Jason Sterlace's blog

Robert Reich comments on the current economic situation:

Regardless of your ideological stripe, you’ve got to see that when consumers and businesses stop spending and investing, there’s only entity left to step into the breach. It’s government.

 This is like saying that if you won’t jump into the pit, we’ll just push you. 

When the government spends money, it spends taxpayer money.  With regard to the current economic situation, it is money that taxpayers have already decided not to spend.  They’ve made that decision because, as Reich himself notes, “they’re perilously in debt and worried about keeping their jobs.”

If government then steps into the breach, politicians are overruling your decision about whether or not your money should be spent—and on credit, by the way.  Keep in mind that you knew you couldn’t afford it.  Reich knows it, too.  He acknowledges:

From the standpoint of any particular individual, paying down debts or saving may be smart behavior — even commendable. But what’s intelligent for an individual does not necessarily translate into what’s good for the economy as a whole. The only way to get businesses to create or preserve jobs is through additional spending.

But it is also true that what’s good for the economy as a whole is not necessarily intelligent for the individuals the politicians want to put on the line.  Reich, like so many others, is advocating that we prop up our house of cards and keep pretending it is sturdy.  I would much rather he allow me to figure out whether or not I can afford to be a part of the scheme.  Of course, this kind of conservative viewpoint may sound very unrealistic and overly selfish.  After all, there’s the whole Keynesian paradox of thrift to think about.  There are a lot of people counting on me to buy things with money I don’t have.

In other words, the economy is too big for us to afford having it jeopardized by what is good for us individuals.

But not long ago, it was Reich who said:

[I]f a company is too big to fail, maybe – just maybe – it’s too big, period.

 It strikes me as remarkably inconsistent that Mr. Reich would not be willing to level this same criticism at government.  But consider the point made by another (albeit less famous) economist:

Imagine, it was in 1900 that the US government only taxed us at a 2.5% rate. Then, after each successive war, the government has found it necessary to boost its take of economy to today, where including Obama’s bailout, I estimate the federal government ALONE will take 30% of GDP in 2009.

If the goal of Reich, the president, and the other big spenders in Congress is simply “to create or preserve jobs here in America,” then maybe we can start by reevaluating how we could better spend that money that is already in the budget.  We could certainly consider limiting the salaries of federal employees (as was proposed with corporate executives) and spread the wealth that the federal government is already distributing, rather than printing and/or borrowing ever more money.

It would be an inspiration if President Obama himself would take the lead and forgo his $400,000 salary, his $50,000 expense account, and his $100,000 nontaxable travel account.  (That right there could create a dozen jobs at my salary range.)  And it would also put Barack Obama in pretty impressive company: George Washington is the only president to have refused his salary, and John Kennedy gave his to charity.  (confirm at Wikipedia)

Set the example, Mr. President.  Until then, regardless of my ideological stripe, I just don’t see how I could take your (or Mr. Reich’s) populist rhetoric seriously.

This is a crucial point.  With the fiscal stimulus legislation, Democrats want to create manufacturing and construction jobs - an attempt to recreate the New Deal.  But America is no longer a manufacturing economy.  America is an Information Economy.  Dragging us back to 1930's-era shovel projects is not economic progress.  It is nostalgia. - Jon Henke

A few days ago, Matt Dabrowski asked:

If Obama's stimulus plan doesn't give jobs to the white-collar, educated people who need them, can the stimulus possibly work?Let's leave aside for the moment whether or not the nation needs these projects (which I believe we do), or whether we support them (which I do as well). Will these infrastructure projects even work?

The answer is "No, they won't".

The Wall Street Journal says that "many Americans have been out of work for months and are resorting to lower-wage or part-time jobs to make ends meet." But infrastructure construction jobs are skill positions--the era of digging ditches with shovels is long gone. It's not a matter of handing out shovels to millions of laborers who have been locked out of their factories or whose farms have failed. That's not how things are built these days. And after decades of changing the shape of the American workforce, it is finally time to admit that the shape of the workforce has changed.

This is not 1933, and the old New Deal simply can't be enacted in today's America.

Anybody who wants to address ways to lower unemployment needs to consider this point made by the Economist: 

The New Deal was introduced into a world of giant organisations—of big businesses and big trade unions that were capable of striking deals with big government. But today’s economy is much more fluid. America’s most successful companies are entrepreneurial outfits like Apple and Google, which thrive on flexibility; even giant companies such as General Electric are breaking themselves up into entrepreneurial divisions. More Americans own their own companies (15%) than belong to trade unions (12%).

