Red Herrings and Regulation

Barack Obama’s press conference this evening, dealing mainly with his proposed budget and the economy, was a microcosm of his first weeks in office.  It seemed that the questions asked and the manner in which they were answered provided a sad commentary on conditions in the “Change Train.”  Conditions can be summed up in two phrases: Red Herrings and Regulations.

Red Herring, for those unversed in logical fallacies, is essentially a fallacious argument in which an unrelated issue is used to argue for one’s position on another issue.  For example, the flareup over the AIG bonuses over the past week has now been seized upon by the Obama administration as primary reason for increasing regulations on other segments of the financial sector.  Essentially, Obama has pointed to these wasteful bonuses as the need for regulating not just the insurance industry, but also the energy and health industries as well.  Another red herring that cropped up in the press conference was Obama’s consistent shifting of responsibility for certain situations to other groups and individuals.  For a man who has called for an “Era of Responsibility” he sure doesn’t like to accept it.  When one reporter asked him about the projected record debt that would come as a result of his budget (7-10 trillion dollars) Obama argued that he was merely cleaning up the Republicans mess!  What he didn’t do was explain how a $10 trillion debt was worse than a $1.8 trillion deficit. 

Regulation was also on full display.  Not only was Obama advocating for regulation of the insurance industry, as was his Secretary of Treasury earlier in the day, but the very press conference itself was regulated.  Obama calmy selected reporters from a pre-approved list to ask questions, patently leaving out the reporters from such eminent publications as the New York Times, Washington Post, Wall Street Journal, and other financial rags.  The questions he had to field were thus the simplistic pratings of reporters, rather than the insightful inquiries of journalists.   Obama also regulated time spent on dealing with questions of foreign policy, his glaring weak spot.  Despite a campaign pledge to reshape America’s image abroad, Obama provided trite and simplistic answers to the few foreign correspondents he called upon, speaking in very  general terms on crucial issues like the Mexico drug wars and the Israeli-Palestinian crisis. 

At the end of the conference, the picture that emerges is that of a president attempting to micromanage his administration and its image, while advocating for increased government power due to causes that are not wholly related to his policy proposals, but instead pet projects of his political ideology….  Where have I seen this before?  Oh yeah, the Bush administration.

Recession is the New Terrorism

We’re in a recession and no one can deny it.  People are losing jobs, investments, and all aspects of economic security.  It’s not the greatest time, but it’s not the worst either.  Markets are still operating, and our government is not melting away.  In fact, we can look at the wild ride we’ve been on over the last year as being a massive trimming of excess economic fat.  If history is to be instructive, as time goes on we can expect our top heavy markets to stabilize and the economy to rebound.  However, the new administration has jumped at these economic hard times as being an existential threat to the United States.

President Obama’s editorial in the  Washington Post today is a case in point.  The editorial serves as a call to rally support for Obama’s new stimulus initiatives by painting the same bleak economic picture that served the Democrats so well in the election.  I couldn’t help but read the piece at marvel at the continuity between Obama’s administration and the Bush administration.  Both have built a culture of fear in order to drive their pet projects and policies forward.  For the Bush administration this was terrorism and the existential threat of Al Qaeda.  For Obama, this existential threat is economic.

While Bush established a narrative of a global struggle against terror, the defining narrative of Obama’s presidency appears to be that of economic prosperity.  In order to rally support for both these struggles, both presidents played on people’s fears.  The problem?  It only works so long.  The moment people felt safe, Bush’s anti-terror campaign lost steam.  The moment the economy begins to recover….  what might occur?  Will initiatives lose steam, or will the democrats have to maintain a constant environment of economic uncertainty?  It could be both at the rate they’re spending.

Some Have a Way With Words

I suppose I could always write about Obama’s proposed stimulus package and critique the view he holds on the government’s ability to solve economic crises. But why should I do that when others do in such a fine manner? Awesome article listed below, check it out.

