Did the Squad give away their Bargaining Power?

by
Michael Hudson
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I was glad to see Ayanna Pressley make clear over the weekend what a travesty has occurred, explaining that she had to oppose the infrastructure bill because House leaders did not honor the agreement that they had made: “We have been clear from the onset that any vote on the narrow roads and bridges bill must happen in tandem with a vote on the Build Back Better Act that invests in our care economy, housing, paid leave, combating climate change, and more.”

Has the Progressive Caucus lost its bargaining power by giving in to President Biden promise of “Trust Me.” Suppose that he is indeed able to get the Blue Dog/New Democrat Thatcherite “centrist” House members (mercenary lobbyists for corporate America and the One Percent) on board. But what about the Senate? What in the negotiated agreement will prevent Manchin and Sinema from killing the bill there?

If they really wanted to, the Democratic leadership could simply get the Senate to remove Manchin and Sinema from their committee positions. Schumer could bring matters to a head with a motion saying that taking money from lobbyists to introduce policies that result in bribes (campaign contributions) is a corrupt conflict of interest. It wouldn’t succeed, but would draw attention to how corrupt the campaign financing process really is in determining what candidates will be on the ballot and what issues they will support.

The problem, of course, is that all the Senators and most Congresspersons do the same selling of their votes. Who is going to propose a law reversing the Citizens United ruling by the Supreme Court by the recipients of this special-interest money writing a new law?

In any case, the new BBB bill has been distorted into something quite different than what was described until last week. The largest element grafted onto it is the $450 billion tax cut for wealthy homeowners, raising the SALT property tax deductibility in East Coast Democratic states from $10,000 to $72,500. This giveaway is promoted by the same “centrists” who are blocking approval of the BBB because it will “add to the budget deficit.”

It gets worse. Over the weekend we have learned how drastically the early promise of fiscal savings for Medicare drug purchases has been drastically watered down. Instead of letting Medicare negotiate directly with drug companies to bring prices in line with what other countries pay, the new “negotiation” “was the one most substantially changed in the last week: It would apply to fewer drugs, require smaller discounts, and, most critically, shield new drugs from negotiations. … The original House proposal to regulate drug prices would have allowed the government to lower the price of up to 250 expensive drugs, no matter how new or how innovative they were. … The current bill would allow Medicare to negotiate over the prices of no more than 20 drugs each year, and only those that have been around for a while. That is a relatively small subset of the drug universe. The Food and Drug Administration approved 53 new drugs last year alone.”

The article notes that “On average, Americans pay about 250 percent of drug prices in other developed countries,” which “tend to negotiate aggressively for lower drug prices, often by purchasing drugs for the entire nation centrally.” So much for the Blue Dogs’ crocodile tears about the federal budget deficit! Complaining about adding to the deficit is a “tell” that they will continue to oppose pro-labor, pro-consumer policies. They never raise this concern when it comes to military appropriations or tax cuts for the One Percent.

In fact, after teasing the Progressive Caucus for a few months by letting them think that the BBB really was “Bernie’s bill,” they made an about-face and treated it as merely a starting point to be scaled back. That has given new meaning to the word “transformative” for Biden’s Administration. It seeks to transform the economy to favor the Donor Class One Percent.

The six House Democrats who voted against the bill are Missouri Rep. Cori Bush, New York Rep. Jamaal Bowman, Massachusetts Rep. Ayanna Pressley, Michigan Rep. Rashida Tlaib, New York Rep. Alexandria Ocasio-Cortez, and perhaps the most outspoken member, Minnesota Rep. Ilhan Omar. The New York Times post mortem reported News  after the Friday midnight capitulation, describing how Black Caucus leaders negotiated a “trust them” compromise.

“The progressives slowly caved. The no votes dwindled from 20 to 10 and finally 6. Ms. Pelosi could only lose 4 Democrats, but aides said she was confident that she could pressure at least 2 of the 6 to vote with her before the gavel came down.”

Did the Squad give away their Bargaining Power?

By capitulating, the Progressive Caucus has lost its single effective bargaining point: its ability to do what Manchin and Sinema have been doing – using the leverage of President Biden’s desperation to get some law passed, to do something in the wake of Tuesday’s losses in Virginia and elsewhere throughout the country.

I was glad to see some discussants of my Friday NC posting bring up Rome. It indeed provides a precedent to the strategy that led only six Squad members to retreat from the only strong negotiating point available to them: the ability to block the Blue Dog/New Democratic Coalition dilution after the original BBB bill was turned from social welfare support for child care, medical care, parental leave and government negotiation to bring down drug prices into a travesty of the original version. Was it all a trick?

