Economics & Business

Obama may abort the American dream

I have been looking for "the sign" that the good times are over for good. It came in a Denver Post headline: "Abortions increase in face of economy". Family planning has a new definition. In the words of country singer Merle Haggard, "Are we rolling downhill like a snowball headed for Hell?" Good ol' Merle said things would be better when Ford and Chevy made cars that last ten years like they should.

Gone are the days of procreating children to help run the family farm or business. The word "family" has been destroyed by cultural revolution. The most famous family today depicts a welfare mother prostituting the images of eight new babies. Now there is a retirement plan.

President Obama and Democrats will do what they want now that they can. It's frustrating. Plans for retirement for most of us now must consider a future of massive inflation to repay more debt than all the nations previous presidents had accumulated. Charge today! No payment till next year!

President Obama talks about the urgent need to pass his oversized-credit-card economic plan, some of which already passed without a chance to readthe fine print. Congress deserves a pay cut. Withdrawal is the new plan for the Middle East. Our Mexican border leaks immigrants and drugs, both of which are killing us in their own way. Shall we expect "amnesty and legalization" as a bold border plan? It would fit the mold.

Mortgaging a nation on "false appraisal" is worse than mortgaging our homes for 125 percent of speculated value was. U.S. taxpayers have been conned into bailing out bad-banking behavior. Our creditors have noticed. The Chinese are abandoning the dollar because they fear our inflation will erode their investments. The international Ponzi scheme has been outed.

Obama the wanderer

I've been struggling over the last few weeks to put my finger on what bothers me so much about Barack Obama. Yes, I know that sounds strange coming from me -- since the pages of my blog are filled with criticisms of the man and his beliefs. But there is something else that is bugging me about the Obama presidency, and it isn't so much about policy as it is a feeling that I have -- a sense of the peripatetic way he is going about this very serious job he has. I've been watching Obama now travel from media event to media event, fluttering about the country with much fanfare but little substance. There is something missing. A sense of steadiness. His devotion to his teleprompter -- already the stuff of scorn and ridicule -- is unsettling. Wasn't he supposed to be the eloquent one who wields a brilliant intellect? The next great communicator?

Peggy Noonan does a masterful job in today's Wall Street Journal of putting my sense of Obama into words -- it's a must read. I've been frustrated with Noonan's commentary about Obama since the election -- she seemed all too willing to accept the notion that Obama really is some new, transcendental leader. But no more. This most recent piece captures perfectly the true essence of the "Obama phenomena" -- full of sound and fury, and signifying nothing:

He is willowy when people yearn for solid, reed-like where they hope for substantial, a bright older brother when they want Papa, cool where they probably prefer warmth. All of which may or may not hurt Barack Obama in time...

Such impressions—coolness, slightness—can come to matter only if they capture or express some larger or more meaningful truth. At the moment they connect, for me, to something insubstantial and weightless in the administration's economic pronouncements and policies. The president seems everywhere and nowhere, not fully focused on the matters at hand. He's trying to keep up with the news cycle with less and less to say.

Our new president is chasing the news cycle, going on Jay Leno and following the cues from the dwarfs in Congress -- that august body of tax cheats and pork spenders where Obama most recently worked. He is engaged in a dance of reaction as opposed to a steady march of action, all at a time when we are dealing with crisis at home and war abroad. This is a time for steeliness and strength, and what we have is unfocused, peripatetic waffling.

Those of you who read this blog know that this comes as no surprise to me. Barack Obama is a man of great salesmanship, who understands how to get you excited to buy something, but then knows nothing of the details once you've purchased it. He's already on to the next sale, the next opportunity to close the deal and show his ability to convince and cajole. His sense of office is a constant campaign -- lots of platitudes and generalities, the kind of stuff that makes crowds clap. He's a jack of all and master of none. And now that he is the master of our collective domain -- the United States of America -- the weaknesses show through with growing clarity and alarm.

As Noonan succinctly argues, Obama has two jobs -- to fix the economy and to keep us safe. On both scores he seems wanting. When Dick Cheney recently criticized Obama for making us less safe in the wake of his recent decisions on Guantanamo and interrogation, White House press secretary Robert Gibbs reacted with disdain. Mr. Cheney is part of a 'Republican cabal.' 'I guess Rush Limbaugh was busy.' This was cheap."

Cheap and wrong. For whatever you wish to say about Dick Cheney, he know of what he speaks -- having seen first hand the post 9/11 intelligence briefings for 8 years. Cheney knows that the threat from Islamic terrorism is a constant drumbeat that can't be wished or talked away. He knows that the Obama administration has not yet found a serious footing on this issue -- and that this puts the country at risk. Noonan says it well:

What can be used will be used. We are a target. Something bad is going to happen—don't we all know this? Are we having another failure of imagination?

