All About Greed

It comes down to greed. That’s what the economic turmoil is all about for many people. Too many of us were greedy, and now everyone is paying the price. Luckily this belief is wrong, because if it were right we’d be up the creek.

The rest of this week's TGIF, "All About Greed," is here.

Mr. Obama, What About Tomorrow?

The Obama administration’s $275 billion bailout for mortgage lenders and troubled borrowers once again shows that “tomorrow-be-damned” thinking still rules the White House. President Obama has clearly dumped the Clinton administration’s theme song, “Don’t Stop Thinking about Tomorrow.” (Not that Clinton or his successor took the lyric to heart.)

The rest of this week's op-ed, "Mr. Obama, What about Tomorrow?" is at The Future of Freedom Foundation website.

Less than Nothing

The story is told that Ludwig von Mises was once asked, "Do you mean to say that the government should have done nothing during the Great Depression?" Mises responded, "I mean to say it should have started doing nothing long before that." I hope the story is not apocryphal, because it perfectly sums up the government’s proper role in managing the economy: none.

The rest of this week's TGIF, "Less than Nothing," is here.

Cross-posted at Anything Peaceful.

Shame

Obama flunks a big civil liberties/foreign policy test, according to the incomparable Glenn Greenwald. Read it here.

What to Fear

The only thing to fear ... is ... government itself.

Belatedly

Happy Birthday, Charles Darwin!

Keynes Returns

Keynes is all the rage these days. Our House of Commons and Lords — sorry, House of Representatives and Senate — are brimming with Keynesians, and more than one news commentator has boldly declared (as we’ve heard before), "We’re all Keynesians now." In light of the resurrection of the at least twice-interred Keynes , I decided to revisit some of the gentleman’s writings.

The rest of this week's TGIF, "Keynes Returns," is here.

Proving Too Much?

• “The legitimate object of government is to do for the people what needs to be done, but which they can not, by individual effort, do at all, or do so well, by themselves.” –Barack Obama, quoting Abraham Lincoln
• “[N]ot a single person on the face of this earth knows how to make [a pencil].” –Leonard Read, “I, Pencil”
• Therefore, making pencils — and, by implication, everything else — is a legitimate object of government.

What’s wrong with this argument?

Cross-posted at Anything Peaceful.

Lincoln

My friend Jeffrey Rogers Hummel, a Civil War scholar as well as an economist and economic historian, has written a spot-on op-ed about Abraham Lincoln in the Chicago Tribune. I highly recommend it.

The Perverse Genius of Politics

Barack Obama held another town meeting today, this one in Fort Myers, Fla. People in the audience stood up and directly told the President of the United States they are hurting because of the recession. Obama listened sympathetically and explained how he will help them. It was all captured on television.

It takes some understanding of economics — which most people lack — to comprehend what’s wrong with that picture. Those people are victims of the state’s misguided interventionist economic policies — after all, the central government has been the steward of the U.S. economy for generations. Yet Obama, the latest chief executive of this economy-wrecking organization, stood before them as their salvation. The news media reinforced that narrative at every step.

This is why it is so difficult for economic sense to make headway.

Syllogism

• Government takes over regulation of an economic activity from the market process.
• Government regulation fails to prevent the bad it was intended to prevent.
• Ergo, the market is incapable of regulating itself, requiring more government regulation

Addendum: This, of course, can be made more general:

• Government assumes responsibility for the economy as a whole (the Fed, fiscal controls, housing policy, etc.)
• The economy goes through bouts of inflation and recession, and sometimes both at once.
• Ergo, since the market process cannot be relied on for self-generated stability, full employment, etc., more comprehensive government control is required.

Cross-posted at Anything Peaceful.

A Nobel Prize in Economics for Maddow?

I know she's way too easy a target to bother with really, but check out what passes for economic argument on cable television. It's from Rachel Maddow of MSNBC; an excerpt selected by a sympathizer who found it "especially compelling." (I won't inflict the video on you, but it's here.)

Cutting food-stamp funding to attract Republican support is proof-positive that the Republicans are not trying to come up with an effective stimulus here. If your house is on fire, and you call your fire department, and your fire department tells you to pour gasoline on the flames, they're not actually making a good-faith effort to help you put out the fire. They're not a good fire department.

If you're working up policy to fix an economic crisis, which is characterized by there being no spending in the economy, and someone in that debate says, 'OK, but cut the spending out of the rescue plan,' they're bad at making policy.

And you know what? It matters when you're wrong. A whopping proportion of the Republican rhetoric about stimulus is wrong.... It's just wrong. The time is now to take the radical step, as Americans -- as civic-minded Americans concerned about our future -- it's time to take the radical step of privileging correct information over incorrect information....

If you are wrong, from here on out, you should lose the argument and you should lose your political potency. Form a flat-earthers club or something, where you talk enthusiastically to each other about your made-up economic ideas that aren't based in reality. But get out of the way of the people who are actually trying to save the country.

Let's play Find the Fallacies. (A better game might be "Find the Argument.") Here's one to begin with: Just because Republicans are hypocrites about deficit spending doesn't mean they are wrong. It may only mean they should have practiced what they now preach when they were in power.

Cross-posted at Anything Peaceful.

Remember the Broken Window!

The debate over what kind of government spending will "stimulate" or not "stimulate" the economy is beside the point. As Bastiat taught us, and Henry Hazlitt reminded us, you have to consider what is "not seen"--what will not happen if the government borrows and spends scarce resources. That is all that really matters in this discussion. If some Keynesian replies that those resources will remain idle otherwise, ask why he or she is not inquiring into the government policies that make and keep productive resources idle. That would be a better use of time than lobbying for a bogus stimulus bill.

Cross-posted at Anything Peaceful.

Silver Lining on the "Stimulus" Bill

Update: The Senate bill is now $827 billion, so the following item has been overtake by events. Hopefully the outcome alluded to below will still take place.

Breaking news from CNN:

Democratic and Republican Senate negotiators reached a tentative agreement for a $780 billion economic stimulus package, according to two Democratic sources and a GOP negotiator. Senate Majority Leader Harry Reid took the list of cuts to the nearly $900 billion Senate bill to fellow Democrats, and the Senate continued the debate into the evening.

Below $800 billion! Well, look at the bright side. Maybe it will drive Paul Krugman crazy.

Republican Albatross II

Why does every Republican in Congress (with the obvious exception) begin his or her statement about the pending "stimulus" bill by saying, "Of course we need a stimulus bill..."?

Bye Bye, Daschle

Former Sen. Tom Daschle is gone. He's taken himself out of nomination as Obama's health and human services secretary because of his failure to pay taxes on perks he "earned" as a consultant providing corporations access to the government power he once held. He was to be the architect of the brave new medical system that is to replace our wild, dog-eat-dog, frontier free-market system. (When are we going to see the first government involvement in the system?)

Whenever someone like Daschle bites the dust in this way, all of Washington, including the so-called opposition party and the news media, get downright teary: How tragic that this good, talented, dedicated, hardworking, nice man won't be able to serve his country. Is anything more indicative of the class conflict inherent in the system? It truly is them against us.

There's nothing tragic about Daschle's fall, of course. It's one fewer parasite to feed overtly off the taxpaying hosts. (He'll have to go covert again.) The tragedy is that there are dozens eager to take his place.