Topic: Government and Politics

The Ballad of Ron Paul

The Onion offers a lyrical farewell to the Ron Paul campaign (via Brian Doherty):

WASHINGTON—After piling the last of his Campaign for Liberty signs in the back of a beat-up Ford truck Thursday, Rep. Ron Paul (R-TX) once again abandoned his candidacy for president and rode on out toward the low western sun, but not before vowing to come back to Washington “when [the country] is ready.” “When the river swirls and the wind blows, and when uncontrollable inflation forces us to revert to the gold standard, and the Federal Reserve bank is exposed as the unconstitutional, neofascist cabal it really is, you’ll see me coming over that hill,” said Paul, leaving a dusty cowboy hat and a stack of “no” votes on his seat in the House of Representatives. “But don’t you fret, America. If you ever feel like your government is getting too big or too intrusive, just give a little whistle, and there I’ll be. I’ll be there quicker’n you can spit.” Although no one has seen or heard from the Texas congressman since Thursday, sources report the Ron Paul for President campaign has gained an additional $2.3 million in contributions since his disappearance.

Hearing the echoes of Tom Joad in that “final speech,” and noticing that in fact Ron Paul has been all over the airwaves as practically the only congressional critic of the bailout and the policies that led to it, I got to musing about another working-class icon, Joe Hill:

I dreamed I saw Ron Paul last night,
Still running on TV.
Says I “But Ron, you lost ‘em all”
“I’ll never quit” said he,
“I’ll never quit” said he.

“The Money Power beat you, Ron,
they beat you, Ron” says I.
“Takes more than Fox to beat ideas,”
Says Ron “I didn’t quit”
Says Ron “I didn’t quit.”

“In South Carolina, Ron,” says I,
“You stood up to the war.
Then Rudy knocked you back again.”
Says Ron, “But I was right.”
Says Ron, “But I was right.”

From Baghdad back to Main Street,
In every funeral hall
Where grieving moms inter their sons,
it’s there you find Ron Paul,
it’s there you find Ron Paul!

And taking on the Fed Reserve
and smiling with his eyes,
Says Ron, “The bailout cannot work,
It’s time to privatize.
It’s time to privatize.”

From Texas up to Washington,
in every lecture hall,
Where working men defend their gold,
it’s there you find Ron Paul,
it’s there you find Ron Paul!

I dreamed I saw Ron Paul last night,
Still running on TV.
Says I “But Ron, you lost ‘em all.”
“I’ll never quit” says he,
“I’ll never quit” says he.

Obama’s Pledge to Cut Wasteful Spending

President-elect Obama has talked the talk about cutting wasteful federal spending. Now we will see whether he can walk the walk. You can review his budget reform promises here.

Some notable pledges:

  • Eliminate “ineffective government programs.”
  • Expand and improve www.usaspending.gov.
  • Expose corporate welfare.
  • Ensure that all ”non-emergency” bills passed by Congress are posted on the web for five days before he signs them. 
  • Eliminate “waste and inefficiency” in government through a new investigative “SWAT team” that reports directly to the president.
  • Enforce tougher new standards on the Office of Management and Budget’s current “PART” program, which grades program effectiveness.
  • “Enforc[e] standards when programs continually fail” by ”cutting program budgets or eliminating programs entirely” or other reforms.
  • “Eliminate wasteful redundancy” in government.
  • “Eliminate government programs that are not performing” by means of a “line-by-line” budget review.
  • Slash earmarks to the 1994 level.

Senator Obama has been a partner of Senator Coburn’s in various budget transparency reform efforts. Now Coburn’s office tells me that they will hold the new president’s feet to the fire on his promises in this campaign document.

One suspects that the sort of “waste” Senator Obama is thinking about cutting here is small potatoes compared to the large cuts that really need to be made in the $3 trillion budget. But it will be interesting to see how hard Obama pushes even these modest reforms through the increasingly liberal Congress.

Switching Sides?

Orin Kerr at the Volokh Conspiracy (via the New York Times) cynically predicts some reversals of position by both Democrats and Republicans in the coming months:

1) Republicans Must Now Oppose Executive Power; Democrats Must Be In Favor Of It. In the last few years, Republicans have been the defenders of executive power: A muscular executive has been needed to fight the war on terror. On the other hand, Democrats have opposed a strong executive on the ground that it threatens the rule of law. Please note that these arguments must now switch. Republicans must now talk of the dangers of executive power; Democrats must now speak of how a strong and agile executive branch is necessary to a modern democracy.

2) Republicans Must Now Oppose Judicial Confirmations; Democrats Must Be In Favor. In the last few years, Republicans wanted an up-or-down vote on judicial nominees; one of their leading blogs on the judicial confirmations was ConfirmThem.com. On the other hand, Democrats focused on the importance of carefully evaluating judicial candidates. Please note that these arguments must now switch, too. Republicans should now visit RejectThem.com (still an available domain name, btw — won’t be for long!), and Democrats should emphasize the need for a quick up or down vote.

