You have to assume that when Team Obama announced that the President would convene his cabinet and challenge them to cut $100MM from their budgets, they were thinking people would be impressed. Government doing its bit, setting an example, showing that they can be good managers and not just spenders of OPM.
So they are probably surprised at the derision with which their announcement was met. People like me who've worked all their lives in what Boston Herald columnist Howie Carr has called "the dreaded private sector" have always suspected that government managers live in a different world, one where prices can be increased in bad times, where budget baselines ALWAYS grow, year over year, by at least 3-5%, where the consumer of your services -- the taxpayer -- can be treated with indifference, since they cannot bring their business to a competitor.
President Obama's laughable idea of managerial frugality only confirms our worst fears. We're laughing because we work in smaller organizations than the federal government that have been cutting, cutting, cutting -- way beyond 1/36,000 of our company's budget.
Corporate managers across America are used to getting challenged to cut costs every year. Just one example: One of the Silicon Valley's largest and most important concerns, Cisco, committed last year to cut its expenses by over $1 billion over the following year. By all accounts, they are getting there.
From what I hear, people are Webexing instead of flying, eating in rather than out, reducing everything down to cafe hours and office supplies. Cisco is a company of about 60,000 employees, with total revenues in excess of $50 billion. By any measure, the federal government is several orders of magnitude larger -- and yet Cisco's frugality measures are several orders of magnitude larger than the federal government's.
There are similar examples here in the Silicon Valley, but only one makes the point: The President's challenge to his top managers belies either an ignorance of what frugality is all about, or is a disingenuous PR announcement that shows contempt for people's intelligence.
A while ago on this blog, I suggested that the President challenge his cabinet to reduce their administrative budgets by a percentage -- say, 10% -- and that they implement a hiring freeze to stop the growth of the federal workforce, to ensure that stimulus dollars go to local communities, not growing DC bureaucracies. Do more with less -- that's what good organizational managers should always try to do.
Instead, we're told that one cabinet secretary figured out how to save a million or so buying office supplies in bulk from Staples. (Guess the Bushies never captured that low-hanging fruit!).
C'mon Mr. President, set the bar higher than that.
Totalitarianism is once again on the march. It's coming at us so fast and from so many directions it is difficult to see as a whole, though the pieces are quite familiar.
Let's start with President Obama's most recent encroachment on the private sector, the putative firing of GM's CEO. Nothing in the Constitution tells us that Presidents should maniuplate the leadership of private enterprise, or usurp the responsibilities of shareholders and boards. While I shed no tears for GM or its failed CEO, I wonder about Obama's vision of the Presidency when he behaves more like Hugo Chavez than Teddy Roosevelt, our most activist President when it came to clipping the excesses of big business.
When in modern times has a President taken such invasive action in the private sector, apart from Richard Nixon's imposition of wage and price controls?
"He has the massive will of the American people behind him -- and he has been granted permission by us to do what he sees fit. If you liked this week's all-net 3-pointer, stay tuned."
To do what he sees fit. We're a long, long way now from the American political heritage of Rousseau, Locke, Burke, and Jefferson when we think like this.
Tough economic times are opportune moments for totalitarianism, and sometimes it comes with charismatic leaders who buff it up with charm and soaring rhetoric. Finally, though, all they offer are their own beliefs about what is fair, just and right. And when the timing is right, a lot of people will agree with them.
What is fair, just and right is usually defined against a fearful backdrop of scoundrels, represented by dehumanized stereotypes: The rich, bankers, lawyers, hedge fund managers, and usually Jews (don't worry -- that's coming).
Consider Glenn Beck's questioning of Connecticut's Attorney General, who could not offer any legal grounds for harrassing the bonus babies of AIG. Finally, he fell back on his perception of popular sentiment -- that AIG employees got "money they don't deserve."
Who's to be the judge of that, if not your boss? Apparently, more and more people feel comfortable making Obama the final judge of more and more things: What should taxpayers subsidize, who should be taxed more, what people ought to earn, what constitutes social justice.
To do what he sees fit. It is really no different than what Germans, Argentinian Peronistas, Spanish Francists, Italian fascists, and Nicaraguan Sandinistas granted to their leaders.
Come now, you say -- Obama's no Hitler! He is not. But National Socialism and every other fascist movement took root with government control of private industry and institutions (especially universities, and press). Private ownership, government control. Take away the funny mustaches and silly uniforms, and that's what totalitarianism is. Sometimes it is accompanied by imperialism and mass slaughter, but sometimes it is quieter than that (Tito, Castro, Peron, Chavez). Only the scapegoats change to suit the Leader's needs.
