Conservative Political Commentary

...usually with an attempt at historical and economic context

Thursday, January 27, 2011

Would You Take “Investment Advice” from This Man? Or, Is This Our “Sputnik Moment?”

How do you make over-the-top, multi-trillion-dollar government spending sound good? Well, you can try calling it “investment.” That’s been President Barack Obama’s strategy for trying to sell what should be unsellable. In his State of the Union speech, he tried to appear more “centrist,” and some media figures said he was “Reaganesque,” and I think he just read a book about Ronald Reagan.

In the election of 1960, anti-Nixon forces came up with a popular slogan. “Would you buy a used car from this man?” My question is, “Would you take ‘investment’ advice from Barack Obama?”

“Investment” Advice
Mr. Obama wasn’t channeling his inner Reagan. He was giving us more of the same spend, spend, spend “investment” advice while still trying sound as though he was prepared to clamp down on spending. I suppose he thinks he can have it both ways. But after two years of record-smashing deficits with no end in sight, is he really the one to tell us we should be spending less, while at the same time urging us to spend more? Something here doesn’t quite compute.

When Mr. Obama starts advising us about the economy, we would do well to consider the obvious, as explained by Rep. Michele Bachmann (R-MN). The thing that’s been the worst problem for many people, unemployment, is the very thing that the least has been done about in terms of success. Meanwhile, we are quickly becoming a nation in decline as a result of the spending orgy of the Obama era, which makes G.W. Bush look like Mr. Frugal.

I suppose we received a lesson in how to do things like China, a nation much admired by our president. I know there are many fine people and admirable things in China, but the “successes” of their economy depend largely on the fact that there are no human rights in China, thus leaving open the use of child labor, virtual slave labor, and total ignoring of “environmental impact.” Probably to build a nuclear power plant in the U.S. would take decades by the time the required permits and processes were completed, and by then the technology would likely be obsolete. Not so in China. I’m not saying we should be like them. Not at all. But maybe a little less determined to stop this kind of construction before it starts. Similarly for oil refineries, etc.

As Glenn Beck explained on his Fox News Channel show January 26, 2011, The fuels we are now using are going to be the main ones for years to come. Right now, less than one percent of our energy is provided by either wind or solar power. Wood provides two percent. So these new energy sources aren’t going to be our mainstays any time soon.

What’s wrong with letting private industry develop these things when they can be made profitable, rather than throwing good money after bad with government “investment?” Of course it’s questionable whether we have any “good” money to throw at anything – just money hot off the printing press, created out of thin air.

Did I hear him right? Did he actually have some good things to say about America? After bowing to every despotic dictator he meets and apologizing for the U.S. at every opportunity; after wining and dining Mr. “Human Rights” Hu of China? Well, that’s supposed to convince us of his “new tone” and his turn toward the center. Well, not quite.

Our Sputnik Moment?
Here in our “Sputnik Moment,” the president wants us to “invest” (i.e., spend boatloads of government funds) in the following things, among others:

Biomedical research – for what? Cloning?
Information technology – I thought we had Google and Facebook, etc. Oh, I see – so we can give him an effective Internet kill switch….
Clean energy technology – see discussion above.
High-speed rail -- For whom? They can't get enough passengers to ride Amtrak. (As Glenn Beck mentioned, we'd have to lay a whole new track system. I say, not needed and not cost-effective.)
Infrastructure – ah, good old infrastructure, the area where everyone excels us. He may not have noticed, but infrastructure is being worked on all the time. In front of my house, we are getting new curbs and a resurfaced street, All over our city, you can’t go two miles without some major road or bridge construction going on and new buildings going up. Maybe some stimulus funds? And yet our country has 9.4 percent unemployment with the “real” unemployment rate getting worse because people have given up looking for jobs.
Education – he seems to want every American to get a college degree. He’s going to “invest” in education to help people pay for college, but when is he going to ask colleges and universities to make their tuition costs realistic by dipping into some of their multi-billion-dollar endowments? There really is no excuse for these rates being so high.

As others have pointed out, the government did nothing to help Edison or the Wright Brothers. Probably not much to help Facebook. Google, I don’t know. Since Al Gore is a prominent figure in that, maybe they got government welfare. Lots of companies do. But government is not the engine of innovation or invention, or the economy in general. It is almost always the impediment that keeps the economy from improving, due to high taxes and endless regulation.


I suggest that this is not our “Sputnik moment.” Yes, we need to compete in the global market. This will be not be accomplished by government “investing” in and controlling so many things. It will be accomplished by unfettered free markets in which entrepreneurs and large companies can be free from government intervention and allowed to pursue their self interest. And government could save a lot by cutting off the corporate welfare spending.

Obama still wants our students to spend more hours and longer school years in the classroom, and to focus more on math and science. Or else, saith he, we won’t be able to compete with the smart kids from other countries. Of course, in some of these countries, kids are taken away from their parents and given special training if they excel in some particular area. I say, get the federal government out of education, return it to local control, and see what happens. Probably, more vocational education, less spirit-strangling student debt, and generally a better economy.

