Of the Federal Reserve and Dreams of Success

March 23, 2022 Leave a comment

Photo by Tyler B on Unsplash

It may be easy, but I think unfair, to fault the Governors of the Federal Reserve System.  Their task is more than they can handle, and yet they are required to do it.  More accurately, I should say that their tasks are more than they can handle, and yet they are required to do them.

When the Fed was created, more than a century ago, a big concern was that it would be dominated by the financiers of New York and the politicians of Washington.  Hence, rather than a central bank, it was born as a system of a dozen regional banks, with a limited focus, to offset the liquidity risk inherent in banking.

Over time the Fed has not stayed that way.  Today, the Federal Reserve is effectively the biggest bank in the world.  Financiers in New York have an outsized influence, but the influence of the politicians in Washington may be greater.  Otherwise, how could a federal republic tolerate a handful of people at a single agency having so much sway over the daily lives and future prosperity of the individuals, families, communities, and businesses in the 50 States of the Union?  Accountability to the elected cannot long be withheld.

A great problem has been that the elected do not refrain from giving the Fed more things to do.  Its one first task has lost its focus by becoming three.  By law, the members of the Board, joined by the presidents of the 12 Fed banks, are to conduct themselves “so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

What if they cannot succeed?  Then we fault them for failures while still pretending that they can.  We hide the goal posts in fog.  What is “maximum employment”?  Can it be today’s 62% of the adult population when we began the 21st Century at 67%?  What are “stable prices”?  Does “stable” mean that the price of food tomorrow will be the same price it is today, or is “stable” the Fed’s official goal that things will cost 2% more each year, so that my young son’s retirement will require nearly twice as much as mine does?  Then there is the third, often forgotten requirement, that interest rates be “moderate.”  For 10 years the Fed kept quiet about that legal mandate, keeping interest rates very close to zero, a huge transfer of wealth from savers to borrowers, Uncle Sam being the world’s biggest borrower.  Is it surprising that the federal government’s debt grew during those 10 years to $30 trillion and still swelling?

What is the Fed to do?  We cannot reproach its current team, because they cannot succeed.  No government agency, regardless of excellent economists and the best computers, can manage it all.  If you read the statements, they carefully admit, essentially, “we don’t know how to succeed, but the law says we have to do something, so we will try this and that and see how it goes.” Meanwhile, it has not been going so well.  To paraphrase liberally from psychiatrist Anthony Daniels, we should not be so beguiled by the dreamy tasks we have placed on the Fed that we cannot bear to lighten the load merely because it is not working.

Filed under banking, Congress, deficit spending, economics, Federal Reserve, inflation, interest rates, jobs, money Tagged with , , , , , , , ,

Of More Money and Higher Prices

January 21, 2021 Leave a comment

Photo by Shane on Unsplash

We have a new occupant of the Oval Office.  I did not hear his inaugural address, uncertain who would forget it more quickly, myself or its deliverer.  Inaugural addresses are highly forgettable literature, Lincoln’s first and second addresses (the second especially) the only ones that anyone can seem to remember, and worthy they are as exceptions to the genre.

I have been remembering the mountains of money that the government has been spending that it does not have, wondering where it is coming from even more than where it is going.  It is hard to find anyone who can tell you much with certainty about either.  The current attention is more focused on plans to spend yet another two trillion dollars that the government does not have on things that are not very clearly explained.  This would be on top of the most recent trillion dollars approved by Congress drawn from an empty well to be spent watering many a hidden garden.

I can understand the first round or two of multi-trillion dollar government expenditures.  Since government caused the collapse of a strongly growing economy by shutting down commerce and locking up the population, a strong argument can be made that paying these victims is not exactly a bailout as it is compensation.  To quote Will Rogers, if Stupidity got us into this mess, then why can’t it get us out? 

A serious problem seems to be that once you get into the game of paying people more to stay at home than they can earn on the job, how do you bring the game to an end.  The plan of the new Oval Office occupant seems to be to go into extra innings but continue serving spiritous refreshments well past the seventh inning.  How will the people get home safely once the game is over?

