“God fortsättning” in the New Year — that’s doubtful…

In Sweden, my old home country, we used to say “God fortsättning” after the holidays — “good continuation” in the New Year. That’s not an expression you hear in America, which is perhaps as well, particularly in these times of the financial cliff, the debt ceiling, and the political disharmony in Washington.

Yes, the cliff was avoided but at what price? Was it worth it?

New York Times columnist Paul Krugman recently wondered if the deal was a “Pyrrhic victory,” a tactical victory that could pave the way for a major defeat later this year. Yes, the victory was tactical in the sense that the Republicans in Congress for the first time since 1993 voted for a tax increase. But what else? It did nothing to resolve the country’s major economic problems, the debt, budget deficit, unemployment. The settlement contained no new stimulus money to invest in the woefully neglected infrastructure or to create new jobs. Remember, the U.S. still has almost eight percent unemployment. Last Friday’s figure of 155,000 new jobs during December was certainly acceptable, but not more. Many more jobs are needed, every month, to seriously tackle the unemployment crisis.

In the deal, President Obama had to give up on his campaign pledge to raise taxes for everyone earning more than 250,000 dollars per year. Instead, the limit was set at 450,000 dollars, meaning than less than one percent of American tax payers will see their taxes increase. Those are not middle class figures. These are high income earners, who will now be exempted from paying their fair share at the same time as more revenues are needed but when Americans are paying less in income tax than the populations of other developed countries. As Stephan Richter pointed out in The Globalist:

“In all the other countries that come to mind, protecting such levels of income is the sole preserve of conservative parties. In the United States, it is a matter of bipartisan consensus.”

Yes, America IS different from Europe –it’s certainly more conservative. In America, taxes are toxic in a way they don’t seem to be in Europe, maybe because Europeans feel that they get something for their taxes, like universal health care, good public transportation, and affordable education all the way through college?

Washington is also similar to Brussels, if you read The Economist, which called the cliff deal an “abject failure” — “Washington’s pattern of dysfunction is disturbingly similar to the euro zone’s.”

But Europe has also made progress, averted disaster and come together around the euro, as Floyd Norris recently wrote in the New York Times, wondering: “Will the United States follow the European path in 2013? Let’s hope so.”

That’s not likely to happen. With the debt ceiling crisis and the resolution of the automatic spending cuts looming in a couple of months, the Republicans seem primed for revenge after the cliff deal, which could make the cliff deal negotiations come to seem like child’s play.

“Good continuation…” well, the New Year actually doesn’t look that good.

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Unions under attack in Wisconsin

That America is not like Europe, although Europeans often think they are one and the same and become disappointed or confused when it does turn out to be the case, has not so clearly been exemplified in a long time than in today’s big battle in Wisconsin between the unions and Governor Scott Walker .
The Republican governor’s clearly stated plan to disarm the unions and reduce their power and influence by abolishing the right to collective bargaining for public employees, is difficult to imagine having its equal anywhere in Europe today, where the trade union movement remains strong as an accepted and integral partner in the community.
Governor Walker argues that his proposal is necessary to overcome the state’s large budget deficit. So far, he has stood its ground, despite a storm of criticism. He has referred to President Reagan, when he simply sacked thousands of air traffic controllers during their strike early in the 1980s, and has become something of a new star among Republicans. Our time has come, says Walker. It is a battle for America’s democracy, according to his opponents, a decisive battle for the future of trade unions in America.
What is sometimes forgotten in this battle is that the unions have already agreed to the Governor’s demands for concessions on pensions and health care in the name of budget savings, but sacrificing the right to collective bargaining is out of the question, they add. The 14 Democratic members of Wisconsin’s Senate support the unions and have fled to neighboring Illinois, making impossible for the governor and the Republicans to push through his proposal – without the 14 Senate Democrats there is no quorum. The governor, they say, must retreat on the collective bargaining issue; otherwise they will not return from their “exile.”
Unions in America have played a crucial role in the years to create a 40-hour work week, rights to vacation, pensions, health care, etc., but they have for decades, maybe especially since President Reagan’s years in the White House, been under attack. The result today is that only seven percent of America’s private sector employees are unionized.
The unions in the public sector have fared better and have been able to better maintain their position and influence. They are precisely the ones now in the Wisconsin governor’s focus, a strategy that has led to a storm of charges against him for “union busting.”
The fact that the public sector trade unions consist of some of the Democratic Party’s strongest supporters has, of course, contributed to the battle’s now clearly partisan overtones in spite of Governor Walker attempts to frame this as solely a budget issue. The mass demonstrations in Madison, Wisconsin’s capital, clearly show how the budget battle in Washington has now spread well beyond the Beltway. It is, fundamentally, at battle for political power in the 2012 elections.