Category Archives: Government & Politics

It’s the Fiscal Uncertainty, Stupid

It is not easy to discern under the fog of misinformation disseminated by the Obama administration and its leftist allies in the Congress and the Federal bureaucracy, but these folks seem genuinely puzzled that their Keynesian/socialist policies have not brought the US economy roaring back to life. They said and, more to the point, apparently believed that: the nearly billion dollar stimulus program would provide the perfect jolt to the US job creation machine and cut the employment rate by at least 2%; Obamacare was exactly what the American consumer needed and wanted, and that it would eventually rescue the economy from the ravages of unchecked health care expenditures; the extension and expansion of unemployment benefits and other welfare programs would ease unemployment and cushion the effect that the economic contraction was having on poorer Americans; and finally, their misbegotten mortgage assistance program, cash for clunkers and other artificial, one-time statist interventions in the economy would save it from the severe harm inflicted by the evil policies of the Bush administration – policies which were strangely reminiscent of those of the current administration.

All of these suppositions are patent nonsense. But that this is so is completely beyond the ken of the vastly-experienced businessman whom the American people so foolishly installed in the White House. Obama utterly rejects the policies of Ronald Reagan that rescued the US economy from similar dire circumstances 30 years ago. Instead, he plows ahead with failed Keynesian economic policies and wonders why they don’t herald the economic revitalization that he believes they should. He is clueless as to why American businessmen and the American consumer don’t respond as he expects. It’s the fiscal uncertainty, stupid! The actions of Obama and his minions who, tragically, govern our fair land have created massive uncertainty about what will come next; and it is that uncertainty – as much as the already manifest deleterious effects of Obama’s policies – that is the cause for the continued stagnation in the American economy.

The notion that the uncertainty caused by Obama’s unwise fiscal policies is as damaging as the already perceived ill effects of those policies is not a new idea – although my phrasing of the concept in the title is hopefully novel. I would like to pursue the thought in two ways in this article. First, I will quickly review the nature of the uncertainties and the harmful consequences that follow. Second, I will consider two excellent, recently published books that analyze Obama’s fiscal policies: The Great Money Binge: Spending Our Way to Socialism, by George Melloan (Threshold Editions, 2009) and It’s Not as Bad as You Think: Why Capitalism Trumps Fear and the Economy Will Thrive, by Brian Wesbury (Wiley, 2010). I will discuss how these astute authors’ analyses of the nature of Obamanomics are almost exactly parallel, but how they come to diametrically opposed conclusions as to the consequences for the country and the economy. The point is that if these accomplished experts (both conservative, incidentally) are in complete disagreement about the fallout from Obamanomics, how great indeed must be the uncertainty it is producing in the business community, among investors and consumers and of course in the public at large.

The financial uncertainties that our nation faces are crippling as well as perplexing. But before we recite them, let us list a few of the certainties that have been established beyond doubt in the last 18 months:

·       Obama is a leftist ideologue who wants to transform the US from a society characterized by free markets, limited government, traditional culture and individual liberty into a government-controlled, Euro-style social welfare state.

·       Nationalized health care, cap and trade, massive deficit spending, punitive taxation – especially on the ‘rich,’ extensive government regulation, re-unionization of the American work force and demonization of American business are the main mechanisms he intends to deploy to bring about his radical transformation. He has succeeded in a few of these areas and he continues to press the others.

·       Despite the fact that his agenda was evident for all who cared to look during the 2008 campaign, the American people were blinded by his charisma and apparent pragmatism, by the cover provided to him by the media, and by the populace’s desire to put the nation’s dismal racial legacy to a final rest by elevating a black man to the Presidency. But now a significant portion of the electorate has awoken to the horrendous mistake that was made and is determined to correct said blunder at the earliest opportunity.

These things we know. We see what Obama has done and he is now largely transparent about what he still intends to do. Now what don’t we know?

·       We are unsure of the level of taxation awaiting us. Obama wants to raise income taxes, capital gains taxes, taxes on dividends, FICA earnings limits, estate taxes and all manner of corporate taxes. Will he succeed? To what extent?

·       Do we have inflation waiting just around the corner? perhaps hyperinflation? or will it be deflation? or just stagnation?

·       Will the economy dip back into recession?

·       What surprises await consumers, businessmen and investors in the two multi-thousand page bills that Congress passed in the last four months? What effect will they have on consumer spending or saving, entrepreneurship, the housing industry, the medical profession, Wall Street, Main Street and your street?

·       How much more of Obama’s destructive agenda will be enacted before he stands for re-election? cap and trade? card check? more campaign finance ‘reform’? more education ‘reform’? amnesty for illegal aliens?

·       How deep is the resistance to the threat he poses? Are the Tea Party people representative of not just deep-seated resentment but of a more widespread disappointment at Barack’s plans? Is the Republican Party more RINO than Tea? How will all of this be manifested in the Congressional elections this fall? What effect will that election have on the progress of Obama’s radical agenda? Can any of it be rolled back?

