Henry Ford Rolls Over

Barack Obama has now unveiled the next iteration of America's new industrial policy, and if you own shares of Ford Motor Company you have every right to be angry. The bailout of GM and Chrysler and the intrusion of the White House on their corporate governance is now part of a program to pick the winners and losers in the U.S. auto industry. The President has made it clear that GM will not fail due to ineptitude, decrepitude or attitude, and the full faith and credit (such as it is) of the United States has now interceded to ensure it. The market no longer is working, because your government wants the UAW to have jobs, and is willing to use your tax dollars to fund them. And, of course, it wants American auto companies to build small "green" cars, and now that it controls the behemoth that is General Motors, you can bet that they will -- whether you want to buy them or not.

And what of Ford Motor Company? The company that brought you the modern automobile industry has, of course, struggled over the past year in a tough market. But due to superior products and better management, Ford has managed to resist the need for tax payer dollars. In a true market, Ford would now be enjoying the fruits of its effort by gaining on GM and Chrysler -- both of which would now be in bankruptcy. The company's employees and shareholders would now be benefiting from the demise of two of its main competitors and be rewarded for its ability to negotiate the difficult waters of CAFE standards and tough credit by surviving in the short-run and and expanding in the long-run. A great American success story, right?

Only not in Obama's America -- where it is more important to reward vested interests than it is those who play by the rules and do a good job. Why should Ford be in a position of watching its two primary domestic competitors receive government aid that will make them leaner and more effective competitors? How is that fair? What is the incentive for doing a good job and not needing a hand out if it puts you at a strategic disadvantage? This is the ultimate moral hazard -- that it is actually better to fail than to succeed, because the government will be there to save you. No matter what.

And don't be mislead. The taxpayer is now on the hook for saving GM and Chrysler. And if you work at Ford or own Ford stock -- tough luck. You will have to sit back and watch as the government puts is ample resources into making your competitors stronger. You lose for winning. What an ironic place to be for the company that Henry Ford built -- the man that created the foundation for mass production, who developed the Model T and established the roots of the modern transportation industry. A man built to compete, with a legacy that is now threatened by the ultimate in non-competitive forces.

One thing you can be sure of: somewhere in his grave in the Ford Cemetery in Detroit, Henry Ford is rolling over.

Off With Their Heads!

One of the hallmarks of revolution -- particularly of the socialist variety -- is retribution. My previous posts about the Obama brand of "retributive justice" have focused on the systemic penalties that his policies have on those who produce wealth. They are punitive -- bot not focused on specific individuals. Until now, I was of a mind that not even in Obama's "new America" would we be stringing up capitalists to cries of "off with their heads".

I guess I've underestimated the zeal of the anti-business zealots in the Congress. Last week the House voted 328-93 to slap a 90% tax -- ex post facto -- on the bonuses of anyone at every bank receiving $5 billion in TARP money who earns more than $250,000 a year. A draft Senate version is even broader. This tax applies to income earned last year and under legally binding employment contracts. It is confiscatory and punitive to the extreme, and targets many talented and innocent executives who have been working in good faith and have had nothing at all to do with the melt down at their companies.

Keep in mind that many of the banks who took TARP money did so under pressure from Ben Bernanke and Hank Paulson, who famously gathered them into a meeting room at Treasury and twisted arms until they took Federal bail out funds whether they wanted them or not. Now the government apparently has these companies where it wants them: having forced them to take the money, they are now confiscating the wealth created by the individuals who run them. Its a classic nationalization power play worthy of Hugo Chavez. And it is patently un-American and unconstitutional.

The The Wall Street Journal has an important lead editorial on this today -- I won't repeat it here. But this is a salient paragraph from it that is worth keeping in mind:

The financial system will suffer in particular, just when the Obama Administration is desperately seeking more private capital to ride out future losses. Facing such limits on the ability to reward talent, every bank CEO will try to pay off the TARP as soon as possible, whether or not this leaves the bank with a weaker capital base. Hedge funds and other investors that Treasury needs for its new Public-Private Investment Program, or for the Federal Reserve's TALF, will also be warier, if they'll play at all. Treasury may promise nothing punitive for these programs, but that's also what it said about the TARP.

America is quickly becoming a banana republic with executive fiat taking precedence over legal contracts. It will fully undermine our system -- and reflects the total lack of understanding that our government has about how incentives influence business and how markets work.

Viva la revolucion!!

Obama's Parallel Universe

This just in from Reuters entitled "Obama says Cheney approach hasn't made us safer":

President Barack Obama hit back at former Vice President Dick Cheney's criticism of his policies on terrorism suspects, saying Cheney's approach had brought the United States scorn instead of security.

Obama told CBS network's "60 Minutes" program that the policy on detainees at Guantanamo Bay military prison under the administration of former President George W. Bush had been "unsustainable"."How many terrorists have actually been brought to justice under the philosophy that is being promoted by Vice President Cheney?

It hasn't made us safer. What it has been is a great advertisement for anti-American sentiment," Obama said, according to excerpts released by CBS on Saturday. The interview was to be broadcast on Sunday.

Ahhh...let's see: eight years after September 11 without another attack on U.S. soil. How is that not safer? The aggressive anti-terror policies of the Bush Administration have devastated Al Qaeda. And Guantanamo -- much to the Left's chagrin -- has prevented terrorists caught on the field of battle from again attacking America. Those are facts. They are impossible to refute -- unless, of course, you live in Obama's world.

