democratic Party are disappointing sectors of the popular classes that supported them against Trump and the Republican candidates in the fall of 2020. During 2021, in several by-elections, this disappointment was expressed at the polls and the Republicans strengthened their position. The October 2022 elections will likely result in a loss of the Democratic majority in both Parliament and the Senate, which will increase the trend towards continuity. A Republican victory in the 2024 presidential election is possible.

Will the left inside and outside the Democratic Party find a way to strengthen itself and break the two-party system so well described by Friedrich Engels 130 years ago? This is the great historical question. Could it be that the popular movement, which in the United States had strong moments like the Black Lives Matter and feminist mobilizations, will it be able to consolidate itself? Will the workers be able to score points against the bosses? Will the youth enter a cycle of struggles that will extend the Black Lives Matter, who will deal with the environment, with debts… The answers to these questions are open and are of great importance for all peoples on the planet.

*Eric Toussaint is a professor at the University of Liège. He is the international spokesperson for the Committee for the Abolition of Illegitimate Debts (CADTM).

Translation: Alain Geffrouais.

Originally published on the website of CADTM.

 

Notes


[1] https://www.capito.senate.gov/news/in-the-news/editorial-to-keep-cost-of-bbb-down-take-out-the-salt-cap-increase; https://www.cnbc.com/2021/11/17/high-income-households-could-get-a-tax-cut-under-build-back-better.html

[2] Financial Times, 27-28 November 2021, “Democrats' tax relief plan leaves bitter taste for party leftwingers” https://time.com/6128775/salt-cap-democrats-divided/; https://www.ft.com/content/712d0a22-8aa1-4204-b93a-3653c1f5bb5e “According to analysis by both the non-partisan Tax Policy Center and the fiscally hawkish Center for a Responsible Federal Budget think-tanks, 94 percent of the benefits of increasing the Salt cap to $80,000 would go to the top quintile of earners nationwide — who make at least $175,000 a year — with 70 percent going to the top five percent.”

[4] Public Citizen, «Statement: Modern Vaccine Belongs to the People», published on November 16, 2020, https://www.citizen.org/news/statement-moderna-vaccine-belongs-to-the-people/

[5] Public Citizen, «How to Make Enough Vaccine for the World in One Year», published on May 26, 2021, https://www.citizen.org/article/how-to-make-enough-vaccine-for-the-world-in-one-year/

[6] Financial Times, December 9, 2021. Extract from the FT article: «“What worries Wall Street banks is that I am going to be an independent and strong regulator that is not one of them, that owes them nothing”, she told the FT. “(…) Jon Tester, a Democratic senator from Montana, and Mark Warner from Virginia expressed concerns during the hearing about Omarova's earlier criticism of aspects of a 2018 bill they advocated that made it easier to regulate community banks. Tester also questioned his proposal for a state-backed national investment authority, which he said could decide which sectors of the economy to lend money to. In the Financial Times original: «“What Wall Street banks worry about is that I am going to be an independent, strong-minded regulator who is not one of them, who is not beholden to them”, she told the FT. “(…) Both Jon Tester, a Democratic senator from Montana, and Mark Warner, from Virginia, voiced concerns during the hearing about Omarova's previous criticism of aspects of a 2018 bill they had championed that had relaxed regulations for community banks. Tester also questioned her proposal for a state-backed national investment authority, which he said could decide which sectors of the economy to lend money to.»

[7] “Nowhere do 'politicians' form a more separate and powerful clan within the nation than precisely in North America. There, each of the two great parties to which domination falls alternately is itself governed by people who make a business of politics, who speculate with seats in the legislative assemblies of the Union and of each of the States, or who live from agitation to the their party and are, after its victory, rewarded with offices. It is well known that the Americans have been trying for thirty years to shake off this yoke that has become intolerable and that, despite everything, they are always sinking deeper into this swamp of corruption. It is precisely in America that we can better see how this autonomy of State power vis-à-vis society takes place, when originally it was intended to be a mere instrument of society. There is no dynasty, no nobility, a standing army there – except for the few men to guard the Indians – nor a bureaucracy with a fixed job or the right to retire. And yet here we have two great bands of political speculators who, taking turns, seize state power and exploit it with the most corrupt means for the most corrupt ends - and the nation is powerless against these two great cartels of politicians allegedly at their service, but who in reality dominate and plunder it”. (Postscript to Karl Marx The Civil War in France 1871 (1891) https://www.marxists.org/archive/marx/works/1871/civil-war-france/postscript.htm

[8] https://www.france24.com/fr/am%C3%A9riques/20210923-l-%C3%A9missaire-am%C3%A9ricain-en-ha%C3%AFti-d%C3%A9missionne-et-d%C3%A9nonce-des-expulsions-inhumaines-de-migrants

[9] Nouvel Observateur, «Bavure americaine de fin août à Kaboul: pas de sanctions, colère de la famille des victimes» https://www.nouvelobs.com/monde/20211213.AFP5613/bavure-americaine-de-fin-aout-a-kaboul-pas-de-sanctions-colere-de-la-famille-des-victimes.html

 

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