The classic formula for inflation is to have too much money chasing too few goods and services.  The kindling for a roaring inflation would appear to be carefully set. The Treasury and the Federal Reserve have been dramatically expanding the money supply, with the Federal Reserve supporting the market for the government’s electronic debt (not much money is printed on paper anymore) by purchasing gobs of Treasury securities from banks, paying the banks with electronic credits on their accounts held at the Federal Reserve, which the banks cannot find much to do with.  At the same time, many governors continue to issue orders to suppress the supply of goods and services.  As Elon Musk reportedly said last year, if you don’t make stuff, there is no stuff.

If this worry is well-founded, then why have we not yet seen any inflation, government spending surges and the Great Cessation having been Federal and State policies for nearly a year?  A very good question, the answer to which may be found in the savings rate.  While a lot of electronic money has been going into people’s bank accounts, people have been shy about spending it.  The personal savings rate jumped in 2020 from about 7% to nearly 35%.  Worried people hoard more than toilet paper.  And a lot of things that people might spend money on, such as travel, suddenly were not available.  I was surprised last year when our car insurance company sent us a rebate:  insurance losses were down because people were traveling less.

The roads are a bit more congested these days, and the economy is showing strong signs of trying to recover.  Even the savings rate is coming down, dropping to about 13% as 2020 approached its close.  More activity is good, but what is the Federal Reserve going to do if more people spend more savings faster than more goods and services are provided?  How will the Federal Reserve respond to another couple trillion dollars of deficit spending to stimulate an economy that is already on a recovery trajectory and families continue draining their savings?  They could allow interest rates to rise, to encourage people to keep some of their money in savings accounts that have paid less than a penny a year per dollar saved.  Recent Federal Reserve comments, though, declare that is not on the table.

In the late 1970s, when Jimmy Carter was president, economists invented the term “stagflation,” as inflation was high and the economy was in the doldrums.  Joe Biden was a relatively new Senator back then.  Maybe he will remember those days.  That economic pattern served no one well.

Filed under banking, deficit spending, economic growth, economics, Federal Reserve, Great Cessation, inflation, money, personal finance, Treasury debt Tagged with , , , , , , , , ,

Of Presidents and Training for the Job, 2015

March 22, 2015 Leave a comment

More and more I have been struggling for the words to express my concern over the frightening incompetence of the current President of the United States. Barack Obama’s economic blunders deepened and prolonged the recession and bequeathed to us the most anemic recovery of modern times. Most of us have been seriously harmed by those policies, some more than others. Unfortunately, the extent of his economic errors are obscured by the benighted economic management in Europe, which amazingly is managing even to underperform ours.

President Obama’s politics have yielded the opposite of what he publicly promised: division in place of unity, secrecy and deception in place of open government, exclusion of those who disagree with him in place of inclusive embrace of open debate, privilege for the few in place of opportunity for the many, racial bigotry for political gain in place of a “post racial” society, rule by breaking laws and ignoring the Constitution in place of rule of law. I am sure that you could easily lengthen the list. Again, these perfidies have been to some degree obscured by congressional Democrat leaders far too willing to compromise their duties of office and the rights of the legislative branch of government, all to cover up and support the Obama Administration’s outrages on the nation and the political institutions of the Republic.

Most frightful of all, however, is President Obama’s dangerously bungling foreign policy. No friend of the United States is safe from this Administration’s blunders. Vladimir Putin, the boss of a second rate economic and military power—albeit one with a formidable nuclear arsenal—has been able to engage in 19th Century military adventures of invasion, conquest, and territorial acquisition against little more than vacuous bully talk from Obama, the emptiness of which has produced similarly pitiful responses from the leading Powers of Western Europe, derision from Moscow, and fear among America’s friends only recently escaped from the Soviet Union. China commits aggression against India and the Philippines, threatens Japan, and toys with close relations with Russia to isolate the United States, while openly engaging in cyber attacks on the U.S. government and American industry. Islamist barbarians increasingly brutalize Muslims, Jews, Christians, and humanists alike, undeterred by inchoate responses from Obama, who asserts leadership while failing to lead, other than with his transparent policies of pusillanimity and indecision. American allies in the Middle East feel abandoned or betrayed, while enemies are emboldened; the best counter strategy that Barack Obama is able to envision is a plan that might delay but will not prevent the nuclear arming of the mullahs of Iran—committed to the incineration of Israel, the more Jews killed the better. Each day seems to extend the list of foreign policy failures.

