Sunday, February 8, 2009

Stop It!

One of my favorite Mad TV sketches features Bob Newhart, as a therapist whose only advice to any patient was contained in two words: Stop it! When a woman who suffers from an irrational fear of being buried alive in a box comes in, his advice is the same: "Stop it!" No matter what inner difficulties the woman brought up, the therapist’s answer was always “Stop it!” I heartily recommend that our lawmakers see Bob Newhart’s most recent rendition of therapy.

One of President Barack Obama’s first initiatives as the chief executive is to implement an economic stimulus package that he repeatedly tells his countrymen is designed to save the American economy from the catastrophes of tax cuts and capitalism.

It should not be too surprising that Democrats wish to pass a package that would be the more invasive than any government measure into the economy since the New Deal, at a time when the current hardships are still nowhere near those endured during the Great Depression, which was only exacerbated because of those interventions. In short, the stimulus package is not so much meant to stimulate the economy, but an initiative to create more political capital for the new president. One portion that has since been excluded from the package, perhaps due to its sheer odiousness, was bailout money for Planned Parenthood (I don’t know about any of you, but I don’t believe the killing industry has any shortage of business).

The more President Obama says some version of "We have to do something because to do nothing would be worse," more people will get scared, remain scared, and eventually begin to believe it. Think of it as a Patriot Act for Democrats.

The Democratic president disparages the Bush tax cuts, one of his predecessor’s finest measures, because the national debt skyrocketed and our nation’s financial institutions crumbled during the final months of the lame duck administration. In other words, the new president is trying to tell us that the economy is teetering toward collapse because Americans were allowed to have more money in their paycheck, and nothing to do with the ridiculous spending spree President Bush and the Republicans went on. President Obama’s prescription for economic recovery seems to be, don’t cut taxes, but go on a ridiculous spending spree. President Bush’s problem was not that he cut taxes, but that he cut taxes, and then did not begin reducing the size of the government to compensate for the lost revenue. President Obama wants to leave taxes where they are, for the time-being it would seem, and then increase the size of the federal government.

Now that the Democratic-bashing portion of the blog is through, let us move on to the Democrats’ henchmen.

What should be more surprising, but that I fear is not, is that the Republicans are willing co-participants in this mad spending scheme as well.

How? you might say, didn’t every House Republican vote against the stimulus bill as it appeared in the House of Representatives? Yes, but every House Republican voted against a massive spending bill that could have caused revolts among their constituents had they voted for it, and every House Republican voted against a massive spending bill that did not need any of their votes.

The Democrats have such a strong majority in the House that they got the bill passed without any Republicans. By voting against the bill out of pure political expediency, they avoided the heat from their home districts. While many Republican cheerleaders on talk radio praised the Republicans and suggested that they might be returning to their fiscal principles, their votes meant nothing because the bill still passed.

By having nothing to lose by doing so, they voted against it. We still need time to see if the Republicans have made a prodigal journey back to fiscal sanity.

But what really made me reach for the Tums is what the party’s senators began attempting once the package reached their chamber.

When Democrats first suggested a $300 billion stimulus package, the Republicans gave the nod to them and then some: they said $445 billion would be just fine.

Republican senators want to give tax credits to homeowners since the housing market bubble has utterly popped. A tax credit, which sounds like it might be good, is really just another manifestation of welfare. Whereas a tax cut in the form of George W. Bush or Ronald Reagan, allows the taxpayer to keep more of their income in their paycheck, a tax credit is a check from the federal government, with money that was printed from out of nowhere.

We can honestly say that we have a bipartisan government.

President Obama, during his never-ending campaign, said that he would bring Americans together and help heal our partisan wounds. Well, all that has happened since he took office is bring Republicans and Democrats together in a massive feast of pork. The parties are fighting over how much money should be in these stimulus packages and that should sound off alarms to conscientious citizens.

The only debate occurring over the spending bills are regarding how much should be spent and on what. There is no debate regarding whether so much money should be spent in the first place.

People seem to have forgotten that one short year ago, President Bush introduced a stimulus package to help boost a slumping economy. The stimulus did nothing to stop the collapse and nationalization of Fannie Mae, Freddie Mac, and Lehman Brothers. President Bush’s massive spending bill did nothing to stop the impending economic disaster. President Obama’s massive spending bill is even more massive and will only exacerbate the problem and ultimately cause more suffering for reasons already illuminated.

