Sunday, June 3, 2018

Trump's Assault Against the Working Class; May 28-June 3

This week, Scott Pruitt, the head of the Trump administration’s Environmental Protection Agency (EPA), who also has extensive ties with fossil fuel companies (as reported last week), is further revealed by the New York Times to be in bed with even more billionaire coal barons than previously thought.

The NYT piece runs-through some of the ways Pruitt has been working to undermine and neuter the agency he is charged with running. It notes how the EPA has repealed (already marginal and insufficient) Obama-era laws aimed at curbing greenhouse gas emissions, further freeing up coal companies to harm the environment, including by making it easier for them to dump toxic metals into rivers.

The EPA has also now completed one of the final steps before it can impose a weakening of rules designed to cut pollution from vehicle tailpipes, the next salvo in its assault against the public good in order to make life better for the exorbitantly wealthy. It’s important to understand that car manufacturers already get around these rules by rigging their vehicles with technology that tricks emissions testers. This is done on a consistent basis, evidenced by the frequency with which they get caught doing so.

Essentially, companies factor in the slap-on-the-wrist fines they receive as penalties within their cost-benefit analysis, and—given the weak laws and enforcement—they rightly judge it is more profitable to continue the practice and pay the fine if they get caught. Thus, the EPA will soon alleviate that small annoyance and manufacturers will be free to poison the air with even more impunity. These kinds of emissions, by the way, lead directly to disease and death.

 On a similar note, Trump’s Energy Department is working on a draft plan that would force energy-grid operators to purchase energy from nuclear and coal plants, in an effort to bail-out these failing industries. This is what is called “conservatism.” But what Trump is really doing here is paying back the corporate owners who funded his campaign. At the same time, he is accelerating the destruction of the environment through climate change. This is even more egregious given that these industries are already dying off due to the shift toward renewables, unlike the oil companies, who won’t go down without a fight. The obvious answer would be to just let them go.

As predicted last week, the momentum of the deregulation drive is only just getting started.

The Fed is now seeking to roll back a rule designed to curtail the kind of risky financial derivatives trading that led directly to the ’08 financial crisis, known as the Volcker rule. The proposed change to the rule would restrict all banks, including the largest ones, from further regulatory oversight of their high-risk derivatives transactions. The change would give the banks further leeway to use FDIC (public) insured deposits to make risky speculative bets in hopes of receiving quick super-profits. The point being, if the bets go sour, the taxpayer is on the hook.

Though the Fed is not a federal agency and is instead representative of the financial elite, the Wall Street Journal notes that the proposal “is part of a broader regulatory rollback that includes a recently enacted law easing rules on small banks and less aggressive leadership at the Consumer Financial Protection Bureau”, which was covered here last week. The Trump administration, which in many ways represents the interests of the private equity industry which lavishly funded Trump’s campaign, has no doubt been pushing for this kind of deregulation from the Fed.

Four other regulatory institutions must approve the proposed changes before they come into effect, and there will be a 60-day period for public comments before the rule could be implemented.

As the World Socialist Web Site notes, although Big Finance routinely condemns regulatory oversight laws like the Volcker rule, in reality “bank profits soared to a record $56 billion during the first quarter of 2018.” As noted before, Trump has already lavishly showered financial investors (who had already been benefitting from rising profits) with even more wealth with the tax cut, which has been used mainly for stock buybacks and to pay dividends to investors.

This, as the worlds richest 1% snagged 82% of all of the wealth generated last year, and while the US “has the highest rate of income inequality among Western countries” and “one of the highest poverty and inequality levels among the OECD countries.” Thus, the US represents a “land of stark contrast” where an increasingly shrinking number of elites live in luxury while “40 million live in poverty, 18.5 million in extreme poverty, and 5.3 million live in Third World conditions of absolute poverty,” as reported by the special UN Rapporteur, Philip Alston, who recently completed his official report on poverty in the US.

As predicted last week, these and other deregulatory measures will lead directly to another economic meltdown. A question of “when”, not “if.” And after all, there is nothing to lose in the eyes of the financial elite. They can simply rely on their Too Big To Fail government insurance policy when everything collapses. The last time that happened they survived unscathed, got rewarded, and now are reaping record-setting profits.

Those who will suffer, as always, will be the working class and the poor; those who are marginalized and disenfranchised both by a tyrannical and rapacious economic system, as well as the decisions of political leaders, better known as—for accuracy’s sake—the in-office representatives of the corporate elite, who, every four years, are charged with managing the economy in service of the masters. It is no surprise then, that they would do so within their interests.

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