The "Obama Winging It" Meme

First we hear that the Obama administration isn’t really ready for prime time. Now Karl Rove suggests that the Obamians are “winging it.”

He’s probably right. Our Democratic friends tend not to pay much attention to capitalism and the way it works, except to rail against it and propose a new intervention to correct “market failure.” Democrats like to think of themselves as the intelligent people, and like to think that they can come to Washington, apply some intelligence to the mess left by the Republicans, and then get back to the stuff they do best, which is handing out benefits to the party faithful.

They would probably be better advised to take capitalism and its development dead seriously and to make sure that they have people on their team who really have a deep understanding of markets and the modern economy. But it looks like they don’t.

So we get the stupid waste of the “stimulus” bill. We get the reckless calls for bank nationalization. And we get the Obama proposal for bailing out homeowners.

Iain Murray has looked at the Obama mortgage relief plan, and he doesn’t like it.

[P]eople who have their loans modified to help them out actually redefault for the most part. The latest figures indicate that 36% redefault after just three months, and by eight months it’s almost 60%. There is no evidence to suggest that this new mortgage restructuring plan will be any more successful.

The markets are looking for policy that will give them the confidence that we are turning the corner. The mortgage refief plan doesn’t do that. Says Murray: “Moreover, by delaying the "clean break" that foreclosure actually represents, the plan actually subsidizes harm with taxpayer money.”

Right now the M2 money supply is soaring. So you’d think that the economy should turn pretty soon. But maybe it will all go into inflation. Gold is up sharply in the last month.

The Obama administration better get its act together soon. It’s wasted precious opportunities already in the first month of office. It needs to make sure that it starts to get things right. It may not be possible to blame everything on George W. Bush, as Democrats did so well in the 1930s when they failed to get the US out of the Great Depression. “History repeats itself, first as tragedy, second as farce,” according to Marx.

Taking on the Powerful

We all know that the Fourth Estate is a keystone of democracy. We need journalists because they “speak truth to power.”

NOT.

When they talk like that, journalists usually mean criticizing the president, government, and big corporations, writes Jonah Goldberg. But the fact is that it doesn’t cost you anything to criticize traditional villains. In fact, if you criticize the president, the publicity might make you a fortune.

In fact, journalists seldom speak truth to power unless there’s blood in the water. And that’s just where politicians and local bigwigs are the targets. There’s another problem, says Goldberg:

I’ve met innumerable writers and editors who are scared, even terrified, of one or more of these groups: gays, blacks, Latinos, Asians, Jews, feminists, evangelical Christians and the handicapped.

Yes. You would think twice before speaking truth to powerful gays or powerful blacks. (But be specially careful of riling up cat lovers, warns Jonah).

Of course there is a reason why you shouldn’t criticize gays, black, Latinos, etc. They are protected groups, and they are the mailed fist of the Democratic Party. (Is it really dangerous to criticize Christians? I hadn’t noticed.)

We know why it’s dangerous to criticize protected groups. Liberals like it that way. It serves their political interests. If you can’t criticize blacks then you can’t effectively campaign against affirmative action and quotas. If you can’t criticize gays then you can’t campaign effectively for the traditional family. Liberals like it that way.

For conservatives to make progress in the culture war it is going to be necessary to develop the courage to “speak truth to power,” in other words, speaking truth to the client groups of the liberals and the Democratic Party.

It’s an issue that was raised by the industrious mice in Beatrix Potter’s Tailor of Gloucester. Who will bell the cat?

The fact is that it is going to take a few suicide volunteers to turn the tide on this, people willing to risk their career, their reputation and everything. That is the real meaning of “speaking truth to power.” Because, as we all know, if you disagree with liberals on race you get called a racist. And if you disagree with liberals on gay rights then you get called a homophobe.

Most of us will do anything to avoid that.

Stimulus: A Clash of Faith

These days we live in an age of reason. Everyone claims that their ideas about politics and economics are driven by reason and science.