While considering the consequences of an amateur in the Oval Office, I came across a brief note I wrote during the 2008 presidential campaign. It might be immodest for me to point out how correct my warnings proved. I can make no claims to perspicacity, as all of this was rather obvious. No self congratulations are in order. It is too dangerous a world to trust the Presidency of the United States to one whose inexperience is only matched by his hubris. This is what I penned August 25, 2008, just before Barack Obama received the nomination of the Democrats:

There are some jobs you just cannot safely do without proper training and experience. Flying an airplane is one that comes to mind. Driving a bus is another. I would put being President of the United States in the Twenty-First Century on the list, too.

President of the United States was a tough job in the days of George Washington. It was even a challenge in the days of Millard Fillmore. It has not become any easier in recent years, and next year it will be a very big job. Considering the global responsibilities of the United States, with several irresponsible oil-drunk regimes threatening peace and freedom (ours and other’s) around the world, can we afford to enroll our new President in a foreign policy on-the-job-training program?

Economically as well, there is little room for error. So far we have gone through a year and a half of the housing market bust without falling into a recession. But our economic growth is anemic. A small false step or two can put us into a full-blown economic decline, exploding banking and financial markets that will then take years to recover. It is important that economic policy next year be led by someone who understands economic growth and how to promote it. The formula for growth—low taxes and steady prices—is well known to those who have learned the lesson; we do not need a novice who does not have enough experience to know that you cannot tax and spend your way to prosperity. We cannot afford his experiments with our jobs and livelihood.

That is why it is breathtaking that a major political party is on the verge of nominating for President someone so inexperienced as Barack Obama. I am unable to recall a single nominee for President, by any major party, less prepared for the office than Barack Obama. Really, there is the challenge for you. Name a nominee—Republican, Democrat, Whig, Federalist—less prepared than Obama.

Barack Obama likes to liken himself to Abraham Lincoln. I cannot claim to have known Abraham Lincoln or assert that he was a friend of mine, but I do say, Barack Obama is no Abraham Lincoln. Even liberal exaggerations of Obama’s undistinguished career cannot make it compare favorably with the long and grueling life experiences that schooled Lincoln for the White House.

In short, Obama does not have the training for the job. It may be that the Democrats’ talent pool is so thin that he will be nominated. But the job of President is too important—to all of us—to be extended to someone so unready.

Filed under banking, Barack Obama, bubbles, China, Congress, Constitution, deficit spending, economic depression, economic growth, elections, European Union, hubris, inflation, interest rates, international relations, Iran, Islamists, Israel, jobs, law, Middle East, national security, politics, racism, recession, rule of law, Russia, Soviet Union, taxes, Ukraine Tagged with , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Of Elections and Consequences

January 16, 2014 Leave a comment

I wrote the following just a few days before Barack Obama was first elected President, in 2008. I am tempted, reading it 5 years later, to congratulate myself on how insightful I was, but, frankly, Obama’s policies were so old and tried and failed, that he made it easy. See for yourself:

Elections have consequences, real, life-affecting consequences. One of the more unfortunate aspects of the mass media attitude toward elections is their approach to them as if they were some kind of game. The running score that they keep of the latest polls, their up-to-date electoral college count, the fixation on who “won” the latest debate, all demonstrate a sentiment that the election is some kind of sporting event, where we all root for one side or another, and when the game is won and the season is over we all go back to business as usual. That is not only wrong, it is dangerous.