Because of these uncertainties: businesses are loath to invest in new ventures or hire new workers; consumers are reluctant to buy homes; the stock market is subject to wild gyrations; other countries lose faith in the soundness of the dollar; parents worry about their children being able to live as well as the parents do; we remain paralyzed and unable to address the entitlement calamity that is bearing down upon us; public morale is damaged by the enormous debt we are piling up; and our pride in our nation is weakened. Incidentally, this litany doesn’t even touch upon the people’s fear for the country’s security occasioned by Obama’s foreign policy of ‘soft power,’ appeasement, obsequious groveling to tyrants, disarmament and multilateralism.

I doubt there is anything that I have said here with which the two afore-mentioned authors would not agree. In their books, they each come down very hard on Obama along the lines that I have laid out in this piece. The similarities in their analyses of Obamanomics are highlighted by the facts that both books have Forwards written by the same person (Amity Shlaes) and both authors have deep connections to the Wall Street Journal. Yet, Melloan strikes a very pessimistic note, whereas Wesbury remains optimistic.

Melloan: Now, with the crash of 2008, our new president and government appear committed to ignoring the lessons of the past. With multibillion dollar ‘stimulus packages’ becoming the norm, and a multitrillion-dollar national debt that will keep growing so long as present policies are continued, America can look forward to a very grim future indeed.

Wesbury: There is clear evidence that panics and depressions happened with some regularity back in the 1800s and early 1900s, and it is also true that government was small back then, but … Government experimented with two different national banks, often changed the price of gold or silver, issued debt, and regularly interfered with the banking system. … The key is that the United States made it through all of that and has averaged a little more than 3 percent real GDP growth per year for the past … 200 years. This history of free market capitalism is a huge hurdle for anyone who wants to say that it was built on sand to overcome. The United States has created so much wealth and built such a robust system that taking it down is much more difficult than anyone thinks. In the end the economy is built on a rock. … Capitalism has not failed. And it’s not time to give up—on free markets or a better tomorrow. History has shown that every time the economy was thought to be done, worn out, finished, it bounced back. …[It will do so again.] It’s not as bad as you think.

 

Melloan concedes that America’s economic goose is cooked, while Wesbury attempts to convince the reader that the American economy can take Obama’s best punch and still come back strong. As a stockbroker acquaintance says: ‘The market factored in Social Security, then it factored in Medicare; it will likewise factor in Obamacare.’ But there is no more factor room counters Melloan. Are we hopelessly far down the road to ruin or will America’s unbelievable history of resilience rescue us? I wish I knew which of these two gentlemen was correct. How could they come to such vastly different conclusions based on the same evidence and based on essentially the same evaluation of the evidence? I think the answer can be found in the notion of a tipping point. The idea, which I believe originates with Thomas Sowell, is that there is a point in the transformation of America from a Constitutional Republic to a Euro welfare state beyond which – if we reach it – it will be impossible to reverse course. Actually, in a previous post in this blog, in which I discuss this idea at length, I described three tipping points – one political, another economic and a third cultural. Melloan and Wesbury are concerned exclusively with the second. The answer to the puzzle I posed is that Melloan believes that we have passed the economic tipping point, whereas Wesbury does not. I sure hope that Wesbury is right.

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This article also appeared in The Intellectual Conservative on Aug 3, 2010 at:

My Shaky Government Pensions: Fixing Social Security

On July 1, 2010 I retired from a major East Coast State University after more than 40 years on the Mathematics faculty. When I was hired in the late 1960s, I enrolled in the State’s Teacher Pension Plan, a defined benefit plan. Over the years I worked very hard in my disparate roles as teacher, researcher and administrator. I climbed the academic ladder and I retired with a reasonably good salary. Ergo, I earned an ample annual stipend to be paid to me during all the years of my retirement.

When I enrolled originally, the State agency that administers the plan sent me glossy brochures assuring me that my contributions – as well as those of the State – would be invested wisely and that these investments would easily generate sufficient revenue in the future to fund my stipend. The accompanying charts and schedules that they sent seemed quite convincing and so I did not doubt the accuracy of the projection. In fact, the plan was typical of others offered by many State governments as well as the Federal Government at the time.

But then the severe inflation of the 1970s struck. The State plan called for annual cost of living adjustments pegged to national indicators without constraint. State legislators decided that the Pension System would not be able to sustain its commitments in that environment and so they made two fundamental changes. First, participants were forced to make a one-time irrevocable choice between substantially increasing contributions in order to keep the same benefit (i.e., no cap on COLAs in retirement) or leaving one’s contribution unchanged in return for a 5% cap on COLAs. I figured that the country would make whatever adjustment was required to reign in inflation (it did: Reagan for Carter) and so I chose the cap. For 30 years I’ve looked like a genius. I used the extra money that I would have paid in increased contributions to fund a 401(k) that did quite nicely over the years – at least until the decade just concluded. Of course, if Obama’s insane fiscal policies cause the severe inflation that most expect, then my genius status will be open to doubt.

