Cronies Forever — Dude!

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In a recent reflection, I noted a number of instances of what is fairly clearly corruption on the part of this Administration. (I was actually adding to a list of instances first given by the Washington Examiner columnist Tim Carrey).

But — such is my declining memory in my declining years — I missed a particularly egregious example of Obama’s Chicago School of Economics (which is definitely not to be confused with the Chicago School of Friedman and his co-workers).

The signature bill for which Obama will be remembered (or cursed) is his healthcare act, the eponymous Obamacare. One of the provisions of this monstrosity is the requirement that all healthcare plans must raise their annual limits to at least $750,000. (In 2012, that minimum allowable limit rises to $1.25 million; it then rises to $2 million in 2013.) Naturally, this requirement forces companies whose employee insurance has lower limits to raise them and thus pay higher premiums, or to cancel their employee health plans. The only way not to obey it is to go hat in hand to the Department of Health and Human Services — run by the Obama regime, remember — and get a waiver, which the HHS Department will grant or deny, as it sees fit.

The number of these waivers has been rising rapidly, with well over 700 companies and unions now having obtained them. And, behold! An amazing pattern is emerging about who gets the coveted waivers: disproportionately, they seem to be going to the regime’s supporters.

To be precise, as David Freddoso documents, 40% of the workers affected are in union plans. (In fact, of the 14.6 million unionized workers in this country, nearly a million are now conveniently exempt from the provisions.) But do I have to add that these unions are all huge donors to Democratic campaign coffers in general and Obama’s coffers in particular?

And I’m willing to bet that of the companies that got exemptions, a large percentage have also contributed to Democratic political campaigns.

That’s Obama’s Chicago School of Economics, or what I call neo-socialism. The regime doesn’t actually own all major businesses, but it controls them tightly and exacts tribute from them. More succinctly, it’s “play for pay, the Chicago way”!




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A New Record of Folly

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A new report that hasn’t gotten much play in the afterglow of President Obama’s state of the union address was the Congressional Budget Office estimate for the budget deficit this year. The CBO estimates that the deficit will hit a new record of $1.5 trillion. And it projects that the 2012 deficit will be $1.1 trillion. Even though this will be the third year of trillion-buck-plus deficits, and it will top last year’s record-setting deficit of $1.4 trillion, no doubt Obama will continue to blame Bush (whose largest deficit was a little over $400 billion in 2008). But that rhetorical trope is working less and less well for Obama.

Obama seems now to be aware that the populace is becoming increasingly alarmed at these unprecedented budget deficits. His speech proposed a meager deficit reduction — about $400 billion over ten years.

The big question is how much stomach the Republicans have to push for steeper cuts. The public is now aware of the problem but is still fiscally incontinent: it favors cutting the budget generally but opposes cutting specific popular programs. Even Tea Party members typically support the major entitlement programs (Medicare, Medicaid, and Social Security) that are metastasizing most rapidly.

There are slight signs that the Republicans may strap on some stones and step up to the plate. Orrin Hatch (R-UT) has once again proposed a balanced budget amendment, stronger than the amendment that failed by one vote in the Senate 14 years ago. Hatch’s version would require a two-thirds majority for Congress to raise taxes. But while a dozen Republican senators have signed on, no Democrats have, indicating that this has little chance of passing.

Sen. David Vitter (R-LA) has raised the deficit issue in a different way. He has asked the administration to provide actual figures on the drop in offshore drilling revenue collected by the federal government. That information would show us just how much the Obama slowdown of offshore drilling has and will cost the government in revenues, and hence added to the deficit. One calculation puts the amount of lost revenue due to lower production in the Gulf at about $3.7 million a day.

But most interesting is the legislation introduced by Rep. Jim Jordan (R-OH) and Sen. Jim DeMint (R-SC) that would cut the deficit by $2.5 trillion over ten years. Some of the savings would come from the elimination of a number of programs and agencies, such as the US Agency for International Development (savings: $1.39 billion a year) and from cutting the subsidies of the Corporation for Public Broadcasting ($445 million a year), Amtrak ($1.5 billion a year), and high-speed rail ($2.5 billion a year). But most of the savings would come from rolling back all non-defense discretionary spending to 2006 levels across the board, and keeping it there until 2021.