You won't catch President Obama wearing a funny uniform, but his minions in Congress just passed a bill that triples funding for Americorps, and organizes them into "local cadres," with uniforms, military-style discipline, and a committee to consider compulsory service for Americans of all ages. Even the San Francisco Examiner, hardly a conservative oracle, called it "creepy authoritarianism." And those same minions are considering passing his reduction of tax deductions for charitable contributions -- a move no doubt designed make the non-profit private sector more dependent on government, and less on private donors.
All of these policies, and more, show us a President who is a classid statist, with a profound distrust of the individual, and a will to curb individual freedoms in the interest of groups -- favored political classes of people. Most people won't be among those favored groups when it's all said and done.
The rising totalitarian sentiment is not confined to the left. It's worth remembering that our modern left and right, Communist and fascist movements, both originated from the dialectic philosophy of Hegel. Increasingly, we see fascist and Communist flags in public demonstrations in the streets of London and Paris, not to mention long-forgotten fascist flags and insignia increasing displayed at professional football matches in Europe.
Unconnected things, perhaps. I think not. I think we're seeing social phenomena -- Obama is one example -- that reflect people's reactions to widespread economic insecurity and fear for the future, a call for someone to just fix it, to make things right again. To do what he sees fit.
I really enjoy reading the work of converts -- people who were formerly on the left but through some epiphany became conservatives. They have the most keen insights into what animates leftist thought, and they also understand the tactics that the left uses to advance their causes. David Horowitz, who edited Ramparts in his youth, is probably the best known.
Janet Daley of the UK Telegraph is another such voice. She has a wonderful column this morning that wraps up the Obama administration's response to the economic crisis, and pairs it with Gordon Brown's leadership.
She notes that while Obama may not meet the textbook definition of a doctrinaire socialist, he meets her own practical definition, one with which Great Britain, particularly in the 15 years before Margaret Thatcher, became all too familiar:
You may quibble at my use of the word "socialist" to describe people who generally present themselves as friends of the free market, and who have repudiated full-scale nationalisation (even of the banks at a moment when that option might have appeared irresistible). So, as someone who spent her formative years on the Left, let me make clear that I am using the word to designate those who accept the primary tenet of Marxist ideology: that the economy can and should be controlled by the state.
Like Krauthammer last week, she calls Obama on the odd, revisionist story he told during his speech to Congress, a statist vision of the causes of economic upheaval:
...he actually seemed to suggest that the present crisis had been caused by America's failure to develop a universal health care system and to attend to the impending environmental disaster of global warming ("we made the wrong choices"), and that by focusing on these matters a way can be found out of the country's economic problems.
Is he quite mad? Does he really believe that the banking crisis and the recession were some kind of divine retribution for the absence of universal health care, and excessive carbon emissions? Or is he suggesting that a practical solution lies in spending money on health care and the development of alternative energy sources?
No, not "quite mad," just clever, in a ham-handed way.
I grew up with the Left and what this looks like to me is a power grab: a seizing of the moment by the forces which always believed in state domination. The Left sees an opening here, first for telling a critical lie about the historical origins of this crisis, which was propelled as much by the Left-liberal determination to spread prosperity through easy credit to the poor, as by the greed of bankers. And then, out of the wreckage, to restructure the economy along the lines that it always wanted, complete with central controls over the pay levels in private financial institutions.
We are being led to believe that public debate should be all about economic mechanics when it should really be about political principle: just how many freedoms do we want to lose while governments pretend that they are the solution?
On the lighter side, another UK voice worth reading is James Delingpole, whose book, Welcome to Obamaland: I Have Seen Your Future and It Doesn't Work!, is a real hoot. Delingpole is no convert, but he understands the Obama attraction well, and has good fun comparing it to the Blair years to let us know what's ahead in the former colonies. It'll make all but most humorless Obama acolytes laugh, too. Among other things, he chronicles the left's campaign to ban fox hunting, "the only sport," he notes, "FACT - where alcohol actually improves your performance."
Rush Limbaught often makes the point that conservatives need to stop arguing with liberals on policy solutions and start questioning the premises that underly their arguments.
As I look across these blogs, and so many others, I feel awash in class envy and hatred, and within that, an assumption that big government is a good thing for ordinary people.
Republicans have been such poor stewards of conservatism these last eight years, especially the mute President who just left office, who quite unlike Reagan and even Bush the elder, simply refused to explain conservative principles, challenge his critics -- and arguably failed to be a conservative on key issues, like the budget and immigration policy.