The other adjustment the State made (30 years ago) was that it discontinued the plan for all new employees from that point forth. It replaced my plan with one that required smaller contributions by participants but also paid drastically curtailed benefits upon retirement. However, as the years passed, the State became one of the most profligate spenders in the nation – to the point that it now has a multi-billion dollar structural deficit. That puts the State in virtually the same shape as the Federal Government. Its entitlement programs – of which the Pension System is a prime component – have made financial commitments for the future for which there is no reasonable chance that the State will obtain the requisite revenue to pay the expenses.

The State cannot print money like Uncle Sam can. Therefore, it has only two choices: raise taxes and/or cut spending. It has already done the former, with the predictable ill effect on the local economy. There are many ways it can do the latter, but one option not really available to it is to cut my retirement benefit. That would be a clear and blatant violation of the sanctity of the legal agreement that the State made with me more than four decades ago. I don’t think it is going to happen, but I would be lying if I said that I wasn’t worried about the prospect.

Now I have argued, in this blog and elsewhere, that the role of the government in our society has grown far beyond what was intended by our Founders. I believe that the Federal Government’s intervention in and control of the economy and culture of our nation is a grave threat to our freedom and the traditional American way of life. State governments are not nearly as threatening, but they too have gone, in many ways, substantially beyond their assigned role and, like the Federal Government, they interfere with individual liberties more than they protect them. A prime example of both types of governments overstepping their bounds is entitlement programs. Through these programs, governments, both national and local, control our health care and our retirement. But they also increasingly control the education of children, our energy, financial institutions, automobile manufacturers, housing and much more. It was not supposed to be this way. Moreover, I believe it should stop.

And yet, here I am getting a monthly check from both the State and the Feds (my pension and also Social Security). My very sustenance during my retirement arrives via the government, acting in a role that I believe is improper. Ughh!

Am I going to refuse either check? Not on your life! First of all, I earned every penny of the check from the State. I entered into a binding financial deal with the State 40 years ago. I kept my end of the bargain. Now it is time for the State to do likewise. Besides, supposedly the State has been using my contributed funds properly all these years in order to enable it to live up to its obligation to me. I view Social Security somewhat differently. The Feds have been spending every nickel I sent to them lo these 40 years. There was never any pretext otherwise. My financial contributions to the State were an investment. My Social Security contributions were purely taxes paid. Nevertheless, I am not returning my Social Security check either. The Feds would just send it to someone else. Instead, I’ll use it to fund needy people of my own choosing.

It is ironic that I, a staunch opponent of unlimited government, should be ‘dependent’ on two governments to fulfill the legal obligations they took on to bankroll my retirement. Of course, I am not alone. But the situation is more than ironic; it is, as we all know, unsustainable. We need to get the government out of the retirement business. How are we going to do that? Well, since I am part of the problem, it is reasonable that I propose a solution.

In the future, an individual’s relation to Social Security will be as follows. (The choice of the ages is negotiable; the underlying principle is not.)

·       If you are 55 or older, you continue in the current Social Security system.

·       If you are between 40 and 55, you have a choice of remaining or bailing out.

·       If you are under 40, your only choice is to bail.

·       If you bail (either mandatory or optional), you receive from the Feds all the contributions you have made previously to Social Security, augmented by a modest but compounded interest rate. It is now incumbent upon you to provide for your own retirement.

·       If you remain in Social Security, the rules stay as they are (except that the retirement age might increase). Social Security will cease to exist in 50 years. Those few 40 year olds who opt to stay in and survive until 90 will have to be dealt with on an individual basis.

This scheme will still be expensive for the Feds to implement. But it will not be open-ended and just that fact alone will cause a great change in the long-term fiscal health of the nation, as well as provide a start down the road of returning the government to its proper role.

Similar principles can be employed to phase out Medicare, Medicaid and many other government programs. The hard part will be summoning the political will over an extended period to prevent future law makers from reneging on the deal.
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This article also appeared in The American Thnker at:

 

Coolidgizing Reagan

I grew up in the 1950s in a union household where leftist thought was accepted as gospel. I recall three jokes/stories that I heard repeatedly at family events:

1.     ‘Did you know that the President takes two 2-week vacations each month? On the few remaining days, he plays golf.’ This was a not very subtle slap at Eisenhower’s supposed lack of attention to his presidential duties.

2.     My parents bragged that they taught me in 1948 to say ‘Phooey on Dewey’ whenever the name of the Republican Governor and Presidential candidate was mentioned on the radio. I was five years old at the time.

3.     ‘Do you know who was President before the 1929 Stock Market Crash? Neither do I. No one remembers his name or whether he did anything?

