Let's Not Think Big on Energy

Oh good. Big thinker Jeffrey Sachs, part-owner of the mess in post-Soviet Russia, and now director of the Earth Institute at Columbia University, wants President Obama to think big on energy.

What the disaster truly makes clear, however, is the inadequacy of the administration's own approach to overhauling America's energy system.

Yeah. Like government and its bribed-apologist experts have a clue "overhauling" anything, let alone America's energy system.

Sachs understands, at least, that the current Obama policy approach is flawed. The American people can see that it is a rat's nest of favors and subsidies to special interests. So that's why a bold plan is needed.

That is where the government - and the President - must come in: to promote, in a systematic and aggressive way, the best alternatives for clean energy and then to speed their adoption as they prove their economic and environmental merit.

Franky, Mr. Sachs, I doubt it. For all the talk about consensus and imminent disaster required massive government intervention, the fact is that we haven't a clue about the "best alternatives" or even the meaning of "clean energy." We don't know if CO2 concentration is a problem. We don't know what the climate is doing. And we don't know which technologies will be the winners.

The best thing to do, right now, as Iain Murray writes in National Review Online, is to stop the crony capitalism that induces companies like BP--"Beyond Petroleum"--to get cozy with the government. Look what happened after the Exxon Valdez spill.

After the Exxon Valdez spill, legislators and industry got together and agreed to a cap on damages in exchange for an increase in tax payments. Generally, damage caps create what is known as “moral hazard,” lessening the consequences — and thus increasing the likelihood — of a potentially damaging act.

Isn't that special! Special privileges and exemptions in return for tribute.

What we need to get us to the energy future is a lot of people trying different stuff. That's because nobody knows what the future will demand. Nobody knows what the best alternatives are. Sure, there are a ton of promising ideas out there. But who knows which are the good ideas and which are the good ideas that work.

Fortunately, we have a wonderful system for exploring the future and rewarding the people that get it right. It is called capitalism. Free enterprise capitalism, not government-corrupted crony capitalism.

Government's role is an important one. It is to play the role of impartial judge. When you get "people trying different stuff" you can be sure that they will make a ton of mistakes. Some of those mistakes will be messy, like BP's mistake in the Gulf of Mexico. When people make a mess, they must clean it up. No need to send down the US Attorney General with criminal complaints and perp walks. Just make sure that the law operates properly so that people damaged by a spill or a gas release get compensated fairly and justly.

Conservatives have a great role to play here. It is to play interference against politicians, against experts like Jeffrey Sachs, and against politicized corporations like BP.

The future will almost certainly be significantly different from the future planned by government and its experts. It will almost certainly be different from the future imagined by today's big corporations. That's because, in the nature of things, today's power elite won't want futures that diminish their power. Politicians want to spend money on programs that will get them reelected. Experts want national crises that require more research. Big corporations want solutions that will allow them to leverage their current market advantages against small upstarts.

The beauty of capitalism is that it doesn't give a damn about politicians, experts and big corporations. It just rewards the chap who had the right idea at the right time. And the other people? The chaps with the right idea at the wrong time? The chaps with the promising idea that wouldn't scale or couldn't be reliable or inexpensive enough? Well, they probably had a grand time trying.

The encouraging thing is that whatever stupid crony-capitalist or public-private partnership policy or grand strategy that Obama comes up with, he'll probably botch it.

And then the decks will be cleared for ordinary technologists and businessmen to do something sensible.

Canada and Welfare State Cuts

I checked out a TV in the guest room yesterday and in two minutes saw an ad for AARP's Medicare Supplement insurance and an ad by a lawyer advertising his services in applying for Social Security Disability benefits--the benefits "you deserve!"

It shows how central the welfare state must be in the lives of the TV-watching classes.

AARP's Medicare Supplement business is one of the untouchables in national politics.

And Social Security's Disability program already covers about four percent of the working population. I read an article a while back that predicted that the disability rolls would reach seven percent. Expect that number to be reached when we fully emerge from the current Man-cession in the next couple of years.

What will happen to the welfare state in the years ahead? Obviously we will hit a crisis. And liberals will suddenly realize that they need to trim the welfare state or go out of business.

In Canada, liberals reached that point in the 1990s, as Fred Barnes reminds us.

Canada was called an “honorary member of the Third World” by the Wall Street Journal in 1995, and for good reason. Out-of-control spending, soaring debt, and the government’s bite of the country’s gross domestic product (GDP) growing at a furious pace—those trends prompted the Journal’s harsh putdown.