Skeptical of Obama\'s Stimulus Plan – Jonah Goldberg

No Learning Curve For Obama

George senior had it.  Bill had it.  To a certain extent, George junior had it.  Each of the last three presidents had a time prior to, or in the early weeks of their presidencies to get used to the job, largely free from any kind of large scale crisis.  In the case of George H.W. Bush, a stint in the Vice President’s office during some critical days in the final years of the Cold War had given him a good taste of what the job entailed.  The next two presidents drew on their experience as governors.  Essentially, these guys had a learning curve in their favor.  President-elect Obama has no such curve.  With the Israeli invasion of Gaza and new reports on unemployment rates in the US, Obama is already being expected to make changes, and drastic ones, beginning day one.

But will that happen?  Chances are, Congress will have to be wooed and persuaded to accept some of Obama’s more radical plans while his foreign policy heads are increasing likely to respond to current crises in much the same manner as the previous the administration.  Obama will be forced to reckon with interests that backed him expecting change, yet not receiving any tangible results in the short term.  The political outcome may not be a dramatic reduction in support for Obama, but it won’t help his political capital in the long term, that’s certain.

Ultimately, Obama will have to demonstrate that the time between November 12 and January 20 was time well spent in planning and preparing to implement his policies and leadership style.  Not much can be said at this point except to acknowledge the nonexistent time Obama will have to iron the wrinkles in his administration.

Good To Be Back

After a month long hiatus from this space, I feel that the world is running too much amok not to say something.  Admittedly, I could have been a little more consistent in reporting on it as not  too few of my readers let me know, but in the realm of priorities research papers for graduate school generally take precedence over blog posts.  Not a good month to take off either, no matter how inadvertently.  So much has occurred where shall I begin?

Internationally?  Certainly the terrorist attacks in Mumbai two weeks ago reminded the world that there are still groups out there capable of large scale operations.  And while Inida is India and America is America, the Mumbai Incident should be crystal clear in its message:  the war is still on.  I’ve read some interesting material of late suggesting that terrorism will always be with us and that we should never have to war with it in the first place, but I must point out the misreading of history such an idea is.  True, terrorism has been around a long time, but internationalterrorism and terrorist corporations with state sponsors is something entirely recent.  At this point, it is no longer local police who deal with the situation, but it becomes a national security threat as well.  So for those who are still believing that our War on Terror is a misnomer, reread your history and take a lesson from Mumbai.

The national scene?  Oh, too much to say for this post alone.  Suffice to say, what with the Blagojevich scandal exploding on the scene and Obama’s initial picks for cabinet posts coming from the Clinton old guard, I feel I can confidently confirm my assertion from last February that Obama’s “audacious hope” for change would quickly go the way of W’s “compassionate conservatism” in the event of the former’s election.  While Obama has made an excellent choice keeping Gates in the Department of Defense, I doubt that’s the change most of his supporters thought was coming.  And certainly the corruption exposed within his party is making the newly minted leaders of the nation out to be what many already conceived them as:  hypocrites in the first degree.  Wake me up when Change gets here, because its taking the slow train.

What about the state?  I love California politics if only because it’s so entertaining.  Just today the LA Times ran an article suggesting that California is not just on the verge of fiscal insolvency, but of political insolvency as well quoting that august statesman and expert in governmental ineptitude, Gray Davis.  Apparently there’s a blog out there (Three Californias) that is advocating that California become an independent country divided into three states.  I wonder how that’s going to solve anything.  If check the blog out, let me know what you think.

I must say, that despite the events of this month I in no way feel behind the times because what I just commented on is no deviation from what has been occurring for some time.  With the hullabaloo of the election over, it really seems as if it’s business as usual, and the same dead horses are being beaten… Britney Spears even has a new album out.

Obama Is My President

I may not have voted for him, and I definitely didn’t want him to win, but Barack Obama is my president.  Why do I say this?  Because this is democracy, and that’s what democracy is about.  Democracy allows for the public debate over what course a country should take and then it allows the people to choose that course.  However, the thing that makes a successful democracy tick is not the pre-election debate, or the free election.  What makes it all work so that we can do this again is the post election peace.  No rancor, no bitterness, and “charity for all” as Lincoln would say. 

I don’t agree with Obama’s policies, but I’m on board with his desire to make America better.  If he wants to make America better I’m okay with that.  I don’t think his ideas are the best way to make America better, but he promised America that he would listen to both sides and I’m willing to hold him to that promise in whatever small way I can.  He is my president now, and I am going to support him. 