The first two barbs manifest at least a modicum of humor. But the third is a mean-spirited and blatantly dishonest characterization of Calvin Coolidge as an inconsequential and eminently forgettable occupant of the White House. Furthermore, it is indicative of a highly successful campaign to, on the one hand, obliterate Coolidge from the political memory of the American public and, on the other hand, guarantee that on the rare occasion when his presidency is considered, it is relegated to the dustbin of marginal, inept and failed presidencies. Eisenhower is still remembered warmly by the elderly – especially as the 50s were a time of prosperity for America. Two-time loser Dewey was an inconsequential national figure and so his banishment to oblivion is not inappropriate. But Coolidge presided over a time of unprecedented growth and prosperity in the United States. Moreover, his policies played a fundamental role in bringing about that success. That his memory should be marginalized is a great injustice perpetrated on the American people by the progressive movement that has been increasingly dominating the national conversation (with precious few exceptions) since Coolidge passed from the scene.

How have the progressives been so successful in erasing the memory of Calvin Coolidge from the national psyche? And are they having a commensurate level of success with Ronald Reagan – to which they surely aspire. The answer to the first question will be fairly straightforward. As many have observed, over the last century, the left has slowly but surely captured control of virtually all of the main opinion-molding organs of American society. The mainstream media, libraries, foundations, legal profession, educational establishment (including academia) and the arts are – with rare exception – completely dominated by leftist thought. With that kind of pervasive cultural control, the left has been able to generate a host of myths that are accepted as truth by substantial majorities of the American public. I will give some of the most prominent of the myths, but I will carefully separate them into three eras – the reason for which I will explain later.

Pre-1950s Myths.

·       The muckrakers and social reformers of the Progressive Era accurately highlighted the economic and social abuses inflicted upon the people of this nation by the Robber Barons of the Industrial Era. In so doing they justified the reigning in of America’s laissez-faire capitalistic system by a benign and enlightened federal government.

·       The Roaring Twenties represented a temporary resurgence of capitalists exploiting labor, which ended – as it was destined to – in an orgy of corporate greed that resulted in the 1929 Stock Market Crash and the ensuing Great Depression.

·       Harding and Coolidge were corrupt and their policies helped to bring on the calamity. Hoover continued those policies even after the onset of the Depression thereby making matters worse.

·       FDR and his New Deal saved the nation from economic and social ruin.

1950s-1980s Myths.

·       The 1950s resembled the 1920s in that the country slid back into some of its former discredited habits. Reactionaries fought futile rear guard battles to: preserve segregation and racial discrimination; deny women and minorities equal rights; retain antiquated sexual and social constraints on the people that were motivated by religious zealotry; maintain control of the economic life of the nation by corporate giants; and generally resist the progressive agenda whose implementation was clearly the wish of the majority of the American people.

·       The US engaged in a morally questionable Cold War with the Soviet Union that risked the annihilation of mankind. In pursuit of that conflict, America betrayed some of its fundamental ideals in its unwarranted and ultimately doomed intervention in Vietnam.

·       A historic and long overdue correction of some of America’s most profound flaws was engineered by an enlightened Supreme Court with such decisions as: Brown vs. Board of Education, Reynolds vs. Sims, Griswold vs. Connecticut, Miranda vs. Arizona and Row vs. Wade. The dramatic infringement of the people’s sovereignty by the federal government inherent in these and other SCOTUS decisions reflected a new understanding of our living Constitution – namely, that it does not provide a blank check of individual liberty; in fact, some limitation on same is a worthwhile sacrifice to be made in the pursuit of equality, fairness and social justice.

·       The stagflation of the 1970s, like the Depression, was caused by corporate greed and could be brought to heel only by further empowerment of the federal government.

Post 1980s Myths.

·       The notion of American exceptionalism is unjustified. America’s history of slavery and segregation, genocide against the Indians, internment of Japanese-American citizens, aggressive wars against Mexico and Spain, suppression of women’s rights and use of the atomic bomb in WWII reveal the country to be deeply flawed, and therefore not entitled to its claim of special status among the nations of the world. It is no more a ‘force for good’ than any other country.

·       Global warming is caused by humans pursuing excessive personal comforts at the expense of the Earth’s natural bounty. The US is the lead violator and must adjust its consumption habits in order to restore balance to the planet’s environment.

·       Islam poses no special threat to the US and Western Civilization. It is the youngest of the three great monotheistic religions and as such should be accorded the same gracious acceptance in our society as is afforded its two elders.

·       The economic malaise of the first decade of the 21st century culminating in the crash of 08 is, like its predecessors in the 30s and 70s, due to corporate greed. Had we not initiated previous palliatives like Social Security, Medicare, Fannie and Freddie and all the critical federal regulatory agencies that keep watch on our volatile economic system, things would be much worse. But the government should do MORE.