It is unlikely that this proposal will even come to a vote in the Senate, much less be signed into law by Obama. Even if it did, as exemplary as it is, it would not address the real threat, which is the “Entitlement Explosion” — the ballooning costs of Medicare, Medicaid, and Social Security, costs that are going to drive the country’s economy to the wall as the Baby Boomers quite predictably age, retire, and sicken. In fact, the CBO just reported that this year Social Security will run a deficit of $45 billion (or $130 billion, if the cut in payroll taxes is included), and will continue to run deficits until the bogus “trust fund” is exhausted in 2037. As late as last year, please note, Social Security was projected to run surpluses until 2016.

The entitlement programs are what really endanger the country (and I haven’t even mentioned the state employee pension fund liabilities). The American people haven’t yet reached what I call the public-choice tipping point, the point at which a problem becomes so large that it is no longer rational for the average citizen to be ignorant of it. So the Republicans may do a little by way of deficit reduction, but I wouldn’t hold out hope that they will do a lot — the public isn’t there quite yet.

Give it a few more years, and a bout of high inflation . . . and that may finally do the trick. By then, of course, the economy will be in ruins. Rational ignorance is such a bitch, isn’t it?




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Shot — Countershot

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Four years ago, a Chicago real estate agent by the name of John Maloof discovered a large collection of candid “street” photographs taken in the 1950s and 1960s by a Chicago nanny named Vivian Maier. Helped by the internet and a carefully calculated public release, Maier’s work is now attracting tremendous popular interest, catching the eyes of both scholars and photographers.

I first encountered Maier’s work while searching the web for articles on photography and photographic equipment, as is my habit. Upon finding a blog with Maier’s work and self-portraits prominently displayed, my first thought was, “These photos look like they were taken by the world-famous Diane Arbus."

Granted, I'm no expert on Arbus’ photography, but I've heard things about it that always return to the words “surreal” and “weird” as a way of describing its peculiar quality. Beyond simply the strange appearance of many of her subjects, I guess it's a kind of instantaneousness in her photos that makes them appealing, something about how life can start to look strangely discordant when chopped into little temporal slices by the click of a shutter. That weirdness is certainly there in Maier's work, too. Often, Maier’s style — resulting from her close proximity to her subjects and the “avant-garde” timing and framing of her shots — seems nearly identical to that of Arbus.

It takes a kind of brusqueness and self-driven ability to get past strangers’ personal barriers and produce this kind of photo, an attitude somewhere between the “interested observer” and the “invader of privacy.” It's a psychological barrier that I struggle with, as do many other photographers. In my copy of “The Honeywell Pentax Way” (a 1966 guidebook intended for amateur users of Pentax 35mm single-lens-reflex cameras), the author advises photographers not to wait until a scene is devoid of human content, but to shoot pictures of people “without hesitation . . . [I]f they object, tip your hat and smile.”

The only times I've been able to break that barrier are when I’ve been shooting photographs of political protests or street scenes in foreign countries. In both cases, the barrier is easy to cross. Usually, no one cares about what you’re shooting (or even notices that you’re doing it). As for photographs taken in foreign parts, a practitioner of “subaltern” theory would say that tourists are simply practicing the “hegemony of the foreigner” when they snap a picture. Take the theory for what it’s worth; I’ve never paused long enough behind the camera to ask myself, “Am I being hegemonic?” Whether that question ever crossed Arbus’ or Maier’s mind, we may never know. If it did, it wouldn’t have helped them break any barriers, personal or artistic.