Why?  It’s not only my duty as a citizen, it’s my duty as a Christian.  As a citizen, my service is to a country and a Constitution, not to an individual president, or congressman.  The only reason that America has lasted this long is because every generation has recognized that the power of America lies in its founding documents and institutions, not in the men and women who are elected to run those institutions and interpret those documents.  As such, how should my duty to my country change because the president has changed?  It shouldn’t change, and it hasn’t.

More importantly, as a Christian citizen my duty is to support my president.  This doesn’t mean I march lockstep with him.  It means that I intercede for him in prayer before God.  Paul spells out the basic duties of Christians in their relations to the state in his letters to Timothy and Romans.  One basic duty is to pray for leaders everywhere (1 Tim. 2:1-2), and the other is to submit to authorities (Rom. 13:1-7).  Both duties are incumbent upon all Christians to follow, and I feel they are quite often ignored in American churches.  Rather than praying for Obama this Sunday, I fear many pastors will be praying that God spare America from the damage he could do.  Rather than submit to the new presidency, give due honor and work with the administration, I fear first thoughts will be given to opposition.  We need to reexamine what it means to be not just a citizen, but a Christian citizen.

The real election battle has now begun:  how will we work with the new administration?  Will we be ready to pray for our president, his leadership and his wisdom?  Or will it be only embittered criticism and complaining that’s coming out of our conservative base?  It’s time to do what Americans do: work together and move on towards a greater goal than our petty partisan policies.

Are We Still “The People”?

We’ve heard it all by now.  With just a few days until election day, no end of pundits and observers have weighed in on this election and its possible ramifications.  I don’t want to weigh in on the possible outcomes of policies, or the makeup of the Supreme Court, or even the future of race relations in the States.  While these may all be good things to consider, there’s a bigger picture that’s being missed amidst the hourly polls, the last minute barrage of mud slinging, and the growing Democratic self-assurance of victory:  We are not realizing that democracy in America will be changed in a couple of major ways in America.  In at least two critical points, the power of the people will be either affirmed or denied on Tuesday:  The choice of president and the outcome of the controversial Prop. 8 ballot in California.  This election will determine the future course of democracy in America.

No, I’m not going to say that Obama is a pseudo-commie who’s going to destroy democracy.  What I will say though, is that should Obama win the election, especially if it’s by a margin of any considerable size, the American populace will have confirmed its own self doubt.  Amidst fears of economic catastrophe and foreign entanglements, the American voters have forgotten that they are the power in this land, and thus they look to candidates and parties that would control larger amounts of their paychecks, while increasing the size, scope, and capability of government as though it were some warm security blanket.  Americans fear to make this country strong again.  The shock of 9/11 and the sense of helplessness felt when retirement savings evaporate along with jobs and homes has left voters bereft of any sense of direction, or vision.  Thus they look for a messiah, and find him in a unproven, untested, un prepared Senator who tickles the ears with promises of a greater tomorrow borne upon the sure shoulders of a nurturing state.

In California, the proposed constitutional amendment to recognize marriage as only being between a man and woman is on the ballot, only because the California court took it upon itself to tell the voters they were unenlightened when they passed the initial Prop. 22.  Thus, rather than upholding the law and the will of the people, the court overturned both.  The issue that has been ignored in the Prop. 8 debate has been that of power:  Do the people dictate to the courts, or do the courts dictate to the people?  Should the proposition be defeated, the answer would have been answered in the negative because voters have failed to see past the emotionally charged issue of marriage to the internal struggle for power that is convulsing the state and the entire country.  A dangerous precedent will have been set for legislative action to be taken in the courts that will outflank every representative body in the land.

“We, the people….”  Have we reached a point in our democratic experiment where our fears and hopes lie at the mercy of courts, demagogues, and special interests?  It is We, the people, who hold this country together.  The government stands with our permission, and when history looks back on this time and places it as a turning point in the definition of democracy and the place of the citizen in this country it will not point to a party, court, or president as being the cause of democracy’s demise.  Rather, history’s finger will be pointed towards the body politic that stood by and let such people lead.  The finger will be pointed at us, the people.  That is the double edged blade of democracy:  We are ruled by our hopes, or our fears.  When we vote for bigger, more intrusive government, and courts that can overturn our very will we vote for our fears.  Iraq is not at stake this election, the future of black America is not at stake this election, gay rights are not at stake this election.  Hope and a future, the sould and lifeblood of a people are at stake this election.