The explanation for the division of the myths into three distinct eras is that the level of public acceptance of them differs according to era. That assessment can be summed up in the arithmetic sequence: 90-60-30 in which each figure represents the percentage of the public that believes the myths of the corresponding era. Well, this is a bit overprecise and impossible to justify numerically. My point is that I believe the first set of myths is nearly universally accepted as received wisdom in the US; the second set is accepted unquestioningly by at least half, but perhaps not much more of the population; and the last set’s acceptance is restricted largely to hard core leftists and those completely under their sway. As evidence for this assertion, I would offer these points:

·       I assimilated the first set of myths by osmosis in school and from my family; I never encountered anyone for decades who thought otherwise. Throughout my life the status of these myths has not changed. Those who question them are viewed as members of the lunatic right. Virtually no one in the opinion-molding organs that I cited earlier questions any of it. Indeed, it is remarkable how widely they are accepted as self-evident in the same way that the Earth is round and life is finite. You have to look to ‘extremists’ like Limbaugh or Beck and other members of the ‘vast right wing conspiracy’ to find skeptics.

·       As for the intermediate set of myths, the collection of true believers is less universal. My experience is that my children and my students’ generation – those educated in the 70s and 80s – probably encountered them as gospel. But in the last generation, with the explosion in the number and variety of sources of information available to the public, it has become more difficult for the progressives – despite their continued strangle hold on the main opinion-molding organs of society – to program the thought of the citizenry.

·       Finally, why has the last set of myths hardened only in the hearts of the hardcore left? There are three obvious reasons. First, the myths are relatively recent and have not had time to seep through the porous membrane that protects the people from the left’s craziness. More seriously, the proliferation of alternate sources of information beside the main opinion-forming organs continues to accelerate. And finally, as implied, these myths are indeed far loonier than those in the previous two sets and so the public is less receptive.

Let us therefore answer the original two questions. First, it was very easy to marginalize and vaporize Coolidge because in the mid 20th century milieu, the first set of myths was almost universally accepted. Poor Calvin never had a chance. But it is much harder to do likewise to Reagan – although it is not for lack of trying.  What would the left’s kultursmog (to use Tyrrell’s favorite phrase) have you believe about Reagan? Simply that he was an amiable dunce who fell asleep at Cabinet meetings and was essentially senile in his second term; that his tax cuts and military build up caused the 80s deficits, not the profligate spending of the Democratic Congress; that his supply side economic philosophy was a ‘voodoo’ scheme to benefit the wealthy and not the engine that propelled America to 25 years of economic growth; and that Reagan did not win the Cold War – it was ended voluntarily by Gorbachev. So far, America is not buying it.

I sat in a schoolroom 25 years after Calvin Coolidge left office and absorbed all the false myths that doomed his legacy to oblivion. It is now nearly that long since Reagan left office. The progressives have had nowhere near the same success in marginalizing the Gipper. Maybe there is hope for the country after all.
This article also appeared in the online magazine The Land of the Free at

Tipping Points: The Decline of the USA

Many conservative commentators have spoken of a forthcoming ‘tipping point.’ By that is meant a point, usually signified by some major event, beyond which it will be impossible for the United States to recover its founding principles and restore its fundamental structure as a Constitutional republic. I believe the idea of a tipping point originates with Thomas Sowell. It presupposes that the United States is on a century-long march from a Constitutional republic in which individual liberty is the highest ideal toward a Euro-style social welfare state in which equality of outcome is the main goal.

Sowell postulates that there will be – if it has not already occurred – a point beyond which the institutionalization of the mechanisms of the social welfare state will be so deeply ingrained that it will be literally impossible to reverse course. The fate of the country will be sealed; no conceivable course of action could then stop the nation’s slide into the basically tyrannical, unexceptional, collectivist, vacillating and increasingly poor nation that it will inevitably become. Some think that the passage of Obamacare was indeed the tipping point.

I will argue here that in fact there are three distinct tipping points – one political, one economic and one cultural. I will explain how we might identify these points and then assess which, if any, has actually occurred. In this way I will raise the possibility that the American people could lose some of the parts of ourselves that make us unique and special, but perhaps not lose the whole ball of wax. I will not claim that the political, economic and cultural features of American society are completely distinct and unrelated – that is certainly not the case. But I will hypothesize that it might be possible to change the fundamental nature of one aspect of American society without losing the heart and soul of another.

Political Tipping Point. A political tipping point would be the place beyond which it is impossible to restore America as the Constitutional republic envisioned and established by our Founding Fathers. That republic was based on these fundamental political principles: Constitutional rule of law; limited government with powers confined only to those enumerated by the Constitution; a federal system in which power is shared by the national government and the States; the people are sovereign and all branches of government derive their legitimacy from the consent of the people; the people’s rights are derived either from Nature and Nature’s God or from the Constitution (as amended); political leaders are ‘on loan from the people,’ not professional politicians and their most sacred duty is to ‘preserve, protect and defend the Constitution of the United States’; and finally, the main functions of government are to defend the nation from foreign and domestic enemies, maintain a sound currency, ensure that the States deal with each other fairly and consistently and to enforce legal contracts – it is expected to do little else.

