Government, not capitalism, should take blame
By Adam Creighton, commenting from Australia
As the public squares of Western capitals fill with angry crowds – self-appointed representatives of the ‘the 99%’ – it is easy to poke fun.
Railing against greed and inequality is akin to complaining about human nature. And far from being 21st century sans-culottes, these are mostly avec-ipods: relatively well-off, educated, and accessorised with the clothes and gadgets of the corporate culture they damn.
But their inchoate chants give vent to an increasingly widespread disgust with the economic status quo. Across the OECD the global financial crisis has thrown 15 million people out of work. Massive bank bailouts have triggered public debt crises in the United States and Europe that presage penal inflation and tax hikes.
In Britain, whose public debt has surged £1 trillion, GDP per person is now 13% lower than its pre-crisis trajectory. Ordinary taxpayers and voters are bearing these colossal costs, while those that abetted the crisis – bank staff, economic bureaucrats and politicians – remain and even prosper.
If this is not galling enough, the steady drip of obscene ‘bonuses’ and gargantuan pay cheques in the wider corporate world is Chinese water torture for disillusioned taxpayers and shareholders.
The public is not angry about inequality per se; they are concerned by an economic system that appears to be allocating rewards arbitrarily and unfairly.
They are rightly gobsmacked that the system’s shortcomings, starkly revealed, are being papered over, even exacerbated.
It is a public relations disaster for the intellectual ‘Right’ that vast swathes of voters worldwide are blaming capitalism for this offensive economic bog, and calling for greater government intervention.
It is not surprising, though. The International Monetary Fund, self-anointed ringmaster of ‘free markets’, repeatedly endorsed our economic system before 2008.
That people blame capitalism will be an economic disaster too, laying the groundwork for yet further shifts away from the ideals of a free society.
Indeed, the ‘occupying’ protestors should be agitating for more capitalism and less government.
Capitalism rewards talent and effort, and leaves the biggest rewards for those that risk their own money and time to produce goods or services that consumers can voluntarily buy – think Henry Ford or Lang Hancock or the late Steve Jobs.
Capitalism is not about giant corporations being able to dump their losses on taxpayers. It is not about allowing senior employees to feast with impunity on the profits of capital supplied by others simply because they can. Nor is it about armies of bureaucrats, corporate welfare, implicit guarantees for banks, or welfare states so pervasive and meddling they have sucked the appetite for individual responsibility out of their citizens.
Government has systematically shielded the biggest companies and their staff from the bracing but vivifying winds of ‘creative destruction’, what Joseph Schumpeter considered the hallmark of genuine capitalism.
Through direct spending and subtle regulations western governments have permeated almost every facet of the economy. In banking, governments and economic bureaucrats have acted as Dr Frankenstein, unwittingly facilitating monstrous growth in banks’ size, short-term profits and risk-taking with their implicit guarantees and feckless ‘Basel’ regulations.
Finally, despite patchy evidence, most economists agitate for Keynesian pump priming and artificially low interests rates to resuscitate economic growth. Yet their underlying models are often no less naive than the Leontief input-output tables that tried to animate the Soviet Union.
In short, Adam Smith and Friedrich Hayek would recoil at the economic status quo. If genuine liberals want to maintain credibility, they need to distance themselves from corporatist and managerial rent-seeking as much as they do from the labour and bureaucratic kind.
Arguing for a greater role for owners of capital in our economy – shareholders – is one important way to encourage enduring support for capitalism. Adam Smith railed against the avarice and waste of the managers of the British East India Company. Indeed, economists have long recognised the gross inefficiencies that can arise when the link between ownership and control is severed, whether in government or private enterprise.
Limited liability companies are a gift and construction of the state. They came about to promote risky ventures whose success could bring wide benefits but the costs of whose failure would be borne by the owners. They have been a boon for western civilisation, but they require managers to exercise prudence and restraint, especially in the banking sector where limited liability for owners and no liability for bankers can and do have harmful social outcomes.
Even if the distribution of incomes and wealth is of no concern, how it comes to manifest itself is. If the current trend continues, whereby ever greater rent-seeking, bureaucratic and corporate parasitism contributes to ever greater disparities of wealth, our western democracies leave ourselves open to extreme elements that could remove the freedoms and liberties we still have.