Thank God For Joe the Plumber!

Joe Wurzelbacher has restored my faith in the American public.  With a recent poll done by the LA Times suggesting that upwards of 70% of the American population was in favor of more government regulation of the economy, I was ready to acknowledge that America’s flirtatious relationship with socialism was about to be consummated.  And then along came Joe. 

Joe represents the best traditions of America:  hard work, common sense, and the willingness to ask an honest question.  When he caught up with Barack Obama in Ohio he was able to expose more flaws in the Obama tax plan than the McCain campaign has been able to do for all its negative ads and rhetoric. 

Two things stood out to me in the five minute conversation between Obama and Joe:  First, the common American has a good enough business sense to spot a bad idea and call someone on it.  Second, Obama doesn’t give a darn for people like Joe.  While Joe was expressing his concern over the potential for his business to grow (which would include the creation of jobs and investment into the economy), Obama was concerned with telling him, at least via implication, that such a concern was selfish.

Obama clearly states (and I’ve posted the video for you to listen to) that not only does he want to “share the wealth,” but also that he wanted to take a little from Joe and give it to the people behind him.  How is this not classic socialism?  If you want an idea as to how well this works, look to Europe.  A professor from France told me a story about her two brothers a couple years ago.  One brother was a business owner, and the other lived off of government handouts; handouts that her other brother’s taxes paid for.  While one lived a comfortable, responsibility free life, the other was getting approximately 50% of his profits taxed!

This should enrage any American.  It’s not an issue of the top 5% at all.  The issue is the ability to grow our economy.  When a business has to surrender its hard earned money for a government handout, it’s losing investment money.  While Obama would hand out that money that will never get a return (it’s being spent by the individual not invested), the business has to shorten its growth strategy and limit itself lest it get taxed more. 

The idea is that the bottom will be brought up while the middle and top are kept from going anywhere.  This has proven throughout history to be an insolvent, utopian pipe dream.  I’m not saying let the poor fend for themselves.  Let the businesses and churches help them.  The government can get a bigger return by increasing tax breaks for charitable organizations who give people a leg up.  Americans are charitable people who would easily answer such a call, but the less the government asks of them, the less they will do.

What Joe the plumber has exposed is a socialist tax plan that stifles investment and small business growth while allowing for free government handouts that may, or may not help individuals for whom we don’t even know if they qualify or not.  A drug dealer could qualify for such a handout simply because on paper he is in a low tax bracket and thereby deserving of a little extra money to invest in his arsenal of black market weapons. 

Watch the video and listen closely.  Obama may have good intentions, but good intentions based on a bad idea can, and quite often, do more harm than good.  Just ask Karl Marx.

Bailout A Wolf In Wolf’s Clothing

“We don’t have any choice.” – Zach Wamp (R-TN)

“I may lose my race over this.” – Sue Myrick (R-NC)

“I don’t like this rescue plan anymore than you do.” – Jim Marshall (D-GA)

“The markets may go up for a few days….  but democracy is going down.” – Dennis Kucinich (D- OH)

In a country where private businesses must now link themselves to the government in order to save themselves, democracy is indeed “going down.”  Of the quotes above, only Kucinich voted against the unprecedented bailout plan that the House passed on Friday.  It is interesting to note the doleful voices that support such a plan.  Despite an apparent acknowledgment that this is not the best thing in the long term for America, nor something that is wanted by many voters, national leaders persisted in pushing it through. 

For eight years I have been a staunch supporter of the Bush administration and have argued for its successes in foreign policy, but here I draw the line.  No administration that so recklessly grabs for executive power as to give a cabinet member unprecedented discretionary power over the fate of our financial institutions deserves to be applauded as acting in the interest of a nation. 

Of Congress, I have been a critic of their willingness to surrender their power to check the executive and I cheered the vote Monday that threw this power grab back into the face of Secretary of Treasury Paulson.  However, I stand confirmed in my belief that Congress is a broken body, desperately in need of new leadership.  Leadership that takes its role as the Executive’s check seriously.  They certainly deserve the ratings they enjoy:  lower approval than even the presidents.

