C'est le change, Obama-style

Today's lead editorial in the Wall Street Journal caught my eye this morning, reminding me of a famous French proverb that should be kept close at hand over the next four years: "Plus ça change, plus c’est la même chose". Translated: "The more things change, the more they stay the same." It sure didn't take long for Barack Obama to answer one of the compelling questions that I repeatedly raised during his campaign: will he be the "post-partisan" candidate that he promised to be? Or will he be the highly partisan politician he proved himself to be in the United States Senate?

The answer to this has come early in week #2 of his term, when he decided to ram the economic stimulus through the House of Representatives on purely partisan lines -- bowing to Nancy Pelosi in the process. As the Journal reports:

Barack Obama promised to end the "politics of division," unite Washington's factions and overcome partisanship. And what do you know -- so far he has: The President's stimulus plan generated bipartisan House opposition, with every Republican and 11 Democrats voting against it on Wednesday. It passed 244-188. The political class is feigning shock that Mr. Obama's stylistic olive branches to the GOP -- cocktail hour at the White House, cutting a line item for shrubbery on the National Mall -- failed to peel off even a single vote across the aisle. The chatter is that Republicans were taking a great political risk to oppose a President with 70%-plus approval ratings on his first piece of legislation. But the real risk here is to Mr. Obama, and it isn't from Republicans. It's from his fellow Democrats. Given the miserable economy and the Beltway's neo-Keynesian policy consensus, a true compromise would have gathered overwhelming support. But rather than use Mr. Obama's political capital to craft such a deal, the White House abdicated to Speaker Nancy Pelosi. House Democrats proceeded to ignore all GOP suggestions as they wrote the bill, shedding tax cuts while piling on spending for every imaginable interest group. The bipartisan opposition reflects how much the Pelosi bill became a vehicle for partisan social policy rather than economic stimulus.

Genuine bipartisanship means compromises on policy, not photo-ops and hand shakes. The last two Democratic Presidents, Jimmy Carter and Bill Clinton, also came to power with big Democratic majorities in Congress, veered far to the left on policy, and quickly came undone. To adapt White House Chief of Staff Rahm Emanuel's now famous line, a 70% approval rating is a terrible thing to waste on the ideas of Henry Waxman and Pete Stark.

One of my biggest fears about Barack Obama was that he would not be strong enough to stand up to the far-left partisans of his own party, and would be bullied into following the ideologues into a standard liberal abyss -- filled with the kind of redistributive social policies that brought us the Great Society and other expansive social progams. Given the unprecedented recent expansion of the government into our economy, with tax payers spending trillions on bail-outs and flame-outs, the hope was the Obama would be able to put pragmatism over politics on managing the public's interest. So much for "hope" and "change".

Of course, "change" was always an ill-defined bromide, capable of allowing the Obama campaign to create a narrative that had almost nothing of substance underneath it. It was the perfect vessel for this candidate, who gave people hope without telling them what specifically he was going to do to make such lofty ideas and goals a reality. And now we know that for all the rhetoric, the reality is something we've seen before: old style partisan politics with big government aspirations.

Change we can believe in, mon ami.

Why the stimulus won't work

The reason the so-called stimulus bill will not achieve the goals set for it is twofold: Ideology plus the Democrats' lack of understanding of how the economy works. Democrats do not seem to grasp the concept of the “money multiplier effect”. It’s important what you spend money on, not just the spending in itself. Spending needs to actually increase the size of the economy, and not merely be a transfer money from one sector to another.

** To “soak the rich” in the name of “fairness” shrinks the economy. Every $100 the government takes in taxes, only $65 ever makes it back into the economy, the rest is absorbed in bureaucracy. Punitive tax rates also discourage business (and jobs) formation, making the viability of proposed projects harder to achieve. That is why government to an economy is like mistletoe to an oak tree: it burdens the tree and leaches out its vitality. Yet the “economics challenged” Democrat public sector types will raise taxes to “get the corporations who have millions” and mumble “Justice! ” with great satisfaction.