Whenever I think about their kind of photography, I remember an incident that took place when I happened to be on the other side of the camera, the subject side. My family and I were taking a trip to Death Valley and Las Vegas on one of those quirky tours run by a Chinese travel agency, and tailored specifically for Chinese wallets and efficiency — that is, we were given only 15 minutes per scenic vista, were housed in cheap hotels that reeked of equally cheap cigarettes, ate third-rate buffets for almost every meal, and were herded on and off the bus like cattle.

At one buffet stop — and these were all Chinese buffets — we were turned out of the bus in some Nevada country town, approximately in the middle of nowhere. We were waiting outside while the guide went in to secure tables, when a scrawny, dark-haired teenager with inverted baseball cap suddenly glided up to us on his skateboard. He produced a Pentax 35mm film camera with a 50mm lens, of the type ordinarily used by high school photo students and starving artists. He started to take pictures of us, moving down the line of tourists, all of whom gawked back at him. Watching him snap away, I realized that if I were in his position, and didn’t have the embarrassment I usually have about photographing strangers, I might have taken the same pictures. And it was a real Diane Arbus moment — a bunch of Asian tourists waiting outside a run-down buffet, in an equally run-down strip mall with an otherwise deserted parking lot.Weirdness and discord!

In this case, however, the subjects resisted — at least some of them. When the teenager skated up to my family and started to photograph us from close range, my dad bristled. “Don't give that punk the benefit of a smile,” he said in Chinese. We all scowled at the kid — but he didn't let up. He just snapped and grinned maniacally at us (I suppose that’s what Arbus looked like, when she was working) until he skated away. I imagine that somewhere, in some art gallery, there is now hanging a beautiful black and white print of us, an angry-looking family of Chinese tourists waiting impatiently outside a country town buffet. The photograph is probably entitled “Untitled No. 4,” or “The Visitors,” and the teenager has made a lot of money out of it. One might say that he, Arbus, and Maier were all cut from the same cloth — or perhaps printed from the same negative.

But were they? I think not. As photographers and persons known or unknown, they were all individuals in their own right, for better or for worse. After all, there is “human content” on both sides of the lens.




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Being Green Is Not a Sign of Health

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There are two new reports in the Wall Street Journal about flops in the green energy movement — further illustrations of how much hype there is in it.

The first (Jan. 19) reveals that the vaunted new “amazingly energy efficient,” compact fluorescent light bulbs aren’t so energy efficient after all.

Pushing the hapless consumer to replace incandescent bulbs with CFLs (compact fluorescent lamps) has been the received wisdom among lawmakers for years, and no more so than in California, the ever-green state. California’s utilities alone spent $548 million over the past seven years in CFL subsidies. In fact, California utilities have subsidized over 100 million CFLs since 2006. And on the first of this year, the state started phasing out incandescent bulb sales.

Of course, when I say that the California utilities have been subsidizing the CFLs, I really should say that the aforementioned hapless consumers have been doing so, because all the subsidy money — about $2.70 out of the actual $4.00 cost of the CFL, i.e., more than two thirds of the actual cost — is paid by the consumer in the form of higher utility rates.

Naturally, the rest of the country — and, for that matter, the world — is set to follow California’s lead on CFLs. A federal law effective January 1 of next year will require a 28% step-up in efficiency for incandescent bulbs, and bans them outright by 2014. One consequence of this federal policy — unintended, perhaps, but none the less foreseeable — is that the last US plant making incandescent bulbs has been shut down, and China (which now makes all the CFLs) has seen even more of a jobs expansion, and is able to buy even more of our debt.

The UN is also pushing CFLs to help solve global warming, estimating that about 8% of all greenhouse gas emissions worldwide are caused by lighting. The World Bank has been funding the distribution of CFLs in poorer nations. Last year, for example, Bangladesh gave away five million World Bank funded CFLs in one day.

But now — surprise! — California has discovered that the actual energy savings of switching to CFLs were nowhere near what was originally estimated. Pacific Gas and Electric, which in 2006 set up the biggest subsidy fund for CFLs, found that its actual savings from the CFL program were collectively about 450 million kilowatt hours, which is only about one-fourth of the original estimate.

