John Hawkins writes in Townhall:

In today’s dollars, the stimulus bill will cost more than the war in Korea and the war in Iraq – combined! It will cost about the same amount as FDR’s New Deal AND the war in Vietnam combined! It’ll cost far more than the Marshall Plan, the Louisiana Purchase, and putting a man on the moon – combined!

Those were momentous events in our history. Going to the moon, rebuilding Europe, fighting wars – meanwhile, ten years from now, we’ll have very little to show from this stimulus plan other than a considerably larger national debt and slower economic growth. In other words, all hyperbole aside, this may very well be the single least effective, most wasteful, most costly piece of legislation in all of recorded human history.

 Donald Lambro in Townhall criticizes Obama’s ‘solution’ to the economic crisis, the plan for massive infrastructure spending.  Read the whole article here. 

What exactly is the theory behind spending stimulus bills? Can the federal government miraculously spend money on public-works jobs and, thus, jumpstart a $14 trillion private economy?

Listen to fiscal policy analyst Brian Riedl of the Heritage Foundation: "Government stimulus bills are based on the idea that Congress can ‘inject’ new money into the economy, increasing demand and thus production. But where does government get this money? Congress does not have a vault of money waiting to be distributed. Every dollar Congress ‘injects’ into the economy must first be taxed or borrowed out of the economy," Riedl says.

But every dollar taken out of the economy is one dollar less that the economy has to spend to build businesses, produce goods and services and hire more workers. That means fewer jobs, a lower savings rate, less investment and ultimately a weaker economy. "No new spending power is created. It’s merely redistributed from one group of people to another," Riedl says.

 Charles Krauthammer writes:

Obama was quite serious when he said he was going to change the world. And now he has a national crisis, a personal mandate, a pliant Congress, a desperate public – and, at his disposal, the greatest pot of money in galactic history. (I include here the extrasolar planets.)

It begins with a near $1 trillion stimulus package. This is where Obama will show himself ideologically. It is his one great opportunity to plant the seeds for everything he cares about: a new green economy, universal health care, a labor resurgence, government as benevolent private-sector "partner." It is the community organizer’s ultimate dream.

Ironically, when the economy tanked in mid-September, it was assumed that both presidential candidates could simply forget about their domestic agendas because with $700 billion drained by financial system rescues, not a penny would be left to spend on anything else.

On the contrary. With the country clamoring for action and with all psychological barriers to government intervention obliterated (by the conservative party, no less), the stage is set for a young, ambitious, supremely confident president – who sees himself as a world-historical figure before even having been sworn in – to begin a restructuring of the American economy and the forging of a new relationship between government and people.

Don’t be fooled by Bob Gates staying on. Obama didn’t get elected to manage Afghanistan. He intends to transform America. And he has the money, the mandate and the moxie to go for it.

 ‘Conscience,’ Hamlet says, ‘does make cowards of us all.’

Or does cowardice claim the name of conscience – steal its identity – in order to excuse itself? 

Conscience should drive us, as individuals, to do what we believe to be morally right. But it may be a self-flattering word we use to explain why we do certain things that we actually do out of craven cowardice itself, or the sort of moral vanity that makes us want to appear virtuous rather than to act virtuously.

Governments, nations, and crowds also cover their actions with the same deceptive claim, attributing to conscience what they really do out of weakness, fear, stupidity,  hypocrisy and ideological romanticism.  

False conscience calls itself by many other names, among them these: political correctness; respect for multiculturalism or ‘diversity’; a striving for ‘social justice’ or economic equality or ‘fairness’;  remorse for (largely imaginary) historical sins. Under such names all kinds of idiotic, unjust, destructive and evil things are done.    

Exempli gratia from the real world: 

In the US millions of voters elect an unqualified candidate to political office because he is black.

Navies refrain from capturing pirates, or (even better) summarily killing them, because ‘they have human rights’.

Liberal democratic welfare states keep and protect alien Islamic preachers of terrorism and sedition, lavishly house, feed, educate and medically treat them (and their pluralities of wives and families) at the expense of their intended victims, the indigenous population, because if they’re returned to their own countries they may be tortured or executed – or even because some witness at their possible trials might be tortured.

Western governments abrogate freedom because citizens use it to criticize Muslims and their beliefs. 