** Vast portions of the spending have been earmarked for things like “bailing out the States”, (keeping the mistletoe healthy but not the tree) extending Medicare benefits (40% of which is absorbed in paperwork and HIPPA Compliance reporting requirements), more unemployment benefits, repairing Federal office buildings or constructing parks and public recreation centers. Infrastructure spending is beneficial, but it will take years. It addresses years of neglect and deterioration rather than adding to our capital stock. In all these cases once the money is spent the economic activity peters out. The ultimate result is filled medical waste bins behind hospitals, more housing project sewage, cleaned up Federal office buildings, fewer potholes, and empty new parks and recreation centers. None of this spending results in sustained increased economic activity! English major Democrat activists fail to understand or grasp this. They think any spending will do.

** The Government spending multiplier effect is typically less than one: $100 taken in taxes goes to $65 in spending which quickly peters out once the contractors finish their government projects. And another aspect: sometimes it takes government contractors months to get their money: (the layer of bureaucracy that “safeguards” the public purse must be satisfied). The “stimulus” then languishes in slow pay Accounts Receivable, pushing some contractors into bankruptcy.

** Real stimulus is in starting businesses. When a business starts, it generates jobs and demand for goods and services. The spending ripples through the economy sometimes at a ratio better than ten to one! Every dollar spent on a business results in ten dollars of economic activity in the economy. But this would entail “tax breaks for the rich”, ideologically unacceptable to the Marxist Progressives who now run the country. They cannot tolerate money NOT funneling though their hands and the power that goes with it. Yet with no understanding of the “multiplier effect”, they will continue pour resources into projects that will increase the size of government (the leaching mistletoe) and shrink the economy. Democrats are setting the stage to break the Japanese record for “stagflation “and misery. They will blame everything and everyone but themselves.

What rule by Democrats brings

It has often been said that, as California goes, so goes the nation. And for good reason. With the largest population and so many talented and influential people, the Golden State has long set the standard, for good or for ill, in both the public and private sector. It is the public sector that concerns us now. Long before Democrats took control of our national government, they had effective control over California government, whether or not there were Republican governors. Democrat control of Congress for half a century limited what Republican could presidents do, too.

Some have likened California government to a kind of social experiment in which every political, economic, social or pseudo-scientific nostrum gets free play because of the iron lock Democrats have on the legislature. As long as redistricting has been in the hands of the legislature, district lines have been drawn to freeze the political advantage of the permanent Democrat majority and Republican minority.

Even term limits have done nothing to change this. Time will tell whether the measure enacted by California voters last year to put the redistricting power in a commission will make any difference either.

In any event, because of their dominance–and more important, because of their "progressive" (i.e., interventionist, latitudinarian) principles–Democrats now threaten to enfeeble commerce, drive away entrepreneurs, curtail government by consent and, as practically everyone knows, bankrupt the state's government.

Surely the most useless comment that is made about politics is that party labels don’t matter, that one should vote for the person and not for the party, that there’s no difference between the parties, that we can all get along if we just put aside partisan differences, ad nauseam.

California Republicans are pretty disappointed in Gov. Schwarzenegger because he wants to balance the budget with a combination of spending cuts, tax increases and borrowing (not to mention kicking the fiscal can further down the road to the "out years"), and they are right to be. A more principled man, like Tom McClintock, for instance, who also ran in the recall election that dispatched Gov. Gray Davis, would be standing firm.

However, since Californians have who they have, and especially since there are lopsided Democrat majorities in both the Assembly and the Senate, a "solution" will ultimately be found that is fiscally irresponsible. What is needed is not only need a staunch Republican governor, but also a Republican legislature.

Democrats on principle oppose tax cuts and spending cuts because they want a big, intrusive government that overrides free citizens in a free marketplace. They believe that markets are incapable of allocating resources fairly, because they believe "fair" means equal conditions rather than equal rights. They are oblivious to the fact that unrestrained government spending, with its corollary of high taxes on incomes, sales and properties, is lowering the standard of living and diminishing economic opportunities.

The flip side of government micro managing commerce is moral latitudinarianism for the populace. Sexuality freed from moral or legal constraints is consistent with the short-sighted, present-oriented perspective that the government has aided and abetted via the credit crisis in which many people, rich and poor and in between, have gotten in way over their heads.

