To Stimulate or not to Stimulate? A Question I can't Answer

First a confession, I am not an economist. While I consider myself a fairly well educated person, my areas of expertise reside outside of the financial realm. As I have written over the past month about the various stimulus and bail out bill put before congress it has been as a common everyman. I am trying to bring a center-right common sense viewpoint to the debate. Initially I gave tacit support to the proposed 750 billion dollar stimulus with the strong caveat that monies should be diverted to areas of development that actually would lead us into the future, not simply a litany of "shovel-ready" road projects that while might give a short term boost to our economy, would have little to no long standing impact on moving us into the 21st century. I though that we had a unique opportunity to truly invest in the future of America, further cementing its position as first among equals in the western world. However, as the plan has ballooned to nearly $1 trillion in questionable spending, with far too little devoted to permanent tax cuts, which would stimulate business for the long term, and various economists have weighed in on its benefits or lack thereof, I have begun to seriously question whether those at the Cato Institue are right and doing nothing may be better than doing something wrong. What follows are questions to which I do not have ready answers, but which our elected officials had better think long and hard about before voting for anything.

Do any of these provisions sound stimulative?
$1 billion for Amtrak, the federal railroad that hasn't turned a profit in 40 years
$2 billion for child-care subsidies
$400 million for global-warming research
$2.4 billion for carbon-capture demonstration projects
$650 million on top of the billions already doled out to pay for digital TV conversion coupons.

According to the Washington Posts estimates, only $90 billion out of $825 billion- 12 cents of every $1- is for something that can be considered a stimulus. That means 88% of this bill simply raises the budgets of existing programs. What exactly will that do for the middle class most effected by the current recession?

A huge amount of money will be directed towards the urban transit systems, not for revolutionary new forms of transit, just hugely increased budgets. These entities are so badly managed that their fares cover less than half of their costs. However, the people who operate these systems belong to public-employee unions that are campaign contributors to . . . guess which party?

$54 billion will go to federal programs that the Office of Management and Budget or the Government Accountability Office have already criticized as "ineffective." Is this what Obama meant by a new "era of responsibility?"

$66 billion more for education funding which is more than the entire Education Department spent just 10 years ago and is on top of the doubling under President Bush. Additionally as the cost of college tuition is skyrocketing some $6 billion of this will subsidize university building projects. Have schools become drastically better over the past ten years with all this extra money? Should we be looking instead on ways to revolutionize the way we structure education in the 21st century rather than simply keep doing more of the same?

Will this increased spending become part of the annual "budget baseline" that Congress uses as the new floor when calculating how much to increase spending in the future. But it's hard to imagine that Congress will cut spending next year on any of these programs from their new, higher levels. Are we creating a socialistic society under the guise of emergency aid? Is it happening so quickly and organically that we won't even notice until it is too late?

Government stimulus plans have a long history of failure. From Roosevelt's New Deal to last February’s $168 billion economic stimulus package. President Bush called that “a booster shot for our economy” and promised that it was large enough to have an effect, but it didn’t work. What makes us think this will? $1 trillion is a huge amount of money, but in an economy that is $14 trillion will it be enough?

The Do-Nothing Crowd argues that it is probably insufficient and definitely unwise. Many of the Do-Nothings argue that a painful recession is the best way to destroy America’s runaway culture of irresponsibility and debt. Economic turmoil, after all, has a way of grounding Americans. Maybe dramatic belt-tightening across the board is the only way to stop our endless cycle of borrowing. Many agree with a tough love attitude towards our children- what hurts now will make you stronger in the future- should the same principle apply to a country?

Housing prices are coming down to a more sustainable level. The National Association of Realtors reported this week that housing sales rose 6.5 percent from November to December. Is this a sign that the housing market is on its way to a balancing point at which lower prices once again draw new buyers into the system? Capitalism does work if we let it. If we inject $1 trillion dollars worth of debt into the system will we stiffel the natural recovery process?

