Posted on 11/24/2008 9:07:16 PM PST by jazusamo
Barack Obama says that we have to "jolt" the economy. That certainly makes sense, if you take the media's account of the economy seriously-- but should the media be taken seriously?
Amid all the political and media hysteria, national output has declined by less than one-half of one percent. In fact, it may not have declined even that much-- or at all-- when the statistics are revised later, as they very often are.
We are not talking about the Great Depression, when output dropped by one-third and unemployment soared to 25 percent.
What we are talking about is a golden political opportunity for politicians to use the current financial crisis to fundamentally change an economy that has been successful for more than two centuries, so that politicians can henceforth micro-manage all sorts of businesses and play Robin Hood, taking from those who are not likely to vote for them and transferring part of their earnings to those who will vote for them.
For that, the politicians need lots of hype, and that is being generously supplied by the media.
Whatever the merits of trying to shore up some financial institutions, in order to prevent a major disruption of the credit flows that keep the whole economy going, what has in fact been done has been to create a huge pot of money-- hundreds of billions of dollars-- that politicians can use to give out goodies hither and yon, to whomever they please for whatever reason they please.
No doubt we could all use a few billion dollars every now and then. But the question of who actually gets it will be strictly in the hands of Barack Obama, Nancy Pelosi and Harry Reid. It is one of the few parts of the legacy of the Bush administration that the Democrats are not likely to criticize.
Much as we may deplore partisanship in Washington, bipartisan disasters are often twice as bad as partisan disasters-- and this is a bipartisan disaster in the making.
Too many people who argue that there is a beneficial role for the government to play in the economy glide swiftly from that to the conclusion that the government will in fact confine itself to playing such a role.
In the light of history, this is a faith which passeth all understanding. Even in the case of the Great Depression of the 1930s, increasing numbers of economists and historians who have looked back at that era have concluded that, on net balance, government intervention prolonged the Great Depression.
Many of those who have, over the years, praised the fact that this was the first time that the federal government took responsibility for trying to get the country out of a depression do not ask what seems like the logical follow-up question: Did this depression therefore end faster than other depressions where the government stood by and did nothing?
The Great Depression of the 1930s was in fact the longest-lasting of all our depressions.
Government policy in the 1930s was another bipartisan disaster. Despite a myth that Herbert Hoover was a "do nothing" president, he was the first President of the United States to step in to try to put the economy back on track.
With the passing years, it has increasingly been recognized that what FDR did was largely a further extension of what Hoover had done. Where Hoover made things worse, FDR made them much worse.
Herbert Hoover did what Barack Obama is proposing to do. Hoover raised taxes on high-income people and put restrictions on international trade, in order to try to save American jobs. It didn't work then and it is not likely to work now.
Perhaps the most disastrous of all the counterproductive policies of the federal government was the National Industrial Recovery Act under FDR, which set out to do exactly what the politicians today want to do-- micro-manage businesses.
Fortunately, the Supreme Court declared that Act unconstitutional, sparing the country an even bigger disaster.
Today, it is unlikely that the courts will let anything as old-fashioned as the Constitution stand in the way of "change." In short, the economy today has some serious problems but things are not desperate, though they can be made desperate by politicians.
It’s like giving sugar candy to a starving child.
The Feds already micromanage business. With Environment ..Equal Opportunity..Minimum wage..Tax plans..Restrictive liscensing..etc....How much more can they do? Nanomanagement will be the Obamubeasts program.
When the surge worked, the MSM turned from Iraq 24/7 to the economy 24/7 in an attempt to get people to stop spending money.
It worked and the big scare got their guy in.
Such lying, deceptive propoganda has not often been seen. Evil is very prevelant these days.
And mostly found in the ranks of the MSM.
Jolt = Shocking
Good choice of words.
Amid all the political and media hysteria, national output has declined by less than one-half of one percent. In fact, it may not have declined even that much-- or at all-- when the statistics are revised later, as they very often are.
The Dems will do their best to fix that or sweep it under the carpet. For them another dependency is another constituency.
I believe you’re right on the money.
Send this “history lesson” to all your friends and relatives....we need to start EDUCATING people....
The media cannot be trusted. Americans need to be more skeptical of the MSM, since they don't seem to be accountable to anyone.
Agreed...I wish more people would distribute Dr. Sowell’s columns. I send them to many in my address book including two of my grandkids who are teenagers.
I’d argue that our government’s relationship to the economy fundamentally changed in three epochs:
1. The Civil War, which determined that Washington could no longer be questioned in a fundamental manner. The states still had options, but federalism was from then on a dead issue so long as the central government stuck to its guns (literally).
2. The creation of the Federal Reserve System, which for the first time put an arm of the government in charge of our money. Ever since, we have had boom/bust cycles, all of which were monetary phenomena.
3. The New Deal, the largest single period of expansion of the power of the federal government, which launched the Welfare State, created entitlment programs thast most likely will bankrupt us, and regulated the hell out of private business.
No matter what we do from this point on, no matter how many businesses we bail out, no matter how many industries we nationalize, no matter how much money we confiscate, and no matter how many regulations we strangle private enterprise with, the game was set long ago. Everything since ‘32, in my opinion, was just adding to the pile.
“What we are talking about is a golden political opportunity for politicians to use the current financial crisis to fundamentally change an economy that has been successful for more than two centuries, so that politicians can henceforth micro-manage all sorts of businesses and play Robin Hood, taking from those who are not likely to vote for them and transferring part of their earnings to those who will vote for them.”
You nailed it Sowell, kudos.
For the first time I can remember, I disagree with Doctor Sowell. The economy is having a different problem than during the Great Depression. The value of American assets is dropping precipitously even as output remains healthy.
BHO may “jolt” the economy like giving a meth overdose to a junkie.
“In short, the economy today has some serious problems but things are not desperate, though they can be made desperate by politicians.”
Politics is the art of looking for trouble, finding it whether it exists or not, diagnosing it incorrectly and applying the wrong remedy...
8 posted on 07/30/2007 6:35:13 AM PDT by Don Corleone (Leave the gun..take the cannoli) http://www.freerepublic.com/focus/f-news/1873579/posts?page=8#8
>> For that, the politicians need lots of hype, and that is being generously supplied by the media.
If we refer to the ‘Invasion of Iraq’ media template, should we anticipate similar headlines?
‘President Lied’
‘They killed free trade in cold blood’
‘There were no loans for mass construction’
‘They were taxing innocent civilians who worked all night’
‘We lost the economy’
Very well put, exactly so.
That's scary, George but I believe it.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.