A month ago former FBI director Robert Mueller, in a speech to the Council on Foreign Relations, warned of Mumbai-type terrorist activity, saying a similar attack could happen in a U.S. city. He spoke of the threat of homegrown terrorists who are "radicalized," "indoctrinated" and recruited for jihad. Mumbai should "reinvigorate" U.S. intelligence efforts. The threat is not only from al Qaeda but "less well known groups." This had the hard sound of truth.

Contrast it with the new secretary of homeland security, Janet Napolitano, who, in her first speech and testimony to congress, the same week as Mr. Mueller's remarks, did not mention the word terrorism once. This week in an interview with Der Spiegel, she was pressed: "Does Islamist terrorism suddenly no longer pose a threat to your country?" Her reply: "I presume there is always a threat from terrorism." It's true she didn't use the word terrorism in her speech, but she did refer to "man-caused" disasters. "This is perhaps only a nuance, but it demonstrates that we want to move away from the politics of fear."

Ah. Well this is only a nuance, but her use of language is a man-caused disaster.

Exactly right. Eight years after 9/11 and two wars in Iraq and Afghanistan and we are still learning the same lesson over and over again: there are enemies who want to destroy us out there, they are Islamic fundamentalists and they can and will use any weapon they can get their hands on -- from machine guns to suitcase nuclear bombs. It isn't an issue of nuance, it is one of survival. The administration's responses -- as Dick Cheney points out -- should in no way be comforting.

These are the two great issues, the economic crisis and our safety. In the face of them, what strikes one is the weightlessness of the Obama administration, the jumping from issue to issue and venue to venue from day to day. Isaiah Berlin famously suggested a leader is a fox or a hedgehog. The fox knows many things but the hedgehog knows one big thing. In political leadership the hedgehog has certain significant advantages, focus and clarity of vision among them. Most presidents are one or the other. So far Mr. Obama seems neither.

Very well said, Peggy.

Market economy must be our future

The economic battlefield is strewn with the lost swords and shattered shields of failed corporations, and the age of the free market seems to have ended. Steel owls of liberal orthodoxy seem to be standing about the grave of the free market, and everywhere the controlled market seems to be the wave of the future. Still, in this melee of "reform" the free market remains the superior system and we must return to it if we ever hope to recover. Doubtless it has gone astray and to get it back on track will require tough choices in regard to spending, regulation and above all conservative theory. The rise and continued eminence of the United States has been possible according to a number of features. A resilient well meaning people, significant checks and balances on government power, and a system that fostered diversity all contributed greatly. But in economic matters the success of the United States can be traced to one form: the free market. The silver-shielded hypaspist of the free market is open competition and no other force has made more money, invented more technology and fostered as much growth as competition. As Americans we pride ourselves in a high work ethic and the ability to compete, but somehow in recent decades we have gone far astray from this concept.

In a strange combination of regulation and deregulation the federal government has seriously weakened the tenets of the free market. Excessive regulation and taxes, designed for large corporate entities, disproportionately burdened small business. At the same time, the government's failure to establish clear rules on a host of business issues created the environment for the recent sub-prime collapse. Companies and banks were allowed to grow to a point where they could not be allowed to fail, prompting a stream of endless bailouts.

Recently, failed companies like GM, were absolved by the government of bad business decisions and essentially given a mulligan on incompetence and bad management. Over regulated on one hand and allowed to run wild in the other, many American corporations ran afoul, overextending themselves and making unwise decisions. Normally, such actions would be offset by the competitive aspect of the free market, but the government has shown an unbridled desire to take away this risk thru guarantees and bailouts. Such action only worsens the decline, subsidizing failure and corrupting the free market into a controlled one. Sadly, this treachery is extended by the fact that the various bailouts are financed by an increased tax and debt burden on small businesses and individual families. Lest we forget, the same week GM asked for 17 billion in additional funds they announced mass layoffs of 50,000 workers.

With the recent economic downturn many state that the free market has been disproved and is no longer in play. But in truth this is impossible because the free market hasn’t been in play for a long time. Both Democrats and Republicans are responsible for this and both will need to show bravery and leadership in order to get it back on track. In fact, both must come to the conclusion that the role of government in regard to the economy is to preserve the feasibility of the free market and nothing more.

Economics, academics & liberty

(Denver Post, Mar. 1) One thing will get Colorado out of this recession, and it’s not big government. It is the human spirit. All economic growth is the improvement of material resources by creativity and work. Silicon, ignored for eons as beach sand, became microchips humming with intelligence. Petroleum was worthless tar seeps before men made it black gold. Our state was labeled “the Great American Desert” on early maps. People transformed it into the place of opportunity and productivity we now enjoy. Wealth multiplies when men and women combine the intellectual capital for producing goods and services with the moral capital for honest dealing and deferred gratification. Americans have always known this. “Religion, morality, and knowledge being necessary to good government and the happiness of mankind, schools and the means of education shall forever be encouraged,” says the Northwest Ordinance of 1787. The Constitution hadn’t been written, and we had barely crossed the Appalachians. But the founders put first things first.