The libertarian Cato Institute is planning an all out ad blitz making the case against the proposed stimulus. The ad will include the names of 250 economists across the country, including Nobel Prize-winning economist Edward Prescott of Arizona State University, who oppose the massive spending and tax cut program. Do they know something congress doesn't?

Or scarier still does congress know and not care?

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Yes We Can! Recycle Old Ideas.

The current generation of Americans has often half-bemoaned the fact that it has had no great war, no great depression, no great call to national sacrifice in which to prove itself the way our forefathers did. 911 could have brought that if Bush had not made the national call to arms a call to shop. The War on Terror, while real, has not impacted the vast majority of citizens in the way WWII or even Viet Nam did. Now, in a tragic case of be-careful-what-you-wish-for, America is facing crises, economic and military, the likes of which have not been seen for nearly 100 years. And in an almost poetic twist of fate we have an historically elected president to try to deal with them.

After over a year of rhetoric and debate the time has finally come for Obama, and the Democrats he helped sweep into power, to govern. The first order of business is getting the country back on its feet economically and so the battle over stimulus has begun. It presents the first opportunity for conservatives to voice their concerns over the direction the new administration is taking the country. After an hour or so trolling the net for economists’ views on a stimulus plan’s effect on reversing the effects of a recession of the magnitude we now face, it seems that opinions are legitimately divided. For every expert who claims we can spend our way out of danger there is one who says the short term effects will not amount to much, and the inflation and incurred debt will cripple us in the long term. What to do?

It would seem that, like it or not, a large-scale stimulus in the $800 billion - $1 trillion range is going to happen. What conservatives need to focus on is doing their best to steer the money towards those things which will offer the most reward and least risk, such as tax cuts, investments in energy independence and eliminating waste. Unfortunately as the plan now stands there seems to be little in the way of forward looking investments that will create real economic growth.

Below are some of the highlights of misdirected funds and what the conservative response could be.

$120 billion in education grants & state aide to prevent cut backs
While educational funding and the merits of federal involvement can be honestly debated, it seems clear that this money will do nothing to create jobs or act as an immediate stimulus to the economy when that money will simply be spent to continue the programs of the past. If we want to direct money toward education, why not revamp our trade schools to provide certificate level training in many of the growth industries such as technology and health care. Another innovative idea that has been proposed is to change the way we structure secondary education so that people could become certified in professions such as accounting, business management & technicians without needing to attend 4-year colleges.

$129 billion to help states with Medicaid
The amount of Medicaid fraud and abuse has been termed "staggering," but experts have not been able to determine exactly how much the program loses each year. Throwing more money at the system without real meaningful reform will not help either in the short term or the long term. We need to look with revolutionary eyes at how we provide and deliver health care in this country.

$4 billion on preventative health care
This is an area that could actually stimulate some growth and lead to long term savings in our health care costs, yet the plan only allows for $4 billion? The U.S. leads the world in medical advances, branching out into preventative care is a logical extension. Obesity rates are jumping off the charts and the future looks even worse. Instead of pumping nearly $130 billion into a system rife with fraud (Medicaid) shouldn’t we be creating jobs in areas that will help our kids’ futures? This just shows the short sightedness of the plan’s authors

The nonpartisan Congressional Budget Office projected less than half of the $355 billion that House Democrats want to spend on highways, bridges and other job-creating investments is likely to be used before the end of fiscal 2010.
This means the recession will be well on its way to ending by the time states get around to spending the so-called stimulus. And even the money that will be spent on-time really won’t do that much in the long term. New roads are not the future of transportation. I argued earlier for forward looking transportation investments in maglev trains, fuel cell technology and the like. Revamped roads and bridges will look nice but add little to our national economy or development. One can almost see the pork-filled projects that are likely to be included in this portion of the plan by the time state governments get through with it.