But that is wrong. We live in an age of faith, an age of faith in science. Everything comes down to faith.

And that goes for economics too.

The “stimulus” bill that President Obama is signing today is an act of faith. Ever since the late 19th century a large group of the western elite has believed that capitalism is inherently unstable, and can only succeed if minutely regulated by large-minded people like themselves. We generally call these people liberals or progressives.

Against this movement is another group and another belief system, one that we call the conservative movement. It believes that by and large, if framed by appropriate laws, the free market economy can run itself subject to the fluctuations of the business cycle, and that the interventions of large-minded people usually make things worse.

In the Reagan-Bush era conservatives believe that we made the point pretty clearly that a regime of stable regulation of business, a sensible and simple tax regime, and a level playing field is the best approach to political economy.

But our liberal friends hated every moment of this period. Because their faith says that you need people like them to help the helpless. If you don’t have minute regulation of the workplace, they say, people will be brutally exploited. If you don’t give targeted groups a helping hand then these traditionally marginalized groups will never succeed in reaching the mainstream of American life.

Arguments like this don’t get settled over the dinner table. They are fundamental arguments of faith, and only the clearest and most brutal experience will ever change minds.

In my view the present “stimulus” bill is the Last Hurrah of the interventionist faith. After the Obama era is over, there will be a lot fewer people that believe in government intervention to fix the economy.

The argument against the liberal faith has been developed by many people over the years, most notably by F.A. Hayek, who argued that the “man in Whitehall” or Washington just could not know enough to regulate an economy. It has been most powerfully made by the disastrous economic record of socialism and communism (and in a short while by the Bolivarian Revolution in Venezuela).

But our liberal friends can’t bring themselves to abandon their faith in their own ability to create a better world through detailed and comprehensive government administrative programs. And so we are going to have to descend into the pit before we will get to junk their whole cruel, corrupt, wasteful, unjust, and deluded welfare state.

Learning from the Secret of FDR's Success

The conventional line on the New Deal is that FDR captured a generation with his New Deal programs. Sure, they didn’t all work, but they gave people hope.

Not exactly, writes Michael Barone. What put FDR into the pantheon of national heroes was World War II.

In 1938 the Democrats suffered a meltdown.

In the 1938 off-year elections, Democrats lost 81 House seats, 51 of them in the industrial belt from Pennsylvania and Upstate New York west to the Upper Midwest. The Democratic governors of Michigan and Ohio were defeated for re-election. The congressional district that included Flint, Mich., site of the first sit-in strike, went from Democratic to Republican; so did most congressional districts in Ohio.

The 1938 elections didn’t return the Congress to Republican control but the 81 seats that changed hands almost wiped out the 92 seats that had gone Democratic in the 1932 election.

So the Republicans were looking good for 1940. But then along came World War II and Americans decided to stick with FDR. A whole generation went to war, and found that government could get things done. Then they went home and got an education on the GI Bill. Hey, government really worked for those people, so they went to work and voted Democratic. After all, they had benefitted from government programs. They owed the generations coming after them and wanted to give them a helping hand.

So what? What does that have to do with today?

I think that the Democrats are completely misreading the American people if they think that it’s time for a New New Deal. And they are kidding themselves if they think that the American people are going to swallow the stimulus package. Today’s Americans—outside the political looter class—don’t think that government works. They don’t think that Senator Harry Reid (D-NV) and Speaker Nancy Pelosi (D-CA) are noble public servants. And they will soon start to think that President Obama is just the President of the United States and not a hope-and-change phenomenon.

The Democrats have been playing a high-stakes game with the American people. They insisted that President Bush was uniquely stupid and that Republicans were corrupt and dominated by the right. They, the Democrats, were the friends of the middle class.

That’s all fine and good. Everyone gilds the lily when running for office. But when you actually get elected you really ought to at least go through the motions of pretending that you meant all that stuff.