There are several reasons for the fact the switch to CFLs hasn’t lived up to expectations. First, not as many of the heavily subsidized CFLs were sold as originally estimated. PG & E doesn’t say why, but I will hazard a guess, based on personal experience. Many consumers dislike the light produced by CFLs, which they find dimmer or more artificial in its effect. Also, many complain that lights create static in AM radio reception. In a free market (i.e., one that, among other things, contains no subsidies), it is likely that few consumers would want to switch.

Surprise! — California has discovered that the actual energy savings of switching to compact fluorescent lamps were nowhere near what was originally estimated.

Second, the useful life of the CFLs is less than 70% of original estimates. Amazingly, the estimates were based on tests that didn’t factor in the actual frequency with which consumers turn them on and off. CFLs burn out more quickly the more often they are turned on and off than do the old incandescent bulbs.

Not mentioned in the story is the fact that CFLs contain mercury, and so are supposed to be specially disposed of (which presents an added cost to the consumer in time, money, and energy). The alternative is for the consumer to throw them out in the regular trash, making toxic waste sites out of ordinary trash dumps, with future clean-up costs of God only knows what.

The second Journal story (Jan. 18) reports that Evergreen Solar has closed its Massachusetts plant and laid off all the workers there.

This is deliciously ironic. Evergreen Solar was the darling of Massachusetts. Governor Deval Patrick, devout green and all-around Obama Mini-Me, gave Evergreen a package of $58 million in tax incentives, grants, and other handouts to open a solar panel plant there. In doing so, he simply ignored Evergreen’s lousy track record — a record of losing nearly $700 million bucks in its short life (its IPO was in 2000), despite lavish subsidies from federal and state governments.

Now Evergreen is outsourcing its operations, blaming competition with China, and whining like a bitchslapped baby about China’s subsidies of its solar energy and its lower labor costs. But Evergreen has itself sucked up ludicrously lavish subsidies, and it knew all along about China’s labor rates compared to Massachusetts’.

So Patrick winds up looking like a complete ass, and the taxpayers of Massachusetts wind up eating a massive loss.

But that’s not all. Near the end of last year, the Journal (Dec. 20) revealed still another case of American crony capitalism, of the green sort. It turns out that the wind industry — aptly dubbed “Big Wind” — copped a one-year, $3 billion extension of government support for wind power. It was part of the end-of-2010 tax deal.

Originally, this government subsidy was a feature of the infamous 2008 stimulus bill, under which taxpayers were forced to cover 30% of the costs of wind power projects. The American Wind Energy Association (AWEA) begged for the subsequent bailout, because without it 20,000 wind power jobs would be lost (one-fourth of all such jobs in America). But despite the billions in subsidies, Big Wind is sucking wind; its allure is dropping like a stone. The AWEA’s own figures show a 72% decline in wind turbine installations from 2009, down to the lowest since 2006.

Besides trying to make the 30% subsidy(!) permanent, the AWEA is pushing for a national “renewable energy” mandate that will force utilities to buy a large chunk of the power they sell from renewable sources (mainly solar and wind), irrespective of the fact that the price of renewable energy is sky high. The association has gotten more than half the states to enact such mandates, with higher energy bills for consumers as the result. Not surprisingly, Big Wind is also pushing the EPA to make energy from fossil fuels vastly more costly.

According to the federal government’s own figures, wind and solar take 20 times the subsidy to produce electricity than do coal and natural gas. So you can see why Big Wind keeps blowing smoke up the public’s rear about the fabulous future of renewable energy. You can also see why Big Wind is such a big contributor to the campaign coffers of Democratic politicians. They are the only ones who keep this outrageous boondoggle awash in money.

Meanwhile, the promises of green energy look more and more hollow, every day.




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At Least Some People Get It

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The Obama administration continues to scratch its collective head over what to do about creating jobs. After the disastrous failure of the numerous mega-billion-buck bailouts intended to lower the unemployment rate, even the now happily departed lame-duck Congress refused to pass another massive pork bomb. The Obamanistas, devoted Keynesians all, have pushed through more spending more quickly than any other administration in history. The national debt, which stood at $13 trillion on June 2, 2010, closed the year at $14 trillion. So we have spent beyond the dreams of Keynes’ avarice, and the unemployment rate still hovers near 10%.