After the election in November is over, it will not be back to business as usual. America’s standard of living, our economic welfare, our health, safety, and national security will all be affected. Electing Jimmy Carter meant economic and social malaise, it meant the loss of allies in several parts of the world, it meant civil war in Central America and the rise to power of the Ayatollahs in Iran. It meant a toxic economic brew of high unemployment, high inflation, and high interest rates. It meant increased crime in our cities. It meant an underpaid and undersupplied military, with Navy ships coming into harbor trading ammunition with those leaving port because there was not enough ammunition to go around.

Barack Obama is not quite as good or experienced as Jimmy Carter. His leading economic proposal is a whopping tax in the face of an economic downturn. Presidents Hoover and Roosevelt tried that in the 1930s, which turned a recession into the Great Depression. And Obama lies about his tax increase. He lies that it would not affect 95% of the population. The severe recession that it would cause will affect everyone, even the non-tax payers who are promised a tax cut by Obama.

Obama’s plan for a camouflaged government take over of health care will mean that health services will be provided with the same efficiency of the U.S. Postal Service. That means that sick people will have reduced access to medical services. It means that incentives to develop new medicines and new treatments will melt away. If government runs health care, as Obama wants, that means that political muscle will determine health care priorities rather than patient demand setting the priorities.

Obama’s foreign policies are right out of the Jimmy Carter briefing book. That means betrayal of our friends, appeasement of our enemies, and adventurous use of the military in places and causes that mean little to the national security of the United States. It means preparation always for some other war but inadequate commitment to fight the war we are in (he’s eager to send more troops into Afghanistan, but unwilling to win the war in Iraq). It means further design of the next weapons system, but never deployment of it, a return to starving our military of what it needs to do the job with least loss of life and maximum success. It means that the most important issues for the Obama military will be social engineering of the armed forces rather than a focus on their increased effectiveness and efficiency.

Voting in a republic like the United States is a serious matter. It is not a game. It means far more than bragging rights over whether our team won the World Series. It means that we are responsible for our electoral choices, with a full understanding that the people we elect will mean a difference in our lives and the lives of our families. It is a truism that people get the government they deserve. I firmly hope and believe that the American people deserve better than Obama. I know that my children do.

(First published October 5, 2008)

Filed under Barack Obama, deficit spending, economic depression, elections, Franklin D. Roosevelt, healthcare, national security, politics, recession, statism, taxes

Of Con Artists and Presidential Candidates

November 15, 2013 1 Comment

There is something disturbing about Barack Obama. I have been trying to put words to it. It is not merely that I disagree with him on his political prescriptions. There are many people, across the political spectrum, with whom I disagree on political policies and programs, even those for whom I used to work. With only a relative handful of them, however, have I sensed the same disquiet that I feel with regard to this year’s Democrat nominee for President.

After the recent presidential debate between Obama and Republican candidate John McCain I found the right words. Obama is a con artist. Fundamentally, he is acting in a deceptive way to get something from you. He wants you to believe that he has your best interests at heart so that he can get from you your precious vote. He pretends to be what he is not, because if you understood what he is all about, you would not vote for him.

Take, for example, his tax policies. Barack Obama promises a tax cut for 95% of the population. He is offering you a financial incentive for your vote. He is offering to buy your vote. He does not tell you that many of those people for whom he promises a tax cut do not pay any federal income taxes. A tax cut to people who do not pay taxes is just a government hand out. And he usually tries to hide the fact that this hand out to people who do not pay taxes is coming from you. We should not be so willing to believe that you can tax just 5% of the people in order to give a tax break to the other 95%—especially if many of the 95% do not pay any income taxes. You cannot get there, even if you try to take all of the money of the “rich,” and once that is gone what do you do for the next act?

If you own your own business, chances are very high that your business is taxed like an individual and that the revenues for that business will be classified as the “rich” that Obama says he thinks need to pay more taxes. Or perhaps you have some investments in the stock market—half of all Americans do. When those rich companies pay the new Obama taxes, that money comes out of the hides of the companies’ shareholders. Moreover, raising taxes into the teeth of an economic decline is a certain recipe for accelerating the decline. That is what Hoover did, and what Franklin Roosevelt did in order to make an economic recession last for a whole decade (eventually history should recognize that FDR was the worst president of the 20th Century—even if he could talk a good game).