The liberals in Canada's Liberal Party realized that something had to give. So they implemented draconian cuts in central government spending.

The results have been remarkable. In two years, spending declined 8.8 per-cent. The size of the national government dropped from 16 percent of GDP in 1994 to 13 percent. As debt shrunk, once-gigantic interest payments fell dramatically.

That’s not all. Canada’s version of Social Security was put on a sound financial footing. Only one large government entity with soaring costs has been left unreformed: the single-payer health care system.

Now Canada is trying to do something about its health care system, satirized a while back in the movie The Barbarian Invasions. According to Reuters:

British Columbia is replacing block grants to hospitals with fee-for-procedure payments and Quebec has a new flat health tax and a proposal for payments on each medical visit -- an idea that critics say is an illegal user fee.

Well, you can see that the Canadians are not that serious about cutting health care costs. Not yet.

But you can see the problem. Millions of people, like the folks watching those TV ads about government benefits, have organized their lives around the government's IV. If anyone tries to change the bottle of joy-juice, or even reduce it, it will produce enormous rage and resistance.

So, just like in Canada, we really need the liberals to get out in front. It is liberals that must carry the news to their supporters that the glory days are over. Will they? Would President Obama lead such an effort in 2012 after a chilling defeat in the November 2010 mid-terms?

Because if President Obama doesn't lead off, then it will be eight or ten years before another Democrat can lead his party towards a welfare state that recognizes limits on government largesse.

By that time we'll really be in trouble.

Not "Battle" but "Conversation"

I'm afraid that Arthur C. Brooks is missing the point in his new book The Battle: How the Fight between Free Enterprise and Big Government Will Shape America's Future

Not that there won't be a battle over the future of America.

In his book, trailed in The Washington Post in "America's New Culture War: Free Enterprise vs. Government Control," Brooks argues that Americans support free enterprise over government control by 70% to 30%. And he writes that it is not just money and materialism that drives the private sector but "earned success."

Earned success is the creation of value in our lives or in the lives of others. Earned success is the stuff of entrepreneurs who seek value through innovation, hard work and passion. Earned success is what parents feel when their children do wonderful things, what social innovators feel when they change lives, what artists feel when they create something of beauty.

There's just one problem with "The Battle" and "earned success." It is boy stuff. What about the girls?

The key challenge for conservatives is not to appeal to men. Men are already voting conservative and Republican. It is to appeal to women, particularly the single women who vote 70-30 for Democrats.

Free enterprise is a sublimation of the warrior code into the non-violent pursuit of victory in the pursuit of market share. Battle is the way that men go about social competition. Free enterprise vs. big government is a battle-oriented way of looking at our national problems.

We conservatives need to learn girl talk. We must propose not a "battle" but a "conversation." Men assemble on two sides to fight a battle to decide a conflict. Women gather for a conversation to "share" their dilemmas and negotiate a fair outcome.

Conservatives need to "share" with their liberal friends that big government is a terrible way to resolve dilemmas. Take education for instance. Every woman knows that her child is different and special. So why do we turn education of children over to big government and its one-size-fits-all philosophy?

Conservatives need to advance the idea that abortion doesn't just terminate the life of a child, but aborts the future. Abortion makes it harder for a woman to find love, for abortion makes the argument that sex is nothing special and should be available on demand.

Conservatives need to discuss with women how children suffer in any home that isn't headed by their married biological mother and father. Any other arrangement means more abuse of the children in it. When it's mother and boyfriend, the abuse may be six to 30 times the abuse in a married, biological home.

Men think in terms of strategic concentration. Women think in terms of sharing the wealth. Want to share the wealth? Much better to do it in a large extended family or through charitable kindness than in the wasteful corruption of Chicago-style big government.

"Earned success" is also a boy concept. Women don't "earn" anything; they don't have to. A man knows that he must prove himself before he can contribute to society. A woman is valuable and precious just because she is. She works and cares and loves and gives. What the world must do is give back to her, for there is nothing sadder and nothing angrier than a woman whose love and care has been spurned and wasted.

Yup. There's going to be a battle royal in the next few years. But conservatives need to see beyond that.

What we need is a great national conversation with women. We need to discuss with them how big government diminishes the future of their children and pollutes their lives with conflict and cruelty.

Should be a slam-dunk, fellas. I mean, it should be easy for everyone to share and come to agreement.

Sometimes Footwork Can't Save You

This year it looks like there's no place to hide. Moderate Republican US Senator Arlen Specter (D-PA) thought he could switch to the Democratic Party and win a sixth term to the Senate. But he was wrong, and was defeated in the Democratic Primary by Rep. Joe Sestak two weeks ago.

