|
You can't help
feeling sorry for President Barack Obama. The media have turned him
into a comic book superhero that is faster than a speeding bullet,
more powerful than a locomotive, and able to leap tall buildings in a
single bound. A man of steel.
In his first 100 days
he'll solve the financial crisis, convert bio-mass to gas, and provide
better health care for millions at lower cost. World conflicts will
end and "the lion will lay down with the lamb."
The first man of
steel was created during the Great Depression in 1932 the year FDR was
elected president. The left-leaning perspective of creators Joe
Shuster and Jerry Siegel is reflected in early storylines. According
to Wikipedia, "Superman took on the role of social activist, fighting
crooked businessmen and politicians and demolishing run-down tenements
as a reflection of the liberal idealism of Franklin Roosevelt's New
Deal."
No man, of course,
can live up to the expectations projected onto President Obama and
none will be more disappointed than the media, his most ardent
supporters. Just as FDR's original backers, the Democratic Party,
labor unions, socialists and the media undermined him so they will
President Obama. FDR too was called the messiah.
While Barack Obama
has Joe the Plumber, FDR had Jack the Tailor. New Jersey tailor Jack
Magid was jailed for pressing clothes for less than NRA (National
Recovery Act) sanctioned prices and became a cause célèbre. Code Pink
and the Democrat leadership (Harry Reid, Nancy Pelosi, Diane
Feinstein) started undermining Obama even before he took office.
One of President
Obama's first acts will be to institute an $825 billion stimulus
package aimed at re-building infrastructure and reducing unemployment.
It seems few people want to ask: How well did stimulus packages work
under Presidents Ford and Carter? Millions of dollars in Community
Block Grant Funds (CDBG) were spent by the city of San Diego in the
1970's to pave alleys in the poorest neighborhoods to raise incomes in
specific census tracts. After millions were spent and the alleys
paved, you are never going to believe this, but in the targeted census
tracts incomes were exactly the same. The money went to the concrete
contractors and their employees, all of whom lived elsewhere.
While I was on the
San Diego City Council in 1978, CETA (Comprehensive Employment
Training Act) funds were granted to the city with monthly Carter
Administration exhortations to spend immediately. So the city had the
fire hydrants painted red, white and blue by employment trainees. I'm
sure those receiving the money appreciated it -- however, the economic
stimulus and lasting infrastructure benefits were questionable.
The Dines Letter
recently posed a scintillating question about the government injecting
a trillion dollars into the economy. Dines writes that Obama's first
federal deficit will be over $1 trillion and in future years a
trillion as far as the eye can see. Since no nation in the world has
a trillion dollars on hand, who will the money come from?
Think about it! Really, stop reading and think about this.
Politicians say the
government will raise the money by selling Treasury bonds, notes and
bills. But where do these come from? The government simply prints
them. Perhaps more technically correct, the money is no longer printed
but created electronically. Sort of like hitting F-7 or "SEND" and
Shazam! A lightening bolt deposits $20 billion into Bank of America's
reserves account.
Franklin D. Roosevelt
campaigned as more conservative than Herbert Hoover and then spent
more money to stimulate the economy than any previous president. He
tripled taxes on business, created cartels to raise prices and
eliminate lower-priced "cutthroat" competition, authorized the
slaughter and burial of millions of farm animals and caused the
dumping of millions of gallons of milk in order to raise the incomes
of farmers. He initiated labor legislation to increase the purchasing
power of those employed. FDR apparently did not understand that higher
prices result in less demand; not only for products and services, but
also labor. Despite -- or more likely because of -- these programs,
unemployment rates continued at record highs.
In "Out of Work,"
Richard Vedder and Lowell Gallaway provide compelling evidence that
between 1933 and 1941 hourly wages doubled for many workers while
record unemployment rates were set. "Those who worked were better off
than ever before ... Yet for those millions without jobs, misery and
poverty continued ... and there is overwhelming evidence that the
newly instituted policies of (the Roosevelt) administration served to
weaken the recovery and prolong the misery of the Great Depression."
The U.S. Census
reported only one year of double-digit unemployment between 1900 and
1931, followed by 10 consecutive years greater than 14 percent with
highs of 25 percent in 1933 and 19 percent in 1938, the 10 consecutive
years of FDR's massive government intervention.
After World War II
ended and FDR's death (and economic policies) in 1945, unemployment
returned to its natural long-term trend averaging between 4 percent
and 6 percent.
"The Great Depression
was not a tragic example of market failure as is conventionally
believed, but rather was an example of government failure," write
Vedder and Gallaway. The CATO Institute reports "While millions of
jobs were created in the government during the 1930s, private-sector
jobs were destroyed. Total U.S. private employment was lower in 1940
than it had been in 1929."
While skeptical about
President Obama, I hope he'll do, like FDR, the opposite of what's
expected -- he'll not punish success and reward failure and thereby
prolong the current recession. I hope I can vote for him in four
years, and as he recites the oath of office this week I raise a toast:
"Ladies and Gentlemen, to the president of the United States."
Schnaubelt, president of Citizens for Private Property Rights, has
been a commercial real estate broker for 39 years and was a San Diego
city councilman from 1977-81. |
