The Shutdown: Forty years in the making

What is going on in the United States?  Why the first government shutdown in nearly two decades? Kay Dilday sits down with Colin Greer to trace the origins of the current crisis.

KA Dilday
14 October 2013

As has been widely reported, the United States government has shut down because the House of Representatives refuses to pass a budget that provides financing for the Affordable Care Act and without a budget, there is no official funding for government programs.

 There is no chance of a budget that does not fund the Affordable Care Act passing because President Obama has the power to veto any budget and if it does not include funding for the Affordable Care Act, Mr. Obama has said, unequivocally, that he will veto it.

From New York City where I live in Harlem, the government shutdown looks bizarre. And it is bizarre, but from here, in the multicultural enclave of New York, the Republicans leading the charge sound like wacko birds. They are people who identify as Tea Party Republicans, the extremely powerful far right wing of the conservative party in the United States.

Here in New York, a state that nearly always votes for the less conservative party, the Democrats, it’s hard to believe that these Tea Party Republicans are so powerful. After all, New York’s seasoned Republican congressman, Peter King, seems as appalled as most Democrats by the catastrophic intransigence and posturing of the Tea Party faction of his party.

My confusion is a result of location and political focus, and it is part of the problem according to Colin Greer, the president of the New World Foundation, a member of the openDemocracy USA Board, transplanted Brit, playwright, and former state-school teacher in the UK and the US.

On a Monday morning in New York, Colin Greer explained that the government shutdown is a direct result of a moneyed class’ half-century long effort to increase their influence over the workings of this country. As soon as I could, I moved outward from Jackson, Mississippi, where I grew up to New York City, while the extreme right stealthily moved inward, taking political control of the state I left behind. For forty years, Greer says, while the left has been concentrated in the largest cities and coasts with like-minded peers, and pursuing federal statute when pushing political change, an ultra-conservative moneyed faction has focused on the long game, by building up local power, and local armies that steadily and stealthily transformed national government.

Greer describes it as a series of political arcs: “One, the commitment to defeat the new deal and get rid of social welfare policy; two, a positioning for power and rule versus democratic participation; three: deploying money effectively at an unprecedented scale; four: the diminution of the left; and five: race and racism.”

Of these arcs Greer describes, three is the means by which one and two are being achieved. The fourth is the situation that has permitted it and the fifth is the demographical shift in America, one in which Americans of White European origin will soon become a minority, which has given new urgency to the plan.

This strategy was laid out in party by a memo written by Lewis F. Powell, a corporate lawyer who subsequently became a justice of the United States Supreme Court. Powell wrote that the interests of business were neglected and unheeded by government, a situation that business people should work to change. According to Greer, American business interests have taken this advice to heart, shoring up local power to enable their power grab, bringing shrewd challenges in all the branches of government, but most successfully in the judicial and legislative branches. This shutdown is an example: as the New York Times reported, it was carefully planned for more than a year, masterminded by a former attorney general in concert with billionaires who then deployed local armies to build public support for defunding the Affordable Health Care Act. Ted Cruz, the senator leading it, is their legislative tool.


Ted Cruz. Demotix / Mark Tenally. All Rights Reserved.

As Greer describes, in 1951 President Dwight Eisenhower, a Republican, said the New Deal (fiscal and social policies enacted during the 1930s to counter the devastating effects of the great Depression) was part of the framework of the country and no political party would survive that attempted to dismantle it. In a letter to his brother he wrote that there was a rump group of the oil men from Texas who want to defeat it but “don’t worry. They are stupid."

These oilmen whom Eisenhower underestimated are now embodied in billionaires from myriad fields bound together by their extreme wealth. This shutdown is a component of that battle. It’s not a conspiracy, Greer clarified: “They are operating out of class and position.” 

In the United States, Greer pointed out, there are now elected officials who rather than being accountable to the people, credit a single donor with putting them in office. This has been made possible by several legal cases of which the most significant is Citizens United v. Federal Election Commission, allowing unlimited personal donations to Super Political Action Committees - organizations that are allowed to spend unlimited funds to influence campaigns. They’ve also been buoyed by a Federal Election Commission rule which has permitted a certain type of non-profit organization to keep its donors secret but to spend unlimited funds advocating for particular legislative and political outcomes.

The Supreme Court ruling in Citizens United allows for unlimited donations from visible contributors: the FEC rule or lack of one allows for a certain type of non-profit to receive unlimited donations from invisible donors. This means that multi-billionaires like the ultra-conservative Koch brothers, David and Charles and Sheldon Adelson, with personal net worths of more than $18 billion, can control campaign outcome by using their money to promote a sensationalist terrifying portrait of a candidate, one that reaches potential voters through an expensive onslaught of television commercials, mailings, rallies, and canvassing.  