All this has happened before. Rome has some relevant history of the appropriate tactics that the Squad could have followed when Pelosi and Biden begged them to accept all the pro-corporate, pro-Wall Street, pro-oligarchy changes to the original plan. By the 370s BC, Rome’s patricians had bone back on their word again and again. Even when they passed pro-debtor laws, the Senators and the courts that they controlled refused to enforce them. So I was glad to see references to Rome in Friday’s discussion.

Rome’s patrician tactic was to block reforms, stalling while the debt crisis got worse and worse. In 376, G. Licinius Stolo and L. Sextius Laturanus were elected as plebeian tribunes and put three bills before the Assembly to provide debt relief by scaling down debts and deduct interest already paid from the principal that was still owed – with and the balance to be paid in three equal annual installments. Livy’s History of Rome (6.36:12) describes how Sextius and Licinius addressed the patricians:

Is it your pleasure that the plebeians, crushed by debt, should surrender their persons to fetters and punishments sooner than that they should discharge their debts by repaying the principal? That, they should be led off in crowds from the Forum as the property of their creditors? That the houses of the nobility should be filled with prisoners, and wherever a patrician lives there should be a private dungeon?

The alternative to this program, they warned, was that “there would be no limit to the seizure of land by the patricians or the murder of the plebs by the deadly usury until the plebs elected one of the consuls from their own ranks as a guardian of their liberties.”

[4]

Livy wrote that the Senate deemed only aristocrats fit to serve, and “refused to allow either the reading of the bills or any other procedure which the plebs usually adopted when they came to vote. For many weeks the Assembly was regularly summoned without any business being done, and the bills were looked upon as dead.” That drove Sextius to reply:

Very good. Since it is your pleasure that the veto shall possess so much power, we will use this same weapon for the protection of the plebs. Come then, patricians, give notice of an Assembly for the election of consular tribunes, I will take care that the word which our colleagues are now uttering in concert to your great delight, the word “I FORBID,” shall not give you much pleasure (Livy, 6.35).

Livy described this fight as lasting for an entire decade, but the fight probably lasted just one year. What is affirmed, is that Licinius and Sextius made an all-or-nothing demand for their three-part program. Military levies could not be enacted without the assent of plebeian tribunes, and even military tribunes were blocked from being elected.
Opponents of the plebeians accused Licinius and Sextius of “seeking kingship” for themselves – what today is called being “left-wing” or “socialist.” But they won the historic rewriting of Rome’s debt laws.

The class struggle went on, of course. The plebeians threatened yet a new secession in 366, and escalated the standoff by electing Sextius as the first plebeian consul. “The patricians refused to confirm his appointment, and matters were approaching a secession of the plebs” (Livy 6.42.11).

But again, the hard line taken by the plebeians won.That didn’t happen in America on Friday night. Just as many Roman plebeians shied from confronting the incorrigible Senate, the Progressive Caucus gave in to President Biden so that he could “save face” from Tuesday’s embarrassing loss in Virginia and other places that rejected DNC-backed candidates.

The Democratic Party leadership thought it would win by identity politics to distract voters from the economic issues at hand and the common denominator of voters being wage earners. But the effect was to turn the hyphenated-American identities against each other, aggravating the white/black divide.

The elephant in the room is the DNC. Its Blue Dog leadership has pushed conservative candidates in every primary against the “left,” meaning pro-labor, pro-consumer, pro-environment candidates against those who support the policies that most voters want.

The Progressives could have said, “It’s obvious to us that the DNC has its knives out for us. Our price for support for voting for the bipartisan $1 trillion infrastructure bill is that you assign us dominant position on the DNC. We will no longer be hoodwinked into supporting politicians who represent special corporate interests and the One Percent against the policies that we support.”

Here’s what the Progressive caucus should do from now on: When any National Defense bill comes up, they should emulate the “conservative” tactic and insist on reviewing the budget to see that it won’t increase the national debt. I understand that something like $6 trillion (could this really be the number) is unaccounted for by the Pentagon.

Insist on seeing it, and stretch the inquiry out until the bill is killed.
 I don’t expect them to do this, and it may be that the only part of the BBB act that the Democratic leadership wants to preserve is the SALT property-tax reduction that falls mainly on Democratic states. It’s a central demand of the Blue Dogs, who turn out to be the real Democratic center, not Bernie’s Progressive Caucus.

Footnotes

[1] Jim Puzzanghera, “Ayanna Pressley and other members of ‘The Squad’ buck Democratic leaders and vote against bipartisan infrastructure bill,” Boston Globe, November 6, 2021.

[2] Margot Sanger-Katz, “Democrats Choosing Less Risky Path on Drug Prices,” The New York Times, November 6, 2021.

[3] Jonathan Weisman and Carl Hulse, “The Congressional Black Caucus Was Key to the Infrastructure Vote,” The New York Times, November 6, 2021.

[4] Livy 6.37:3. He explained (6.37.4): “There could be no fair or just administration as long as the executive power was in the hands of the other party, while they had only the right of protesting by their veto.