Bushama Economics

Bushama Economics

 

Bush and Obama

Bush and Obama are thought to be so different and the Obama partisans I hear so often in NYC think that is the case.  I wish they would subject Obama to the same standards to which they subjected Bush.  If they did, they couldn’t possibly support Obama.

Surprisingly, economic policy is one area where they are more alike than different.  Both of them directed hundreds of billions of dollars to favored constituencies at the expense of the rest of us.  Bush directed money to faith-based organizations as one clear example.  He increased Federal education spending by leaps and bounds, to the benefit of public sector unions.  This was probably an attempt by the Republicans to convert this powerful interest group to their side.  The Republicans should have known the Democrats have the public sector unions locked up for the foreseeable future.

Another Bush-Republican attempt to buy off an interest group was the expansion of Medicare to include drug coverage, i.e. Medicare Part D.  That made sense politically because the elderly are the most powerful group in every democracy.  It doesn’t make sense as economic policy when 1) most of those receiving the benefit, such as myself, don’t need it and 2) we can’t afford another entitlement program piled on top of the ones we already have.

Obama and the Democrats have appropriated hundreds of billions of “stimulus” dollars to, among others, state and local governments.  State and local employees are a natural Democratic constituency.  Thus, public sector job numbers grew during the early part of the current recession while private sector jobs plummeted.  Any connection there?  If you are taking hundreds of billions out of the private sector, which is inevitable if the government is spending hundreds of billions of dollars to “stimulate” the economy, the private sector will lose jobs as a result.  Many people seem to think government spending comes out of dollars sitting around unused and don’t stop to think of what the economist Bastiat called the “unseen” effects of a given policy.  The unseen in this case is money removed from the private sector to support government.

There’s another similarity, this one from their first days in office.  Early on Bush placed import quotas on steel, so that domestic manufacturers could raise prices and make more money.  This served the interest of steel manufacturers and powerful steel unions.  Why did he do it?  Probably because at that time there were some steel-producing states closely divided between Republican and Democratic voters, such as West Virginia, and Bush wanted to tip the balance toward the Republicans for future elections.  We all paid the price for this favoritism in the form of higher prices for any product with steel components.  This policy was eventually changed when it was ruled in violation of international trade agreements.

Obama changed a policy under Nafta shortly after taking office.  He terminated the right of Mexican truckers to bring Mexican produce into the United States and required the produce to be transported on U.S. driven trucks once the produce crossed the border.  He gave safety as the justification despite the fact Mexican drivers had a better safety record than U.S. drivers.  What was the real reason?  The Teamsters.  He had promised during the campaign he would do this, thus acquiring Teamster support.  This policy was eventually changed because of negotiations conducted by the administration with Mexico.

Obama instituted a new entitlements program as well, known as Obamacare.  Not only is it an entitlement program in a general sense because of its myriad subsidy schemes, it also contains specific entitlement programs within it.  One is called the CLASS Act of all things.  It provides subsidies for the purchase of long-term care insurance and is almost guaranteed to generate trillions in additional unfunded liabilities if it is ever put into effect.

The fact of the matter is that Bush and Obama have turned the U.S. into a crony-capitalist country.  One author speculated about where the tipping point was and concluded it was the Bush bailout or the Obama stimulus package, each one totaling almost one trillion dollars.  Does it really matter to whom we allocate the blame when they both deserve it?

The Who performed a rousing song about revolution entitled “Won’t Get Fooled Again.”  The last line is “Meet the new boss; same as the old boss.”

 

Other than Economics

Obama and the Democrats promised us relief from the Bush administration’s intrusion into our civil liberties, yet Obama has expanded those intrusions.  He has asked for more extensive authority to monitor our communications and he and the Democrats extended provisions of The Patriot Act, instead of repealing this intrusive and unnecessary act.  The government had too much surveillance authority prior to 9/11, much less after the hastily passed Patriot Act.  We know for a fact the government had plenty of information to enable it to stop the 9/11 terrorists but was unable to put the information together effectively.  I don’t fault the government for being imperfect but what we now know clearly indicates the government had more than enough surveillance authority before 9/11.

Civil liberties authorities such as Nate Hentoff have said that the Obama administration is even more resistant than the Bush administration to releasing data when faced with Freedom of Information requests.

It is true that Obama promised to close Guantanamo, a salutary promise, but it is still in operation, holding people who have not had fair determinations of guilt or innocence.  Obama did not even mention Guantanamo in his second State of the Union address.

Libertarians

Libertarians rightly criticize both Bush and Obama, pointing out how similar they are.  We sometimes call the two major parties the “Republicrats” to make our point.  The Republican and Democratic partisans argue about the righteousness of their parties, not acknowledging how similar the parties are in their desire for ever-increasing power.  To Democrats I say:  Subject Obama to the same standards you subjected Bush and you can’t rationally support him any more than Bush.  To Republicans I say: With friends like Bush, you don’t need enemies, especially if you are concerned with the fiscal disaster we are courting.  Presidents such as Bush who have the label “conservative” are especially pernicious because conservative fiscal policies get blamed when we in fact had a spendthrift Bush-Republican regime.

Hoover-Roosevelt

There are parallels to Bush-Obama with Hoover and Roosevelt.  Hoover is usually portrayed as a laissez-faire kind of guy who did nothing as the economy tanked.  In fact, he and the Republicans pursued major interventionist economic policies before losing power to the Democrats.  For example, he increased spending and even created some of the Depression-era agencies that Roosevelt later expanded.  Hoover vastly increased income tax rates, especially marginal rates, which Roosevelt increased again.  Roosevelt the candidate criticized Hoover for his deficit spending, then expanded the deficit.