Now for some numbers that seem to be little more than pork for local constituents:

$6 billion to fund the weatherizing of modest income homes
$6 billion to provide high-speed Internet to rural areas
$200 million in renovations to the Mall in DC
$50 million for the National Endowment for the Arts
$360 million to slow the spread of sexually transmitted diseases

A third of a $billion for government approved condoms. Really?

Additionally, some argue that the plan doesn't contain enough safeguards on how the money is spent, and that some measures are designed to circumvent normal spending procedures. It seems likely that some officials are using the package to try to enact major shifts in federal policy, such as getting government back into the business of building public housing. More Medicaid, more public housing, largely useless and wasteful spending projects, billions of dollars to prop up a fundamentally flawed educational system, does any of this sound like a plan to move us into the economy of the future? Clearly not. Rather this sounds like an endorsement of the status quo.

Obama won the election and the Democrats were swept into office largely on his coat tails. Now that we are seeing the first major result of the nation’s shift to the left it is up to conservatives: Republicans, Libertarians and even our friends the Blue Dog Democrats to stand up for some common sense in terms of what we need to spend our future on. Much has been made of The Greatest Generation, and rightly so. Now is our chance. How will we stack up in the annals of history? Will we rise to the challenge, make dutiful sacrifices and pave the way to a brighter future? Or will we bow under the pressure of tired ideas and simply do more of what got us here? It is up to us.

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Partisanship vs Solutions

When I was a child, I spoke like a child, thought like a child, and reasoned like a child. When I became a man, I gave up my childish ways.- 1 Corinthians 13:11

When Obama paraphrased this passage in his inaugural speech on Tuesday I wondered if those who really needed to hear it did or even could. Only a few minutes earlier crowds chanted in a derogatory manner toward former President Bush as he ceremoniously left the capital. And before the parade had even begun, callers to conservative radio programs railed against Obama, his speech, his demeanor and the inauguration itself. It seems as if the political battle lines are so taughtly drawn that a ceasefire between Red Sox and Yankee fans is easier to pull off. However, politics is not really a game for the stakes are much too high; and we do need to put away our childish ways if we are to fix our current problems. Debate is a good and healthy part of any democracy, but partisanship for partisanship’s sake needs to end.

Once, not too long ago, our government was run by two political parties who, while spirited opponents of each other’s positions, were able to come together in a civil way when they needed to. For a variety of reasons this ethos has been lost. Over the past 16 years specifically, the hostility has grow to the point where extreme adherents to either side view their opponents with such scorn that civility seems an impossibility. Something changed during the Clinton/Bush years. Clinton had of course famously battled with the Gingrich-led Republican congress, and while the Bush years are too recent to give any summative evaluation it seems fair to say that congress felt they could vote with him while at the same time rail against him in the media, and he at times was heavy-handed in his dealings with them in return.

What’s past is past. We need to change our manner of dealing with each other for the future. The problems we have now, and those on the horizon are simply too big, too consequential, and too hard for us not to find a way we can work together. The Middle East is a tinderbox on the verge of exploding. Pakistan and Afghanistan are becoming hotbeds for Islamic extremists again. Russia is dangerously rearing its head in international affairs. The current economic crisis could turn to a world-wide depression at any time. These are not some Nostradamus doomsday predictions; this is the world we now live in.

As a conservative there are certain ways I feel these crises should be dealt with, much of which center around a muscular foreign policy with many “boots on the ground,” continued low tax rates, and forward looking stimulus. However, I also know that there are well-meaning progressives who have their own set of ideas. If I am ever to convince them of the benefits of a conservative solution I have to at least entertain their ideas, and they need to respond in kind. Partisanship for its own sake will only lead us to more stalemate, more divisiveness and less solutions. All of us, myself included, need to stop acting like children at play, rooting for our team no matter what the cost. We need to root for solutions. Period.