But reading about "taxing the rich" and "closing income gaps" is nothing more than a euphemism for confiscation. And on top of it, cheering on the expansion of the federal government into every corner of our lives -- it all seems shocking. What happened to the passion for indvidual freedom? Distrust of government and the centralization of power? These used to be characteristics of liberal as well as conservative thought -- they are rooted in the country's founding and in the thinkers who influenced them, like Rousseau and Burke.
Now we might as well read the Communist Manifesto as read these blogs... read about the proleteriat rising up to appropriate the means of production... transforming private property into the property of the people... appointing a dictatorship of the proleteriat, with the Party as its vanguard... throwing the jackboot of capitalism onto the ash heap of history!
Why did so many of us give up on the founding American principles? Why should we accept that people have given up on them? I urge posters on this board to challenge the premises and assumptions behind these malign arguments, and show how market economies really work for everybody when the right balance between state power and individual freedom is struck.
Krauthammer did a good job of challenging assumptions -- Obama's -- in his column today.
It slipped by everybody, but in his speech to Congress Obama pinned the cause of our economic decline on expensive health care, energy policy, and education policy. Krauthammer paraphrases and replies:
(Obama says) The "day of reckoning" has now arrived. And because "it is only by understanding how we arrived at this moment that we'll be able to lift ourselves out of this predicament," Obama has come to redeem us with his far-seeing program of universal, heavily nationalized health care; a cap-and-trade tax on energy; and a major federalization of education with universal access to college as the goal.
Amazing. As an explanation of our current economic difficulties, this is total fantasy. As a cure for rapidly growing joblessness, a massive destruction of wealth, a deepening worldwide recession, this is perhaps the greatest non sequitur ever foisted upon the American people.
In the speech, Obama did not mention as causes the "credit bubble, a housing collapse and a systemic failure of the entire banking system... improvident loans, corrupted bond-ratings agencies, insufficient regulation of new and exotic debt instruments, the easy money policy of Alan Greenspan's Fed, irresponsible bankers pushing (and then unloading in packaged loan instruments) highly dubious mortgages, greedy house-flippers, deceitful homebuyers."
And now, true to Thomas Sowell's formula in The Vision of the Anointed, we have a crisis, and the anointed have the solution, and anyone who questions his solution is benighted.
In that book, Sowell questioned many liberal assumptions and shibboleths himself. So rather than argue about with liberals on this blog about the distribution of wealth:
"To say that 'wealth in America is so unfairly distributed in America,' as Ronald Dworkin does, is grossly misleading when most wealth in the United States is not distributed at all. People create it, earn it, save it, and spend it."
Exactly.
To me "rich" means having so much money that you don't need to get up in the morning and go to work if you don't want to.
But I don't want those people punished. I want those people spending or investing their money, and the rest of us being able to keep as much of our money as possible so we can all do the same.
I'm tired of hearing the Robert Gibbs, the Obama team, and my liberal friends claiming we're criticizing Obama's budget but that we don't have any cogent policy solutions of our own. Newt has always been a font of ideas, almost too much so. So I'm starting this thread to ask, if you were President, what policy and budget priorities would YOU be sending to Congress.
Brave fellow and glutton for punishment that I am, I'll go first. It's by no means complete (no housing policy for example), but it's a start.
My message to Congress is in four parts. First, stabilize the economic ecosystem and stop the fear that's spreading now to all sectors of the economy as they assess the impact of the recession combined with radical reforms like health care reform and energy policy.
Table the cap-and-trade debate until economic growth returns for at least two straight quarters.
Table major health care reform til 2010, but help the uninsured and our emergency rooms through Medicaid and S-Chip, and continue discussion of Community Health Centers as a small-scale solution targeting medical services to the uninsured.
Second, we need to have tax policy that attracts investors back to the markets and allows for capital formation that will drive business creation, expansion, and jobs in the private sector -- and keeps some money in the pockets of individuals so they can spend, save, or pay down debt.
Permanent indexing or elimination of alternative minimum tax
Leave Bush tax cuts in place til 2012
Cut or eliminate the death tax
5-year tax holiday for long-term cap gains
5% reduction for short-term cap gains
Third, the federal bureaucracy needs to manage the budget responsibily. In business, millions of managers are challenged every year to reduce expenses while maintaining output. In bad times, those reductions are steeper, and pay is frozen or cut. Time for government to do the same. Items 6-7 are already in the Obama budget.
The President should defer his salary for two years, be an example to those greedy CEOs.
