“What the cynics fail to understand is that the ground has shifted beneath them — that the stale political arguments that have consumed us for so long no longer apply. The question we ask today is not whether our government is too big or too small, but whether it works — whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified.”
So said Barack Obama upon his inauguration as the 44th President of the United States. And, yes, that is exactly the question we ask today, and the standard to which he will be held. Does the government that he and the liberal Democrats now completely control and for which they will be held responsible work for the good of the people of the United States?
But it is characteristic self-absorption for Obama to think this is a new question. It is the same question the people asked the last time liberal Democrats held dominant power for an extended period — the 1970s. Obama’s political forebears back then produced both roaring inflation and soaring unemployment, along with stratospheric interest rates. If Obama and his liberal allies do that again, yes, indeed, the people will be asking what happened to government that works?
It is, in fact, the exact same question that Ronald Reagan asked the people in 1980, Are you better off today than you were four years ago? If Obama and his liberals want to ignore what Reagan did to solve the problems created by the liberal Democrats of the 1970s, or if they want to pretend that the spectacular Reagan boom never happened, they can just go right ahead. Just adopt the exact same economic policies those 1970s liberals did, and take us backwards 40 years, and call it change. That is exactly what Obama is proposing, only on a much grander scale, with a trillion dollars of new spending in his first two months, and deficits well over a trillion as far as the eye can see, when just last year the entire federal budget was $3 trillion. All while whooping on the Fed to loose, easy money. And if the result is to bring back roaring inflation while unemployment is still higher, and interest rates are in double digits, Obama can rest assured that he will face an opponent four years from now who will be asking whether his government really works for the people.
The Congressional Budget Office released a report just the other day indicating that Obama’s idea from the 1930s of trying to stimulate the economy in the short term with hundreds of billions in increased infrastructure spending will not work because most of the money cannot possibly be spent in the short term. Much if not most of it will still not be spent by 2012. But that is not the only thing wrong with Obama’s stimulus plan. If the government borrows a trillion dollars out of the economy to put it back in by spending a trillion dollars, that leaves no net gain to the economy.
What works is enhanced incentives for economically productive activity, which results from reductions in marginal tax rates and in unnecessary regulatory costs. But if, while Obama “proclaim[s] an end…to worn out dogmas,” and that “the stale political arguments that have consumed us for so long no longer apply,” he ideologically rejects such practical and proven policies because they also benefit those he believes already have too much, then he should not be surprised when that long outdated, hoary, 19th-century ideology does not work. If Obama thinks he is going to create prosperity by increased welfare, runaway spending, and trillions in deficits instead, he should remember, as he himself has said, the test will be what works.
The Wall Street Journal reported yesterday that on Obama’s first day in office he will summon his national security team to begin preparations for all troops to leave Iraq within 16 months. George Bush already won the war in Iraq, while Obama counseled defeat. A formal agreement is already in place for all U.S. troops to leave within the next 35 months, and they already began leaving last summer. But if Obama’s ideology insists that this is not good enough, and they must all get out of there within 16 months no matter what, then if Obama loses what has already been won as a result, the people will ask what happened to the government that works, and will hold him responsible.
Obama also said yesterday, “As for our common defense, we reject as false the choice between our safety and our ideals. Our Founding Fathers, faced with perils we can scarcely imagine, drafted a charter to assure the rule of law and the rights of man…. Those ideals still light the world, and we will not give them up for expedience’s sake.”
George Bush has set a standard for Obama in at least one sense — no terrorist attacks on U.S. soil since 9/11. Obama now promises to change course out of concern that those with knowledge regarding plans to murder Americans, or who have attacked America outside the bounds of warfare, not be treated too harshly. But if terrorism returns to our land on his watch, then Obama and his liberal Democrats will be held responsible, you betcha, as Americans ask what happened to the government that works. Obama should recall that when General Washington’s forces captured British Major John Andre spying behind their lines out of uniform, Washington accorded him the dignity of a swift military trial and execution by firing squad.
Obama also promised yesterday, “We will harness the sun and the winds and the soil to fuel our cars and run our factories.” That is a nice dreamy vision, but if we neglect production of what we know works to power our economy — oil, and gas, and coal, and nuclear power — and we end up with blackouts and gas rationing because the sun and the winds and the soil didn’t really come through, then Obama will be held responsible, as America again asks what happened to the government that works.
Obama ran for President as a champion of the middle class. But yesterday he seemed to be threatening it, saying, “And to those nations like ours that enjoy relative plenty, we say we can no longer afford indifference to suffering outside our borders, nor can we consume the world’s resources without regard to effect. For the world has changed, and we must change along with it.” Despite Obama’s long campaign, I still don’t know what change he is talking about here, and neither does America’s middle class. America can best help the world’s poor by leading a global economic boom, as it did from 1982 to 2007, the greatest period of worldwide prosperity in the history of the planet, as Art Laffer and Steve Moore have recently written. But if Obama thinks he is going to save the world through American austerity and deprivation, then the American people will be asking, what happened to the government that works?
Obama concluded yesterday by saying, “What is required of us now is a new era of responsibility — a recognition on the part of every American that we have duties to ourselves, our nation, and the world, duties that we do not grudgingly accept but rather seize gladly, firm in the knowledge that there is nothing so satisfying to the spirit, so defining of our character, than giving our all to a difficult task.”
We didn’t hear much during the campaign about responsibility, duties to the world, and giving our all to difficult tasks. What I remember hearing is a tax cut for 95% of workers, and “if you are in the bottom 95% your taxes will go down, not up,” and that there will be no tax increase on the bottom 95% of income earners. So the minute Obama and his liberal Democrats propose a tax increase for anyone in the bottom 95%, I expect the American people to hold them responsible, you betcha.
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