A second example follows directly from the tax example. After he is finished talking about tax cuts (on people who do not pay taxes), Obama starts his litany of very expensive new government spending programs. The price tag for these comes to some $800 billion, give or take a hundred billion dollars. Each program is carefully designed to buy votes. Not only do his tax cuts not work as real tax cuts—taken by themselves—they cannot possibly work in the face of $800 billion of new federal spending.

The third example is really the most prominent. Barack Obama says that this is all “change.” He says you should vote for change, because he thinks that you want change and that his promise for change will get you to give him your vote. If you believe that major tax increases and massive new government spending programs are change, maybe he will succeed in getting many votes. But maybe people will say that they have heard that formula before, and whenever it is applied the nation always becomes poorer.

Barack Obama looks good, talks smooth, promises everything. If he loses this race for President, maybe he could try his hand selling used cars.

(First published September 28, 2008)

Filed under Barack Obama, deception, deficit spending, economic depression, elections, Franklin D. Roosevelt, politics, recession, redistribution, taxes

Of Borrowing and Saving

November 8, 2013 Leave a comment

The basic rule is, if you are not already saving, then you are not ready to borrow. This may sound paradoxical, but it is the only safe way to approach borrowing.

You may wonder, if I have savings, then why would I borrow? That question may be answered in any number of ways. Asking it suggests some lack of understanding of the proper purpose of borrowing.

The proper purpose of borrowing is to manage your income. You should never borrow to spend beyond your income.

Most people receive income in lumps, like once a month or twice a month. Expenses do not always behave themselves that way. First, there are the every day expenses, such as for food, transportation, and a wide range of miscellaneous minor expenditures that quickly add up. Then there are other expenses that occur monthly and may more or less happen at about the same time as your income. A third category is the big expenditure, that may come once or twice a year, such as tuition, taxes, major purchases, insurance premiums. Since the timing of our income and outgo often do not line up, we use borrowing to help bring the two into line.

For example, the tuition is due in September, but you plan to pay for college by working through the school year. A student loan or other borrowing arrangement with the college can line your income up with the expense.

Another example might involve a big appliance. Your refrigerator breaks down and you need a new one. You may not usually have several hundred dollars of unallocated income available in any one month to pay for the new refrigerator, but you likely will over the course of a year. Borrowing lets you draw that income from the course of the year into your current month and match it against this large purchase needed today.

Here is a bigger example. You need a new car, both for family transportation and perhaps even for travel to work. Very few people have enough ready income to buy the new car with what will be received in any one month. Most people, though, can draw upon funds available from their income over the course of a few years to pay for the car, and borrowing is the tool that they can use to do that.

Of course, this borrowing from the future to pay for something today can be abused. There is a natural temptation common to man to seek gratification today and worry about tomorrow’s problems tomorrow, even while causing them today. Two things can help counter this potential for abuse. One is interest, and the other is saving.

Interest is what we pay for borrowing. While rewarding the lender, it is a penalty against anyone who borrows in order to spend beyond his income. As you spend beyond your income, the interest mounts. In the end, it will bring down the abuser once the abuse has gone too far and gets out of hand.

Saving is a more benign and effective check on the impulse to borrow in order to spend beyond income. If you are regularly saving, you are doing something even more important than preparing for the future and reaping the rewards from lending to other borrowers. By definition, if you are saving, you are living within your income. You are taking part of your income and putting it aside. That discipline is what is needed to prevent you from using borrowing to exceed your income. You have a proven practice of spending less than you earn.

That is why I say that if you are saving, then you are prepared to borrow, and if you are not saving, then you are either living right on the edge—spending your income as fast as it is received—or you are going beyond, borrowing to spend beyond what you earn, and that leads to trouble. Then you will be spending to consume something that you did not earn and do not deserve. The eventual price for that is loss of freedom, as you must in the future consume much less than you earn in order to satisfy the debts.