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Transition of Power

The term “Founding Fathers” is a plural noun, which in turn means that the face of the American Revolution is a group portrait. To be sure, Washington was primus inter pares within the founding generation, generally regarded, then and thereafter, as “the indispensable figure.” But unlike subsequent revolutions in France, Russia, and China, where a single person came to embody the meaning of the revolutionary movement—Napoleon, Lenin/Stalin, Mao—the revolutionary experience in the United States had multiple faces and multiple meanings that managed to coexist without ever devolving into a unitary embodiment of authority. If one of the distinctive contributions of the American political tradition was a pluralistic conception of governance, its primal source was the pluralistic character of the founding generation itself. -Joseph Ellis

Watching CNN over just the past few months one could see the kind of violence and turmoil that can come with a change of power in other countries. And we often have seen so-called democratically elected leaders simply refuse to give up power that had been given to them, often using their armies to remain in power.

While Americans now take it for granted, the peaceful transition of power from one leader to the next is a recent phenomenon in history, only dating back to the American Revolution. It is easy to forget, but the election of a new president, the orderly transfer of power, and the regular opportunity for us to change the nation's course are some of humanity's most amazing achievements. That we now regard this as normal testifies to the success of the Founding Fathers and their creation, The United States of America. This is why we are able to witness George Bush graciously welcome Barrack Obama into the White House and turn over the reins of power this Tuesday.

Imagine a leader who usurped civil liberties, condoned wire tapping, promulgated wars, tortured enemy combatants, was accused of having Darth Vader for a vice president. Imagine this leader being ridiculed as inept at best, evil at worst, during the longest and most contentious election cycle in recent memory. Now imagine this leader inviting his elected successor into the halls of government with unprecedented openness and cooperation. That is exactly what has happened in our country over the last couple months, and it is truly miraculous. For all of George Bush's faults, he has helped engender one of the most productive and controversy-free transitions in recent history. Nowhere else can this level of bitterness be so swiftly swept aside so that the machinery of government can smoothly pass from one man to the next.

Stories of President Lincoln are everywhere to be found lately for the obvious parallels to President-Elect Obama. The symbolism, from the Illinois roots, to the soaring rhetoric, to the whistle stop tour en-route to the inauguration, is extremely powerful indeed. But as millions watch the first black man to be sworn into office as President of the United States, we should stop and recognize that it was the Founding Fathers' genius that allows something this historic to occur. There is a reason much of Europe, and parts of Asia, modeled their governments after the USA. Perhaps that influence is now beginning to spread further into parts of the middle east, though time will tell.

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The Audacity of Hope vs The Reality of America

After the election I was challenged by a center-left friend to read Obama's book, The Audacity of Hope. The literary hubris of the title aside, the President-Elect is clearly as good a writer as he is a speaker. However, my feelings have largely been reinforced, not really changed. I will deal with three realities which I believe to be true about Obama. First that he is an intellectual without enough realism to come up with common sense policies, second that he is more of a talker than a doer, and third, that while he possess a good heart and wants to help, he is philosophically wrong as to how this should be done.

In his book he talks at some length about how we should fix the nations educational system, and he correctly points out many of its flaws. However, he seems to have spent no real time talking to people who teach for a living before prescribing his remedy. Thus his policies represent an intellectual approach not a realistic one. He claims that money matters and that schools need to be better funded to succeed. As a teacher I know that a well-funded school is always a plus, but simply throwing money at the problem doesn't help. He uses as his proof of money being the driving force the fact that many people move into districts which have higher per-pupil spending. Why else would they move to these communities, he rhetorically asks? While in truth, a stronger motivating factor for people moving into these areas is to avoid having their kids in with certain populations. While this does correspond with a lower economic situation, it doesn't change the fact that people are avoiding "bad influences" not going towards high funding.

