Category: Politics

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Business News Politics

Rollback of Welfare Not the Only Way Out

In today’s TIA Daily, Robert Tracinski mentioned the Washington Posts’s Robert Samuelson’s continual apoplexy over the U.S. governments reckless course towards insolvency, and he concluded, “The bills are coming due for the welfare state, and the result is that we are entering a period of permanent fiscal crisis—a crisis that can only be solved if we decide to begin rolling back the welfare state.”

I would like to respectfully take issue with one word in that conclusion: only. Certainly, a rollback of entitlements would slow the inevitable decline of the state, but it’s not the only way, nor the most likely. Imagine the federal government coming to a consensus such as, “we just can’t afford it right now, so we’re halting subsidies for agriculture.” That’s an unlikely fantasy. What seems more plausible is a sudden disappearance of multiple programs, and the ones who’s beneficiaries have the least pull. Realistically, you can already see this. Big corporations get giant bailouts but schools want for funding.

It seems more likely that we will find decisions to cutback left unmade but made for us thanks to the hard facts of reality. These government programs will meet their just ends, and there will certainly be strong emotional reactions, tantrums even. I’m speaking euphemistically–I won’t be surprised when there are riots.

Some of these basic services our parents and grandparents handed over to the government are necessary and desired. (Being able to drive around on pavement is nice!) When the government fails to provide them, an opportunity might be seized. Without the a gun-powered monopoly chasing entrepreneurs away, what kind of wonderful solutions can we expect? I’m not sure, but I have been considering how I might help. Is anyone else thinking about how a collapse will provide an unprecedented chance to be productive?

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Politics

He Isn’t Atlas, But He Does Need Help

Last March, I noticed a cynical political cartoon depicting President Obama as Atlas. I would have rather seen the producers of the world carefully stepping through a field of booby traps set by Obama.Daily Fitz March 4, 2009

Today, I noticed a new take on this upsidedown theme. This time, Patrick Corrigan shows Obama as pleading for help from the U.N. as the weight of the world bears down on him.Corrigan September 24, 2009

Truthfully, the weight of the nihilistic policies of the people who imagined the U.N. are crushing the wealth-producers of the world. Portraying Obama as Atlas is doublethink. Because it’s the same image Rand used for her famous novel, the misuse of this metaphor is particularly galling.

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Politics

Obama’s Appeal to Emotionalism

Charles Krauthammer has an editiorial up on RealClearPolitics today titled Deception at Core of Obama’s Plans. He argues that Obama offered up non sequiturs for reasons why our economy is rapidly declining. There are any number of reasonable explanations for the downturn (too much money given out by the Fed, irresponsible lending, etc) but Obama’s reaons are ridiculous (lack of universal health care, global warming, not enough college graduates).

The logic of Obama’s address to Congress went like this:

“Our economy did not fall into decline overnight,” he averred. Indeed, it all began before the housing crisis. What did we do wrong? We are paying for past sins in three principal areas: energy, health care, and education — importing too much oil and not finding new sources of energy (as in the Arctic National Wildlife Refuge and the Outer Continental Shelf?), not reforming health care, and tolerating too many bad schools.

The “day of reckoning” has now arrived. And because “it is only by understanding how we arrived at this moment that we’ll be able to lift ourselves out of this predicament,” Obama has come to redeem us with his far-seeing program of universal, heavily nationalized health care; a cap-and-trade tax on energy; and a major federalization of education with universal access to college as the goal.

Amazing. As an explanation of our current economic difficulties, this is total fantasy. As a cure for rapidly growing joblessness, a massive destruction of wealth, a deepening worldwide recession, this is perhaps the greatest non sequitur ever foisted upon the American people.

But Krauthammer misses the key principle in action here. Obama is making a fervant plea to our religious emotionalism. We’re paying for past sins? It’s a day of reckoning? This is the type of argument you’d expect from Mike Huckabee, who’s argued that we’re stewards of the earth who shouldn’t wreck something that doesn’t belong to us. Or Pastor John Hagee who claimed the disaster in New Orleans as a result of Hurricaine Katrina was punishment from God for sinful behavior.

Obama leaves it vague as against whom we’ve been so sinful. Let the religious assume it’s God. Let the environmentalists assume it’s nature. It doesn’t matter. It’s the same nihilist rhetoric: you’re inherently evil, you’ve been doing evil things and the universe is trying to crush you.

The only sins we’ve committed are individually against ourselves when we agree to this irrationalism.

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Business Politics

No Bailout. You Fail? Out!

I suspect (hope!) we’re headed towards a tar and feathering of two jokers who have attempted to pull one over on us: Paulson and Bernanke. Both are urging swift action with no time to think. Bernanke is quoted in a New York Times article as saying “There are no atheists in foxholes and no ideologues in financial crises.” In fact, there are many atheists in foxholes, brave soldiers who risk their lives despite not believing in an afterlife. And ideas are precisely what’s needed now, not a rush for a fresh grab of power by the government.

