Tuesday, December 23, 2008

A Short Break

There's been lots and lots of good stuff I've been meaning to blog on lately, but the holiday season and winter weather has been catching up with me. I figure blogging may be light for the next week or so, so, before the holidays, here are some unsupported and unsubstantiated thoughts:

# The auto bailout passed with nary a peep from me or Congress- Bush went right ahead and ordered his own bailout in a way that some on both the left and the right have described as unconstitutional. In typical Bush fashion, no accountability was placed upon him or the automakers- Obama will have to decide what to do when progress reports come due in March.

#I saw a big piece this morning on one of the news shows executive compensation and how outrageous it was that some of the CEO's at financial firms receiving bailouts are still receiving such large bonuses (even though as a whole, executive compensation for 2008 is way down). 1) This was the law that was passed, so it's what were stuck with. 2) There is good language in the bailout bill to prevent bad management from receiving "golden parachutes," which makes good sense. But compensation becomes a more difficult issue, as compensation is obviously one of the tools used to lure away good management from one company to another. Even as a libertarian, I'd be willing to accept the proposition that, in general, there are problems with executive compensation. I just find the proposition that government (or anyone) can dictate what compensation is fair to be even more troublesome.

# Two other things from this morning- The compensation for executives and upper management for all of these major financial firms totaled about 1 billion, which would be 0.00125% of the 800 billion dollar bailout package. One of the reporters discussed an interview with a CEO who's name I don't remember about the notion of accountability in this bailout. The CEO said point blank there could be no accountability. In essence, they took the check, cashed it, and continued to go about their business. Even if the law had demanded accountability (which it doesn't), what does that even mean in the first place?

# Thank God for the angry and the principled left, many of the members of which have become more and more critical of the Obama plan. Obama, of course, is giving America exactly the sort of unity and change he promised. And without being too conspiracy-oriented, let's be clear about what Obama is doing. Obama is attempting to unify Americans behind the mantle of big government while calling a truce in the culture war. Having Rick Warren deliver the invocation at his inauguration is an appeal to social conservatives and Mike Huckabee Republicans, while his holdover of Robert Gates as Secretary of Defense and naming of several other Republicans in cabinet posts is an attempt to assuage whatever remaining Bushies may be left. Who does this leave out, but me and my fellow libertarians, along with any conservatives who still fly the flag of limited government.

Should libertarians regret not actively opposing Obama? That I'm not so sure about. Obama-brand big government may well be better than Bush-brand big government, but I have no way of knowing. What scares me though, is the nature of the language being used and the way that those who would stand with a stop sign in the face of a government onslaught are being simply brushed aside. The Bush administration is held up as a straw man for free markets and limited government so that our ideas don't even have to be addressed anymore. Rather, we're presented with a picture of the future, where Americans are unified in the idea that our political leaders should solve our problems.

I said thank God for the left because if so-called conservatives wind up as mushy-spined as their Congressional Republican representatives, than libertarians will need the left more than ever to stand true to their principles and point out this new administration's abuses of power.


Anonymous rose said...

Charles Krauthammer wrote a piece that echoes your thoughts about Obama's priorities and real aspirations:

The Real Obama

Barack Obama has garnered praise from center to right -- and has highly irritated the left -- with the centrism of his major appointments. Because Obama's own beliefs remain largely opaque, his appointments have led to the conclusion that he intends to govern from the center.

Obama the centrist? I'm not so sure. Take the foreign policy team: Hillary Clinton, James Jones and Bush holdover Robert Gates. As centrist as you can get. But the choice was far less ideological than practical. Obama has no intention of being a foreign policy president. Unlike, say, Nixon or Reagan, he does not have aspirations abroad. He simply wants quiet on his eastern and western fronts so that he can proceed with what he really cares about -- his domestic agenda.

Similarly his senior economic team, the brilliant trio of Tim Geithner, Larry Summers and Paul Volcker: centrist, experienced and mainstream. But their principal task is to stabilize the financial system, a highly pragmatic task in which Obama has no particular ideological stake.

A functioning financial system is a necessary condition for a successful Obama presidency. As in foreign policy, Obama wants experts and veterans to manage and pacify universes in which he has little experience and less personal commitment. Their job is to keep credit flowing and the world at bay so that Obama can address his real ambition: to effect a domestic transformation as grand and ambitious as Franklin Roosevelt's.

As Obama revealingly said just last week, "This painful crisis also provides us with an opportunity to transform our economy to improve the lives of ordinary people." Transformation is his mission. Crisis provides the opportunity. The election provides him the power.

The deepening recession creates the opportunity for federal intervention and government experimentation on a scale unseen since the New Deal. A Republican administration has already done the ideological groundwork with its unprecedented intervention, culminating in the forced partial nationalization of nine of the largest banks, the kind of stuff that happens in Peronist Argentina with a gun on the table. Additionally, Henry Paulson's invention of the number $700 billion forever altered our perception of imaginable government expenditure. Twenty billion more for Citigroup? Lunch money.

Moreover, no one in Congress even pretends that spending should be pay as you go (i.e., new expenditures balanced by higher taxes or lower spending), as the Democrats disingenuously promised when they took over Congress last year. Even some conservative economists are urging stimulus (although structured far differently from Democratic proposals). And public opinion, demanding action, will buy any stimulus package of any size. The result: undreamed-of amounts of money at Obama's disposal.

To meet the opportunity, Obama has the political power that comes from a smashing electoral victory. It not only gave him a personal mandate. It increased Democratic majorities in both houses, thereby demonstrating coattails and giving him clout. And by running on nothing much more than change and (often contradictory) hopes, he has given himself enormous freedom of action.

Obama was quite serious when he said he was going to change the world. And now he has a national crisis, a personal mandate, a pliant Congress, a desperate public -- and, at his disposal, the greatest pot of money in galactic history. (I include here the extrasolar planets.)

It begins with a near $1 trillion stimulus package. This is where Obama will show himself ideologically. It is his one great opportunity to plant the seeds for everything he cares about: a new green economy, universal health care, a labor resurgence, government as benevolent private-sector "partner." The first hint came yesterday, when Obama claimed, "If we want to overcome our economic challenges, we must also finally address our health care challenge" -- the perfect non sequitur that gives carte blanche to whatever health-care reform and spending the Obama team dreams up. It is the community organizer's ultimate dream.

Ironically, when the economy tanked in mid-September, it was assumed that both presidential candidates could simply forget about their domestic agendas because with $700 billion drained by financial system rescues, not a penny would be left to spend on anything else.

On the contrary. With the country clamoring for action and with all psychological barriers to government intervention obliterated (by the conservative party, no less), the stage is set for a young, ambitious, supremely confident president -- who sees himself as a world-historical figure before even having been sworn in -- to begin a restructuring of the American economy and the forging of a new relationship between government and people.

Don't be fooled by Bob Gates staying on. Obama didn't get elected to manage Afghanistan. He intends to transform America. And he has the money, the mandate and the moxie to go for it.

9:33 AM  
Blogger lonely libertarian said...

That's actually one of the pieces I meant to link too last week, thanks for posting it.

9:46 AM  

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