M D NalapatFriday, July 31, 2015 - The past two weeks have been spent in what is still the world’s most consequential country, the US, in Washington and New York, with a couple of days in between in Miami, the home of Republican Party Presidential hopefuls, Jeb Bush and Marco Rubio. They are looking to contest an extrordinary election, for the US has changed significantly since Ronald Reagan swept aside Democratic Party opposition in the 1980s. The reason for this is the weakening of the middle class in the US, just as what took place in South America in the 1970s.
This trend is worrisome, for the middle class provides an anchor of stability in a democracy. This is so for two reasons, the first being the perception of opportunity for advancement within the lower economic brackets seen in a growing middle class. Such an expectation lowers societal tensions and generates the ambition needed for success, as well as a sense of pride that enables a citizen to adopt socially helpful work and lifestyle ethics. The second reason is the market a strong middle class provides, thereby ensuring the health of manufacturing and services in the economy.
The continuance of high tax rates (relative to the quality of government services delivered, which in India is among the worst in Asia) has angered the middle class, which were strong backers of Modi in 2014. This disquiet has been fuelled by the inexplicable refusal of the BJP leadership to take action against senior BJP leaders exposed in the media as corrupt, apart from avoiding any action against top central leaders of the Manmohan Singh government who are known to have become super rich during their decade in office. Only some state-level BJP leaders have been proceeded against, that to, usually those who levied corruption charges against BJP leaders, against whom of course zero action has been taken despite evidence of massive enrichment while they were in power in certain states.
The middle class is getting squeezed in India, but as yet less so than is taking place in the US and in much of Europe. Within the NATO alliance, the decade just past has been disastrous for the middle classes, which in countries such as Greece, Spain and Italy are getting reduced by the week. In the US, President Obama went by the advice given by Larry Summers, who was responsible during the Clinton years of the 1990s of freeing banks and financial institutions in the US from the prudential norms that had been in place since 1936. What followed was an orgy of greed, which ended in a collapse that led to Obama following his predecessor George W Bush’s prescription of bailing out the very bankers who were responsible for the 2008 economic collapse. Of course, when it came to the millions of US citizens who were in danger of losing their homes because of mistakes made by financial entities, President Obama had no money to help them keep their homes.
The dispossession of millions of US citizens of their homes during 2008-11 has led to homeless individuals sleeping on the pavements of big cities a sight usually associated with Bombay and Calcutta rather than New York or Washington, now both cities where the streets are filled with the helpless, the hopeless and the homeless. Had Barack Obama not abandoned his own conscience by following jn the footsteps of the Clintons in the matter of economic policy, he would have ensured that US citizens kept their homes rather than have them foreclosed by banks and sold at distress prices. This act of inhumanity towards the economically damaged has led to a revival of the “socialist” stream within the US, an ideology that had almost vanished for the past four decades.
This rise in discontent has led to Bernie Sanders, the only socialist in the US Senate, becoming a powerful force in the coming Presidential polls. Of course, an even more formidable candidate would have been Elizabeth Warren, the Democratic Senator from Massachusetts, who (like Sanders) is an idealist who has not followed the example of other US Senators and become millionaires. However, for reasons which are not clear, Senator Warren has refused to run for the Democratic nomination for the Presidency, thereby giving respite to the candidate of Big Business in that party, Hillary Rodham Clinton. Both the Clintons are millionaires many times over and make no secret of their ties to Wall Street. However, the mood within the Democratic Party reflects that within the country, which is why there is a rising probability that Bernie Sanders may become more favored to run for office than Hillary.
On the Republican Party side,the most popular candidate is Donald Trump, a high-living, free-spending billionaire who is associated more in the public mins with pretty women than with matters of state policy. Trump talks in public what many leaders of his party say only in private. He hatred immigrants from poorer countries and has even called Mexicans “rapists and murderers”, a slur on a hard-working people. His honesty in revealing his views has made him the front-runner within a party thrown into panic at his success. Although the establishment in both parties despise the socialist Sanders and the plutocrat Trump, yet it is conceivable that they may emerge as the top two candidates, thereby ensuring that one of therm will get elected as President of the United States.
Both Jeb Bush as well as Hillary Clinton are too closely associated with the failed security and economic policy of the immediate past, and discontent at the injustice done to both the middle as well as the working classes by administrations that work only for the benefit of billionaires may ensure that the Democratic Party nominee may be the socialist Bernie Sanders who is independent of the Big Money lobbies backing Clinton ,while Donald Trump may get the Republican Party nomination for his candour in speaking in public what the other party leaders only whisper in private.