Budgets are more than numbers. They are statements of intent, of priorities. So to understand what Barack Obama has in mind for America, don’t start by fussing with the numbers.
Start with his theory that inside every crisis there is an opportunity. The crisis is the current recession; the opportunity within is the chance to convert America into a social democracy.
The covering fog is provided by the word “stimulus,” which conceals the fact that a good part of the President’s spending will be on programs he would have pursued even if he inherited an economy running at full throttle.
Obama’s critics have allowed themselves to be distracted by their distaste for his outsize budget deficits and massive interventions in the auto and financial services industries. Socialism, they say.
Not a bit of it. Obama did not tramp through the snows of Iowa in order personally to guarantee he will have our mufflers replaced if necessary. Or to pick the hotels in which bankers would be permitted to entertain clients.
He did it to convert America into a social democracy on European lines. Smaller cars; more modest homes; faster, highly subsidized trains; a health care system managed by the government; a “green” electric supply system engineered to government specifications, with cost not a consideration; guaranteed college tuition with associated control over universities.
And, necessarily, higher taxes, at first on “the rich”, then on the middle class in an effort to transfer control of a larger portion of the nation’s income from those who earned it to government bureaucrats.
In short, Obama is taking very seriously his self-description as a “transformative” president. Lincolnesque. Rooseveltian. With time-hallowed constraints on the power of government eliminated or at the very least attenuated.
If AIG has contracts with its employees that the President finds offensive, abrogate the contracts or confiscate their proceeds.
If banks find regulation so onerous that they want to return money borrowed from the government, warn some of them that if they do, they might be declared to have failed the “stress tests” now being conducted by the Treasury.
If financial institutions and, eventually, other firms don’t meet government standards of compensation and lending, authorize the Treasury to take them over.
If Congress balks at imposing billions in taxes on electricity generated from coal or natural gas plants, have EPA make an administrative rule to accomplish what Congress won’t do by making a law.
And if workers don’t vote to have trade unions represent them, take away the secret ballot and force them to express a preference in the presence of union organizers, who know where they live.
Unlike many conservatives, I was not unhappy when Obama defeated my candidate, Sen. John McCain, R-AZ. Not because the election of a black President was necessary to prove how far this country has come since the days of Abraham Lincoln. It wasn’t.
Nor did I think that Obama could parlay his worldwide stardom into policy gains for the U,S., which the recent G-20 and NATO meetings prove he in fact cannot.
Rather, I thought he might introduce sensible reforms into the tax systems, walking a path between the no-tax-is-a-good-tax crowd and the soak-the-rich bunch in his own party.
But I did not imagine that our new president would take as his model economies that have failed for decades to grow at a sufficient rate to provide jobs for all their citizens. He is determined to do just that.
We have in the past had presidents with whom many of us disagreed. But their programs were reversible: dislike Reagan’s deregulatory policies and they could be changed; disagree with Bill Clinton’s supine attitude towards terrorists, and a new man could toughen policy; hate George W. Bush’s tax tilts, and reverse them.
But Obama is intent on a policy of no return. His successor will be swimming in so much red ink that he will have no choice but to raise taxes, especially since new entitlements will be set in stone.
Tax carbon, and even if the tax is repealed, no sensible utility will ever build the coal plants essential to adequate electric supplies, for fear that the tax will some day be re-imposed.
Freeze the private sector out of the health care business, and a public-sector constituency is created that prevents any turning back, no matter how rotten the resulting performance.
Worry about the budget deficits, if you will, but worry more about the Europeanization of America.
Examiner columnist Irwin M. Stelzer is a senior fellow and director of the Hudson Institute’s Center for Economic Studies.
