Since the beginning of the Reagan administration, the takeover of government by giant corporations including Wall Street banksters has proceeded apace. This takeover was greatly helped by two Supreme Court decisions (1976 Buckley v. Valeo and the 2010 Citizens United v. the FEC) allowing corporations and their vast resources to play an increased role in the funding of election campaigns. This corporate coup advanced under both Democratic and Republican presidents. In contrast, the plight of the majority of the U.S. population has worsened over these past 40 years.
During this period, influenced by corporate contributions, the Democratic Party joined the Republican Party in primarily representing interests of the wealthy. However, there are still some politicians within the Democratic Party who work to protect the public interest. Their presence is crucial on some social issues, particularly in protecting Social Security, Medicare and Medicaid.
The Ronald Reagan Administration
President Ronald Reagan played a key role in this corporate coup by undermining support for the government and its crucial role of protecting the public against the depredations of the powerful. For example, he said: “In this present crisis, government is not the solution to our problem; government is the problem.”
Another of Reagan’s infamous quotes about government is: “The most terrifying words in the English language are: ‘I’m from the government, and I’m here to help.'” His words and policies spread the false and incredibly harmful idea that private businesses could do a better job than the government in meeting public needs.
In addition, Reagan’s actions weakened the strength of labor unions, his huge tax cuts for the wealthy played a role in dramatically increasing income inequality and excessive greed was no longer considered to be a deadly sin. Moreover, Reagan’s policies — including large deficit spending and showering money on weapons manufacturers — tremendously increased the national debt.
The Bill Clinton Administration
President Bill Clinton strongly backed NAFTA, a trade agreement that benefited large transnational corporations and harmed U.S. workers and small farmers. He also signed the Telecommunications Act that enabled a handful of dominant media moguls to greatly increase their power. The subsequent telecommunication mergers put the control of information into fewer and fewer hands and meant lots more money for the wealthy media owners. Clinton also signed an act that implemented major changes to the U.S. social welfare policy as well as dramatically weakening the safety net.
In addition, Clinton approved an act essentially repealing the Glass-Steagall Act that had separated investment banks from commercial banks. He also signed a bill that prevented the regulation of over-the-counter derivatives. The effect of these two laws was that a casino mentality reigned on Wall Street and, accompanied by widespread fraud, led to the Great Recession.
The George W. Bush Administration
President George W. Bush’s large tax cuts in 2001 and 2003 benefited the wealthy to a greater extent than the rest of the population. These cuts also increased the budget deficit and the national debt. Bush and his administration’s horribly inept response to Hurricane Katrina increased the scale of the disaster for the people in New Orleans and surrounding areas, especially for the poor.
Moreover, under Bush, the U.S. committed major war crimes and made life a living hell for Iraqis and Afghans. These war crimes took trillions of dollars from programs that could have helped the U.S. public and people around the world. Instead, this money destabilized the Middle East, led to the creation of ISIS, enriched weapons manufacturers and opened up Iraq’s oil fields to U.S. and other foreign oil corporations.
The Barack Obama Administration
President Barack Obama inherited the 2008 financial crisis from the Bush administration. The Obama administration quickly supported and expanded the Bush bailout of Wall Street banksters, the very people who played a leading role in causing the crisis through their excessive greed.
In addition to the government’s bailout, according to a 2011 Government Accountability Office study, the Federal Reserve allocated over $16 trillion to corporations, including banks internationally. The Levy Institute’s 2011 detailed analysis of the amount of money that the Fed provided in loans and asset purchases was $29 trillion. Whatever the correct number, it was enormous compared to the paltry amount of money spent to bail out the people who lost their homes and jobs due to Wall Street’s fraud and gambling.
The Obama administration also ardently campaigned for the passage of the Trans-Pacific Partnership, another egregious trade bill to benefit the wealthy at the expense of the rest of the population. It was often referred to as “NAFTA on steroids.” Fortunately activists around the world mounted a strong effort to stop this bill. Opposition from the Bernie Sanders campaign and then the Donald Trump campaign also helped the effort to derail this terrible trade deal that greatly favored corporate interests.
The Donald Trump Administration
President Trump continues the transfer of wealth upward to the obscenely rich. His 2017 tax cuts have not benefited the economy as touted, and the wealthy received the greater share of the cuts. The large cut in the corporate tax rate has helped a few at the expense of the many.
Instead of using the new money to strengthen the corporation, a large number of corporations have put tons of money into stock buybacks that reward the corporate execs and high-income investors. As a result of this greed, these corporations were ill-prepared for the economic meltdown resulting from Trump’s disastrous mishandling of the pandemic.
Making matters worse for the great majority, Trump is now demanding that the next bill for dealing with the effects of the pandemic include a cut in the payroll tax for some period. Any reduction in this tax weakens the financial viability of Social Security and Medicare, programs that are vital to the public. In addition, the Republican leadership wants to prevent lawsuits against corporations if they fail to provide the necessary protection for workers against the novel coronavirus.
The public is still waiting for real assistance to help it survive the pandemic. So far, the giant corporations, including the banks, have received enormous amounts of funding, and some “small” businesses have been helped. This is a repeat of the shameful 2009 bailout. There are tens of millions of people still in desperate need of help who have been mostly ignored in the current bailouts.
The Trump administration has also rollbacked numerous environmental regulations. These reductions pose a major threat to the health and security of the U.S. population and of coming generations while primarily benefiting corporations, especially the fossil fuel industry.
The Trump administration has signed legislation providing large boosts in military spending, despite the U.S. outspending the total military spending of the 10 nations with the next largest military budgets. As the current pandemic shows too well, all this wasteful weapons spending does not provide security for the public. This budget primarily benefits the military-industrial complex, that is, what used to be called the merchants of death.
The Trump tax cuts and unnecessary and wasteful increases in military spending have drastically increased the budget deficit and the national debt. Instead of enriching the wealthy, the money could be put to better use in truly providing security, that is, providing housing, food, health care, education and a clean and safe environment for the public.
It is crystal clear that the current neo-liberal economic model has failed the public while greatly benefiting the few at the top of the economic ladder. This failed approach is taking us down a path of societal and environmental destruction as well as to a possible nuclear conflict. Unless the public quickly rises up and demands fundamental change, this is the future we and coming generations will experience.