3) Republicans Must Now Favor Legislative Oversight; Democrats Must Now Oppose It. You get the point by now. Yup, everyone has to switch sides on this one, too. If we all stick to the script, in 6 months the old arguments of the Bush era will be long forgotten. (Oh, and extra credit to those who charge the other side with hypocrisy for changing sides without noting that they have changed sides, too.)

Well, he might be right. And we may also see Republicans once again waxing eloquent about how the filibuster protects minority rights and Democrats railing against its obstructionism. But I’ll note that here at the Cato Institute we try to be nonpartisan. I think we always favor due consideration of judicial nominations, followed by confirmation of those who properly understand the Constitution and its limits on power. We’ve criticized President Clinton’s abuse of executive power and President Bush’s — and the general problem. We’ve called for congressional oversight when Republicans were in the White House and when Democrats were.

We hope that the new president and the 111th Congress will restore civil liberties and checks and balances. If they don’t, Cato scholars will point that out.

Correspondence with a Presumed Proponent of Auto Bailouts

As a supporter of free trade, I’m used to getting angry letters and emails whenever I do media. Below is one of the more civil, reasonable emails, which I received following my appearance on last night’s Lou Dobbs:

I would have liked to see the rest of what you said about the auto industry on the show but what I did see angered me. You said something to the effect that bad business decisions by the Detroit automakers should not get them a bail out and that one of them should be allowed to fail is what I heard you say. I am assuming that the out of control greed that has run unchecked for years and terrible government policies have allowed the investment banks to basically destroy thousands of peoples lives should deserve a bail out. My thinking is that none of them should get one penny. As for the auto companies failing. Lets see. The banks fail then they will not lend to anyone now. I with a 780+ credit score can no longer get a loan for a car which then hurts the auto company is one cause. The fact that people are losing their jobs by thousands is not helping, the people losing their houses and high gas prices are killing the sales of cars. I don’t know if you know that if lets say GM goes under 100’s of thousands jobs could be lost. Engineers, designers, line workers, computer guys, and so on, not to mention all the other business that supply the automakers. Did you give any of this any thought? I also would like to know what you think about the good paying jobs that go overseas. Plus can you tell me one benefit to this Global economy has had for the USA. Please don’t give me the cheaper prices line either.

Here’s my response:

Thanks for your thoughtful comments.  More often than not, the messages I receive from people who disagree with my perspective tend to be nasty and poorly articulated.  So, yours is a welcome dissent.

I am opposed to interventions of any kind. The Wall Street bailout and the subsequent partial nationalization of what were private U.S. financial institutions is in essence a penalty on prudent behavior and a subsidy for risk taking. It is patently unfair and grievously unwise to use taxpayer dollars to insulate people or institutions from the consequences of their actions, as it is unfair and unwise to deprive risk takers of the full fruits of their efforts.

The story is no different in the auto industry. Yes, the industry employs thousands of workers and there are many jobs in related industries that depend on a healthy (or at least functioning) auto industry. I am sympathetic to your suggestion that auto’s woes are at least in some part attributable to the credit freeze, which is a response to, among other things, circumstances beyond its control. But there’s much more to the picture than the one you seem to want to paint of the auto industry as an innocent victim. 

The fact is that much of the Big Three’s problem is self-made. The credit crunch and the contraction of demand is just the latest dark cloud, and a problem that affects all industries, not just autos. Thus, if there is a bailout for Detroit, where, how, and why do we draw the line to exclude other manufacturers, home builders, coal miners, and masseuses, who are all suffering from the same contraction in demand caused in part by the credit crunch? Don’t tell me we should bail everyone out. For starters, we can’t afford that.

Detroit’s problems predate the financial meltdown. Management and labor, together, consigned the Big Three to a future of troubles when ridiculously liberal work rules that flew in the face of basic economics were agreed upon, requiring management to pay workers at 90% of their salaries when they were laid off. The “Cadillac Platter” of health and retirement benefits granted to the UAW also dramatically raised the cost of producing vehicles at unionized auto plants in the United States. And let’s not forget about the far-in-excess-of-average manufacturing wages that auto workers “won” through concessions by management over the years. Management agreed to all of these conditions — and labor pushed them — because both sides assumed that the U.S. governent would come to the rescue (that the industry was too big to fail) when the chickens came home to roost over this inefficient, uncompetitive cost structure. That, to my mind, reflects labor’s and management’s greed.

On the demand side, Big Three management demonstrated an egregious failure of imagination, if not downright dereliction of duty, in assuming that large pick-up trucks and SUVs would never fall out of favor. Of the top 10 selling cars (not trucks or SUVs) in the United States, Big Three offerings have barely made the list this decade. Not one has been a top 5 seller. Shouldn’t producers try to make things that people want to consume before scapegoating their failures and seeking government bailouts?