Meanwhile, up in the Great White North, our Canadian friends have shown the way. For the fourth year in a row, they are lowering their federal corporate tax rate. It has just been dropped to 16.5%. This is less than half the American federal rate of 35%. Amazing, considering that Canada is sometimes supposed to be the pure welfare state, while we are the pure capitalist one.

And it won’t stop there. In 2012, the Canadian federal rate will drop to 15%, bringing the combined federal and provincial rate on businesses to about 25%. Back in 2000, the combined Canadian corporate income tax rate was 42.6%, so the decline has been dramatic.

Besides cutting the corporate tax rate, the Canadian government has eliminated corporate surtaxes as well as levies on capital.

All these incentives, combined with Canada’s healthy financial sector — Canada never created crazy government agencies to encourage and then purchase bad mortgages (it apparently grasps the concept of moral hazard!) — are enticing increased business investment. Spectra Energy of Houston, for example, has decided to invest $2 billion in Canadian energy and infrastructure projects. The Citco Group, a financial firm, has decided to open its only North American bank in Canada. And the big accounting firm KMPG has moved many of its operations to Canada.

American corporate taxes remain the second highest in the industrialized world. Our competitors to the north have grasped the idea that to tax an activity is to deter it. The Canadians obviously want more business, not less. And the reason they want more is that they grasp the fact that business creates jobs.




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Are You Kidding?

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Jonathan Alter, a leading Obama sycophant, appeared on a talk show recently with Washington Examiner columnist Tim Carney. The topic turned to a comment made by Rep. Darrell Issa (R-CA), who observed that Obama’s administration is “one of the most corrupt administrations ever.” Issa’s claim sent Alter into an apoplectically angry rant, saying there was “zero” evidence of corruption.

To Alter’s evident surprise, Carney immediately demurred, incredulous that Alter couldn’t see any evidence. While Carney said that Issa’s comments were “hyperbolic,” he gave a few choice illustrations, and later listed a few more on the Examiner’s website. Carney’s list included the following:

1. Ex-Google lobbyist Andrew McLaughlin, employed by the White House as a tech policy specialist, chatting with Google lobbyists about the rules governing “Net Neutrality,” from which Google stands to gain. (Carney’s blog doesn’t mention it, but Google gave lavishly to the Obama campaign.)

2. A former Goldman Sachs lobbyist took the job of the Treasury Department’s Chief of Staff within nine months of his Goldman employment. (Again, we can add that upper-level management at Goldman Sachs was a big contributor to Obama’s coffers.)

3. Former H&R Block CEO Mark Ernst was hired by Obama to help the IRS write new regulations on tax preparation (which Block subsequently endorsed, because it stands to benefit from them).

4. Obama officials have met “off-campus” repeatedly in order to dodge the Presidential Records Act.

5. When AmeriCorps Inspector General Gerald Walpin started investigating Obama’s friend and supporter Kevin Johnson, Walpin was summarily fired.

6. In the Obama-orchestrated Chrysler bankruptcy, the UAW was given the bulk of the stock in the new company (while the secured creditors were burned).  Naturally, the UAW was a big contributor to Obama’s campaign.

As good as Carney’s list is, it only scratches the surface. Here are a few more illustrations:

7. Besides the crony bankruptcy deal that gave the bulk of the stock in the new company to the UAW, there was a similar deal that gave a big chunk of the new GM stock to the UAW.

8. Moreover, in the recent IPO, the feds held onto the public’s shares while the UAW was allowed to dump its own. This ensured that the UAW pension fund would be made whole.

9. ACORN, the bogus “community service” group for which Obama was counsel and which worked so hard to register voters (even fictional ones) on Obama’s behalf, received lavish amounts of “stimulus” money.