Even today, sophisticated and stimulus-dependent as the nation has become, we sense that the truth from Washington’s time is still true: Moral and intellectual capital will make or break the American dream. Hence our endless arguments about education.

From preschool to grad school, Coloradans can’t get enough of the classroom – and can’t agree on what it’s for. That’s a good thing on both counts. The push to improve ourselves, improve everyone and leave no one behind, is laudable. The contention over education’s meaning expresses liberty in all its messy glory.

So it’s okay that the University of Denver will host a debate on Monday between Prof. Alan Gilbert and state Sen. Shawn Mitchell on trying former Secretary of State Condoleeza Rice as a war criminal. And that CU-Boulder on Thursday will allow back on campus the disgraced plagiarist Ward Churchill and the unrepentant domestic terrorist Bill Ayers.

I abhor the anti-American falsehoods that will echo at both forums. But this petty childishness is a small price for free speech and unfettered dissent. It was even a “good” if distasteful thing when a Metro State professor could smear Sarah Palin, or when a terror apologist could address the 9/11 commemoration at Colorado College.

Such unruly eruptions in the thought-life of a free society are tolerable on one condition – competitiveness in the education marketplace. As long as students have alternatives, outrageous utterances by academic malcontents hurt no one. In fair combat amongst the campuses, Jefferson’s assurance was right: lies won’t stand.

This is where it gets dicey for Coloradans. In March 2004, concerns over professorial mistreatment of conservative and religious students yielded written assurances to legislators by the presidents of CU, CSU, UNC, and Metro for better protection of academic freedom. But little has changed.

Fortunately, competition in higher ed isn’t limited to the old-line public and private colleges. Other choices include for-profit upstarts like Colorado Tech or the University of Phoenix, as well as faith-based options like Regis and Colorado Christian University. Both of the latter uphold a 1787 understanding of education’s moral and religious benefits.

CCU, where I now work, is proudly counter-cultural. One of its objectives, in addition to academic excellence, is “to impact our culture in support of traditional family values, sanctity of life, compassion for the poor, biblical view of human nature, limited government, personal freedom, free markets, natural law, original intent of the Constitution, and Western civilization.” Heretical, perhaps, but healthy.

CCU President Bill Armstrong, a former US senator, instead of railing at the Boulder leftists, politely counters by bringing to his Lakewood campus such eminent conservative speakers as Michael Novak on democratic capitalism and Thomas Krannawitter on America’s greatness. Take that, Bill Ayers.

All hail the open mind and the unregulated marketplace of ideas. A rebounding economy is sure to follow.

Bailouts beget corruption, history warns

Obama’s attempt to save America’s failing financial sector, automakers, etc., perhaps by nationalizing them, is classic socialism. It will result in failure not only of those industries but of our entire economic system. It will also produce the same massive societal corruption found in former states of the Soviet Union. I served as a Fulbright scholar in the former Soviet republic of Moldova about a decade after the end of the Soviet Union and observed how this culture of corruption continued to suppress freedom, initiative and economic growth.

f corporations are inefficient, they must either be made to be efficient or they must be allowed to fail. According to Joseph Schumpeter, destruction can actually be creative. If there is a need for the product the failing company produced, someone will step in the gap and produce to meet the demand. The fresh start provides the new company the opportunity to be free of the burdens which caused the inefficiency of the failed corporation.

If the government props up the inefficient corporation, it perpetuates the inefficiency and passes the cost on to the taxpayers and the entire economy as well. Like a communicable disease, this spreads the inefficiency from the corporation to the general economy and entire populace. Those not responsible for the inefficiency are now burdened unfairly, and that burden brings down more efficient businesses, who become burdened with the increased taxes necessary to prop up the inefficient businesses.

In this situation corporations are no longer seeking to respond to the needs of consumers to insure their viability, but to government which props them up. This is corporate welfare at its worst. The consumer loses his power to influence the market and is instead forced by the government to consume what is offered by mediocre, propped-up providers -- a situation artificially imposed upon them by politics.

Corporations find it more advantageous to cooperate with government than with the market. This close relationship between business and government elites, is akin to fascism in its truest sense which was how Mussolini attempted to run Italy in the 20s and 30s. It also corrupts both our economy and our government.

Access to government becomes the top priority of corporations, as they become more dependent on government than on consumers. Government officials began to manipulate the corporate sector and corporate executives begin to manipulate government.

This develops into a symbiotic relationship of corruption and inefficiency reminiscent of what resulted in the collapse of communism. It began with supposed noble and benevolent aspirations, and resulted in the worst of tyrannies and inevitably a far more profound collapse.

William Watson is a professor of modern history at Colorado Christian University.