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In Earmarks Lies Salvation?

Comment

In a deepening recession, what does the reasonable man do?

Seeing friends laid off, he will get rid of all but essential credit cards, dine at home more often, terminate unnecessary trips to the mall, put off buying a new car, give up the idea of borrowing on the vanishing equity in his house. He will begin to save and start paying down debt.

A company that has reached the limits of its credit and is staring at Chapter 11 will batten down the hatches, lay off nonessential workers, cut employee hours, put off expansion plans, cancel year-end bonuses and try to ride out the storm.

This is the natural behavior of people responsible for others in an economic storm of the magnitude of the category 4 hurricane heading our way. Yet, to see and hear our government, folks are doing exactly the wrong thing.

For the U.S. government is set to borrow on a colossal scale, unprecedented save in World War II, and to take America trillions of dollars deeper in debt to pick up the slack in the economy caused by the rational decisions of individuals and corporations.

The Fed, whose easy money policy created the housing bubble that has exploded in our faces, is back printing money and shoveling cash into the banks. And, though the Bush deficits are said to have been responsible for our troubles, a new Congress and president have advanced a deficits-be-damned, full-spending-ahead policy.

On top of Bush's $455 billion deficit and hundreds of billions in bailouts for AIG, Bear Stearns, Fannie, Freddie and CitiGroup, Obama is talking up a new stimulus package of $500 billion to $1 trillion.

Our governors and mayors — who, facing deficits, had been cutting back — have now reversed field and are demanding to follow the federal formula.

When Obama arrived at the National Governors Association Conference in Philadelphia, they pounced. Led by Pennsylvania's Ed Rendell, they handed Barack a bill: $138 billion. The governors want U.S. taxpayers to relieve them of what U.S. families face: the need to cut spending, pay down debt, make sacrifices, take pain and live within their means.

According to The Wall Street Journal, the mayors have now followed the governors' lead, declaring they have 4,100 projects "ready to go," which they want U.S. taxpayers to fund.

What are these projects?

Under the ever-popular rubric "infrastructure," they include roads, bridges, schools and public buildings.

California Gov. Arnold Schwarzenegger says he has $28 billion worth "ready to go," which he would like folks in the other 49 states to fund.

Now, historically, bridges, highways, roads and public buildings have been regarded as pork. In the campaign, they were "earmarks" — payoffs for powerful constituents, a form of political corruption that reformers like Barack and John McCain were going to end.

Now, it seems, earmarks are our salvation.

Why are governments at every level doing this?

Because government believes that the restoration of economic health requires us to act against our natural instincts in a recession, and start buying and financing new homes and cars, and get back to the malls, lest this Christmas season become a bummer for retailers.

After all, 70 percent of our gross domestic product is now based on consumption, though Americans in recent years have had a savings rate of zero.

The disconnect between the instincts of average citizens and the policies of government could not be greater. Governments want us to act prodigally, while natural instincts and inclinations are telling us to act conservatively.

Conservatism and capitalism are giving conflicting signals.

Average Americans are behaving as though in rehab, trying to kick a bad habit of spending more than they earn and borrowing more than they can pay back, while the U.S. government is suggesting that what we really need is to return to the auto showrooms and malls, and start spending again, only in radically increased dosages.

Beyond the present recession, questions arise as to whether the U.S. model is sustainable. If government spending were the remedy to recession, why, after Bush's deficits, are we in recession? And if the easy money of Ben Bernanke's Fed is the cure for what ails us, how did we get sick when Alan Greenspan's Fed was conducting a never-ending policy of easy money?

How does it stimulate the private economy to pump hundreds of billions of dollars into consumer checking and credit-card accounts, when more and more of what we consume — from computers to cars to clothes — isn't even produced in America anymore?

What do conservatives, few of whom have opposed the Obama plans and fewer of whom have called for repeal of Bush's big-spending social programs, believe is the alternative approach to ending the recession and creating a sustainable economy?

For the economy we have seems to be condemned to an ever-deepening and widening cycle of crises, each brought on by the cure for the previous crisis, which is always the same: more government.