European police refrain from enforcing the law against Muslim offenders.  

In Britain the rule of a single Law of the Land, the very thing that makes it possible for people of different provenance to live together in harmony, is arbitrarily abandoned by the acceptance of Sharia as a second system of law, although it is incompatible with and contradictory to the enchorial system. 

Western nations reduce their defensive power to the point of ineffectiveness while vicious tyrannical regimes, inimical to the West and motivated by a declared intention of aggression, acquire arsenals of nuclear weapons. 

Governments interfere in markets and impoverish the people.  

Jillian Becker  November 21, 2008

 Michelle Malkin writes that Paulson ‘doesn’t know what the hell he’s doing’. Here’s part of her article (read the whole thing): 

Members of Congress who let themselves be bullied into switching their votes on the bailout should be experiencing the biggest case of buyers’ remorse in U.S. history. They fell for what Nobel Prize-winning economist F.A. Hayek called "the fatal conceit" – the disastrous idea that a federal bureaucrat has the knowledge to do a better job than the private market in organizing and directing an economy. They gave unchecked power to a single government official without a clue…

Wielding his enormous authority, Paulson is desperately throwing our money at banks in a futile attempt to convince them to lend. Instead, those banks are either hoarding the cash or acquiring more assets. In other words: Paulson is helping the banks that were "too big to fail" grow even bigger with taxpayer backing. Swell.

The White House says: "We’ll just trust our treasury secretary to implement the program." President Bush insists "government’s role will be limited and temporary." Meanwhile, Democratic Rep. Barney Frank is shrugging off the lack of bailout disclosure by both the Federal Reserve and Treasury. But as I reminded readers before this latest bait-and-switch admission, Hank Paulson is not to be trusted. I repeat:

This is the man who proclaimed the subprime crisis "largely contained" in April 2007; "near the bottom" in May 2007; and "largely contained" again in August 2007. This is the man who pledged that he had "no interest in bailing out lenders or property speculators" in October 2007 and couldn’t "think of any situation where the backdrop of the global economy was as healthy as it is today."

This is the man who patted himself on the back for refusing to "put taxpayer money on the line" to rescue Lehman Brothers on Sept. 15 – and then turned around the next day and engineered the $85 billion taxpayer-funded bailout of AIG. This is the man who vowed he had "no plans to insert money" into Fannie Mae and Freddie Mac – and then turned around and committed $200 billion in capital and credit lines to those corrupt, bloated, crumbling institutions.

This is the man who declared that "the worst is likely to be behind us" in May 2008.

Emperor Paulson’s bipartisan courtiers in Congress berated anyone who dared challenge his wisdom. Minority Leader John Boehner sniffed: "This is no time for ideological purity." Well, ideological pollution begat this mess. It’s time for a fiscal-conservative counterinsurgency to disrobe and disarm the charlatans before they do more harm.

 I’ve never been persuaded that there is such a thing as a sin of greed. What cannot be denied is the sin of envy. I think leftism is the politics of envy. More than likely, those among the enviable rich who embrace lefty politics do so for fear of that evil green eye .

So I enjoyed this paragraph from an article by the admirable Walter Williams, writing about something he calls ‘wackonomics’ – the idea that there is a fixed amount of wealth and that it ought to be doled out (by an all powerful government) in strictly equal shares:

Speaking of CEOs, there’s the "unconscionable," "obscene" salaries they receive, in some cases over $10 million a year. Wackonomics has an easy answer for these high salaries: it’s greed. However, CEOs don’t have the corner on greed. There are other greedy people we don’t scorn but hold in high esteem. According to Forbes’ Celebrity 100 list, Oprah Winfrey receives $275 million, Steven Spielberg gets $130 million, Tiger Woods $115 million, Jay Leno $32 million and Dr. Phil $40 million. I need to talk to these people and learn their strategy. I’ve been making every effort to get that kind of money. I go to bed greedy, dream greedy dreams, awaken greedy and proceed through the day greedy. Despite my heroic efforts, it’s all been for naught; I earn a pittance by comparison.

As the comments on many of our entries show, we come in for a fair amount of abuse. We take it all as a form of compliment. If we get under the skin of our enemies, we are doing well. 

Now, thanks to our reader, Kenn, my attention is drawn to this entry on the website of endiana, and a real compliment, following the important posting on McCain’s prophetic letter concerning Fannie Mae.  