Democratic Rep. Parker Griffith (R-AL) thought he could switch from the Democratic Party and keep his seat in north Alabama as a Republican. He was wrong, and was defeated last night in a Republican Primary by "long-time conservative Mo Brooks."

Is it possible that we are looking at a Perfect Storm this Fall? You never know. Here are three reasons why our liberal friends are probably looking at the worst night of their lives.

People don't like the powerful. Our liberal friends have done a remarkable job over the years pretending that it is evil banks and corporations that run the country, and that they are plucky Davids trying to slay Goliath. Sorry chum. But they are deluding themselves. It is liberals that occupy the commanding heights of politics and culture. We are spending 45 percent of GDP on government these days because of liberals. A trillion dollars a year on pensions, a trillion a year on health care, a trillion a year on education, and a half-trillion a year on welfare. You could look it up.

Liberals "have misused the King's press damnably." Shakespeare's Falstaff said it first. At least he was honest. The Greek-American said it better. You don't have power unless you've abused it. And how. I don't think that our liberal friends really understand the damage they have done with their power and their government programs: smashing the low-income family, devastating urban neighborhoods, smashing the nation's finances, politicizing everything (and thus dividing the nation), wrecking education, messing up health care with a rat's nest of subsidies and regulations.

Sometimes, it's time. One of the consolations of religion is that it promises that the evil will get their deserts. Maybe not in this life but in the next one. Abuse and injustice in this vale of tears roll on from year to year, and it seems that the heavens themselves ought to cry out for justice. Sometimes you don't have to wait till the next life for the Last Judgement. All of a sudden, along comes a Perfect Storm. The floodwaters rise, and years of sediment are washed away in a single night. So far, 2010 is shaping up as a year like no other.

Of course, after the Perfect Storm, the problems are still there, maybe worse than ever. But at least the old order has been shaken to its foundations.

Our problems are not that great. We simply spend too much on government and on its supporters. Just about every dollar spent on government is a waste. But the people getting their dollars from the government are well organized. In normal times they can face down the reformers that want to reduce the weight of government on Americans and American businesses.

But then, along comes a year with a Perfect Storm.

Where the Liberals Went Wrong

So, the sea level hasn't started to recede. Nor has the planet started to heal. In fact, the planet is ripped open in two places, the Gulf of Mexico and Iceland.

And President Obama is staring into the abyss of presidential irrelevance, as his irresolute response to the Deepwater Horizon disaster has exposed the hollow man where his executive ability ought to be.

What went wrong?

The problem is the fundamental error at the heart of the liberal project.

The problem is quite simple. Everything that should be forced, liberals won't force; everything that shouldn't be forced, liberals force. The result is disaster.

Should we take a firm line against communism and radical Islam? No, no. Not so fast. Should we crack the heads of teenage hoodlums in the city? No, that would be racial profiling.

Should parents have the right to direct their children's education? Certainly not. They cannot be trusted, and must be forced to send their children to government schools. Health care? Force everyone to help the needy and the not-so-needy. Relief of the poor? Force is the only option.

Here's the error. Humans are social animals, not servile animals or mechanical animals. We are designed not for rigid hierarchies and clockwork precision, but flexible social interaction. We thrive not as subordinate ciphers but as interconnected members of a group.

Thus, to view society as a private sector and a public sector, of corporations and government, as we like to do, is a fundamental misunderstanding of human society.

Let us at least divide it into three, as Michael Novak does in The Spirit of Democratic Capitalism. There is the political sector, the zone of force. There is the economic sector, the zone of exchange. And there is the moral/cultural sector, the zone of... Er, yes. What shall we call it?

Shall we call it the zone of persuasion? The zone of feeling? Sentiment? Caring? Sharing? Yes, that's it: the zone of sharing.

You can see where the liberals go wrong. They want to make the zone of force the preeminent zone. OK, but look at the problems they create. Liberals bring everything under the color of compulsion. Sharing is compulsory. Exchange comes under the knout of political power. Persuasion is backed up by the power of the state. Caring comes to be defined by the amount of government spending.

The great challenge of the coming years, starting from right now, is to imagine a world of sharing, a world of social animals, in which the zone of force has been put back into its box. Where exchange is once more free and equal, and sharing is voluntary and free.

In the enlargement of the zone of force, liberals have collapsed the penumbra of moral action. It used to be that social force was limited, and people found themselves under enormous social pressure to be moral. But now, the moral and the legal are almost identical. So that means that the immoral has become almost always the illegal and the criminal.

