Wednesday, June 13, 2012

More Obama deception

Blaming others for the results of his own policies

President Obama’s latest campaign talking point on the economy is that the Republicans in Congress are responsible for laying off teachers, police officers, and firefighters.

The “private sector is doing fine” line was the one that got all the attention on Friday in the president’s remarks to the press, but Mr. Obama’s other message was just as newsworthy: “the private sector has been hiring at a solid pace over the last 27 months. But one of the biggest weaknesses has been state and local governments, which have laid off 450,000 Americans. These are teachers and cops and firefighters. Congress should pass a bill putting them back to work right now, giving help to the states so that those layoffs are not occurring.”

Mr. Obama followed up over the weekend in his weekly address: “it should concern everyone that right now—all across America—tens of thousands of teachers are getting laid off. In Pennsylvania alone, there are 9,000 fewer educators in our schools today than just a year ago. In Ohio, the number is close to 7,000. And nationwide, over the past three years, school districts have lost over 250,000 educators....I hope you’ll join me in telling Congress to do the right thing; to get to work and to help get our teachers back in the classroom.”

This message is so misguided, and at the same time so characteristic of Mr. Obama’s overall approach, that it is worth taking it apart in greater detail in five ways as an illuminating example.

The focus on inputs rather than outputs. President Obama is concentrating on how many teachers, police, and firefighters there are. What matters more to me is whether the students in schools are learning, what the crime rate is, and how many fire-related fatalities there are. If standardized reading and math scores are increasing, homicide statistics are decreasing, and fire-related losses are diminishing even with fewer teachers, police officers, and firefighters, that could be a good thing, because it saves taxpayers money. In the private sector, increased productivity—doing the same amount of work with lower labor costs, or getting more work out of the same number of person-hours —is a goal, often achieved through technology or innovation. To President Obama, it seems like a threat.

The stasis. For a guy who ran on a promise of “change,” Mr. Obama sure seems alarmed by minor fluctuations in teacher headcount. The president talked about the decline in teacher employment in Pennsylvania, though he did not say how much of it was owing to retirements and attrition and how much was attributable to layoffs. He also didn’t mention that the number of students in Pennsylvania has also declined—to 1,765,327 in October 2011 from 1,801,760 in October 2007, according to the Pennsylvania Department of Education. The same is true in the other state Mr. Obama mentioned, Ohio, where the student headcount dropped to 1,832,832 in October 2010 from 1,892,490 in October 2004. Private businesses add and shed employees all the time in response to how many customers there are. Why shouldn’t governments make the same adjustment?

The obliteration of distinctions between federal and local responsibilities. The best people to decide how many police or teachers or firefighters are needed are the people within the jurisdiction being policed, or protected from fire. Some places may prefer lower taxes and a volunteer fire department. Other places may prefer higher taxes and a fancier high school. The framers of the Constitution realized this when they created a national government with limited and enumerated powers and left the rest of the powers to the states.

The redistribution. There’s a certain amount of redistribution that goes along with most government functions, and it can sometimes be unjust. Residents who do not have children, or who chose to send their children to private schools, are taxed to support the public schools. Non-smoking residents who live in brick houses with working smoke-detectors and sprinkler systems are taxed to support firefighters to rescue neighbors who smoke in bed in their straw houses and who have let the batteries in their smoke detectors go dead. But people can make choices about where to live based on their preferences. Injecting the federal government into these local government payroll choices means that even the childless couple who deliberately moved into a low-tax district with leanly staffed schools is stuck having their federal tax dollars pay for the teachers in the overstaffed district next door.

The vote buying. Mr. Obama can’t fairly be blamed for being political. He is, after all, a politician. But I can’t recall ever encountering another politician who so sanctimoniously preens about being above politics while so crassly engaging in vote-buying with taxpayer money. Pennsylvania and Ohio, after all, are swing states in the presidential election, and Mr. Obama’s effort to bolster state and local public-sector payrolls there with federal taxpayer dollars would expand and enrich government-employee unions that are reliable Democratic allies. Yet Mr. Obama’s weekly address concludes, “I know this is an election year. But some things are bigger than an election. Some things are bigger than politics....We can’t afford to wait any longer.”

There are a lot of listeners who may agree about the “can’t afford to wait any longer” part — not about re-hiring the laid-off public employees in Ohio and Pennsylvania, but about allowing a certain Washington-D.C.-based government employee to join them in the ranks of the newly unemployed come January 2013.



Socialist or Fascist?