Consistent with this pernicious policy is the virtual conspiracy by all three branches of state government to challenge the right of the people to determine what their constitution shall protect or secure. Together Democrat Attorney General Jerry Brown, Democrats in the legislature and, of course, a majority of the State Supreme Court seek to set aside the clear decision of Californians last fall to define marriage as the union of one man and one woman.

The Court’s ruling last May that homosexual and lesbian couples have a "right" to marriage, which not only the current common sense limitation but even civil unions evidently cannot adequately satisfy, might have provoked a constitutional crisis from an attorney general who is required to uphold the law in court or a state legislature which is authorized to legislate, but in fact all three branches are in cahoots.

The shocking thing about the California government’s movement to shut down Proposition 8 is that it’s no secret and therefore it is not, strictly speaking, a conspiracy. Considering the fact that it is aimed at the right of self government, the foundation for our republic, it is deserving of the massive public outrage that an offense of this magnitude should generate. It must not be allowed to stand. Only Republicans can be counted upon to perform this necessary work.

Obama's first 48: Do you feel safer yet?

Barack Obama has been president for all of 48 hours, and I already feel less safe. In one of his first official acts as president, Obama ordered the detention facility at Guantanamo closed "within a year", and officially outlawed any "enhanced interrogation" techniques that fall outside of the U.S. Army Field Manual. In a signing ceremony attended by all the usual liberal suspects, the new president said that we would confront global violence without sacrificing "our values or our ideals".  After years of criticizing the Bush Administration, Obama and the Democrats will now have a chance to do it "their way". Democrats, of course, have always put a premium on high minded ideals -- preferring things to look good, sound good and feel good -- even if they don't work well (or at all) in practice.   The notion of fighting a war against a brutal enemy -- that decapitates its prisoners and seeks to wipe us from the face of the earth -- with the high ideals of our democratic laws and rules is both naive and dangerous. It reflects the fact that most on the left have never seen the fight against Islamic extremism as a real war, but rather as a difficult issue that can be dealt with through diplomacy, so-called "soft power" and conventional law enforcement techniques. In this upside down view of the world, Miranda rights, Habeus corpus and all other protections for terrorist detainees makes perfect sense.

The immediate result of closing Guantanamo is that it will now fall on the U.S. justice system to figure out what to do with the 250 detainees that remain there. For many on the left, this presents something of an academic question; there is a common narrative among opponents of Guantanamo that those imprisoned there are mostly innocent sheep herders and others caught up in the net of American power, and thus unjustly held without trial. Nothing could be further than the truth: the majority of prisoners at Guantanamo are hardened killers who if released will take up terrorism against us again, and present a real and pressing threat to the United States.

Obama's move to close Guantanamo comes as no surprise, of course, having been a central theme of his campaign. In fact, Obama has been on record as favoring a conventional legal remedy for terrorists ever since the U.S. Supreme Court ruled last year in Boumediene v Bush that Guantanamo terrorists should be granted access to the U.S. courts:

“I mean, you remember during the Nuremberg trials, part of what made us different was even after these Nazis had performed atrocities that no one had ever seen before, we still gave them a day in court and that taught the entire world about who we are but also the basic principles of rule of law. Now the Supreme Court upheld that principle yesterday”.

Now, as president, Obama is acting to put his view of "terrorist rights" into effect.  In ruling that interrogation techniques be limited to the U.S. Army Field Manual, which limits questioning to "please" and "thank you" kind of questions, Obama has effectively tied the hands of CIA and other interrogators who seek vital intelligence about Al Qaeda and other terrorists in the field. Unlike the salons of Paris, London or now Washington, D.C., the CIA and U.S. military operate in the real world, where innocent lives may depend on extracting information from evil doers intent on destroying us.

But that apparently doesn't matter to Obama, who with a swipe of his pen, has decided that he and the other liberals now in charge of our national security apparatus know more about security than does the current head of the CIA, General Michael Hayden, who has testified repeatedly in front of Congress that enhanced interrogation techniques are critically important to our security. Rather than study the issue from the inside and take some time to make the right decision on this important issue, Obama has placed politics over public safety in unilaterally disarming our intelligence officials as a grand act of political theater.