Not a good idea.

We know why this has happened. It has happened because liberals have deliberately worked to loosen social ties and obligations. That is because liberals think that community obligations are often oppressive and marginalizing. People need to be liberated from the cramped norms of the family and the neighborhood--even the nation state.

But there's a price to that. Looser networks mean less social norms and more antisocial behavior and more force. As Leon Festinger found in his research: "norms are clearer, more firmly held and easier to enforce the more dense a social network is." And vice-versa.

Actually, "enforce" is an unfortunate choice of word here, and shows the liberal blindness on force and persuasion. Because in a social network, you usually don't have to resort to force.

What is the right word? Let's say this: Norms are clearer, more consensual, and more observed the more dense a social network is.

Well, it's a start.

Dems Bash Rich for Midterms

First it was President Obama, who told an audience in Quincy, Illinois:

“We're not trying to push financial reform because we begrudge success that's fairly earned. I do think at a certain point you've made enough money, but you know, part of the American way is, you can just keep on making it if you're providing a good product.”

Er, I don't think that has much to do with financial reform, Mr. President. As I see it, your financial reform package is designed to maintain government control over the finance industry. What has government domination of the finance industry done for us? Fannie. Freddie. Value of the dollar down 98 percent in 100 years. On that record we are supposed to increase the government's powers?

Then it was Hillary Clinton in a speech at the Brookings Institition urging governments to "increase their public revenue collections" to spur investment.

"The rich are not paying their fair share in any nation that is facing the kind of employment issues (the United States is), whether it's individual, corporate, whatever the taxation forms are," she said.

You mean increase taxes on job creators in a recession, Madam Secretary?

Then there is Robert Reich who says that "'investing' in 'people' through education and social welfare programs leads to job and economic growth."

You mean the wonderful system that gives us 15 percent of adults "below-basic" in literacy? And welfare programs that have cratered the low-income family?

If Clinton and Reich were correct, then with the massive increase in "public revenue collections" in the 20th century from about 7 percent of GDP to about 35 percent, we should be seeing a lot more jobs and economic growth. Actually, spurts in growth happened after the government lowered tax rates in the 1920s, 1960s, 1980s, and 1990s.

In fact, rich people pay rather more than their fair share of taxes, particularly income taxes. In 2006 the "top 1 percent of households earned 18.8 percent of income and paid 28.3 percent of taxes."

Democrats seem to be eager to argue for increased taxes in the upcoming mid-term elections this Fall. We will see what the American people think of that.

Big Government's Katrina

Republicans and conservatives naturally want payback on Katrina.

Famously, President Bush's failure to respond to Hurricane Katrina within moments demonstrated what Democrats had been saying all along, that Bush was a jumped-up frat boy who wasn't intelligent enough to be president.

Now everyone is saying that the Deepwater Horizon oil spill is "Obama's Katrina."

But that would be a mistake. That would be missing the forest for the trees. As Rahm Emanuel said so succinctly: "You never want a serious crisis to go to waste."

Blaming Obama would be missing a golden opportunity to have a national conversation about Big Government.

What Deepwater Horizon shows is not that Obama is incompetent. It shows that Big Government is incompetent.

It means that all the tens of thousands of programs we have built up over the last century are a waste. All the regulations and the permits in the world can't stop people from making an honest mistake. Or misreading data. Or cutting a corner. Or being in a hurry. Or just frightened to make a decision that will cost a lot of money and get them in trouble with their boss.

There's even a book about it: Normal Accidents: Living with high-risk technologies by Charles Perrow.

Humans advance by trial and error. We don't live by the precautionary principle, that we should really think through everything before we start messing around with sacred Mother Earth. We can't. Life is too short. So we push blindly ahead and every now and again we make a mess. Sometimes it's a big mess. Then we clean it up.

The great advance in the last century is in just how good we have got in keeping things clean and in cleaning up messes.

Peggy Noonan is right to point out that Deepwater Horizon is a disaster for Obama and his political philosophy. (Imagine if this happened on President Bush's watch!) So it is.

But that's why we needed the Obama presidency. We needed the American people to see that it wasn't George W. Bush who was the problem. The issue isn't competence of presidents, the delusional god of liberals.

The problem is that you can't run a complex world with hierarchical bureaucracies and regulations and permits and "Mr. President, is it safe?" Life is much messier than that.

Let's not pile on President Obama. Even if he deserves it. Let's concentrate on the bigger picture. Let's focus on the failure of Big Government.

The American people deserve something better than blundering Big Government.