EDITORIAL: Shock and awe revisited

The Bush administration developed expertise in the use of “shock and awe” in its Iraq war for oil. Now it is using those tactics in economic warfare against the American people.

Having sent over 4,100 Americans to their death in Iraq at a cost to taxpayers of $600 billion, they now demand that we cough up anywhere between $700 billion and $1.8 trillion to bail out their Wall Street friends.

Bush wants American workers to hand over a blank check to the administration that deregulated Wall Street, helped shed millions of American jobs, weakened national and economic security with the Iraq war, allowed a major American city to drown and rolled back our standard of living — as it fought tooth and nail against even a paltry increase in the minimum wage. This blank check, Bush says, is required to fix the financial mess deregulation created.

The bailout demand comes after 18 months of telling us the economy is basically sound and everything is under control. Suddenly, we are told the sky is falling and we must immediately consent to being rolled for at least $700 billion.

The sky may indeed have fallen on Wall Street last week. On Main Street, however, it has been falling for a long time. The livelihood of the working class has been systematically destroyed as jobs have gone overseas, 50 million have gone without health care, wages have stagnated, home values have sunk and people have lost their homes, pensions, dreams and hopes.

Where has the sense of emergency been all this time? Why only now does Bush declare an emergency?

The bailout plan the administration is pushing is dangerous and should not be approved by Congress. The crisis in the real economy on Main Street is the true underlying crisis. Any bailout plan must address this crisis. Failure to do so would make the Wall Street fix short-lived and set the stage for an even bigger future squeeze on the hard-pressed American people.

A blank-check bailout would tie the hands of the next administration and Congress and block real reforms. You would kiss health care for all good-bye, because the lords of high finance would say: you must pay off this debt first, and the only way is to “liberalize” your markets. You have to privatize Social Security, cut public spending for education, and on and on. In short they would impose a “structural adjustment plan” like the ones forced on numerous developing countries by the same U.S. (mainly) corporate finance forces.

We need government intervention to stabilize the financial and credit interests of working families and retirees, whose pensions are invested in these markets. But we reject the notion that the world will end if we don’t immediately adopt a “welfare for the rich” scheme.

Let’s be clear: Bush’s proposed government action has nothing in common with socialism. It leaves the companies controlled by the same greedy capitalists who ran them in the first place.

The AFL-CIO says any bailout should:

• Be governed by an independent board with transparency and effective public and congressional oversight with strong safeguards so that any taxpayer money is spent in the public interest, and does not become a raid on the Treasury by financial elites. Participating institutions must give the government equity — a stake in the good assets in exchange for the benefits of the bailout;

• Stop foreclosures and restructure home mortgage loans for working families;

• Address the cause of the crisis on Main Street in addition to the symptoms on Wall Street. Congress should pass a second stimulus package in its entirety. We need a stimulus that extends unemployment benefits, provides needed aid to cities and states, and creates good jobs by rebuilding crumbling schools, roads, bridges and water systems;

• Work to strengthen our financial regulatory system and corporate governance system that allowed this disaster to happen.

We agree. The credit and financial markets must be stabilized to safeguard the livelihoods of working families and retirees. In addition, a tax relief plan for lower- and middle-income Americans is a must. And those who may be heading for college — or paying off college debt — need access to low-interest student loans and do-able payment schedules. Young people should not have the boom lowered on them because of Wall Street’s meltdown.

Speak out! Tell Congress and the White House you refuse to mortgage yourselves, your children and the country’s future to the same people who brought us Enron and now seek a no-strings-attached giveaway to Wall Street.