American Elephants


Free enterprise or social democracy? It shouldn’t even be a question. by The Elephant's Child

In an interview with NPR, Lisa Jackson, head of the Environmental Protection Agency, gives her perspective (and her boss’s) on the car companies.

Jackson: The President has said — and I couldn’t agree more — that what this country needs is one single national road map that tells auto makers who are trying to become solvent again, what kind of car it is that they need to be designing and building for the American people.

NPR reporter: (interrupting) Is that the role of the government, though?  I mean that doesn’t sound like free enterprise.

Jackson: Well, it it, it is free enterprise in a way.  Umm uhh you know, first and foremost the free enterprise system has us where we are right this second (laughs) and so some would argue that the government already has a much larger role than we might have when Henry Ford rolled the first cars off the assembly line.

In the Wall Street Journal, Arthur C. Brooks, President of the American Enterprise Institute, points out that the real culture war is over capitalism.  The new divide centers on free enterprise — the principle at the core of American culture.

You can see the beginnings of this schism, he says, in the “tea parties” that have sprung up around the country, with the count now greater than 800,000 people expressing their opposition to government deficits and bailouts that prop up those who engaged in mortgage fraud and corporate malfeasance.

They worry about the massive debt that will affect the lives of their grandchildren.  They paid their mortgages,  they were small business owners who don’t want  corporate welfare, they were bankers who made prudent loans.  They are watching elected politicians hand their tax money over to reward the people who did all the important things wrong.  And they don’t like the casual distribution of taxpayer money by the members of Congress who caused the problems in the first place.

The Pew Research Center asked people in March 2009, if we are better off  “in a free market economy even though there may be severe ups and downs from time to time.”  Fully 70 percent agreed, compared to 20 percent who disagreed.

Under President Obama’s tax plan, fully 49 percent of American adults will have no federal income-tax liability.  Another 11 percent will pay less than 5 percent of their income in taxes and less than $1,000 in total.  The other half will pay for everything — your own health care, and theirs, their education and  the “tax-cuts” that simply give the untaxed welfare money.  You will pay for all the volunteers who will do make work jobs in the name of “community service.”

“Social Democrats ” says Brooks, “are working to create a society where the majority are net recipients of the “sharing economy.”

Advocates of free enterprise must learn from the growing grass-roots protests, and make the moral case for freedom and entrepreneurship.  They have to declare that it is a moral issue to confiscate more income from the minority simply because the government can.  It’s also a moral issue to lower the rewards for entrepreneurial success, and to spend what we don’t have without regard for our children’s future.

Do read the whole thing.  It’s important to understand the real basis of today’s culture war.



The king of France went up the hill, with forty thousand men; The King of France came down the hill And ne’er went up again. by The Elephant's Child
April 30, 2009, 6:52 pm
Filed under: Economy, Freedom, Socialism | Tags: , ,

Economist Veronique de Rugy warns President Obama that while France is admirable in many ways, economics is not one of the ways.



The H1N1 flu strain by The Elephant's Child

The Swine, Mexican, H1N1 flu, will be relatively mild scientists say, according to genetic data, and won’t be as deadly as even the average winter flu. Scientists are working on a new vaccine, but it won’t be ready until around December.  Because of  Hillary Clinton’s insistence on removing the profit motive from vaccine manufacture, there is now only one company that makes vaccines in the United States.

The World Health Organization says that only 7 8 people worldwide have died from the H1N1 flu.

Janet Napolitano warned youngsters released from schools closed in fear of the flu, that school closure didn’t mean they should go the the mall, but that they should stay home.

Somebody or other announced that the flu was caused by a virus — as the flu always is — and you cannot get it by eating pork chops or bacon.

According to the media, this flu is closely related to Seattle’s own winter storm watches.  All panic, few flakes.



A few insights from Obama’s press conference. by The Elephant's Child

In his televised press conference last night, celebrating his first 100 days, President Barack Obama claimed that his $787 billion deficit spending stimulus package “has already saved or created over 150,000 jobs.”  It’s just that nobody can figure out where these saved or created new jobs are, and a lot of policy wonks are trying to figure it out.

“This crisis is neither the result of a normal turn of the business cycle nor an accident of history.  We arrived at this point as a result of an era of profound irresponsibility that engulfed both  private and public institutions from some of our largest companies’ executive suites to the seats of power in Washington D.C.”

Well, no. This crisis is the result of regulations put in place by Congressional Democrats, and of Democrats refusal to rein in Fannie Mae and Freddie Mac.

While we have inherited record budget deficits and needed to pass a massive recovery and reinvestment plan to try to jump-start our economy out of recession, we cannot lose sight of the long-run challenges that our country faces and that threaten our economic health…”

Well, guess what happened while our attention was diverted by the debate about torture?  Congress passed an enormous budget without a single Republican vote. The graph below shows the ” inherited deficits,” and estimates of Obama’s spending.

wapoobamabudget11

“We have rejected the false choice between our security and our ideals, by closing the detention center at Guantanamo Bay and banning torture without exception.”

And where did the detainees go?  Obama also acknowledges that the harsh interrogation techniques he has banned might have yielded useful information.

“I don’t think we should micromanage.”

This is what the President says about the automobile companies after describing just how he plans to micromanage the automobile companies.

“We have to lay a new foundation for growth.”

The Treasury Department announced yesterday that it is going to step up the issuing of 30-year bonds to cover the hundreds of billion of dollars the Obama administration is spending on bailouts, budget and stimulus.   An advisory committee warned that domestic and foreign investors are going to demand significantly higher interest rates in exchange for buying the vast number of new bonds.  Higher interest rates will strangle the economic recovery.

At the Reason Foundation, economist Jeffrey Miron explains the financial crisis, and why we would have been better off to have done nothing at all.




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