(First published September 8, 2008)

Filed under abundant life, banking, compensation, deficit spending, discipline, freedom, interest rates, money, personal finance, slavery

Of Dysfunction and Governing the Nation

October 27, 2013 Leave a comment

It seems that no more evidence is needed.  The establishment press, normally loathe to criticize the federal government, has at last become even fond of proclaiming that “Washington is dysfunctional,” although they do so as if announcing something worthy of being “news.”  The Senate has not passed a budget in some four years.  The House of Representatives regularly passes budgets that the Senate will not even consider.  The President—who has no budget-proposing role under the Constitution—proposes budgets that are routinely disregarded while declaring his intent to govern without the Congress.  At the same time, people feel more alienated from their government than ever before, in ever increasing numbers considering the nation headed in the wrong direction, regardless of the party in control of national policy.

In the most recent demonstration of the Washington breakdown, the Congress this year failed to pass the annual appropriations bills before the current ones expired.  Or, better said, the House passed appropriations bills, the Senate demurred, and the President announced that he would veto any appropriations legislation that offered either more or less than what he wanted.

The establishment press, amplifying executive branch efforts to promote panic and stampede the public, announced that “the government would shut down,” and yet 83% stayed open.  Some prominent public operations (that do not require any appropriations to operate) were closed at the President’s bidding, like the Lincoln Memorial and the various veterans and war memorials, but the President seemed to have enough money to travel to various campaign-style rallies to complain about the government shut down.  There was national confusion and consternation.

Perhaps what is news is that there is, at last, general agreement, and the President has helped demonstrate, that the federal government has become dysfunctional, by which we may mean, not doing what it needs to do.  I also notice that this condition has not been getting any better.  In addition to the recent, visible indicators, I would offer some longer-term measures.

Economic growth is depressed and has been declining for decades; employment is also down, with millions leaving the work force.  Government welfare rolls have expanded dramatically, suggesting that a very large portion of the population is either not able to take care of itself or has surrendered its responsibility to do so.  The federal balance sheet approaches ever closer to insolvency.  To avoid being gloomy and doomy, I will not recount dismal education trends, eroding family formation patterns, the precarious condition of national infrastructure, or our worsening international relations (with allies and opponents).

Yet, the federal bureaucracies are far larger, taxes—visible and hidden—are higher, red tape has become ubiquitous, and federal subsidies have fallen behind promises even as they outdistance the ability of the federal government to pay for them.  If government is the solution, then why is more government not making things better?

How could this happen?  Have we as a nation lost our ability to govern ourselves?  Have “partisan politics”—as though something new rather than part of our national intercourse since 1796—frozen the ability to consider, set, and follow national priorities?  Have the problems of modernity exceeded the ability of policymakers to resolve them?

A case could probably be made for each and all of the above explanations.  I think, however, that they are all symptoms of a more fundamental problem, one recognized long ago, at the founding of the nation.

As early as 1787 the Founders recognized that a central government would not work for the United States.  Even with just the original 13 states and 3 million people, the nation was too vast to be governed in detail from one capital.  That is why they created a federal system, under which the few, truly national concerns—such as national defense, trade, international relations, national standards of measures and sanctity of contracts, preservation of freedom and the rule of law, together with the means to fund these activities—would be handled by the national government.  All else was reserved to the States.

Note that I did not say given to the States.  Remember, the States and the people in them created the national government.  The States and the people in them gave to the national government its authority and power.

Today, the United States stretches across a continent and reaches to the isles of the sea, with over 300 million inhabitants.  It is even more impossible than ever to govern from a single capital, by a centralized government.  We all have seen the evidence, in addition to the growing dysfunction of Washington.  Everyday, people all over the nation struggle with rules made by the federal bureaucracies, rules that are often nonsensical where people live and work and play, rules governing the volume of water in our toilets, the content of our children’s food, the gasoline in our cars, the content of our communications, the form of our financial affairs, and many other elements of daily, personal life.  Even worse, they have become too vast and complex to be administered faithfully or complied with loyally. 