Thomas Sowell

It bothers me a little when conservatives call Barack Obama a "socialist." He certainly is an enemy of the free market, and wants politicians and bureaucrats to make the fundamental decisions about the economy. But that does not mean that he wants government ownership of the means of production, which has long been a standard definition of socialism.

What President Obama has been pushing for, and moving toward, is more insidious: government control of the economy, while leaving ownership in private hands. That way, politicians get to call the shots but, when their bright ideas lead to disaster, they can always blame those who own businesses in the private sector.

Politically, it is heads-I-win when things go right, and tails-you-lose when things go wrong. This is far preferable, from Obama's point of view, since it gives him a variety of scapegoats for all his failed policies, without having to use President Bush as a scapegoat all the time.

Government ownership of the means of production means that politicians also own the consequences of their policies, and have to face responsibility when those consequences are disastrous -- something that Barack Obama avoids like the plague.

Thus the Obama administration can arbitrarily force insurance companies to cover the children of their customers until the children are 26 years old. Obviously, this creates favorable publicity for President Obama. But if this and other government edicts cause insurance premiums to rise, then that is something that can be blamed on the "greed" of the insurance companies.

The same principle, or lack of principle, applies to many other privately owned businesses. It is a very successful political ploy that can be adapted to all sorts of situations.

One of the reasons why both pro-Obama and anti-Obama observers may be reluctant to see him as fascist is that both tend to accept the prevailing notion that fascism is on the political right, while it is obvious that Obama is on the political left.

Back in the 1920s, however, when fascism was a new political development, it was widely -- and correctly -- regarded as being on the political left. Jonah Goldberg's great book "Liberal Fascism" cites overwhelming evidence of the fascists' consistent pursuit of the goals of the left, and of the left's embrace of the fascists as one of their own during the 1920s.

Mussolini, the originator of fascism, was lionized by the left, both in Europe and in America, during the 1920s. Even Hitler, who adopted fascist ideas in the 1920s, was seen by some, including W.E.B. Du Bois, as a man of the left.

It was in the 1930s, when ugly internal and international actions by Hitler and Mussolini repelled the world, that the left distanced themselves from fascism and its Nazi offshoot -- and verbally transferred these totalitarian dictatorships to the right, saddling their opponents with these pariahs.

What socialism, fascism and other ideologies of the left have in common is an assumption that some very wise people -- like themselves -- need to take decisions out of the hands of lesser people, like the rest of us, and impose those decisions by government fiat.

The left's vision is not only a vision of the world, but also a vision of themselves, as superior beings pursuing superior ends. In the United States, however, this vision conflicts with a Constitution that begins, "We the People..."

That is why the left has for more than a century been trying to get the Constitution's limitations on government loosened or evaded by judges' new interpretations, based on notions of "a living Constitution" that will take decisions out of the hands of "We the People," and transfer those decisions to our betters.

The self-flattery of the vision of the left also gives its true believers a huge ego stake in that vision, which means that mere facts are unlikely to make them reconsider, regardless of what evidence piles up against the vision of the left, and regardless of its disastrous consequences.

Only our own awareness of the huge stakes involved can save us from the rampaging presumptions of our betters, whether they are called socialists or fascists. So long as we buy their heady rhetoric, we are selling our birthright of freedom.



Socialism in action

The Soviet Union lasted as a socialist workers' paradise from 1917 until 1991. As a direct result of that experiment, at least 30 million Russians died. It may have been twice that. China's experiment was shorter: 1949 to 1978. Perhaps 60 million Chinese died.

The system failed to deliver the promised goods. I can think of no topic more suitable for a class in economics than a discussion of the failure of socialism. The same is true of a course in modern world history. A course in political science should cover this failure in detail.

They don't, of course. They do not begin with the fundamental challenge to socialist economic theory, Ludwig von Mises's 1920 essay, Economic Calculation in the Socialist Commonwealth. Why not? Because most social scientists, economists, and historians have never heard of it. Among people over age 50, the few who did hear of it heard about it from some prosocialist or Keynesian advocate, who wrote what he had been told in graduate school in the 1960s, namely, that the article was totally refuted by Oskar Lange in 1936.

They are never told that when Lange, a Communist, returned to Poland in 1947 to serve in several high-level posts, the Communist government did not invite him to implement his grand theory of "market socialism." No other socialist nation ever did.

For 50 years, the textbooks, if they mentioned Mises at all, said only that Mises had been totally refuted by Lange. The Establishment academics dropped Mises down Orwell's memory hole.

On September 10, 1990, multimillionaire socialist author-economist Robert Heilbroner published an article in the New Yorker. It was titled "After Communism." The USSR was visibly collapsing. In it, he recounted the story of the refutation of Mises. In graduate school, he and his peers were taught that Lange had refuted Mises. Then he announced, "Mises was right." Yet in his bestselling textbook on the history of economic thought, The Worldly Philosophers, he never referred to Mises.