The left believes that some quid pro quo will exist between us and our enemies; that somehow us living up to our ideals will make a difference with those who seek our destruction and are willing to go to any lengths to ensure it. It is hard to believe that smart people can be so naive as to the real nature of the threats arrayed against us.

I've said many times that the left lives in a fantasy world of their own making, and this is further proof that with the Democrats in charge we will be in greater danger because of it.

TABOR for dummies (and Dems)

Here they go again. Faced with a budget that's hemorrhaging dollars, it was only a matter of time before one of our spendthrift legislators made headlines by erroneously pointing the finger of blame at Colorado's Taxpayers Bill of Rights (TABOR). Never mind that last spring Governor Ritter and the Democrat-controlled legislature ignored numerous warning signals of a looming recession.

Never mind that they ignored the consensus lesson of the last "budget crisis" -- when times are good, save a little money for when times aren't so good.

Never mind that in November voters rejected higher taxes and defended the few remaining constraints on government spending.

Nope, to hear the Denver Democrats tell the story, the problem with the state budget isn't the economy or undisciplined spending. A few degrees further from reality, newly-elected Boulder Democrat Sen. Rollie Heath says the problem is TABOR.

Apparently Sen. Heath didn't hear about Referendum C which loosed Colorado's government from most of TABOR's constraints ‹ except for that pesky requirement that voters still get to decide whether to raise taxes.

"We're hamstrung," Heath complained to a legislative committee even before taking office. "Not only does (TABOR) put a limitation (on spending), it takes away your flexibility. We desperately need flexibility right now."

So perhaps it's time a for a quick session of "TABOR for Dummies" to benefit anyone else who's been elected to state government after spending the past four years in a galaxy far, far away.

Lesson 1 - TABOR doesn't limit spending during a recession.

To quote James Carville, "It's the economy, stupid!" During a recession, the limiting factor on state spending is the economy. After all, Colorado ‹ unlike Congress ‹ has a balanced budget amendment, so the state can't spend money it doesn't have.

Lesson 2 - Ref C doesn't expire in 2010.

When the voters passed Ref C in 2005, they changed the way the original TABOR worked. Even after portions of Ref C expire in 2010, the new, revised spending limit under TABOR 2.0 will no longer "ratchet down" spending during a recession and will rarely restrict spending during an economic recovery.

According to the legislature's economists, TABOR will not limit government's ability to spend in the foreseeable future.

Lesson 3 - Amendment 23 doesn't expire in 2010.

The constitutional amendment that actually makes matters worse during a recession is Amendment 23, which mandates that K-12 education spending must increase every year - even when revenues are decreasing.

In the current budget, Amendment 23 requires a spending increase of $189 million. Meanwhile, economists predict that total general fund spending must be reduced to $172 million less than last year.

K-12 education accounts for 41 percent of the general fund budget, so the remaining 59 percent of the budget must be cut by $172 million to compensate for falling revenue plus another $189 million to accommodate Amendment 23.

Will Sen. Heath and his fellow Democrats buck the teachers unions to pull the teeth of the real shark in the budget process? Don't hold your breath.

Lesson 4 - Flexibility under TABOR 2.0.

Ever since Ref C suspended the TABOR spending limit, legislators have enjoyed absolute flexibility to spend, to save or to strike a balance between the two.

Guess which option they chose? Not saving. Not balance. Just more spending.

The flexibility they haven't enjoyed is the flexibility to raise taxes without a vote -- although they even tried that with Gov. Ritter's property tax increase.

Herein lies the lesson for voters:

For four years, legislators have budgeted without TABOR's training wheels. They could have saved money during good years, but they didn't. They should have asked our permission before raising property taxes, but they didn't.

What possible justification exists for relaxing the remaining safeguards that protect taxpayers?

Mark Hillman served as Senate Majority Leader and State Treasurer. To read more or comment, go to www.MarkHillman.com