As the Remuneration Tribunal is about to recommend massive pay increases for politicians and senior bureaucrats – justified by ‘market rates’ – consider whether corporate largesse is contributing to a creeping venalisation of the public service too, which will only erode further public support for our economic system.
Abortion coverup and Kathleen Sebelius
If a private health insurer had engaged in the kind of criminal obstruction that Health and Human Services Secretary Kathleen Sebelius has been tied to in her home state of Kansas, it would be a federal case. Instead, it's a non-story in the Washington press. Nothing to see here. Move along.
On Monday, a district judge in the Sunflower State suspended court proceedings in a high-profile criminal case against the abortion racketeers of Planned Parenthood. World Magazine, a Christian news publication, reported on new bombshell court filings showing that Kansas health officials "shredded documents related to felony charges the abortion giant faces." World Magazine reported: "The health department failed to disclose that fact for six years, until it was forced to do so in the current felony case over whether it manufactured client records."
The records are at the heart of the fraud case against Planned Parenthood. Kansas health bureaucrats now shrug that the destruction of these key documents -- which they sheepishly admitted had "certain idiosyncrasies" -- was "routine." Who oversaw the agency accused of destroying the evidence six years ago? Sebelius.
As governor of Kansas, Sebelius fought transparency motions in the proceedings tooth and nail for years. Prosecutors allege a long-running heinous cover-up to manufacture false records of patients who had late-term abortions -- and to whitewash Planned Parenthood's systemic failures to report child rape.
Former GOP state Attorney General Phill Kline's investigation turned up massive discrepancies in reported child rape statistics compared to Planned Parenthood and the late late-term abortionist George Tiller's bogus claims. Planned Parenthood of Overland Park and Tiller together performed abortions on 166 girls aged 14 and under and only reported one each to authorities. So, 164 cases of underage rape or statutory rape went unreported and were not investigated by authorities.
Where is Joe Biden to decry actual rape atrocities and Nancy Pelosi to decry dire hazards to women's health when we need them?
A Kansas district judge found probable cause of criminality in the abortion providers' records; another district judge found probable cause to believe Planned Parenthood committed 107 criminal acts. Sebelius' response? A bloody ideological soul mate of Tiller's, she launched a vengeful witch-hunt against Kline. The state ethics board accused him of lying. The left-wing state Supreme Court Sebelius appointed stymied Kline's subpoenas and appeals.
Kline was cleared of all ethics violations. In fact, for 20 full months, the state's disciplinary board for lawyers suppressed an internal investigative report concluding there was zero probable cause to justify the ethics complaints.
Where there's obstructionist smoke, there's corruption fire. Under Sebelius' watch as governor, an inspector general also reported that her appointed health policy board had "applied pressure to alter an audit report, restricted access to legal advice and threatened to fire her for meeting independently with legislators," according to the Topeka Capital-Journal.
Entirely fitting, of course. The war on whistleblowers and inspectors general has been a hallmark of the current White House. And the radically pro-abortion rights Sebelius has ruled ruthlessly from her Beltway perch: policing citizen critics of Obamacare through a taxpayer-funded Internet snitch brigade; threatening private companies and insurers who have increased rates to cope with Obamacare coverage mandates; lashing out at newspapers who dare report on the costly consequences of the federal law.
As she bullies private companies to meet discriminatory and arbitrary disclosure demands, Sebelius has yet to be held accountable for overseeing state government agencies that conspired to hide the deadly truth about the Big Government/Big Abortion alliance from taxpayers. Like her boss in Washington, Sebelius' political playbook has a single page: Destroy the messenger.
Occupied with jobs, jobs, jobs
Has the country gone mad? No need to answer; the question is rhetorical. (In other words, I know the answer, too.) According to the Bureau of Labor, 14 million Americans together make up our dismal national unemployment rate of 9.1 percent. That figure doesn’t include the 9.3 million who have uncomfortably settled into part-time work, or the million additional folks who have become discouraged and stopped looking for work altogether.
This is a depression. No doubt, some agency of government spares no expense cataloguing the psychiatric records needed to substantiate that diagnosis.
