In a recent article writer and journalist John Stossel states that “Barack Obama wants to use the recession to remake the U.S. economy.” Citing FDR’s mistakes in the 30′s, Stossel says that such “reform will impede recovery.”
Stossel is right in that Obama is certainly using the economic calamity to push economic redesign legislation whose cost is estimated upwards of $1 trillion over the first two years. Obama wants to redo how our economy works. This includes massive infrastructure projects, various “green” schemes such as “weatherization,” alternative fuel subsidies, “buy American” programs and tariffs to protect domestic industry, and decoupling health care from employment-in other words, transferring health care costs and liabilities from the private sector to the public. What we know about government programs is that estimated costs almost always come in way under actual costs. In the case of this Soviet-style economic redesign, the $1 trillion price tag will likely fall woefully short.
Any money the government spends must be taxed, borrowed or conjured out of thin air by the Federal Reserve, and that will reduce sound private investment. Obama has no real wealth to inject into the economy. He can only move around existing money while inflation robs us of purchasing power. Meanwhile, private investors who might have produced a better engine, battery, computer, cancer treatment or other wealth-creating and life-enhancing innovations hold back for fear that big government will undermine productive efforts.
Americans have been on a path since the Second World War of delegating increasingly more of a our lives to government. We suffer from a disease that will likely prove fatal, in which we place undue confidence in third parties to manage our lives. As Stossel puts it, an “economy really is people engaging in exchanges to achieve their goals. Planning it means planning them.”
This is not American and will not lead to long term prosperity.
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Actually a great deal of these ideas you have problem with work quite well for Canada.
It makes me wonder who has the “conceit” in this discussion since the conservative “regulate nothing” did wonders for the US economy and those to the farther right of the spectrum (I’m looking at you libertarians) require even less oversight in the “business process”.
The sad fact that you’re overlooking is that the “investors” whose fate you bemoan here:
Meanwhile, private investors who might have produced a better engine, battery, computer, cancer treatment or other wealth-creating and life-enhancing innovations hold back for fear that big government will undermine productive efforts.
have not been overly interested in creating a better engine, battery, or computer but, have only been interested in adapting the Japanese “just in time” inventory model and exporting jobs out of the US.
Medical advancement in the US has come only as it was profitable and sparked the repetitive gouging of the US consumer. Show me another country with the high cost of medical care vs the low access.
The most true statement about your article is this:
We suffer from a disease that will likely prove fatal, in which we place undue confidence in third parties to manage our lives. but, the undue confidence was in the deregulation of the “free market” not in government oversight.
@Cuervos Laugh – Looks like we have varying opinions on what drove the US economy to its present state. I contend it was decades of bad legislation and monetary policy that over-inflated markets, drove homeownership and unsustainable indebtedness for those who couldn’t afford it, and distorted markets in ways that have persistently driven costs higher throughout the economy.
Health care is one of the most distorted markets by government intervention, so I would be skeptical to use that as an example of how freedom messed things up.
http://www.thefreedomfactory.us/does-regulation-increase-health-care-costs/
Before government involvement, starting with the introduction of Medicare and Medicaid in 1965, expenditures were 5.9% of GDP. They rose 27% between 1965 and 1973, which startled Congress enough to again try to “fix” the problem by creating the HMO industry. Correlation doesn’t necessary mean causation, but it is interesting to note that expenditures now amount to over 16% of GDP. At a minimum, I think it prudent to question the omnipotence of politicians and their bureaucratic mandates.
There are myriad other examples of regulatory distortion that have led to calamity. Housing and the financial crisis being the most destructive to date.
It always sounds nice to think benevolent leaders can forcefully alter reality for our benefit, but more often than not their interference leaves us all worse off.