Barack Obama, in his first official address to Congress, in short order has declared the end of the concept of small government that has been the predominating ideology of our federal government since 1981. Some have called it the end of the Reagan Revolution; I think they are right. Mr. Obama is clearly making a serious push to move the United States politically to the left, much like Franklin D. Roosevelt did with the New Deal; or similarly to Ronald Reagan’s moving the country to the right in the 1980s.
Obama has single handedly brought back big government, in a big way. The list of programs that Obama is proposing is staggering, especially considering the $2 Trillion deficit we will have in this fiscal year. Come on, the most successful Democratic President of the last generation, Bill Clinton, even declared ‘the era of big government over’ in his State of the Union Address in 1996; was that only 13 years ago? It may have just as well been the middle ages. But that is all history. Obama started with glowing rhetoric; and finished with the reality:
We have lived through an era where too often, short-term gains were prized over long-term prosperity; where we failed to look beyond the next payment, the next quarter, or the next election…And all the while, critical debates and difficult decisions were put off for some other time on some other day.
Well that day of reckoning has arrived, and the time to take charge of our future is here.
Now is the time to act boldly and wisely — to not only revive this economy, but to build a new foundation for lasting prosperity. Now is the time to jump-start job creation, re-start lending and invest in areas like energy, health care, and education that will grow our economy, even as we make hard choices to bring our deficit down. That is what my economic agenda is designed to do, and that’s what I’d like to talk to you about tonight.
First, when has huge government spending ever produced long term wealth? I can’t think of one time. People point to the New Deal, but I and others have clearly outlined that the New Deal did no such thing. And critical debates? I have barely heard the President mention the words ‘Social Security’ and ‘Medicare’, the two largest items in our deficit.
We are going to pay for programs that aren’t necessarily going to save money, that will actually cost us more? Health care reform? I am for nationalized health care policy. But this will cost MUCH MORE than we currently pay. Every major study on the issue has shown that. Are we willing to go into deeper debt for health care reform, no matter how much we need it? Energy policy? Obama is again making the mistake of government funding the majority of the new technologies needed. What we need is huge new tax breaks for green technologies; make profit from green technology tax free for 20 years, and watch the capital flow. Education? As someone who runs his own charity dedicated to education, I am a strong believer in more education access. Is Obama willing to fight the Teacher unions for real improvement? If you paid attention to the speech, no part of his speech got LESS APPLAUSE FROM DEMOCRATS than his points on education. And education is such a huge problem, it cannot be fixed from the federal government. If it is ever fixed, it won’t even be done on the state level. Only individual districts, with help of states and the federal government, will solve that problem. That is one thing that No Child Left Behind has taught us.
Do Americans want the type of change that Mr. Obama is suggesting? That is still up for debate. Polls have shown support for Obama as President. But similar polls, such as the NY Times/CBS poll, show that although greater than 70% of people support him, many disagree with specific Obama proposals. 59% said the bank bailout will help banks more than Americans, and 2/3 are against bailing out GM and Chrysler.
What is surprising is, within the larger scheme of things, how many things are not changing from George W. Bush’s policies:
- No real change in Iraq and Afghanistan.
- Actually more involvement within Pakistan than the Bush Administration considered.
- Rhetoric on closing Gitmo; but as of yet, Obama’s Administration is largely defending the Bush policies.
- Education Secretary Arne Duncan has decided that Bush’s signature No Child Left Behind Act should be retained and moderately reformed. His boldest suggestion so far? “Let’s rebrand it. Give it a new name.” I am not sure that is change you can believe in.
- On financial issues, what is significantly different in TARP II versus TARP I? Not much. Oh, sure, there is rhetoric about forcing banks to lend. It is still primarily money going directly to banks.
And the deficit. What a joke. Obama will increase the deficit more in his first two years of presidency than Bush did in 8 years. He keeps on claiming there are no earmarks in the stimulus bill…with politifact says is not true. And Congress just sent Mr. Obama a $400 Billion appropriation bill…with close to 9,000 earmarks in it. Is he going to veto the bill? On taxes, Obama says no family with income making less than $250,00 will have their taxes increased; not true. With the Bush taxes expiring, many of these people will see their taxes increase in 2010 from 2008 levels. On the foreclosure bill, he promised not to allow speculators to gain benefits from the proposal, but no one has heard how he is going to verify that.
But there is no doubt that in this speech, Mr. Obama is once and for all destroying any belief that he is going to be a political moderate in any sense of the word. He can argue that if he wants, but facts speak for themselves. Is there any single liberal core ideology that Obama has not swallowed hook, line and sinker? Obama, in a few short weeks, has started to dismantle the welfare reform from the 1990s; has expanded government power into the private sector; is expanding government oversight of energy use; has drastically increased federal spending on education; increased tax benefits for buying homes and cars; and is this week proposing the largest tax increases in about two decades to pay for all of it.
Obama finished on an almost inspirational note:
But while our economy may be weakened and our confidence shaken; though we are living through difficult and uncertain times, tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before.
The weight of this crisis will not determine the destiny of this nation. The answers to our problems don’t lie beyond our reach. They exist in our laboratories and universities; in our fields and our factories; in the imaginations of our entrepreneurs and the pride of the hardest-working people on Earth. Those qualities that have made America the greatest force of progress and prosperity in human history we still possess in ample measure. What is required now is for this country to pull together, confront boldly the challenges we face, and take responsibility for our future once more.
Whether Obama’s responses to the crisis are effective will be the debate for the coming political year. He will at the very least raise the specter of Health Care reform, and possible environment reforms such as a carbon tax. Will he discuss the elephants in the room, Social Security and Medicare? He must if he wants to be honest about cutting the budget, as he has proposed. He promised everything but he kitchen sink; is there anything he promised NOT TO DO? And so far, the sacrifice he is calling for is limited to corporations and the wealthy. If we want to fix Social Security and Medicare, and maybe even Health Care, the majority of people are going to have to give up something, whether it be benefits or more taxes; is Obama ready to demant that kind of sacrifice? Finally, he is making the ultimate mistake; what sacrifice is he willing to make to pay for all these programs? Is he willing to really give up something Democrats deem important to get these priorities accomplished? For example, will he veto the new Democrat appropriation bill which overall increases spending by 8%? It will be fascinating to see if Obama will really hold to his word. So Obama had his hands full in this speech; and overall, it was a mixed result.