President Obama campaigns across the country for his jobs bill — or to get re-elected next year on the slogan, “Republicans are even worse than me.” Only one effort stands any chance of success.
This jobs bill is predicated on two central ideas: (a) drop-shipping crates of cash to state and local governments, tallying each tiny statistically detectable response to stimulus as credit to Mr. Obama’s heroism, audacity, and sagacity, and (b) when people decide whether or not to vote for him next year, he’d prefer they be employed (if they’re not too discouraged) or, at the very least, to blame Republicans.
Thankfully, the Obama Jobs Bill is fully paid for. How? By raising taxes in the future on rich people who can afford it and don’t pay their fair share.
So, what does that tax share look like now? America’s top ten percent of income earners pay 73 percent of all income taxes collected. The bottom 47 percent of Americans certainly pay plenty in many another tax, but pay nothing in federal income taxes . . . in many cases receiving money from Uncle Sam over and above what they’ve paid in.
Fairness has a whole new meaning.
A proposal by U.S. Congressman Jesse Jackson, Jr., makes more sense than Obama’s bill — if the goal is to make sure everyone has a job. It makes no sense at all, but Jackson’s idea is for the federal government to simply hire every unemployed American at roughly $40,000 a year.
That’s more than 15 million people.
But that’s not the half of it. Think of all the millions making less than $40K who will quit their jobs to take the sinecure with the salary bump.
Hmmm. Why didn’t we think of that?
But count on congressional Republicans to stand in the way of Obama and the Democrats. Not out of a principled belief in free markets and antagonism to government taking money from one person to give to another, mind you. Something else will be at play, here.
With all the jaw-boning over jobs, former New Mexico Governor Gary Johnson’s proud declaration that as governor he never created a single job is the only statement with any merit — proving he understands the difference between politically-created, walking-around-money jobs and productive private sector positions financed through profits earned.
Funny, unemployed Americans don’t want jobs badly enough to travel to Alabama to pick the crops not now being harvested by illegal immigrant labor. Obama’s administration doesn’t want Boeing to open up a plant in South Carolina. Even in my neck of the woods, in Arlington County, Virginia, the county board moved unanimously to prevent a Wal-Mart, Target or other big box store from opening for business.
The message is: We want jobs, but only the jobs we want. We want high-paying jobs, with lots of perks and lavish health benefits and a pension paying more in retirement than one makes while working.
These days you won’t find many of those jobs . . . outside of government.
Maybe the government will start growing money trees.
Barack Obama and the infantilization of America
By JAMES TARANTO
Here's ABC News, reporting on the speech the president gave in Fog City: "At a million-dollar San Francisco fundraiser today, President Obama warned his recession-battered supporters that if he loses the 2012 election it could herald a new, painful era of self-reliance in America."
Oh no! Horror of horrors! Obama is the only thing standing between us and having to rely on ourselves! And do you know what they call people who rely on themselves?
Oddly, the White House website doesn't have the text of this speech, but here's a passage from ABC: "The one thing that we absolutely know for sure is that if we don't work even harder than we did in 2008, then we're going to have a government that tells the American people, 'you are on your own. If you get sick, you're on your own. If you can't afford college, you're on your own. If you don't like that some corporation is polluting your air or the air that your child breathes, then you're on your own.' That's not the America I believe in. It's not the America you believe in."
Obama explicitly rejects the American ethos of self-reliance. He sees dependence on government not as an evil, if sometimes a necessary one, but as a goal to be pursued. It reminded us of Peggy Noonan's observation last week that there's something not fully adult about the president himself: "Sorry to do archetypes, but a nation in trouble probably wants a fatherly, or motherly, figure at the top. What America has right now is a bright, lost older brother. It misses Dad."
Perhaps Obama is eager to infantilize Americans precisely because he is not a fatherly figure--a man of unquestioned wisdom and maturity. A strong father continues to command his children's respect even as they too reach adulthood. As Mark Twain observed, "When I was a boy of 14, my father was so ignorant I could hardly stand to have the old man around. But when I got to be 21, I was astonished at how much the old man had learned in seven years." The "bright, lost older brother," by contrast, can command the respect only of young children.
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