It pains me to say so, but there is not a single clause in the above list that represents an accurate description of the political rules by which the United States is currently governed. Our political leaders, in all branches of government, routinely and flagrantly ignore the bounds impose upon them by the Constitution. Perhaps the most telling justification of that assertion may be found in the book, ‘Lies the Government Told You’ by Andrew Napolitano. He details the subversions perpetrated by our national leaders throughout US history going all the way back to John Adams’ signature on the Alien and Sedition Acts of 1798. He highlights how the transgressions have escalated – slowly in the 19th century, much more rapidly in the 20th. Moreover, it is clear that the American public is so accustomed to the misbehavior of its leaders that it has completely lost sight of how far we have strayed from our Founders’ ideals. The people are unaware that the current political system under which we live is far more accurately described as a social welfare state than as a Constitutional republic. Furthermore, there is almost no movement by the people or their leaders to recapture our founding principles. Even if they did, it might be impossible to succeed.

Therefore, from a political point of view, it would appear that we have passed the tipping point. When was it? In fact one can legitimately consider a score of candidates – moments and/or events at which the principle political nature of the American republic was irretrievably lost. Here are a few candidates:

·       Adams’ signature on the Alien and Sedition Acts of 1798

·       Marbury vs Madison in 1803

·       Lincoln’s suspension of Habeas Corpus in 1863

·       The introduction of the Federal Income Tax and/or the direct election of senators – both in the time of Woodrow Wilson

·       FDR’s New Deal

·       LBJ’s Great Society

·       Obamacare.

It is impossible to say which of the above (or any other event) marked the actual point at which the US ceased to be a Constitutional republic, much less to prove that having passed that point it is impossible to recover what was lost. However, I believe it is beyond any doubt that our current system would be recognized by our Founding Fathers to be as tyrannical as the one they revolted against.

Economic Tipping Point. In the realm of economics, again we see a huge change if we compare the current US economic system to what existed generations ago. The economic life of our country used to be characterized by: free markets; laissez-fair capitalism; the sanctity of private property; low taxation; the lion’s share of GDP accounted for by private enterprise; a climate in which businesses – large and small – succeeded or failed according to their ability to satisfy their customers; a strong dollar as the world’s leading currency and an ever increasing level of prosperity among the people. Now, while some hint of these characteristics remains, it is more true that: government intervention in the market has drastically increased and continues to increase exponentially; we have a mixed economy with government regulation often stymieing free enterprise; high taxation – especially on the ‘wealthy’; eminent domain has expanded beyond the vision of our Founders; government entitlement programs are choking the economy; businesses that are ‘too big to fail’ are ‘bailed out’ by the government; and we are plagued by a weak dollar, high unemployment and feeble economic growth.

Have we passed the tipping point? Has our formerly free market economy been so thoroughly corrupted by government control that our future is inevitably socialistic, and are we doomed to a diminished standard of living? I don’t know, but perhaps not. Matters were equivalently desperate in the 1970s, but Reagan’s economic program revitalized the economy and sparked a generation of sustained economic growth. Perhaps if we could rid ourselves of big government Republicans like George W Bush and even bigger government Democrats like Barack Obama, we could right the ship again. We certainly won’t find out whether it is possible until the Obama-Pelosi-Reid gang is chased from power and replaced by a limited-government, conservative leadership committed to free markets and economic growth – and I don’t mean more big government Republicans like McCain or Romney.

There is another point to be made. Sad to say, as with politics, a large percentage of the American public is not cognizant of the fundamental changes wrought in the American economy over the last 50-100 years. They take it as perfectly normal – and correct – that the federal government should play such an enormous role in the economy. They don’t know otherwise; and if they think about it at all, they don’t think it should be otherwise. As that percentage grows, the economic tipping point grows closer.

Cultural Tipping Point. Regarding American culture, yet again we see massive changes. Until approximately 1900, American culture was marked by: a WASP superstructure that valued morals grounded in religious faith – especially Christianity; a British legal system and classical British cultural traits like modesty, humility, perseverance and personal responsibility; veneration of the family; bourgeois values; patriotism; reliance on civic and religious societies; rugged individualism; and pride in our American heritage and appreciation for the achievements of Western Civilization. Today we see on the ascendancy a different culture, one that emphasizes: multiculturalism and the denigration of Western civilization; secular humanism; personal fulfillment over personal responsibility; sexual promiscuity; homosexuality and other abnormal arrangements in addition to (or even in lieu of) traditional family structure; denial of American exceptionalism; government as the ultimate resource for all societal problems and ‘social justice’ as the highest goal.

Nevertheless, I believe that we have not yet passed any cultural tipping point. I have two reasons for saying that. First, in the cultural sphere – unlike the political or economic, many are aware of the radical changes that have occurred and people have a sense of what is being lost. Politics and economics are very complicated, also impersonal, distant, at times unapproachable. But culture is personal, close, daily. It’s hard to conceal any changes. Grandparents tell their grandchildren about cultural differences much more readily than they discuss political or economic changes. Therefore, resistance is greater to adopting cultural changes than it is to accommodating political or economic change.