Please re-read that last sentence again before advocating any government-works plans to address today's unemployment.

This morning, former (Republican) Secretary of State Colin Powell endorsed Barack Obama for president. 

This may be a major blow to the credibility of John McCain's candidacy, but is it a major blow for the Right?  That depends on how closely aligned you think McCain is to the Right, and how much you feel your vision of the Right would be represented by a President John McCain.

While Conservatives certainly do not want an Obama presidency--especially when Democrats control both houses of Congress with growing (possibly filibuster-proof) majorities--we must note that very few Conservaties actually want a McCain presidency, either.  Consider the language used by Secretary Powell today (0:40):

I have some concern about the direction the Party has taken in recent years; it has moved more to the Right than I would like to see it...

These kind of comments by a prominent Republican help to set the stage for a productive conversation about the future of the GOP--the very conversation that The Next Right was created to address.

I do subscribe to Jon Henke's view of the Republican Party having three main factions, and that the Party is at a crossroads of defining its mission and its message.  This is not just about new packaging of an old recipe.  There are many people who care more about specific ideals and goals than about which political party delivers them.  For example, while I (and probably Powell) identify with Henke's description of a Goldwater Republican, I am not particularly wed to the Republican brand--nor, clearly, is Secretary Powell.

Personally, I will support any Republican who can deliver on the principles of limited government, individual liberty, and strong defense.  I would also support any Democrat who could deliver on these principles.  And absent Republicans or Democrats who can deliver on these principles, I will be disenfranchised and support neither.  That is a situation that does not benefit any faction of Republican, so all Republicans should be looking to avoid it.

But perhaps the most important point for Republicans lies in what Powell says at the conclusion of the clip.

Because of his ability to inspire; because of the inclusive nature of his campaign; because he is reaching out all across America; because of who he is, and his rhetorical abilities (and we have to take that into account); as well as his substance--he has style and substance--he has met the standard of being a successful president, being an exceptional president.  I think he is a transformational figure, he is a new generation coming onto the world stage, onto the American stage.

Is Barack Obama truly a transformational figure in the sense that Secretary Powell thinks he is?  If so, and if he is elected, America will be a much better place over the next four years, and many of us who opposed him will be surprised.  Republicans will be forced to rethink the Big Government policies that have not worked for the Bush administration.

But realistically, the world is likely to see that while Barack Obama's image and brand are among the hottest in the world, he just can't live up to these expectations.  As the bar is set higher and higher, and as he is awarded a mandate on election day, and as the world rejoices and dances, there will be a distinct lack of rainbows and ponies in our daily lives.  Sure, the specter of Bush/Cheney will be there to blame for all ills, in the same way that some Republicans still haven't let go of the Carter administration, but eventually people will have to see that the government is still bloated, the budgets still don't balance, and powers are still abused.  Even under Obama, children will die of horrible diseases and rogue states will still threaten our security and our lives.

Now is the time for the Right to decide whether they will be Democrats Lite for the next decade, or something more.

Thus Spake Al Gore:

If you're a young person looking at the future of this planet and looking at what is being done right now, and not done, I believe we have reached the stage where it is time for civil disobedience to prevent the construction of new coal plants that do not have carbon capture and sequestration.

It is my fervent hope that within the month we will see the former Vice President and a few dozen young persons chained to construction equipment outside Pittsburgh, chanting pro-nuclear slogans and eating soy granola.

I mean, that would be seriously fantastic.

Of course, it was just over a year ago that Mr. Gore said “I can’t understand why there aren’t rings of young people blocking bulldozers, and preventing them from constructing coal-fired power plants.”

While the spectres of Rachel Corrie and Daniel McGowan loom behind Mr. Gore, I can't help but wonder why he keeps putting the onus on young people to chain themselves to the construction equipment. Surely he's not afraid to get his hands dirty in order to save the planet? It's time to lead by example, Mr. Gore--and stop placing excessive burdens on future generations. Rather than asking the youth to risk jail or physical harm, wouldn't it be more responsible to encourage them to go see the last of the polar bears, or the few remaining glaciers? Before they're gone?

Let those few baby boomers who have a conscience bear the consequences of sacrifice. After all, this is a cause worth sacrificing for, isn't it Mr. Gore?