G.K. Chesterton said that many people think they are members of the last generation simply because they can’t imagine the world getting on without them. I think that sort of thinking affects our government. It’s so involved in every aspect of life that it thinks life would simply fall apart if it pulled back. It wouldn’t, of course. Someday, we’ll get back to being a society willing to try it. Or so I hope.

Recommended Reading: R.J. Moeller, "State of the Union On My Mind," A Voice in the Wilderness.


Photo: Barack Obama official portrait by Pete Souza. Public domain.

3 comments:

The Conservative Leftist said...

It's inaccurate to label China a nation much admired by Obama. You point out that their economic success depends largely on terrible worker conditions, child labor, and environmental destruction. Are these not precisely the things liberals in America have struggled against while conservatives have fought to maintain the status quo? China more or less embodies everything that liberals disdain: GDP growth at the expense of human rights and the natural environment.

You say that the government did nothing to create Facebook or Google, but it was the government that created the technology that led to the internet. Same goes for gps, the computer, the jet plane, radar, and on and on and on. I'm not saying I approve of this state capitalism as it exists today; I think it leaves open the possibility of rent-seeking and corruption. But nevertheless you're wrong in your views that the world would be bustling with more innovation and inventions were it not for government investments in technology.

Eddie said...

Obama seems to admire China's accomplishments and doesn't mind saying that in some ways they exceed ours. His treatment of Mr. Hu should tell us something.

All Americans (basically) disapprove of human rights abuses. Liberals' dislike of abuses, that you mention goes back to the Progressive movement of the 1920's, when they got some serious reforms accomplished.

Liberals rightly disapprove of China's abuses, but some are quite tolerant of Islamist abuses, to the point that Obama's administration is forbidden from verbally linking terrorist acts to Islam in any way.

Of course you are correct that the Internet began with government-created technology. I am somewhat familiar with technology from military and space programs (produced by private companies under government contracts) finding their way to commercial applications. I worked in the aerospace industry for several years, after serving four years in the Air Force. Many of these production processes have close government involvement at every step, since Uncle Sam is shelling our billions for these products.

There have been benefits, but these relationships also have their drawbacks, in what too often ends up as corporate welfare, i.e., transfer of wealth from taxpayers to corporations via government through open-ended cost-plus-type contracts. Corporate welfare happens in various industries, not just space and defense, and at many levels of government.

This kind of large-scale government-industry relationship dates back at least to World War I
and has grown much over time and with each war. Ideally, this would not be the case, but it is so entrenched that it cannot be readily changed. So "conservatives" have accepted this much "state capitalism" in defense and space.

Also we are deeply involved in socialistic programs like Social Security, which likely will not be substantially changed until they are forcibly discontinued due to financial collapse.

Anyway, I would much rather see a trend toward much less government involvement in the economy, and a deep cutback of the bureaucratic structure, eliminating several agencies and some government departments.

The Obama Administration has made so many moves to take control of so many things, I have to view them as special interest group in themselves, whose main goal is to accumulate power and control over the American people.

Thus I tend to see taxes and regulations (which used properly are justified) as an end rather than a means (referring to another of your comments) for this particular group. But even before Obama, we were seriously over-regulated and over-taxed.

Thank you for the comments.

The Conservative Leftist said...

We can agree that the golden age of capitalism was in fact the history of government market intervention, a status quo which you admit to accepting. And we can also agree that market distortions that have arisen in the past few decades have undermined capitalism. For example, Ronald Reagan's was perhaps the most protectionist U.S. administration ever.

With taxes at their lowest in decades it's inaccurate to claim that the tax burden is responsible for the lagging economy. Perhaps higher taxes on the rich would help to provide more effective social services for the poor and middle class in order to address the sincere grievances of the American majority. It would be wonderful to return to the democratically distributed growth of the fifties when taxes on the rich were high and unions were more influential.

I agree that Obama's economy is ineffective and unacceptable. The private sector may be growing jobs but the persistently high unemployment rate should be addressed aggressively. Perhaps this could be accomplished more effectively by the Fed than it could by Obama signing legislation passed by elected representatives though. But it should be noted that a conservative like you should be okay with a growing private sector and a shrinking public sector, which is indisputably occurring under Obama, or at least you presumably prefer that scenario to the Bush economy in which private sector growth was anemic or nonexistent but compensated for by a growing public sector.

In any case, I'm more concerned with Obama's foreign policy approach of adopting and recycling the Bush anti-terror policies. This is where you should be looking if you want to speak out against government intrusion on our personal liberties, rather than decrying a stable Social Security fund that real human beings rely on to live or a dysfunctional health care system that is the laughing-stock of truly liberal democracies that have long surpassed us in that area.