Why my pessimism?  While economics is not the end all and be all of democracy, it has been demonstrated by several political observers that the ability of capital and labor to maintain their autonomy from state support is strongly linked to the health of democratic institutions.  In other words, the more closely tied our financial and economic systems become to our government, the less control the private citizens have over the direction their money takes.  This bailout plan saddles the taxpayer with thousands of extra dollars in the national debt and does nothing to punish the perpetrators who threw us into this mess.  Of course the attempt to reduce “golden parachute” outs for CEOs was supposed to be the punishment, but it amounts to little more than a slap on the wrist.

The result is an emboldened executive branch with dangerous new powers, a Congress with even fewer powers, and an American public that is now nearing complete alienation from its government.  The bailout can do little more than slap a bandaid on the situation.  Just on the price tag level, $700 billion dollars cannot possibly equal the amount lost in terms of jobs, bad loans, and financial losses over the term of this crisis. 

This is a short term solution to a systemic problem.  It is the day of harvest for the seeds of greed that have been sown by a culture too preoccupied with power to consider its own frailties.

1932 Revisited

What happens when populist demagogues run for president during times of economic recession?  If history teaches us anything, the demagogue uses lots of rhetoric on teh campaign trail, stays vague on the details of their economic plan, gets elected, then promptly makes the problem worse.  And I’m not talking about Barack Obama.  I’m talking about Franklin Delano Roosevelt.

In 1932, America was almost three years into the Great Depression with six more still to come.  Along came a governor from New York with a message of hope for the masses and a tune they could dance to:  “Change We Can Belie…” I mean “Happy Days Are Here Again.”  While the voters danced their way to the ballot box, Roosevelt danced his way into the White House with an easy victory over the loathed Republican Herbert Hoover.  While Americans were concerned with their evaporating jobs and savings, they preferred to listen to the “New Deal” rhetoric of Roosevelt, rather than the insensitive economics of Hoover. 

In The American President, Kathryn Moore notes that Roosevelt “remained vague on what form that help [Roosevelt's economic plan] would take,” until after he was elected.  Upon election though, Roosevelt lost no time in putting his plan into action.  The New Deal began with increased government bailouts…. I mean…  oversight of the banking industry; dramatic increases of government funded social programs; an increase in size of the bueracracy; and two Supreme Court decisions striking down elements of the New Deal as being an overstretch of executive power.

Despite all that Roosevelt did, or didn’t do, 1937-1938 were some of the worst years of the Depression as unemployment continued to rise and the stock market fell again in a depression within the Depression.  It was only when war in Europe became inevitable that America began the long climb out.  Statistically speaking, Roosevelt’s policies didn’t do much to end the Great Depression, though they may have helped in preventing future crashes.  Truth be told, the cornerstone of the Roosevelt economy, the New Deal, did not end the slide.  World War II took care of that.

Fast forward 60 years.  America is in a similar situation.  In its second year of economic recession (that continues to worsen), a fresh face appears on the political scene with fresh ideas (or fresh rhetoric at least) promising change.  It’s too soon to say if voters will respond to Barack Obama’s message and hand him the mandate for change, but it is instructive to note that most of Obama’s economic ideas come out of the Roosevelt playbook:  Increase government social net programs; establish new government programs; extend the bureaucracy; raise taxes.  Little is said about policy on the campaign trail though, and Obama has been attacked for his vagueness. 

Does this mean Obama is a shoo-in for the White House?  No.  What it does mean is that Obama’s change isn’t new, and the last time it was attempted, met with only limited success.  While the other guy had some notable achievements, it is important to note that war brought us to our feet, not the Roosevelt’s plan for change.  In fact, the New Deal, though hailed as a triumph of modern liberalism, was no economic miracle, nor has it proven to be sustainable as the Social Security crisis has clearly demonstrated.

And lest we think Obama…. I mean….  FDR was completely different from “the other guy” he ran against:  Herbert Hoover created some of the highest tax hikes in American history to try to stem the tide of depression.  Roosevelt followed suit.