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Sunday, March 1, 2009

Obama's "Change" Doesn't Equal Progess

“Never confuse motion with action,” said Ben Franklin. So far, what we seem to be getting from the Obama administration is a lot of motion, with little real productive action. Or, to put it another way, we’re getting much “change” but no real progress. Obama’s administration looks like one of those spread-the-floor basketball teams that passes the ball well, sets good picks, runs the shot clock nearly all the way down and then shoots a brick—again, a lot of motion with no tangible results.

“Not simply change, but progress” should have been the conservative retort to Obama’s cries of “Change! Change! Change!” during the campaign season. As C.S. Lewis put it, “Progress means not just changing, but changing for the better.”

Alas, if you were unsure, now you can see what Obama’s “change” is all about: expanding government, spending massive amounts of taxpayer dollars (“spreading the wealth”), all the while furthering the liberal agenda. This government spending spree, which began in the last administration, seems to have “something for everyone.” (Sounds like some of our local politicians.) Corporations, homeowners, state governments, city governments…almost everyone with his or her hand out is getting money from the federal government.

Given the failings of corporations, banks, and individuals alike, many folks see the government as the way out of our financial mess. In other words, most people think that government should “do something.” A February 19 Fox News poll showed that 58 percent of Americans thought the stimulus legislation was necessary. Of those 58%, the top reason given (37%) for supporting the stimulus was because it was seen as the best option and we “have to do something.”

A February 24 Washington Post poll revealed that 63 percent of Americans thought additional federal action will be needed to improve the economy. What, $800 billion is not enough?! It’s time for another Ben Franklin quote: “When the people find that they can vote themselves money—that will herald the end of the republic.”

Financial expert and Atlanta radio talk-show host Clark Howard had an interesting take on Obama’s stimulus plan. Clark “does not do politics,” so speaking as non-partisan as possible, using “cold, hard economic facts,” he said that Obama’s plan “was not a good idea for the country.” He refers to the stimulus as a “Christmas Tree with ornaments,” with almost $2 in spending for every $1 in tax cuts.

We are where we are financially, he noted, because of a “speculative economic bubble.” We “over-stimulated the economy,” Clark said, and had “false economic growth based on borrowed money.” This was true of individuals, corporations, and the government.

Clark described this debt as a “disease that spread through the full financial arteries of this country.” Along with having a government that is too large, we over-extended ourselves in the private sector as well. Using easy credit, we built far too many homes, retail stores, restaurants, hotels, office buildings, apartments, and so on. This also led us to have too many banks. Thus, Clark notes, our recession is a “natural result of living too large,” and all sectors of American society must begin to work off our current level of debt.

Clark correctly states that the best thing that government can do is let this painful but necessary period of financial correction play out. Government can help soften the blow of this recession, he adds, by creating a temporary “social safety net” (for food, healthcare, etc.). This would come at a fraction (about 1/20th) of the cost of Obama’s $800 billion plan. This $800 billion will create growth, but it will be false growth, Clark says, and will likely be followed by a second recession. He concludes that, “You do not create long-term prosperity by crowding out capitalism with massive doses of federal spending.” (A link to Clark’s full comments is on my website.)

Contrary to the false economic growth, this immense level of federal spending will create all too real government growth. This is why several principled Governors have declined to accept part of the federal money. Tens of billions of these dollars are for health care, welfare, unemployment, and education programs. The federal money will expand these programs, and as Governor Rick Perry of Texas put it, “If this money expands entitlements, we will not accept it. This is exactly how addicts get hooked on drugs.”

As much as many people want to believe it is so, there is no magic wand that government can wave and bring us out of these hard economic times. Government spending at the federal, state, or local level that expands government programs, institutions, facilities, etc. will continue to increase the tax burden on Americans. Congress and the President cannot outlaw the natural financial consequences that must take place for our country to experience real economic progress and the return of financial growth and stability.

Copyright 2009, Trevor Grant Thomas
At the Intersection of Politics, Science, Faith, and Reason.
Trevor and his wife Michelle are the authors of: Debt Free Living in a Debt Filled World

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