The second reason lies in the driver of the changes. Political and economic changes are driven primarily by government whereas cultural changes are driven by the media, the educational establishment and through the organizations of civil society (religious, civic, professional, etc.). Although the historic nature of the American experience encompasses a healthy distrust of government, I think that the people have been trained to instinctively rely on government more than on the opinion molding organs of society that have warped our culture. And so, there is less resistance to the advent of a political or economic tipping point than there is to a cultural one.

There is an anomaly hidden in this analysis. I have argued previously in this blog (see http://new.ronlipsman.com/2009/05/17/what-culture-is-it-that-the-politics-have-caught-up-with/

and

that the strategy progressives adopted in order to radically alter the country was to first capture the culture, whereupon the politics would follow. And that is exactly what happened. Therefore, how can we have a political tipping point precede a cultural one? I believe the answer is as follows: The progressives captured enough of the culture to enable them to successfully assault the classic political and economic structures of the US. With regard to the latter, the people are either unaware of the changes, or can live with them, or actually favor them. But a substantial part of the populace is uncomfortable with the new culture and resists the cultural onslaught – even if they do not resist its political and economic consequences.

Actually, if this interpretation is accurate, then there is cause for hope that conservatives can mount a counter-revolution and take back the culture. Then perhaps we could even overcome the political and/or economic calamities that we have endured. But it will be extremely difficult. History is replete with fallen civilizations that were not able to recover their former exalted status: Persia, Greece, Rome, and more recently Spain, France, Great Britain and the Soviet Union. (It’s an interesting exercise to try to identify the fatal tipping point for these. My favorite is Britain, for which I think the Suez crisis of 1956 was the tipping point. The cavalier way that Eisenhower brushed aside the Brits marked the latter’s downfall as a world power.)

A legitimate question arises: Is the current situation sustainable? That is, having hopelessly corrupted our political system, teetering economically, but retaining our cultural identity to a large extent, can we survive in this hybrid fashion for a long period? Perhaps. The analogy is imprecise, but in some sense that is what the situation is for the Asian Tigers, and to some extent also China. Those countries do not enjoy the political freedoms that America did. Their economies are not as free as ours once was. But their cultural identities are strong and seem to be enough to keep the people unified and motivated. Can America endure as a big Singapore? I find it hard to believe so, but we shall see.

Let me conclude by reinforcing my hypothesis – namely, that we have passed a political tipping point, are very close to an economic tipping point, but are stoutly resisting a cultural tipping point. I will do so by briefly highlighting what I see as the signature consequence or output of each of these three components of American society – politics, economics and culture. They are, respectively, freedom, prosperity and patriotism/morals. Well America might still be the home of the brave, but we’re no longer unquestionably the land of the free. This year the Heritage Foundation downgraded our status from ‘free’ to ‘mostly free.’ For me, that is an unmistakable indication that a political tipping point has passed. As for economics, we are still a very rich society, with great opportunities for individuals to prosper. But if one consults Per Capita Income Data on the web site of the U.S. Census Bureau (see e.g., http://www.census.gov/hhes/www/income/histinc/p01AR.html), one sees (in constant 2007 dollars) a curve that is steadily rising over the years until the turn of this century. During the first decade of the 21st century, the curve is flat. It hasn’t turned down yet, signifying that we are on the cusp of a tipping point. Finally, I think that most Americans still believe in American exceptionalism, that America has been and should continue to be a force for good in the world, that our society – which represents a unique experiment in individual liberty – is blessed by Divine Providence and should remain a beacon of freedom to the world. Moreover, they are bitterly disappointed to learn that their President does not share that belief. If we the people loose that faith and tip culturally, then we are truly lost. I don’t think that is going to happen.
This piece also appeared in The Intellectual Conservative at:

Obama the Warrior

The title is, at first glance, ludicrous. Our post-modern President trots around the globe bowing to our enemies, pledging to disarm, sundering our alliances, denigrating the country he heads and humiliating the leaders of our (former) closest allies. He eviscerates our arsenal, dismantles our intelligence capabilities and willfully ignores the most blatant threats to the United States. To speak of him as a warrior is the height of absurdity.

Yet, in some sense, he actually is a warrior – not in any military context, but rather in the classic parlance of the progressive movement. He is an aggressive, motivated and dedicated soldier in the battle to remake America into a collectivist, social welfare state. He struggles mightily to undermine the Constitution, destroy free market capitalism, subvert traditional culture and weaken the sovereign nature of the American republic. In this struggle, he belittles his opponents, pursues his objectives relentlessly and engages in elaborate feints and misdirection to confuse and demoralize the opposition. Sounds like a warrior to me…except that the field of engagement is the political arena instead of a military battlefield. The weapons are words, money, favors and the media, not guns and missiles. Physical courage does not enter the equation; it is replaced by idealistic conviction, single-minded devotion to cause and stubborn unwillingness to entertain the thought that one might be wrong.