10. When Obama was campaigning for Democrats in the last election, he doled out stimulus money in the states he visited (especially Nevada). Indeed, the stimulus fund was a grab-bag of cash for Obama’s backers. A disproportionate share of the money was spent in precisely those states that supported Obama.

As to whether Issa’s statement was “hyperbolic,” I don’t think so. The Obama administration has racked up a lot of corruption in its two years in office. If it isn’t one of the most corrupt administrations in history, it is surely on track to become so.




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The Government's "Green" Jobs

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Jonathan A. Lester, president of Continental Economics Inc., has written an insightful critique of artificial stimulus to wind power and the like (“Gresham’s Law of Green Energy,” in the Cato Institute’s journal Regulation, Winter 2010–2011, pp. 12–18). Like similar critiques, however, it could benefit from better placement of emphasis.

Lester laments the wasteful diversion of resources into uses that would otherwise not pay (waste, that is, barring untypically sound “externality” arguments). Furthermore, as for jobs created by subsidy- or regulation-based spending on green energy, the money so spent would have to come from somewhere. It would necessarily be diverted from spending on other public or private activities, where jobs otherwise created or maintained would be lost.

Such arguments put too much emphasis on spending itself relative to the allocation of real resources, including labor. Would the workers newly drawn into green jobs come from elsewhere, or would they have otherwise remained unemployed? Do green subsidies, tax breaks, and regulations really remedy economy-wide unemployment exceeding the frictional unemployment of normal times?

Unemployment in a recession reflects discoordination. Mutually advantageous transactions among workers, employers, and consumers are somehow frustrated. That is what needs attention. Putting emphasis on spending and its destinations is superficial. As W.H. Hutt used to say, spending is a measure of transactions accomplished; it is not what drives transactions.

Now, what impedes transactions in a recession? Usually or often it is a deficient quantity of money in relation to desires to hold it at the prevailing price and wage level. Sometimes (as now, apparently) the demand to hold money has increased, even if only passively or by default, because individuals and firms are especially uncertain about what transactions would be worthwhile. Adding to the usual uncertainty about business is uncertainty about taxation, government deficits and debt, complicated and costly regulations, and other government interventions, including unintended consequences of earlier ones.  This is what needs attention, not the allocation of spending between green and other employments.

Recession is not something to be remedied by shifting resources around. Besides channeling resources into relatively inefficient uses, artificially favoring green energy obscures the true nature of recession.




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When Pigs Fly

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There is an old adage in which I find considerable wisdom: “When a pig flies, you don’t criticize it for not staying up very long.” I take the meaning of this saying to be that when someone who has a habit of making poor choices finally makes a moderately good one, you ought to praise the success, even if you feel he could have done more.

Well, a pig has flown. President Obama, who for his first two years ran the most anti-free-trade administration since the days of the Smoot-Hawley tariff, has managed to salvage a free-trade agreement (FTA) with South Korea, after stalling it for two years and being snubbed in Asia when he tried to strongarm a new deal. He managed a minor renegotiation, getting some relief from Korea’s environmental regulations on our cars and a slowing of our phase-out of tariffs on the Koreans’ trucks. He did this, however, at the cost of keeping Korea’s tariffs on our cars in place for five more years, and of an extra two years of Korean tariffs on American pork products. Hardly worth the wait on a deal that was already well negotiated in 2007.

But the good news is that Obama will finally let the deal proceed, and that 95% of all US and South Korean tariffs will be eliminated within five years. The deal also opens up greater trade in services, allowing (for example) more Korean banks in America and more American banks in Korea. That’s all good.

Now that Speaker Pelosi is finally history, chances are good that Speaker Boehner (“Blubbering Boehner” to his chums) will get the FTA with Korea through the House — and also the FTAs with Colombia and Panama, which have been languishing on the sidelines since Bush left office. It would be helpful if the pig could stay aloft long enough to help get these deals past Congress. So far, Obama hasn’t bothered to do that. He has shown a touching deference to the unions that oppose them, and that gave so much to his presidential campaign.

