There’s a new school of economic thought: Obaminableonomics.
Come to think of it, though, maybe there’s nothing so very new about this Obaminable economic school — after all, it just combines typical big-government redistribution with a few nominal nods in the direction of fiscal self-discipline.
You can get a concise idea of the Obaminable approach to economics from a headline that floated into my In Box the other day. I quote: “Obama Promotes Fiscal Restraint, Big Spending.” According to the reporter, the president-elect “wants to project fiscal restraint even as his economic team assembles a massive recovery package that could cost several hundred billion dollars.”
Huh?
Well, President-Elect Barack Obama thinks he erases the contradiction by contrasting his short-term plans with his long-term plans. Short-term, government must spend like there’s no tomorrow, because this is what we allegedly need to see happening if we are to regain confidence in our future. Yes, we absolutely must see an endless parade of babbling bureaucrats going hog-wild with taxpayer dollars on a wide array of ludicrous, unworkable schemes. Absolutely.
After that, though, will come the line-by-line budget review, the ruthless cutting out of bloat.
Well, any alcoholic will tell you that he can stop whenever he likes. Just so, our rulers keep putting off the restraint of fiscal restraint.
This is Common Sense. I’m Paul Jacob.
6 replies on “Obaminableonomics”
We are teetering on the edge of a financial abyss and most politicians, Obama included, are calling for big changes in government policies to prevent further trouble. But instead of more action, I think we need less. The reason we are in this predicament at all is the government’s restrictive policies that destroyed the free markets ability to respond.
The great depression was CAUSED by government policies and then prolonged by even more. Any interference in the natural balance between supply and demand causes things to get our of whack. There is an equilibrium that ALWAYS occurs if sellers and buyers are allowed to reach an agreement WITHOUT interference. But if one side is given a leg up over the other by government policy then trouble awaits.
Setting interest rates is a good example. The interest a person charges for the use of his money to a person who wants that money should be negotiated ONLY by those two people. No government rules are required. If the rate is too high (or unfair as the left would say) then let the resulting excess supply of rental money cause a reduction in interest rates.
Likewise, if one person wants to hire another to do a job, let the two of them decide the acceptable pay rate. No government action here either. To attract good help companies will be forced to raise pay rates or will watch the competition do so and get all the good employees. An interference in this free negotiating causes an imbalance.
And if a union is given excess powers by government policy this imbalance also occurs.
Taxes of any kind distort the market. Laws that prevent one person from taking “advantage” of another in the interest of “fairness” do too.
The mortgage meltdown has been caused by interference in bank’s freedom to lend money at the rate they see fit and to whom they see fit. Buyers of money (home owners) were given an artificial advantage by government policy and banks were given an artificial shield against risk. If free to do so, bankers NEVER lend money without adequate financial compensation for risk. Banks must be free to gauge that risk and deny those deemed too risky. The housing bubble was caused by GOVERNMENT interference in risk responsibility.
Trade barriers distort the market in the same way. Protecting one segment of the economy punishes another. Shortages, and resulting higher prices for all occur. Government restrictions on manufacturing (or drilling for oil) accomplish the same thing.
Throwing billions of dollars at various parties in an attempt to free up capital will have the same effect as levying taxes or imposing rules on commerce. It will distort the free market and prolong imbalances.
The answer to our dilemma is to REMOVE restrictions on ALL commerce and let natural forces of supply and demand restore equilibrium.
Reminds me of the “I Love Lucy” line when Lucy says: We lose money on each sale but we make up for it in quantity.
Typical Obama gobbledygook! I love the above “Lucy” comment.
Obama is going to be better than what we have had in the past 20 years!!
Thank you for the article AND that there are people who really value free speech and individual rights. We are going down the wrong road when politics trumps people.
Please keep writing.
Tell me next June about how good ole Hussein isbetter than we have had in the last twenty years, then we’ll see how it realy is, especially when the gestapo comes to get your guns and gold.