I feel  honored to be placed in the company of Melanie Phillips and SARAH PALIN. 

From Power Line:

We’ve noted many times that John McCain was one of the prescient legislators who saw the dangers posed by the runaway Freddy Mac and Fannie Mae and tried to do something about the problem. Until now, though, I’d never seen this letter of May 5, 2006, signed by McCain and 19 other Senators, that couldn’t have been clearer about the dangers posed by the Democrats’ reckless treatment of Fannie and Freddy, and the need to take action to protect the taxpayers and the economy. It’s hard to see how any warning could be more spot-on. Click to enlarge:

Among the more prescient observations:

We are concerned that if effective regulatory reform legislation for the housing-finance government-sponsored enterprises (GSEs) is not enacted this year, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddy Mac pose to the housing market, the overall financial system, and the economy as a whole. …

Today, almost half of the home mortgages in the U.S. are guaranteed by these GSEs. They are mammoth financial institutions with almost $1.5 Trillion of debt outstanding between them. With the fiscal challenges facing us today (deficits, entitlements, pensions and flood insurance), Congress must ask itself who would pay this debt if Fannie or Freddy could not? …

It is vitally important that Congress take the necessary steps to ensure that these institutions benefit from strong and independent regulatory supervision, operate in a safe and sound manner, and are primarily focused on their statutory mission. More importantly, Congress must ensure that the American taxpayer is protected in the event either GSE should fail.

 Via Human Events. One thing I hadn’t realized is that McCain’s reform legislation was passed through the Senate Banking Committee, but was not able to gain majority support on the Senate floor. All twenty Senators who signed the letter calling attention to the urgency of reforming Fannie Mae and Freddy Mac were Republicans. After May 2006, the Democrats continued to use Fannie and Freddy as their private slush funds until the inevitable collapse, which McCain had warned against so eloquently, occurred.

For some inexplicable reason, John McCain seems unable to claim the credit he deserves for being one of the few politicians in Washington who saw the present crisis coming and tried to do something about it. He is even more unable to vigorously and unambiguously put the blame where it belongs: on the Democratic Party. Which is one of the principal reasons why, as everyone expects, he will lose in November. 

 Investor’s Business Daily tells it straight:

Right now it looks like the U.S., which built the mightiest, most prosperous economy the world has ever known, is about to turn its back on the free-enterprise system that made it all possible.

It isn’t only that the most anti-capitalist politician ever nominated by a major party is favored to take the White House. It’s that he’ll also have a filibuster-proof Congress led by politicians who are almost as liberal.

Throw in a media establishment dedicated to the implementation of a liberal agenda, and the smothering of dissent wherever it arises, and it’s no wonder panic has set in.

What is that agenda? It starts with a tax system right out of Marx: A massive redistribution of income — from each according to his ability, to each according to his need — all in the name of "neighborliness," "patriotism," "fairness" and "justice."

It continues with a call for a new world order that turns its back on free trade, has no problem with government controlling the means of production, imposes global taxes to support continents where our interests are negligible, signs on to climate treaties that will sap billions more in U.S. productivity and wealth, and institutes an authoritarian health care system that will strip Americans’ freedoms and run up costs.

All the while, it ensures that nothing — absolutely nothing — will be done to secure a sufficient, terror-proof supply of our economic lifeblood — oil — a resource we’ll need much more of in the years ahead.

The businesses that create jobs and generate wealth are already discounting the future based on what they know about Obama’s plans to raise income, capital gains, dividend and payroll taxes, and his various other economy-crippling policies. Which helps explain why world stock markets have been so topsy-turvy.

But don’t take our word for it. One hundred economists, five Nobel winners among them, have signed a letter noting just that:

"The prospect of such tax-rate increases in 2010 is already a drag on the economy," they wrote, noting that the potential of higher taxes in the next year or two is reducing hiring and investment.

It was "misguided tax hikes and protectionism, enacted when the U.S. economy was weak in the early 1930s," the economists remind us, that "greatly increased the severity of the Great Depression."

We can’t afford to repeat these grave errors.

Yet much of the electorate is determined to vote for the candidate most likely to make them. If he wins, what we consider to be a crisis in today’s economy will be a routine affair in tomorrow’s.