We could fault the executive branch bureaucrats who make them or the Congressmen and Senators who write the laws, but these people are no smarter or dumber than the rest of us, and just as well meaning.  They just have an impossible job.  No one can know enough to run so many things from Washington.

Consider the big issues that seem to have Washington all tied up in knots—in turn afflicting all the rest of us.  The new national healthcare systems are breaking down even as they get started.  National rules for farmers have Congress stuck over who should get subsidies and who should not.  National tax plans designed to take from some to give to others divide the people into winners and losers.  Environmental regulations impose costs on some in order to subsidize someone else.  National education programs follow each other in rapid succession, each with a new and high-sounding name, none of which do much to stem the continued decline in education.  And ever present with all of these national rules are unintended consequences that were not and probably could not be foreseen but which crush people’s businesses, destroy jobs, and disrupt lives.

These are all issues that the Founders never intended for the national government, issues that if governments should address at all should be left to State and local governments, where decisions can be made closer to the people who have to live with the results.

We have at hand a better, competent government, or at least its blueprint.  It is found in the structure of our Constitution that created a federal system.  Our Constitution is the recognition that only through a system that keeps governing as local as possible can a great nation exist in union and harmony.

What we are seeing play out before our very eyes is that our nation not only should not be governed by a central authority, but that it cannot be.  The sooner we recognize that and return to the federal plan of the Founders the happier, and the sooner Washington will be able to function as it should for the benefit of all rather than frustration for all.  The task is too big otherwise and doomed to failure.  It will not be a pleasant failure.

Filed under Barack Obama, bureaucracy, Congress, Constitution, deficit spending, economic growth, education, environmentalism, federalism, freedom, government, government spending, healthcare, House of Representatives, international relations, jobs, media, national defense, personal finance, personal responsibility, politics, rule of law, sanctity of contracts, Senate, statism, taxes, trade, unity, Washington, welfare

Of Presidents and Training for the Job

October 22, 2013 Leave a comment

There are some jobs you just cannot safely do without proper training and experience. Flying an airplane is one that comes to mind. Driving a bus is another. I would put being President of the United States in the Twenty-First Century on the list, too.

President of the United States was a tough job in the days of George Washington. It was even a challenge in the days of Millard Fillmore. It has not become any easier in recent years, and next year it will be a very big job. Considering the global responsibilities of the United States, with several irresponsible oil-drunk regimes threatening peace and freedom (ours and other’s) around the world, can we afford to enroll our new President in a foreign policy on-the-job-training program?

Economically as well, there is little room for error. So far we have gone through a year and a half of the housing market bust without falling into a recession. But our economic growth is anemic. A small false step or two can put us into a full-blown economic decline, exploding banking and financial markets that will then take years to recover. It is important that economic policy next year be led by someone who understands economic growth and how to promote it. The formula for growth—low taxes and steady prices—is well known to those who have learned the lesson; we do not need a novice who does not have enough experience to know that you cannot tax and spend your way to prosperity. We cannot afford his experiments with our jobs and livelihood.

That is why it is breathtaking that a major political party is on the verge of nominating for President someone so inexperienced as Barack Obama. I am unable to recall a single nominee for President, by any major party, less prepared for the office than Barack Obama. Really, there is the challenge for you. Name a nominee—Republican, Democrat, Whig, Federalist—less prepared than Obama.

Barack Obama likes to liken himself to Abraham Lincoln. I cannot claim to have known Abraham Lincoln or assert that he was a friend of mine, but I do say, Barack Obama is no Abraham Lincoln. Even liberal exaggerations of Obama’s undistinguished career cannot make it compare favorably with the long and grueling life experiences that schooled Lincoln for the White House.

In short, Obama does not have the training for the job. It may be that the Democrats’ talent pool is so thin that he will be nominated. But the job of President is too important—to all of us—to be extended to someone so unready.

(First published August 25, 2008)

Filed under Abraham Lincoln, banking, Barack Obama, bubbles, deficit spending, economic depression, economic growth, elections, George Washington, inflation, interest rates, jobs, national security, recession, taxes