This is What Happens When We Compromise with Conservatives Who are Wrong

Many look at the American Recovery and Reinvestment Act as a victory for Keynesian economics and the progressive majority and as a down payment on fundamental investments we need in vital public services, infrastructure projects and programs that address the needs of the most vulnerable.

There is no doubt that these government expenditures were necessary to compensate for the drastic shrinkage in the economy set in motion by the financial crisis. The movement toward energy conservation and efficiency, and toward supporting various underfunded public agencies and social assistance programs, marked a significant shift in the political climate in our country after years of energy dependence and regressive economic policies.

However, we lost the battle on allocating the funding necessary to assist distressed states and we are now seeing the consequences. Conservative Democrats made a political trade-off with the right over the share of the American Recovery and Reinvestment Act devoted to tax breaks over vital spending. This trade-off was bad economic policy. Handing over money to the general population in the form of tax cuts is not as efficient an economic stimulus as money spent directly by the government, particularly on wages. But now we know the cost in human terms.

In California, plagued by tent cities of those foreclosed on and pushed off the rental market, Governor Arnold Schwarzenegger’s budget cuts paint the portrait of a state without a proper bailout. Seven days will be cut from the public school year; thousands of inmates will be released from prison and others will be packed into county jails; health care will be cut off for more than one million children, including those from low-income families who do not qualify for Medi-Cal, California's Medicaid program; $5.9 million in state funding for four poison call centers will be cut; funding for 220 state parks will be cut; 426,000 seniors will be denied in-home support services; the state Adult Day Health Care program will be eliminated, denying services to about 36,000 Californians and culling 6,500 employees jobs at the state's 300 centers. It’s difficult to overstate the human toll of reconciling a $24 billion budget gap.

And these cuts are on top of cuts at the municipal level. In Los Angeles County, 2,250 teachers are expected to lose their jobs. This is in a public school system already struggling with large classroom sizes and significant underfunding.

Those of us advocating for aid to states and municipalities were not using pie-in-the-sky figures of pet projects; we were pushing for the minimum funds required to meet projected shortfalls reported by the states so that the fabric of the country’s vital services could remain intact.

We argued on rational terms. We argued on economic terms. We argued on moral terms and we lost to those who were sure compromise was the only game in town. We lost more than we could afford in our compromise with Bush-era thinking, believing we were still in a Bush-era political climate and not in a crisis that requires triage and backbone, not pawn-brokering where you sell your valuables at a loss when you get into trouble.

These kinds of cuts are just the beginning. According to the Center on Budget and Policy Priorities [1]:

• Some 47 states are facing financial stress in their fiscal 2009 or fiscal 2010 budgets.
• Budget deficits are already projected in 46 states for the upcoming fiscal year.
• Combined budget gaps for the remainder of this fiscal year and state fiscal years 2010 and 2011 are estimated to total $350 billion to $370 billion. The CBPP lists more cuts [2].

Soon, most of us will all understand the only kind of trickle-down economics that has ever functioned—the regressive rule in the distribution of costs—that when times are tough those most vulnerable bare the burden, unless our elected representatives pay the price for failing to represent our needs.

Now that we see the link between political compromises and human suffering, we must act without equivocation. The ultimatum given to Congress by former Treasury secretary Hank Paulson to secure a $750 billion Wall Street bailout was wrong-headed and uncompromising, done without evidence or moral justification. Congress jumped. We must see that there is no compromise required when states and municipalities are flailing from the bursting of a crisis they did not cause. There is only one place to turn and that's Congress.

Three things you can do:

1. Tell your Congressional representatives they need to answer to you and not Wall Street. If they voted to weaken the Economic Recovery and Reinvestment Act, for the passage of the Wall Street bailout and against mortgage cramdowns, campaign for a new candidate who will fight for those struggling because of this crisis. See where they stand here [3].
2. Support Health Care reform by urging Congress to institute a public plan option, especially the Blue Dog conservative Democrats [4] who are equivocating in their support. See how true health care reform would relieve states here [5].
3. Prepare for a fight on more funding for states and those in need from Congress. See the list of those gearing up for the next battle here [6].

Whatever you do, do not go gentle into that good night.