Yet it seems to be dawning on the exceptionally obtuse Obama that it may be far more useful to his 2012 reelection (gag!) campaign to have lower unemployment than to have higher union contributions poured into his campaign coffers. Perhaps the pig isn’t just flying; perhaps he has had an epiphany.

If for that we are hardly ecstatic, we can at least be satisfied.




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The New Landscape of Libertarianism

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New York magazine published an article called “The Trouble With Liberty” in its January 3–10, 2011 issue. I was intrigued by a line on the magazine’s cover. It asked, “Are we all libertarians now?” And what I found in the essay was very interesting.

The author, Christopher Beam, presents a brief yet wide history of libertarianism, ranging from Ron and Rand Paul and Paul Ryan to David Boaz to Ayn Rand and Friedrich Hayek. Beam explains that libertarianism has elements from both the Right and the Left and does not fit easily into either mode, and he outlines the various attempts to promote a libertarian country — from those that would enlist the Republican Party or the Libertarian Party, to Brink Lindsey’s Liberaltarianism, to the Free State Project and the Seasteading Institute.

Beam pegs libertarians as crazy old uncles or Dungeons & Dragons players, but his history of libertarianism is quite complimentary. He says that the Founding Fathers and the Constitution were actually more libertarian than anything else. The gist of the essay is that with the Tea Party movement and the rise of Rand Paul and Paul Ryan, libertarianism is on the rise and our moment has come.

But halfway through, Mr. Beam changes his tone and gets to the heart of his essay, which is a critique of libertarianism and an explanation of why he thinks it is a bad policy for the United States. His arguments aren’t theoretically sophisticated and are designed to appeal to a mass audience: if there are poor people, and charity can’t provide for them, then we need welfare or else they will steal from us; we need public education in case the free market can’t educate everyone; we need a central bank in order to print a uniform currency. He mentions “asymmetrical information” and “public goods,” and argues that if the bailout had not happened then innocent investors and homeowners who innocently misunderstood the riskiness of their loans would have been punished. “There’s always a tension between freedom and fairness,” he says, and we libertarians “pretend the tension doesn’t exist.”

We must shift the alignment of America’s political discourse so that socialism no longer sounds like common sense, and our proposals seem like the new common sense.

Libertarianism can never succeed, he claims, because politicians must compromise and libertarians refuse to compromise or cooperate. One of the overarching criticisms in the essay, and perhaps its most obnoxious, is the subtle implication that libertarians have such a hard time accomplishing real change because we know that our theories are mere impractical abstractions unsuitable for pragmatic flesh-and-blood reality, so we would be revealed as idiots if we ever achieved political power.

The refutations of Beam’s arguments are so obvious that I need not detail them. What is more significant is the mere existence of his essay. It is, in my opinion, one of the early post-Tea Party attempts by the Left to come up with an ideological response to people with open minds from taking libertarianism seriously. I strongly doubt that libertarianism has reached the peak of its popularity, but what this essay signals to me is that people who ten or twenty years ago might never have known what libertarianism is are now hearing the word “libertarianism” and asking what it means. Beam provides a leftist answer to that question. But he also cites surveys showing that more people now define themselves as libertarians than ever before, and that this poses a threat to the liberal-conservative establishment.

If the Tea Party phenomenon grows and Rand Paul’s career continues, we should expect to see many more such essays. I think that they will all follow Beam’s pattern. “The Trouble With Liberty” shows what two challenges we must overcome in order to be taken seriously.

First, there is something, call it “common sense” or the “social imagination” or whatever, but there is a set of simple political ideas that, whether true or false, permeates a culture. We need to introduce arguments into the American intellectual culture to refute the “common sense” arguments for statism, such as the argument that we need a welfare state to rescue the poor. We must shift the alignment of America’s political discourse so that socialism no longer sounds like common sense, and our proposals, which Beam skewers as extremist, seem like the new common sense. This is similar to what Glenn Beck claims the socialists did to us with the Overton Window – shifting cultural common sense by gradually introducing extreme ideas until they become mainstream  — but it works in reverse.