Patrick Buchanan is the author of the new book "Churchill, Hitler and 'The Unnecessary War." To find out more about Patrick Buchanan, and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate web page at www.creators.com.

COPYRIGHT 2008 CREATORS SYNDICATE INC.



Comments

3 Comments | Post Comment
Sir;... I think the big personal salvation for the American people is Credit.... Certainly they have been forced to buy on credit and to live on credit as wages and production were driven down in this country, but the government has resorted to credit because it could not find the political will to tax the rich...Now that their house of cards is shaking and quaking, you say borrow and spend... Upon what equity old man??? Because the wealth has been taken out of this people, and the sole wealth upon which people have borrowed has dropped below its price.... One thing might save this country for a time, and that would be to take it out of the rich who got it from us; but what they have here, and can cash out, does not reflect all they own in foreign lands that we will never see again... But, if we have a chance to borrow, everyone should borrow the max, and buy what they can, for this reason: If they cannot pay the money back they can go bankrupt, (which the rich never fail to resort to -to cheat the workers, and other creditors) and have the use of the goods in the meantime. .. But if the government continues to borrow money from the Chinese, and does not tax the rich, then it will not save our economy, and it will ruin our money, and this means that anyone with debts can pay them off with paper legal tender that may be only worth the paper... If the Chinese see the government killing itself with borrowing, they will spend all the dollars they can as fast as they can on buying up and exporting our factories to China... And they should; because the more the government borrows without the ability to pay -the more shaky the dollar becomes, and if the government borrows too much, the man with debt may get some freebies, but we are all going to hurt, most of all, the government which will have to spend the last of its social credit enforcing legal tender... All our international power is going to crumble with the dollar... We have always bought people so we would not have to kill them... And we have sold a lot of people on the idea of international capitalism that does not work, even for the handful of capitalists who actually benefited short term...Thanks...Sweeney
Comment: #1
Posted by: James A, Sweeney
Tue Dec 9, 2008 5:59 AM
Re: Earmarks. Patrick: The first few paragraphs were right on. Then you revert to the economics you learned at the John Birch society and Ar Lffler. Big govt can do no worse than BIG BUSINESS. We are here because of the FREE MARKET ECONOMY. We did not know that the FREE was only for larcenous CEOs, genius MBAs and MIT physicistsd all intent on devising the best Ponzi plan ever seen. This one, by BIG BUSINESS, is a feat for Guiness and Ripley. You always see the heart of an issue and generally come up with the worst remedy. You are one of the best casuists I have ever read. That could be taken as a compliment.
Comment: #2
Posted by: alf1052
Tue Dec 9, 2008 4:31 PM
"And, though the Bush deficits are said to have been responsible for our troubles, a new Congress and president have advanced a deficits-be-damned, full-spending-ahead policy." Oh, Byuke, you old dog, you were doing so good there for a while, but now you've lost the scent of the trail again. Get your nasty snout off of that old dead rat and try to sniff your way back to reality. ....................................................................................................................................................................................................................................................................................................................................................................................................................

The deficits-be-damned, full-spending-ahead policy is what we've had to live through for 8 long years now, you dope. But you forgot to add in the part about the giveaway of all our hard-earned tax dollars to those filthy rich gambling fools at the top of the tax bracket at the very same time time Bush was flushing the whole thing down the toilet. We have no choice but to try to spend our way out now that we have a legitimate need to do so. Thanks to Bush and carrion-loving enablers like you we have nothing to spend precisely when we need it. It is not Obama's fault that we need bridges, roads, trains, bullet trains, schools, houses to live in, etc., etc., and if we don't spend on those we may as well head back to the caves. You can't deprive us of these things just because you threw all the rreal money away (OUR money, to be precise) and left us with nothing but a printing press. You get revolution and chaos when you try to take these things away, and you should be thanking your lucky stars the voters were wise enough (wiser than you, I might add) to elect someone with enough smarts to have a decent shot at getting us out of this mess.
Comment: #3
Posted by: Masako
Wed Dec 10, 2008 6:00 PM
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