But no. The Democrats arrived in Washington last month thinking that they were at First and Goal rather than First Down on their own 20 yard line. So they nominated a bunch of lobbyists and tax cheats to the cabinet. So they passed a “stimulus” bill that shovels money at people already in receipt of staggering amounts of government spending. So they shoved through a partial repeal of welfare reform.

Here’s a fearless prediction. I’ll bet that very few centrist Obama voters thought they were voting for a repeal of welfare reform. They are really going to get a shock when Republicans tell them that their Democratic congressmen voted to turn back the clock on welfare.

Recalled to Life

Remember “Recalled to Life?” It comes from A Tale of Two Cities, Charles Dickens’ romance about the French Revolution. The phrase referred to Dr. Manette, imprisoned in the Bastille and now released.

For years Republicans and conservatives have felt a bit like they were imprisoned, or at least uncomfortably shackled.. The long withdrawing roar of the Bush administration and the cold-cock politics of the Democrats put decent, common-sense reform in the meat locker and sadly depressed Republican morale.

But now, in a short three weeks, the Obama administration has Recalled the conservative base to Life. In the lobbyist-fest of the Cabinet nominations, in the pork-fest of the stimulus bill, in the stealth repeal of welfare reform, we are reborn. Thank you, Mr. President, we needed that.

Now we know. There is no Hope. There is no Change. There is nothing to Believe In. It is back to business-as-usual. The Obama administration is giving the clearest signal you can give that the Democrats have not changed. In fact, they are beside themselves in pent-up frenzy after having to pretend throughout the Clinton era that they were really “new” Democrats who weren’t at all like the McGovern Democrats of the 1970s or the San Francisco Democrats of the 1980s who always “blamed America first.”

After years of patient message management and brilliant tactics the Democrats got the American people to believe that they were the party of the middle class and that the Democratic Party was a center-left party and that the Republicans were dominated by the right. You gotta say: they did a remarkable job with that message.

But now it looks like the Democrats under President Obama, Speaker Pelosi, and Majority Leader Reid are throwing off the cloak of invisibility. Underneath all that rhetoric they are liberal Democrats, and that means they believe in the neo-feudal welfare state and its huge patronage systems. They are building a land of great fiefs, vertical hierarchy, and a sea of helpless peasants.

Back in November, I voted for Barack Obama because I thought that, after four years of the Democrats in power, the American people would be ready for a Republican age of reform. Silly me. How wrong can you be?

It’s beginning to look as if the American people will be ready for Republican reform in about another month.

So I think I’ll take time this weekend to make my first contribution to Sarah Palin’s new PAC. Money, said Jesse Unruh, a California sate politician, is the mother’s milk of politics.

But isn’t this all too much too soon? Not really. Here’s the Four Step program I see in the months ahead.

1. Energize the base.
2. Start the money flowing.
3. Organize.
4. Start a conversation with the American people.

So let the games begin!

The Stealth Repeal of Welfare Reform

It is cruel, Mr. President. It is corrupt. It is wasteful, it is unjust. And it is delusional.

What I am talking about? I am talking about the reports from Benjamin E. Sasse and Kerry N. Weems, Mickey Kaus and from Robert Rector that your stimulus bill is repealing welfare reform.

All reports agree that the provisions in the bill that remove incentives to the states to reduce welfare caseloads will result in expansion of welfare programs. The bill will result in a return to the status quo ante 1996. And that is wrong.

I think it is fair to say that nowhere, Mr. President, did you say that you would be turning back the clock on welfare reform. I am talking about the rotted, dysfunctional welfare system that had been a national scandal for 30 years before President Bill Clinton signed off on the landmark reform bill in 1996.

The Obama administration has no mandate to roll back welfare reform. None at all.

This is wrong, Mr. President. It is cruel, corrupt, wasteful, unjust, and it is deluded. Let us count how this is so.