Paulson is quoted as saying, “There was only one way that we could reassure the markets and deal with a very significant and broad-based freezing of the credit market. There was no political calculus. It was overwhelmingly obvious.” To call the solution obvious is to insult your intelligence and bully you into not responding. It’s a great tactic if you’re selling used cars.

George Will has a brilliant piece today, in which he states “The essence of this crisis is lack of knowledge, including the inability to know who owes what to whom, and where risk resides. In such a moment, government’s speed should not vary inversely with its information.” He goes on to argue that handing over such a gigantic sum to Paulson for spending as he wishes, answering to no one, essentially creates a fourth branch of government.

This is exactly what what I was warning of in my last post, Don’t let this “crisis” be another excuse to give away your rights.

Congress has been handing over responsibility to special appointees of the executive branch for many years, which is arguably unconstitutional. Congress passed the laws that created this crisi. Congress approves the appointments of Bernanke and Paulson. Congress has failed and should be replaced unless they somehow get the guts to stop this insanity right now.

Bush has failed, too. His team has been meddling with the market and created this immediate crisis. Recall that they argued that they needed to bail out Bear Sterns in March 2008 in order to avoid what we’re going through now. Given that it hasn’t worked, why are we even considering more of the same?

I sincerely hope that our elected officials do not hand over the power and responsibility we’ve given them to these unelected, anti-thinking hucksters. I hope they wake up and realize most of us do not want a bailout for failures. What we need now is careful, thoughtful deliberation in public.  If congress chooses to fail, there should be no bailout for them either. We should sweep them all out of office.

Update: Is this crisis even a crisis at all? It’s possible that banks are simply measuring their worth according to misguided regulation. Read Maybe the Banks Are Just Counting Wrong from Saturday’s WSJ. That makes me hope there’s deadlock on this bailout plan for long enough for everyone to figure out we don’t need it.

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News Politics

Don’t let this “crisis” be another excuse to give away your rights

Have you seen this pattern before?

  1. The government enacts new laws that subvert natural behavior for the good of society
  2. The government waits for this subversion to create a crisis
  3. The government rushes in to trade your liberties for security from the crisis

We saw this pattern seven years ago. Leading up to 9/11, the government willfully ignored the threat of terrorism. I suppose the excuse was to keep people of the world happy with America. We wouldn’t want to upset other countries by responding to attacks by terrorists. Unfortunately, this timebomb went off in the most spectacular way. And many of us rushed to hand over out liberties to protect us from another attack.

We’re seeing it again. About 16 years ago, the government started enacting policy to force lenders to stop “discriminating” against high risk borrowers. They appealed to a sense of egalitarianism and argued that everyone deserved a chance to own their home. They made it so that it was impossible to be a lender and refuse to lend to people who obviously could never pay back the loans.

The fruit of this misguided vine began to ripen over the past year or so as we’ve seen defaults rise.  The government has been trying desperately to push back the tide with mountains of interference in the markets. In recent years they have been pushing the prime rate down in an effort to draw capital into the market and cover for mounting losses. Now we’ve reached the end of the line. The waiting is over and we’ve got the crisis.

Naturally, our most visible representatives of government, presidential candidates McCain and Obama, are offering the bargain that always comes in part three of this pattern. They spin a story about how businessmen have acted like gamblers, recklessly risking everything on higher profits. And now is the time, they say, when government must step in and take control. McCain went so far as to call for the firing of the head of the SEC, a position that the president cannot hire or fire. Furthermore, when both parties are offering the same solution with only degrees of severity to distinguish them, it’s likely they are wrong.

The people who need to get pink slips work in the House of Reprentatives and the Senate. They are the real source of this crisis. They pass the laws that screw up the natural market forces. They approved Greenspan and Bernake as successive chairmen of the Federal Reserve. It was under their watch that the Fed published guidelines such as Closing The Gap:A Guide To Equal Opportunity Lending. On page 15 of this document, there are the following guidelines for lenders, including this insane paragraph about sources of income (emphasis mine).

Sources of Income:  In addition to primary employment income, Fannie Mae and Freddie Mac will accept the following as valid income sources: overtime and part–time work, second jobs (including seasonal work), retirement and Social Security income, alimony, child support, Veterans Administration (VA) benefits, welfare payments, and unemployment benefits.

Any reasonable person would conclude that being on welfare or drawing unemployment is a sure sign of someone who will likely not be able to make mortgage payments!

What we desperately need now is a swift pullback of control of the markets. Losers need to fail now, more than ever. We should not be swayed by the creators of crisis offering to bail us out. We should not believe them when they say, “we just need to suspend the constitution until we fix this.”