One of the points I made in my interview with the Lou Dobbs show that didn’t make it to air is that a bankruptcy and liquidation or two in the auto industry wouldn’t be the end of the world. In fact, it would be a welcome development for the producers and their workers who remain in operation. They would be able to compete for a larger share of a pie that is currently shrinking, but will again expand. Which companies remain and liquidate should be determined by market forces, not by the coercive, thieving actions of the Michigan congressional delegation and Governor Granholm. 

I think an instructive example for the auto industry is the U.S. steel industry. During this decade, the steel industry responded to waning fortunes and dozens of bankruptcies by finally allowing unproductive, inefficient mills to shut down. As a high fixed cost industry with dozens of producers at the time, the industry finally did what is should have done long ago: it consolidated. In 2001, 12 firms accounted for 75% of U.S. hot-rolled steel production. In 2007, 3 firms accounted for over 80 percent of hot-rolled steel production. The consolidation has afforded the steel industry an alternative to requesting bailouts in the face of declining demand: it curtails output, which affects prices favorably for the mills. If there were fewer automakers in the United States making products Americans wanted to buy, and if labor costs were more variable and less fixed by unaffordable contracts, the auto industry might be similarly equipped to weather storms.

As to your questions about my views on trade, there is plenty of commentary and analysis on our website (www.freetrade.org) that I invite you to check out.

Pay No Attention to the Man behind the Curtain

I’m sorry, but this just makes me ill. In a post he actually titled “The Magic Ballot,” Arjun Appadurai writes:

The word is MAGIC. On the night of November 4, it felt as if something magical had happened, and perhaps there were others, like me, who used that word. But it is not the biggest word in current public use and I wish it were more fully available to us now.

We’ve chosen someone to work for us. We’ve hired him. For a job. We did it through the (yes, rather nifty) process of democracy. And… That. Is. All. Barack Obama is an employee. He’s not a magician. We can fire him later if we like, and he’s not going to retaliate by turning us all into toads or shooting lighting bolts out of his eyes.

I know that many believe that priests can perform miracles, at least of certain kinds, but Obama isn’t a priest. Tuesday night did not and could not make him one. It’s superstitious, impious, or both, to think that something as common as a democratic election could endow anyone with magical powers.

I regret that we are forced to catch the special aura of this election without a deep and serious space for the idea of magic, magic as it used to be. It would help us fill this rhetorical void. It would let us name the un-nameable and it would let us enjoy our means even without certainty about our ends. It would let us enjoy this week without dragging it immediately into boring predictions about what Nancy Pelosi will do, about how many huge headaches Obama will face, about how heavy the coming storm will be, and how fragile our collective sources. We have hardly crowned Obama and we have promptly begun to mourn for him, as if he is has already been vanquished by his foes.

Crowned??? Sir, this is a Lockean republic, not a New-Age theocracy.

But wait, it gets worse:

Magic, anthropologists have always known, is about what people throughout the world do when faced with uncertainty, catastrophic damage, injustice, illness, suffering or harm, while ritual (also magical in its logic) is performed to forestall or prevent these very things. Magic is not about deficient logic, childish mental mistakes, clever priestly illusions or other mistaken technologies. It is the universal feeling that what we see and feel exceeds our knowledge, our understanding and our control. Can we deny that the infusion of 700 billion dollars into our banks is a magical act designed to make our banks rain credit again? Has it worked yet? Are we discarding our belief in banks and credit as a result? Magic is a method for deploying modest technical means to address outsize ethical challenges. Human beings have always done this and always will. We might as well have a grown-up word for this set of practices.

If we really just spent $700 billion on magic, then I want my money back. There’s probably a decent First Amendment challenge in there somewhere, wouldn’t you think?

Some of us, when faced with “uncertainty, catastrophic damage, injustice, illness, suffering or harm” do not resort to magic. We turn to reason, hard work, rectitude, compassion, courage, and thrift. We also note that the government so often tends to interfere with all of these things.

But I guess we don’t have to bother with any of that anymore: The Great Barack is going to save us — magically — from all kinds of disasters!

So the election of Barack [sic]… is also magical in a much more serious way. It has been performed and produced by voting citizens at a moment when America and the world face risks of an enormous order. We have named these risks frequently in the media and the public sphere in the last few weeks: risks of total financial meltdown, of global warm-up, of war without end and terror without faces and sources. And our existing tools for risk management have failed miserably. Should we be surprised that the American electorate has rediscovered magic without knowing it?

Surprised? If you’re right, we should be very, very worried. And no, my objection is neither partisan nor personal. If McCain had won, I’d have made a post mocking the near-religious qualities his followers had invested in him, too.

