The Georgetown speech in which President Barack Obama put his new administration in context has become more famous, perhaps, for the fact that a logo that would have normally appeared behind him — the letters “IHS,” a Christogram, a set of letters designating “Jesus Christ” — was blacked out at White House request.
Some see this as a disowning of Christianity by Obama. Another possible interpretation — that the White House was trying to avoid wrapping a speech already laden with Christian metaphor with additional Christian symbology (to avoid overtly identifying the ideas as Christian more than Judean, Muslim, or, well, universal) — has received less consideration.
But whether you find the symbolic action apocalyptic or not, what do you make of the speech’s content?
As usual, you’ll find the standard political spin: “[E]conomists on both the left and right agree that the last thing a government should do in the middle of a recession is to cut back on spending.” The left never wants to decrease government spending, so I’m not sure what to make of that. On the vaguely identified “right,” there are, however, many, many economists who disagree with the spending idea.
President Warren Gamaliel Harding, for example, cut government during his inherited recession, and the economy bounced back quickly.
But that history — well worth looking up — is not the history as our president knows it. Obama says that “history has repeatedly shown that when nations do not take early and aggressive action to get credit flowing again, they have crises that last years and years instead of months and months — years of low growth, low job creation, and low investment that cost those nations far more than a course of bold, upfront action.”
Well, tell that to the Japanese, who still suffer from their decades-long depression, even after moving mountains to keep their economy going.
Or what about how America got out of the Great Stagflation of the ’70s? Fed chair Paul Volcker simply did the opposite of Obama’s advice, raising interest rates mercilessly. And, after a period of adjustment, the U.S. economy came out swinging.
The obsession with getting the boom rolling again, though, without suffering any downtime (so to speak) rules Obama’s agenda. As it did his benighted predecessor’s.
Get that credit rolling!
But what if the trouble really is too much bad debt? Obama deals with that in one section, on toxic assets, but quickly forgets it, falling back into Keynesian pump priming.
Obama’s speech is filled with half-truths. Fascinating glimpses of recent history refract in the lens of his ideology, making the ultimate picture presented a distortion.
He says he wants “a future where prosperity is fueled not by excessive debt, reckless speculation, and fleeing profit” . . . but his policies of massive government spending and cheap money (thanks, Bernanke, for helping out) will likely amount to more than the first few puffs of another bubble.
The president does have a nice way with metaphor, though, blaming the current recession not on any natural “ebb and flow,” but on “a perfect storm of irresponsibility and poor decision-making that stretched from Wall Street to Washington to Main Street.”
But the metaphor hides a truth. We must understand the current debacle in terms of standard business cycles. It is not something completely different, just bigger than more recent bouts. It was caused by concerted government interventions in the housing markets, a general goofy understanding of risk (itself perhaps largely a product of government regulation, as Nassim Nicholas Taleb has pointed out), and a long-standing policy of inflation from the Federal Reserve, a policy of easy credit that gave power to an investment craze.
But Obama’s mishmash explanation is not the heart and soul of his speech. The real meat is the Gospel parable of two houses, one built on a rock, the other on sand. “We cannot rebuild this economy on the same pile of sand.”
When I look at his proposals, what I see are towers built on the same old sand. The best example is his proposal for health care. Here we have an industry almost wholly circumscribed by government, and yet politicians portray themselves as vexed, blaming market forces and ignoring all the government interventions at work.
And Obama offers more of the same. More interventionism. Not less.
Indeed, after a brilliant bit explaining the harsh realities of entitlement growth and its place in current budget deficits and growing debt, he then rests his response to said imbalance by making a few technical fixes in health care.
The Prez says he’ll reduce costs. Wanna make a bet? What government program has done that? Certainly not Fannie Mae and Freddie Mac.
It is the most absurd bit of misdirection I’ve seen in some time.
But it is nestled among a few powerful metaphors, a bevy of half-truths that resonate, and some good common sense. The problem is often not any single statement, but what it all adds up to.
And what is that? The same old irresponsibility in a nice new package.
Precisely what you’d expect from a mainstream politician. This is the best such folk can deliver. A nice, shiny new cover for politics as usual.
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