My prescription for the economy is to actually do very little. The current system cannot fix the disaster. It has been the invasive bipartisan federal government of this country that has caused this disaster.

Another appealing solution is to simply eliminate the Federal Reserve, that corrupt printer of bad money, which is the topic of Thomas E. Woods’ forthcoming book, Meltdown, A Free Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts will Make Things Worse.

Let this prescription for the horrific levels of spending and bad money be quick and to the point: Stop It!

14 comments:

Daniel Bergquist said...

This just about sums it up.

Carl Wicklander said...

That was pretty good. The stimulus is just a big waste of time and money, not to mention a complete misnomer.

I'm interested to see what will happen when things get worse because they will. FDR massively intervened into the economy in the New Deal and sank the country deeper into it. Obama is following the same path.

TRUTH101 said...

The Depression was well underway when FDR took office. Obama is trying to stem a bigger crisis now. Truth be told. I don't think anyone has any idea what to do. Something or nothing. I happen to agree with Obama that a big solution is in order. The alternative is to do nothing. I'd rather he do something big than something small or nothing.

Carl Wicklander said...

The Depression began in 1929, shortly after Hoover became president who, contrary to popular belief, did intervene into the economy. The Federal Reserve inflated credit throughout the decade of the 1920's and when Hoover became president in 1929, he increased spending and increased taxes, not the other way around.

In short, it was government intervention by Hoover that made the Depression worse. FDR made it even worse.

The best solution is for the government to do little or nothing. It was the economist Ludwig von Mises who said, "If a man has been hurt by being run over by an automobile, it is no remedy to let the car go back over him in the opposite direction."

As I said earlier, I believe nothing is better than something big. If something big fails (remember Fannie and Freddie?), the consequences can be catastrophic.

To use a different example, think of our military endeavor into Iraq and its financial consequences. In addition to thousands of lives lost, we have spent billions, perhaps eventually a trillion, on that country when that money, or a fraction of it, could have been used on something more constructive. Doing nothing with Iraq, a country I believe posed no threat to us, would have been better than that huge something.

TRUTH101 said...

So your position is if we do nothing then at least we can't screw things up.

Very astute Carl. You are wise beyond your years. I have used that very argument in disciplinary meetings with labor and management. "Well yeah. But if wasn't sleeping he might have been screwing something up."

I don't do the union thing anymore but I never lost an employee using that approach.

Carl Wicklander said...

Well, that's probably a little more pessimistic than I would put it, but you're basically right about my interpretation. I am mainly against government intervention. I am in favor, however, of private citizens making sure their financial assets are in good order. The government is what I trust to screw things up.

TRUTH101 said...

There are millions of people that wish the government had done a better job of intervening before the financial meltdown.

Carl Wicklander said...

I'm sure there were. I still contend that government intervention is the reason for most of the financial meltdown. Just about the only government intervention into the economy I could tolerate would be the dissolution of the Federal Reserve (which I doubt will happen) because that is the institution that prints all the fiat money and lowered all the interest rates creating the bubble that finally popped. Continuing intervention will not be the solution.

TRUTH101 said...

The government has been intervening a long time Carl. And rightfully so. Who or what else can provide the regulation and security to keep our markets safe for all?

Carl Wicklander said...

You say that the government has been intervening for a long time, and I agree with that, but the current situation leads me to believe that things have gotten worse precisely because they intervened. It was their intervention that caused the housing crisis.

The debt has skyrocketed under both parties, inflation has caused the dollar to lose its value, and more money is borrowed by our government from China. Government keeps intervening but nothing gets better.

Saying that the government is the answer to the market assumes that politicians and bureaucrats know what is better for the market than people running businesses. And insisting on constant regulation assumes that all businesses are corrupt and need surveillance which is not the case.

TRUTH101 said...

Locks keep honest people honest Carl.

Lax credit standards and eihter naivity or plain stupidity on the part of people that overborrowed and banks that lended them money caused this. Just cause I'm a Lib doesn't mean I don't think people should be held accountable for their actions.

Carl Wicklander said...

I think people should be held accountable for their actions too. But locks only work on honest people. Dishonest people find ways around the locks.

After all, laws and regulations didn't stop Bernie Madoff's Ponzi scheme.

TRUTH101 said...

Perhas not. but jail awaits him because he did illegal things. Would you be happier if what Madoff done was legal? I think not Carl.

Carl Wicklander said...

That wasn't my point. My point was that the laws already in effect are too excessive and people determined to get away with a scheme will usually find a way to do so.