The Galbraith Effect

Thomas Sowell

8/12/2008 12:01:00 AM - Thomas Sowell

Many years ago, when I was a college student, I took a course from John Kenneth Galbraith. On the first day of class, Professor Galbraith gave a brilliant opening lecture, after which the students gave him a standing ovation.

Galbraith kept on giving brilliant opening lectures the whole semester. But, instead of standing ovations, there were now dwindling numbers of students and some of them got up and walked out in the middle of his lectures.

Galbraith never got beyond the glittering generalities that marked his first lecture. After a while, the students got tired of not getting any real substance.

Senator Barack Obama's campaign this year reminds me very much of that course from Professor Galbraith. Many people were ecstatic during the early primaries, as each state's voters heard his glittering generalities for the first time.

The media loved the novelty of a black candidate with a real chance to become president, and his left-wing vision of the world was largely their vision as well. There was a veritable media honeymoon for Obama.

There was outrage in the mainstream media when ABC anchor man Charles Gibson asked Obama a serious question about the economic effects of a capital gains tax. Who interrupts honeymooners to talk economics?

The fact that Senator Obama did not have a very coherent answer made things worse-- for Charles Gibson. Since Obama can do no wrong in the eyes of many of his supporters, they resented Gibson's having asked him such a question.

The question, incidentally was why Senator Obama was advocating a higher capital gains tax rate, when experience had shown that the government typically collected more revenue from a lower capital gains tax rate than from a higher rate.

Senator Obama acted as if he had never thought about it that way. He probably hadn't. He is a politician, not an economist.

Politically, what matters to the left-wing base that Obama has been playing to for decades is sticking it to "the rich." What effect that has on the tax revenues received by the government is secondary, at best.

What effect a higher capital gains tax rate will have on the economy today and on people's pensions in later years is a question that is not even on Senator Obama's radar screen.

Economists may say that higher capital gains tax rates can translate into lower levels of economic activity and fewer jobs, but Obama will leave that kind of analysis to the economists. He is in politics, and what matters politically is what wins votes right here and right now.

The kind of talk that won the votes-- and the hearts-- of the left-wing base of the Democratic Party during the primaries may not be enough to carry the day with voters in the general election. So Senator Obama has been changing his tune or, as he puts it, "refining" his message.

This was not the kind of "change" that the true believers among Obama's supporters were expecting. So there has been some wavering among the faithful and some ups and downs in the polls.

Despite an impressive political machine and a huge image makeover this year to turn a decades-long, divisive grievance-promoting activist into someone who is supposed to unite us all and lead us into the promised land of "change," little glimpses of the truth keep coming out.

The elitist sneers at people who believe in religion and who own guns, the Americans who don't speak foreign languages and the views of the "typical white person," are all like rays of light that show through the cracks in Obama's carefully crafted image.

The overwhelming votes for Obama in some virtually all-white states show that many Americans are ready to move beyond race. But Obama himself wants to have it both ways, by attributing racist notions to the McCain camp that has never made race an issue.

The problem with clever people is that they don't know when to stop being clever-- and Senator Obama is a very clever man, perhaps "too clever by half" as the British say. But maybe he can't keep getting by with glittering generalities, any more than Galbraith could.