Next he states the way to fix our schools is through starting school at a younger age, making the school year longer, and going for more hours per day. At the same time he states that the first line in responsibility is the family, specifically the parents. Yet he can't seem to see the contradiction he is setting up. How can the government (at the same time) take on more of the job of parenting, while expecting the real parents to step up to the plate? You can't have it both ways. He is right to say families are the first line of defense, and in fact the most responsible. The problems that beset our modern families are deeply cultural and will require much more than simply more funding or a longer school day to fix. We need a government that starts valuing the traditional family unit as the most important unit in our society, not as a hinderance. Our current fascination with a consumerist culture which necessitates the need for two income families has much more to do with our lower educational standards than anything else.

Lastly in terms of education he correctly points out that there are teachers who are not entirely qualified for the job. However, his plan to fix the issue is to have people with degrees in, for example, chemistry, be fast tracked into the teaching profession without having to get certified as teachers. This again shows Obama's main weakness as a leader. His ideas make perfect sense on paper, but they do not work in the real world. I can not tell you how many midlife career changers I have seen come through the teaching profession simply to burn out because they have not had the appropriate training. Teaching children is much more than having mastery of content, it is about understanding children and how to teach them.

Education is obviously an important issue, but there is more to Obama's upcoming presidency than education policy. There is also the much repeated line that he is a great speech giver but not much else. While there is admittedly not much of a record to go on here I feel that that simply gives more weight to the few instances we do have. Obama wrote very convincingly about the need to reform how politicians are elected and how the keep their positions. One point he dramatically made the case for was campaign finance reform. Specifically, he called for public financing as a big step towards honest elections. He even quoted JFK and his idea of courage in explaining how hard will be, but also how necessary. So when Obama had the chance to, literally, put his money where his mouth was, what happened? He went on to raise more money than any other candidate in history, essentially buying an election. I realize this is just one example, but we have potentially more in his reversal of a 16 month troop withdrawal deadline, his reversal on wire tapping, his potential reversal on shutting down Guantanamo Bay. The list could go on; we'll see.

Finally we come to his overall economic philosophy. His heart is clearly in the right place. His empathy towards those less fortunate is sincere and I really do think he wants what is best. He wants everything to be even handed and fair. He brings up Warren Buffet and his desire for a more fair tax code that has the wealthy shouldering more of the impact and having a bigger safety net for the lower classes. As a political philosophy this is simply misguided philanthropy. Warren Buffet is right to want his wealth to go to positive uses. But it is his responsibility to do that, not the governement's. He wants someone else to do it for him. He should be setting up foundations, grants and scholarships. Using the government as the leveler allows the population as individuals to wash their hands of their responsibilities towards each other. When we see a neighbor or a family member suffering it is up to us as individuals to help that person. It is our responsibility as human beings to do what we can to alleviate the pain of others. By ceding our responsibility to a 3rd party government agency we are robbing the sufferer of his dignity and ourselves of our duty to be connected to our fellow man.

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Again, I understand his empathy, but his solution, much like his solution to the education problem will simply exacerbate our distancing ourselves from each other, further eroding what used to be, and still can be, a sense of what it means to be American. To paraphrase Rod Dreher- small, local and particular solutions are almost always better than large, global, new and abstract. In the end culture is more important than politics and if we go down this road our culture will continue to change. The institution most in need of conservation is the family, but as the government creeps further into our lives by raising our children, taking care of our elderly, and helping our neighbors, what is left?

Post-Racial America?

It has been two months since the United States, in self-declared historic fashion, elected its first Black President. President-Elect Obama was said to usher in a new post-racial era and everyone from Jesse Jackson to MSNBC heralded its arrival. Just this weekend on NBC's Meet the Press they had a show dedicated to what Obama's presidency will mean to black America. Unfortunately, we are already sliding right back into the era of victimhood just as dramatically.

The story that has captured the headlines as of late is of course the selection of Roland Burris as the junior senator from Illinois by Rod Blagojovich. Yet no sooner had Burris taken the stage during the announcement than the former Black Panther Bobby Rush stole the spotlight.