Whither Fusionism?

One of the victims of the Bush presidency, along with limited government and the Republican Party, has been “fusionism,” the idea that conservatives and libertarians ought to come together to oppose the forces of socialism (and The Left generally).  Indeed, this Tuesday’s election probably saw the highest-ever percentage of libertarians – depending on how you count them – vote for the Democratic presidential candidate (at least in the modern era, with the possible exception of the Nixon years).  This despite that Democratic candidate being commonly seen as the most statist major-party candidate in history.

Cato adjunct scholar Ilya Somin who blogs at the Volokh Conspiracy and in his day job is a law professor at George Mason (currently visiting at Penn) – Ilya being a popular name among libertarian legal community – today puts up a smart post on the state of the erstwhile libertarian-conservative.  Here’s a snippet:

Obviously, a lot depends on what conservatives decide to do. If they choose the pro-limited government position advocated by Representative Jeff Flake and some other younger House Republicans, there will be lots of room for cooperation with libertarians. I am happy to see that Flake has denounced “the ill-fitting and unworkable big-government conservatism that defined the Bush administration.” Conservatives could, however, adopt the combination of economic populism and social conservatism advocated by Mike Huckabee and others. It is even possible that the latter path will be more politically advantageous, at least in the short term. 

Indeed, if conservatives choose some version of the Huckabee-Palin route, fusionism is dead – and so, might I add presumptuously, is the Republican Party.  That just ain’t where the majority of the nation is, or where it’s heading (though, as Ilya says, that direction may be politically advantageous in certain parts of the country under certain circumstances).

But this type of discussion may be beside the point; libertarian-conservative (in the sense of socially conservative, economically squishy) fusionism may have run its course, a relic of the Cold War.  The new fusionism may well be fiscally conservative and socially tolerant (not necessarily liberal, just not wanting government to do anything about the way people live their private lives), including folks who might call themselves conservative cosmopolitans, crunchy cons, South Park conservatives, or indeed libertarians.  Or they might eschew labels altogether but are sick of the rot coming from (or to) Washington.  In other words: Purple America,

A Sweeping Rejection of President Bush

Left-liberal groups are quick to declare Barack Obama’s win a broad endorsement of the “progressive” agenda, their highly inaccurate name for more taxes, more spending, more entitlements, and more regulation. After a trillion-dollar increase in federal spending during the Bush administration and the biggest expansion of entitlements since Lyndon Johnson, it hardly seems likely that what’s troubling the American economy or the American people is an insufficiency of government.

The big problem for John McCain and the rest of the Republicans last night was George W. Bush and his big-government conservatism. Bush had a 25 percent approval rating, and Congress’s was even lower. Republicans hoped up until election day that voters would notice that the unpopular Congress was run by Democrats. But after 8 years of Bush and 12 years of a Republican Congress, just recently ended, voters saw the Republicans as the incumbents who were responsible for the mess in Washington. Concerns about Obama were sufficient to allow McCain to run 20 points ahead of Bush’s approval rating in a time of economic crisis. But the hole was too deep.

Bush and the Republicans promised choice, freedom, reform, and a restrained federal government. They delivered massive overspending, the biggest expansion of entitlements in 40 years, centralization of education, a floundering war, an imperial presidency, civil liberties abuses, the intrusion of the federal government into social issues and personal freedoms, and finally a $700 billion bailout of Wall Street that just kept on growing in the last month of the campaign. Voters who believed in limited government had every reason to reject that record.

Commentators who talk about whether the Republican party moved too far to the right, or too far to the center, miss the point. There are different kinds of “right.” See this New York Times graphic on independent voters, which picks up on some of the themes we’ve talked about in our work on libertarian voters. Lots of independents – as well as voters who identify with one of the major parties – hold broadly libertarian, or “fiscally conservative and socially liberal,” views. A lot of those voters moved from voting Republican to voting Democratic between 2000 and 2006, and it looks like they did so again this year.

As we had predicted, Republicans racked up further losses in the most libertarian parts of the country, such as New Hampshire and the Mountain West. Obama won affluent, educated voters and professionals. And if conservative Republicans continue to respond to the loss of educated voters by declaring themselves proud to be “real Americans” who don’t care much for book learning and Darwinism and elite stuff, they will only accelerate the process.

Big-government conservatism, a toxic combination of the religious right and the neoconservatives, lost badly on Tuesday. But the voters didn’t give a ringing endorsement to big-government liberalism. Fifty-nine percent of voters call themselves “fiscally conservative and socially liberal,” and that’s a rich vein the Republican party is ignoring. If Obama governs as a centrist, he may make it very difficult for the Republicans to recover. But a candidate in either party who presented himself as a product of the social freedom of the Sixties and the economic freedom of the Eighties would be tapping into a market that both parties have yet to nail down.