Second, we must prove that libertarianism can work in practice as well as in theory, and we must call upon our libertarian politicians to show the American people that it is possible to have noble ideals while still being pragmatic and getting things done. In my opinion the danger is not that Rand Paul and Paul Ryan will make too many compromises; it is the opposite: they will be too idealistic and take an all-or-nothing approach to change, and thus will be unable to work with their Republican colleagues. In that way, they will confirm the fears that Beam would like to promote.

“Libertarianism is still considered the crazy uncle of American politics,” Beam writes. It is only natural for the liberal-conservative establishment to oppose us by laughing at us so loudly that nobody will take us seriously. That is, after all, right out of Ellsworth Toohey’s playbook. The question is how we will respond to the laughter — by behaving like weird extremists and impractical idealists, or by showing that we deserve to be taken seriously and that our abstract theories really will work in practical reality.




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Not Gittin' Outta Gitmo

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One has to think that the libertarian Obamanistas — libertarians who supported Obama, thinking that he couldn’t spend more money than the Republicans, and would at least end the war on terror and dramatically reduce the military posture of the country, must feel some uncertainty about their guy.

Certainly, in terms of spending and deficits, he makes Bush look like a fiscal hawk. In his two years in office, Obama’s yearly deficits have been over four times the size of Bush’s largest. And in terms of state control of the economy — the socialization of the medical system, the nationalization of the auto industries, the massive increase in regulations, the dramatic increase in the size of the federal bureaucracy, and the expansion of environmentalist hegemony over natural resources — he has explored a whole New Frontier of statist economics.

As to the war on terror, he hasn’t ended it, or even diminished it appreciably, much less brought in a new era of isolationism. We are still in Iraq — though scheduled to exit, but no earlier than Bush’s plans called for — and are fairly well stuck in Afghanistan. Virtually all of Bush’s executive orders on the war on terror remain essentially unchanged.

A recent Reuters report (Jan. 7) underscores this point. While Obama was in the Senate, then on the campaign trail, then during his first two years in office, he relentlessly bashed Bush for holding prisoners outside the regular court system, detained at the Guantanamo Bay prison. Obama promised to give the Gitmo detainees fair trials in our regular court system, though he also promised they would all be convicted and jailed — well, indefinitely!

But quietly, on a Friday when news coverage is guaranteed to be minimal, Obama signed a law that prohibits bringing the remaining 175 Gitmo prisoners here for court trials.

He said he had no choice but to sign the bill — the defense authorization act for fiscal 2011 — because the military funding was necessary, even though the bill contained that provision banning domestic civilian trials for the terrorist detainees. And he vowed to fight to get the provision repealed — although the ban was put in the bill by one of the most left-wing Congresses in American industry, so it is hard to see why he thinks he can get it through a more right-wing Congress.

Obama’s claim that he had to sign the bill is just a lie. He certainly could have vetoed it and made it clear to Congress that he would not sign any future bill that included the provision. But he didn’t, and this raises a dilemma about him.

Perhaps he still wants to give the Gitmo guys domestic civilian trials, and has merely decided that trying those prisoners here would be too politically costly. Certainly, the public opposes such trials by a large margin. But if that is the case, he is not much of a man of principle.

On the other hand, perhaps he has changed his mind on the matter, and no longer views such trials as worthwhile. After all, the showpiece of the Obama policy of domestic civil trials for terrorists was the trial of Ahmed Ghailani, the Gitmo guy who was involved in the 1998 bombings of US embassies. The trial ended late last year with the jury finding Ghailani not guilty on 279 of the 280 counts Obama’s Justice Department brought against him, finding him guilty on only one count: planning to destroy US property. He was not found guilty of even one of the 224 murder counts against him. Hardly bracing for the prospect of keeping the other Gitmo guys safely away from society.

However, if Obama has changed his mind, what does that say about his judgment — compared to, say, George Bush’s?




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