"My prayers have been answered. I prayed fervently that the governor would continue the legacy established by President-elect Obama and that the governor would appoint an African American to complete the term of President Obama. Let me just remind you, that there presently is no African American in the U.S. Senate. Let me remind you that the state of Illinois and the people in the state of Illinois in their collective wisdom have sent two African Americans to the U.S. Senate. That makes a difference."

Does anyone think Mr. Rush's star turn was a spontaneous outpouring of support? Or is it much more likely that Blago, knowing full-well the racial implications of nominating Burris, decided to punctuate his dare to Harry Ried and the Democratic caucus by having Rush blatantly state that the senate needs a black member. What happened to our newly enabled post-racial sensibilities? Apparently they were as ephemeral as an Obama speech. A good talking point, but not a fundamental change in reality. In fact the Burris debacle is not the only racially toned story to break in the past week.

A lesser know story has been developing in Massachusetts, where Bay State first lady Diane Patrick has complained about the Boston Herald’s coverage of her husband’s Cadillac upgrade as “racist” in Gwen Ifill’s new book, “The Breakthrough: Politics and Race in the Age of Obama.” She takes offense to the description of the Cadillac as “tricked out” during the DeVille debacle that engulfed her husband, Gov. Deval Patrick, during his first days in office. To give the comment some context this was during a time when the newly elected Governor, a good friend of the President-Elect, stirred up controversy when he switched his state car from a Crown Victoria to a Cadillac DTS and upgraded his office with $12,000 drapes and new sofas. Patrick had also hired a $72,000 chief of staff for his wife. The Boston Herald has responded saying that the term ‘tricked out’ is a synonym for decorated, and is over 100 years old with no racial connotation whatsoever.

What these two instances show is that it will take more than the election of the country's first black president to override generations of victimhood. Hopefully a step in the right direction has been taken, but the leftist media who declared a new day dawning in America may have over-stated their case just a tad.

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One Nation-Under God?

While President –Elect Obama’s choice of Pastor Warren to speak at the inauguration has received most of the attention another religious controversy is brewing out there. And this one may have a more lasting effect on our national psyche. According to CNN, a number of atheists and non-religious organizations want Barack Obama's inauguration ceremony to leave out all references to God and religion. In a lawsuit filed last week in Washington, the plaintiffs demanded that the words "so help me God" not be added to the end of the president's oath of office. Additionally, the lawsuit objects to plans for ministers to deliver any invocation or benediction during which God or religion would be discussed.

This is a much more disturbing development than any protest of Pastor Warren’s positions on any particular issue. What is being attacked here is a fundamental aspect of our culture. Religious freedom does not mean freedom from religion. As John Adams stated in 1798, “We have no government armed with the power capable of contending with human passions unbridled by morality and religion. Avarice, ambition, rivalry or gallantry would break the strongest cords of our Constitution as a whale goes through a net. Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”

American is founded on the idea of some sort of divine power looking either down or over us. One needs only look at the religion/spirituality section at any local Borders to see that we are a nation of seekers. To make mention of a nondenominational godhead in public discourse should not be offensive. It is nothing more than a recognition of who we are in a real cultural sense, just as our innate belief in liberty or the pursuit of happiness. Even though we believe vastly divergent things about the deity, we are nonetheless a nation of believers.

According to the Pew Research Center 4% of the population is either atheist or agnostic, while nearly 80% believes in some form of Christianity. We can all agree that minority positions should not be discriminated against, but those minority groups should not dictate all policy either. A larger percentage of our country is racist than agnostic, but we wouldn’t dream of eliminating all references to equality in our public discourse to avoid offending them. Would we?

When our country was suffering from the after-shocks of 911 the nations politicians gathered in Washington to sing a song of solidarity. They sang to be together, to signal hope and faith in the nation’s strength and future. They sang to show the world we could over come this much as we have always over come adversity. What song did they sing? “God Bless America.” As much as we value a separation of church and state we can no more eliminate the belief in some sort of god than we can eliminate who we are as a one nation, under god, indivisible, with liberty and justice for all.

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