1. Cruel: Let’s roll the Ellwood and Jencks chart from their 2004 report on welfare. Need I say more? It is cruel to destroy the low-income family in America with your welfare benefits.
2. Corrupt: Let’s face it. We know why liberals like welfare. It is about patronage, about the same as pirate captains sharing out the plunder. Liberals share the wealth because that is how they buy the patronage support of Democratic Party rank-and-file voters. And then, of course, liberals get to award themselves big administrative jobs to hand out the loot. Pensions too. This is corruption, pure and simple.
3. Wasteful: I could go on and on. There is the waste of taxpayers’ money. There is the waste of the lives caught up in the “poverty trap” of welfare. There is the waste of talent in the people who supervise and administer the programs. There is the waste, dare I say it, of scarce global resources at a time when we are trying to save the planet.
4. Unjust: It is a gross injustice to force Americans to pay for this expansion of welfare. There’s a penalty for injustice, and it catches up with you in the end.
5. Deluded: Yes, liberals. Go ahead. Make my day. If you think that this is just a cute little sweetener for your friends, you don’t understand what you are doing. Let us leave aside the record of thirty years of social science, of political philosophy, of simple decency and common sense, all of which thunders that government welfare is a terrible idea that devastates lives. There is the simple politics of it. Government welfare is very unpopular with the voters. They hate it.

There is only one thing to say about the monstrous repeal of welfare reform by the Obama Adminstration and the Democratic Congress.

This shall not stand.

The SNL Administration

I haven’t watched prime-time TV for 15 years. But I know that back in the day Saturday Night Live developed the concept of “not ready for prime time.” Not that I ever watched the Not Ready for Prime Time Players. (But I did just check Google to make sure I had my facts straight.)

It was common knowledge that the Clinton administration was not ready for prime time in 1993. And now it is looking like the same is true of the Obama administration.

Certainly the Obamites have swung and missed at three pitches in a row. First of all there was the “stimulus” bill that isn’t. Then there was President Obama’s first prime-time press conference. (A non-political friend call and said: R-O-O-K-I-E!)

Now we’ve just had to go through Treasury Secretary Tim Geithner’s not-read-for-prime-time performance on completing the bank bailout. Writes Larry Kudlow:

On Tuesday morning, stocks opened down about 75 points in the wake of Obama’s pessimism. But stocks really started to tumble when Tim Geithner stepped to the microphone. He totally bombed in his debut.

Geithner had no real plan to deal with the problem of unmarketable toxic assets on bank balance sheets. He offered no new architectural structure, no good way to remove the toxic assets, no clear pricing or funding proposals, and no meat on the bones.

Look. I’m a conservative and a partisan Republican. I have no debt and cash in the bank. What do I care if the Obama administration totally tanks and fails to fix the most important government program of all: the government-run and government-dominated credit system? Hey, all this stumbling and bumbling has energized the Republican base like you couldn’t believe.

(Yes. Forget the idea that the banks are private. Banking has been a government-regulated business since whenever. And it has been totally in the pocket of government ever since the Federal Reserve System was formed in 1913.)

(And if you wonder why bankers get all those bonuses, remember this. State and local government workers earn about 50 percent more that comparable workers in the private sector. So why shouldn’t government sponsored enterprises like the banks earn more than ordinary mortals too?)

But the fact is that the people who are going to be hurt by all this are the Democratic faithful. They are the people who got suckered into mortgage loans they couldn’t afford. The people who work in retail. The people who work at the less desirable trades in construction.

So I do care. And I wish that the Obama administration would get its act together, stop playing politics, and get the economy back on track. It’s not that hard. First of all, we’ve got to do Stage 2 of the bank bailout. We’ve got to get the bad loans off the books of the banks. We did that after the S&L meltdown (another Democratic program that went south). Secondly, it wouldn’t hurt to throw a lifeline to small business. Try something like a cut in the FICA tax, the tax on jobs. Try lowering the corporate income tax rate.

But let’s do one thing right now. Let’s stop throwing money at the Democratic establishment. They get 20 percent of GDP to play with already, and have just about zero accountability. So why load ’em up with more? They’ll just waste it.