Implement a 2-year freeze on Congressional compensation (including staff)
5% across the board reduction in administrative and operating expenses for all federal departments and incent managers to acheive these reduction through bonuses
Freeze all discretionary spending, except for unemployment compensation
50% cut to travel and entertainment budgets in the legislative and federal branches
Account for supplemental spending estimates (wars in Iraq, Afghanistan) in the budget
Means-testing for agriculture subsidies
Fourth, we need an energy policy that protects the environment and improves our security by expanding the role of non-fossil fuels in our energy mix, while keeping costs low.
Increase the tax write-off for installation of solar panels from 30 to 65% for residences and businesses
Fund and accelerate licensing to build 10 new nuclear power plants in 3-5 years to power the electric grid and hybrid cars
Provide new incentives for domestic natural gas production and use it as a transitional energy source
With his speech to Congress, and his subsequent radio address, this President's modus operandi is now clear. He makes agreeable noises, language inoffensive to all, then pushes bills through Congress that are full of controversy, and that in some cases, contradict his spoken intentions.
In his speech to Congress, he said he would cap carbon emissions. He did NOT utter the magic words "cap and trade." But we see that is precisely what he intends to do, and I wonder if the public, lulled and hypnotized by his rhetoric and winsome smile, will pay attention to his actions before their first Obama electric bill arrives in the mail.
Here's the deal: Government experts tell you (individual or corporation) how much carbon you can consume. You pay fines to Uncle Sam if you exceed the limits. Uncle Sam then distributes the fines to the middle class and the poor (or in the vernacular of the Obama White House, "the vulnerable") to help them pay for the higher energy costs that Cap and Trade created in the first place. Meanwhile, those who invest in creating energy exchanges, like Al Gore, will get rich off the trades, and the government creates a new "revenue stream" (i.e., tax). In his speech to Congress, Obama told us that he will see to it that renewable energy becomes more affordable. He didn't say that he would do so by driving up the cost of oil, coal and gas generated energy. But that is exactly what he is proposing, and it is consistent with the thinking of the Earth First / No-Growth crowd, who would have us canning beats for the winter rather than buying avocados from California. It all makes you wonder how far he wants to take the extremist environmental agenda. Really, it should come as no surprise for those of us who raised an eyebrow last summer when he was asked how he felt about $4/gallon gas, and responded that it was a shame only that the price went up to fast. See the video...
Have we ever concocted such a disruptive solution to a problem that may not even exist?
A remarkable thing happened last night on the MSM. CNBC Mad Money host Jim Cramer yesterday pinned the tail of recent stock market declines squarely on President Obama's backside. It was remarkable opening commentary, from a Wall Street guy who admits to supporting Obama's policy goals and who all but endorsed his candidacy during the campaign.
Only twice before in my memory has Cramer ventured into the political realm to assign blame for stock market performance -- last summer and fall, respectively, with Bush deficits and Bernanke/Fed inaction on the collapse of major investment banking firms.
Cramer's treatment of Obama was gentle compared to the spitting-mad tirade he threw at Bernanke ("'They know NOTHING!).
Cramer says nothing we haven't heard at this and other conservative blogs -- except to agree that national health care, cap-and-trade, are good policy objectives, they just have to be pursued at the right time.
At the same time last night, David Gergen commented on Anderson Cooper that Obama's team seems to be losing focus, pushing too many ambitious policy goals to the point where they are starting to undermine the foundation objective of stabilizing the economy.
All of this commentary points to one of two possibilities: Either Obama is an overly ambitious Harvard guy, naive about how much change the national can absorb in a year, or he is a reckless ideologue -- he just doesn't care if his accelerated agenda wipes out private savings, because he is so absolutely certain in that "righteous wind at our backs."
Cramer himself raised the possibility that maybe he "just doesn't care about the stock market," and implored Obama to show otherwise.
As if in response this morning, Obama says he won't base policy on the "gyrations" of the financial markets.
Fair statement, but it only proves Cramer's point: There is no gyration in the markets; it is a freefall collapse. Were that we were seeing gyrations! Two and three hundred point drops wouldn't be so troubling. But the decline, since the election and inauguration, has been steady and strong, especially after Obama policy pronoundements.
If capital is indeed on strike, and stays on strike, Obama's confident words this morning about a 2009 recovery ("I'm certain of it") will come back to haunt him, just as John McCain was quickly haunted by his statement that the fundamentals of our economy are sound. It will be no satisfaction to see, given the suffering that is being inflicted.