The idea that the foot soldier in the progressive movement is engaged in a war is completely consistent with the mode set for the movement by its earliest proponents. This is discussed brilliantly in Jonah Goldberg’s 2007 book Liberal Fascism. Goldberg argues that modern liberalism (i.e., the progressive movement) draws its inspiration from classic fascist principles:

The core value of original fascism…was its imposition of war values on society…The chief appeal of war to social planning isn’t conquest or death but mobilization. Free societies are disorganized. People do their own thing, more or less, and that can be downright inconvenient if you’re trying to plan the entire economy from a boardroom somewhere. War brings conformity and unity of purpose. The ordinary rules of behavior are mothballed. You can get things done: build roads, hospitals, houses. Domestic populations and institutions are required to ‘do their part.’


Many progressives probably would have preferred a different organizing principle, which is why William James spoke of the moral equivalent of war. He wanted all the benefits – Dewey’s ‘social possibilities’ of war – without the costs. Hence, in recent times, the left has looked to everything from environmentalism and global warming to public health and ‘diversity’ as war equivalents to cajole the public into expert-driven unity….’Martial virtues,’ James famously wrote, ‘must be the enduring cement’ of American society: ‘intrepidity, contempt of softness, surrender of private interest, obedience to command must still remain the rock upon which states are built.’

Obama and his fellow progressives who are running the country have established the fields of battle in their war to remake America. Moreover, they discuss those fields in military terms, replete with all the implications for national calamity, extensive casualties and lost opportunities that are normally associated with the winds of war. To wit:

·       Global Warming. According to the progressives, the Earth is in danger, the threat is imminent and unimpeded capitalism is the source of the crisis. They use war metaphors constantly when proposing their socialistic policies for ‘winning this war.’

·       Deficits and Debt. Progressives legitimately assert that the threat to the nation from runaway deficits is grave – even existential – and that enormous sacrifice will be required to win this war. What they fail to mention is that their policies caused – and continue to exacerbate – the threat.

·       Healthcare. Despite the fact that the overwhelming majority of Americans are satisfied with their health care, progressives seize on (and inflate) the relatively small number without adequate access as a beachhead in their war to convert the US to socialized medicine. They cite health care’s enormous costs without acknowledging that their programs (Medicare, Medicaid, SCHIP, employer-based coverage caused by FDR’s wage controls, and now Obamacare) are the principal drivers of the astronomical costs.

·       Welfare. LBJ declared that war 45 years ago. The poverty rate is roughly the same now as it was then, despite the progressive generals at HHS and HUD who have been prosecuting the ‘war against poverty’ all the while.

Nevertheless, to label Obama a warrior is indeed truly ridiculous, and here is why. For more than half a century the greatest leaders of the progressive movement were indeed warriors. I am thinking of Teddy Roosevelt, Woodrow Wilson, FDR and LBJ. Teddy was the greatest warrior of them all. His physical courage is legendary. His exploits in the Spanish-American War bear testimony to that. Wilson might not have had the physical courage of Teddy, but he savored the idea of American participation in The Great War. Against tremendous opposition in the country, he cajoled the nation to enter the war, whereupon he converted the society to a heightened war footing and appointed generals who prosecuted the war assiduously. FDR did likewise in the Second World War.
Neither Wilson nor FDR exhibited the personal manifestations of a warrior like Teddy, but in the mold of military leaders throughout history, they led their people purposefully, forcefully and resolutely into war. Finally, the same is true of LBJ – up to a point. He was itching to fight the Communists in Southeast Asia and, like his heroes, he steered the country into war. But unlike his heroes, he botched its execution and presided over defeat instead of victory. In so doing, he converted the progressive movement to pacifism. Oh, progressives might drop a bomb (Serbia) or lob a missile (Sudan) here and there, but the idea of America participating in – much less instigating – a real war became anathema to them.
Obama is from that cloth. In his pacifism and reluctance to commit American troops to battle, he is no different from Carter or Clinton, Mondale or McGovern. One might argue though: what about Iraq? Afghanistan? If he could, Obama would withdraw from those conflicts instantly. However, he inherited them and he knows that he would risk serious political capital by a precipitous withdrawal – especially if it resulted in a military defeat. To his disgrace, he has announced to the enemy his dates for withdrawal in the near future. For him, these conflicts are distractions from the domestic ‘wars’ that he wishes to fight. More pointedly, he refuses to engage the enemies that truly threaten America: Iran, North Korea, nations harboring Muslim terrorists, or the Chinese.
Obama prefers appeasement to confrontation. He prefers despots like Chavez or Castro to democrats like Netanyahu. Unwilling to project strength, he believes that obsequiousness and understanding will reverse the intent of America’s enemies. Some warrior!
To Obama, America is a failed state that has no moral right to fight other states – no matter how evil or how much they might threaten American interests. Besides, it is very difficult to strike a military pose when one is constantly bowing.
This post (with minor edits) appeared as an article in The American Thinker; see