Credit Downgrading Signals the U.S. Needs a More Democratic Economy

[Donnachaidh]

http://www.inthesetimes.com/ittlist/entry/11808/obamas_economic_maelstrom_compounded_by_credit_downgrading/

The downgrading of the U.S. economy by Standard and Poor's compounds a grim reality: the economic recovery from the Great Recession is stalled and beginning to move in reverse. With no relief in sight for the poor, jobless, and those who have lost their homes, and with the country now facing further deep cuts to government sponsored programs, the future looks very bleak. The lack of prospects for further fiscal stimulus measures, and the resulting stock market sell-off, confirm that the United States, and especially its poor and working population, faces an economic maelstrom, propelling the European debt crisis and threatening another global economic collapse.

It did not have to be this way. America's economic troubles are the direct result of decisions made by economic and political advisers in President Obama's administration—as well as the president himself. Of course Republicans are to blame for their complete refusal to negotiate in good faith or to put the well being of American citizens and the economy before their own political aspirations. But the current administration set its priorities long ago.

When President Obama came into office he continued and escalated Wall Street bailouts—infusing huge amounts of capital into failing financial institutions. His administration has since supported tax cuts for corporations and the wealthy rather than pushing for an effective jobs program, or a plan to help alleviate foreclosures and the housing crisis which actually works. As a result we have seen a completely lopsided economic recovery: Large corporations and banks have seen record-breaking profits, while on the other hand the middle and working class have seen rising unemployment, stagnating wages and increasing costs for everything from healthcare to gas, and are now facing painful cuts to social services.

For a president who campaigned on a bottom-up approach to governing, this top-down approach to the economy has been devastating to those on the lowest economic rungs. Wealth has continued to concentrate in the hands of the most opulent at an astounding rate over the past 3 years. We are facing radical inequality—the greatest levels in almost a century. And what has the U.S. government's response been? Austerity for poor and working people with no sacrifices from the rich or corporations.

More at the link --