These very rich men (women do not seem as interested in this demonstration of power) have proven their willingness to spend tens of millions of dollars in each two-year election cycle. To these billionaires, $30 million is a negligible percentage of their income, it is akin to someone like me putting $750 into political campaigns. My $750 won’t get me much influence, but a billionaire’s $30 million will. And even if the lay person can’t see how much these very rich people are spending, the candidates know.

It can become a battle of the obscenely rich versus the obscenely rich. For example, the aforementioned David Koch is the richest man in New York City. The second richest is New York’s mayor, Michael Bloomberg. (A political action committee with connections to David Koch has promised to spend $100,000 to defeat the Democrat candidate for Senate in New Jersey, so Bloomberg countered with a pledge that $1 million of his Political Action Committee’s funds would be used to support the Democratic candidate).

The United States is in danger of becoming an oligarchy masquerading as a democracy. Maybe there is a term for that contradictory mashup of forces, like the constitutional monarchy—oligarchical democracy

Oligarchs, according to Jeffrey A. Winters, author of the 2011 book Oligarchy, have wealth defense as their main purpose. In the United States it manifests as using their influence to prevent government from eroding the ability of private industry to profit obscenely.

Affordable health care is a good example: the Affordable Care Act will undercut the tremendous profit margins of the health industry, for which the annual revenue is $1.668 trillion. The fact that health-care is perceived as something to be purchased and profited from already represents skewed values. All Americans except for the very poor and the very old must purchase insurance if they hope to receive health care at a reasonable rate. (Usually it is purchased through an employer who chooses whether or not to offer a reasonably priced plan. In the past three years, my family of three has paid a monthly price of $200, $750 and $645 through three different employers. We still have to pay a small fee each time we visit a doctor. Without an employer subsidizing our health insurance we would pay about $1500 per month)

Insurers have very little competition and charge extraordinary fees, except to patients whose care is covered by the government (for example a medical test that Medicare, the government’s health financing for the elderly, pays for, will cost the government $30 because it has used its volume use and power to negotiate a reasonable rate closer to the actual cost of the test. That same hospital will cost a large health plan a little more and a private citizen more than 10 times more) Therefore there is a tremendous incentive among healthcare industry executives to keep people from having a government-backed health plan. For people like Koch and Adelson, there is tremendous incentive in keeping the government out of the way of private industry: if the health care industry’s profits fall, it sets a dangerous precedent for outlandish profit in all fields.

It is difficult for the left to counter the shadowy forces of these oligarchs who cloak their activities behind grassroots groups (using such methods as switching from professionally printed signs at rallies to hand-printed ones to look more homegrown). The murky money trails suck up massive amounts of investigative journalists time as they attempt to uncover the backers of the organizations who have a tremendous influence on political change. But even if they are uncovered, the disturbing truth is that it doesn’t really matter to the voters they reach, who don’t have much interest in delving into the source of a message.

The left has not yet mobilized sufficiently to counter the widespread forces of the right. There are organizations like Moveon.org, but it doesn’t have the same financial support as the right wing organizations. Occupy Wall Street gained significant attention, but it deliberately eschewed agenda and political strategy.

“Why don’t we have a Tea Party, why don’t we have an independent political voice separate from the Democratic party that can push it from the left?” Greer asked? “The right understood the necessity for that. Progressive money is fragmented." 

We get lost in the issues. Since the civil rights movement the left has been caught up in legislative agenda rather than base-building, whereas the right has been base-building. Forty years ago the right started running people for school boards, and they became state legislators. The left didn’t do that. We didn’t look at judicial offices; we didn’t look at sheriff’s offices; we didn’t look at school boards. 

These state legislatures that the right captured have approved gerrymandered districts that dilute the voting power of Democrats. A gerrymandered district is an awkwardly shaped district designed to benefit a particular group by enhancing their power, or restricting an opposing group to smaller districts. 

In the end, Greer says he thinks the Affordable Care Act will prevail. 

“I think the Affordable Care Act itself was a left-of-center centrist piece of legislation. It never addressed the problems the health care system has. It kept the control in the insurance companies. It supports power.

This rump group is using it to embarrass the president because he’s black. It’s almost unprecedented for a piece of legislation that gets Supreme Court approval to be contested at the federal level.  But they are going to lose.”

If Greer is right, it may turn out that this strategy will have backfired on the billionaires cabal. I think this is a testing ground for Tea Party Republican Ted Cruz, to raise his national profile and enhance his chance of becoming president thereby putting an oligarch candidate in the presidency. The danger is that Americans grow to like affordable health care, which they will.

And even as the government is shut down, the Supreme Court is still operating. On Tuesday they heard opening arguments in McCutcheon v. the Federal Election Commission, the next important test case in campaign finance law, in which the petitioner is seeking to strip the limits on what individual donors can give to candidates.

The march of the American oligarchs continues.

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