The Visible Failures

The universal failure of 20th-century socialism began from the opening months of Lenin's takeover of Russia. Output declined sharply. He inaugurated a marginally capitalist reform in 1920, the New Economic Policy. That saved the regime from collapse. The NEP was abolished by Stalin.

Decade after decade, Stalin murdered people. The minimal estimate is 20 million. This was denied by virtually the entire intelligentsia of the West. Only in 1968 did Robert Conquest publish his monumental book, The Great Terror. His estimate today: closer to 30 million. The book was pilloried. Wikipedia's entry on the book is accurate.

Published during the Vietnam War and during an upsurge of revolutionary Marxist sentiment in Western universities and intellectual circles (see The Sixties), The Great Terror received a hostile reception.

Hostility to Conquest's account of the purges was heightened by various factors. The first was that he refused to accept the assertion made by Nikita Khrushchev, and supported by many Western leftists, that Stalin and his purges were an aberration from the ideals of the Revolution and were contrary to the principles of Leninism. Conquest argued that Stalinism was a natural consequence of the system established by Lenin, although he conceded that the personal character traits of Stalin had brought about the particular horrors of the late 1930s. Neal Ascherson noted:

"Everyone by then could agree that Stalin was a very wicked man and a very evil one, but we still wanted to believe in Lenin; and Conquest said that Lenin was just as bad and that Stalin was simply carrying out Lenin's programme."

The second factor (1918) was Conquest's sharp criticism of Western intellectuals for what he saw as their blindness towards the realities of the Soviet Union, both in the 1930s and, in some cases, even in the 1960s. Figures such as Beatrice and Sidney Webb, George Bernard Shaw, Jean-Paul Sartre, Walter Duranty, Sir Bernard Pares, Harold Laski, D.N. Pritt, Theodore Dreiser and Romain Rolland were accused of being dupes of Stalin and apologists for his regime for various comments they had made denying, excusing, or justifying various aspects of the purges.
The Left still hates the book, still attempts to say that he exaggerated the figures.

Then came The Black Book of Communism (1999) which puts the minimum estimate of citizens executed by Communists at 85 million, with 100 million or more likely. The book was published by Harvard University Press, so it could not be dismissed as a right-wing fat tract.

The Left tries to ignore it.

The response of academia has been to dismiss the entire experiment as misguided, but not inherently evil. The cost in lives lost is rarely mentioned. Before 1991, this was even more rarely mentioned. Prior to Solzhenitsyn's Gulag Archipelago (1973), it was considered a breach of etiquette for an academic to do more than mention it in passing, limiting it to Stalin's purges of the Communist Party in the late 1930s, and almost-never-mentioning forced starvation as a matter of public policy. "Ukraine? Never heard of it." "Kulaks? What are kulaks?"

Felix Somary records in his autobiography a discussion he had with the economist Joseph Schumpeter and the sociologist Max Weber in 1918. Schumpeter was an Austrian economist who was not an Austrian School economist. He later wrote the most influential monograph on the history of economic thought. Weber was the most prestigious academic social scientist in the world until he died in 1920.

Schumpeter expressed happiness regarding the Russian Revolution. The USSR would be a test case for socialism. Weber warned that this would cause untold misery. Schumpeter replied, "That may well be, but it would be a good laboratory." Weber responded, "A laboratory heaped with human corpses!" Schumpeter retorted, "Every anatomy classroom is the same thing."[1]

Schumpeter was a moral monster. Let us not mince words. He was a highly sophisticated man, but he was at bottom a moral monster. Anyone who could dismiss the deaths of millions like this is a moral monster. Weber stormed out of the room. I don't blame him.

Weber died in 1920. That was the year in which Mises's essay appeared: Economic Calculation in the Socialist Commonwealth. Weber gave it a footnote in his masterpiece, published posthumously as Economy and Society (p. 107). Weber understood its importance as soon as he read it. Academic economists did not. Even today, there are few references to it.

Mises explained analytically why the socialist system is irrational: no capital markets. No one knows what anything should cost. He said that the systems would either violate the commitment to total planning or else fail totally. He has never been forgiven for this breach of etiquette. He was right, and the intellectuals were wrong. The socialist commonwealths have collapsed, except for North Korea and Cuba. Worse, he was right in terms of simple market theory that any intelligent person can understand. That article is a testimony to the West's intellectuals: "There are none so blind as those who refuse to see."




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The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)


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