Does anyone need further proof that Barack Obama and his fellow liberals live in a parallel universe? One of sweetness and light? Where threats are false and the Iranian regime is chomping at the bit to talk to us about peace and security?

Is this for real??

Our Peripatetic President

I've been struggling over the last few weeks to put my finger on what bothers me so much about Barack Obama. Yes, I know that sounds strange coming from me -- since the pages of this blog are filled with criticisms of the man and his beliefs.

But there is something else that is bugging me about the Obama presidency, and it isn't so much about policy as it is a feeling that I have -- a sense of the peripatetic way he is going about this very serious job he has. I've been watching Obama now travel from media event to media event, fluttering about the country with much fanfare but little substance. There is something missing. A sense of steadiness. His devotion to his teleprompter -- already the stuff of scorn and ridicule -- is unsettling. Wasn't he supposed to be the eloquent one who wields a brilliant intellect? The next great communicator?

Peggy Noonan does a masterful job in today's Wall Street Journal of putting my sense of Obama into words -- it's a must read. I've been frustrated with Noonan's commentary about Obama since the election -- she seemed all too willing to accept the notion that Obama really is some new, transcendental leader. But no more. This most recent piece captures perfectly the true essence of the "Obama phenomena" -- full of sound and fury, and signifying nothing:

He is willowy when people yearn for solid, reed-like where they hope for substantial, a bright older brother when they want Papa, cool where they probably prefer warmth. All of which may or may not hurt Barack Obama in time...

Such impressions—coolness, slightness—can come to matter only if they capture or express some larger or more meaningful truth. At the moment they connect, for me, to something insubstantial and weightless in the administration's economic pronouncements and policies. The president seems everywhere and nowhere, not fully focused on the matters at hand. He's trying to keep up with the news cycle with less and less to say.

Our new president is chasing the news cycle, going on Jay Leno and following the cues from the dwarfs in Congress -- that august body of tax cheats and pork spenders where Obama most recently worked. He is engaged in a dance of reaction as opposed to a steady march of action, all at a time when we are dealing with crisis at home and war abroad. This is a time for steeliness and strength, and what we have is unfocused, peripatetic waffling.

Those of you who read this blog know that this comes as no surprise to me. Barack Obama is a man of great salesmanship, who understands how to get you excited to buy something, but then knows nothing of the details once you've purchased it. He's already on to the next sale, the next opportunity to close the deal and show his ability to convince and cajole. His sense of office is a constant campaign -- lots of platitudes and generalities, the kind of stuff that makes crowds clap. He's a jack of all and master of none. And now that he is the master of our collective domain -- the United States of America -- the weaknesses show through with growing clarity and alarm.

As Noonan succinctly argues, Obama has two jobs -- to fix the economy and to keep us safe. On both scores he seems wanting. When Dick Cheney recently criticized Obama for making us less safe in the wake of his recent decisions on Guantanamo and interrogation, White House press secretary Robert Gibbs reacted with disdain. Mr. Cheney is part of a 'Republican cabal.' 'I guess Rush Limbaugh was busy.' This was cheap."

Cheap and wrong. For whatever you wish to say about Dick Cheney, he know of what he speaks -- having seen first hand the post 9/11 intelligence briefings for 8 years. Cheney knows that the threat from Islamic terrorism is a constant drumbeat that can't be wished or talked away. He knows that the Obama administration has not yet found a serious footing on this issue -- and that this puts the country at risk. Noonan says it well:

What can be used will be used. We are a target. Something bad is going to happen—don't we all know this? Are we having another failure of imagination?

A month ago former FBI director Robert Mueller, in a speech to the Council on Foreign Relations, warned of Mumbai-type terrorist activity, saying a similar attack could happen in a U.S. city. He spoke of the threat of homegrown terrorists who are "radicalized," "indoctrinated" and recruited for jihad. Mumbai should "reinvigorate" U.S. intelligence efforts. The threat is not only from al Qaeda but "less well known groups." This had the hard sound of truth.

Contrast it with the new secretary of homeland security, Janet Napolitano, who, in her first speech and testimony to congress, the same week as Mr. Mueller's remarks, did not mention the word terrorism once. This week in an interview with Der Spiegel, she was pressed: "Does Islamist terrorism suddenly no longer pose a threat to your country?" Her reply: "I presume there is always a threat from terrorism." It's true she didn't use the word terrorism in her speech, but she did refer to "man-caused" disasters. "This is perhaps only a nuance, but it demonstrates that we want to move away from the politics of fear."

Ah. Well this is only a nuance, but her use of language is a man-caused disaster.

Exactly right. Eight years after 9/11 and two wars in Iraq and Afghanistan and we are still learning the same lesson over and over again: there are enemies who want to destroy us out there, they are Islamic fundamentalists and they can and will use any weapon they can get their hands on -- from machine guns to suitcase nuclear bombs. It isn't an issue of nuance, it is one of survival. The administration's responses -- as Dick Cheney points out -- should in no way be comforting.

These are the two great issues, the economic crisis and our safety. In the face of them, what strikes one is the weightlessness of the Obama administration, the jumping from issue to issue and venue to venue from day to day. Isaiah Berlin famously suggested a leader is a fox or a hedgehog. The fox knows many things but the hedgehog knows one big thing. In political leadership the hedgehog has certain significant advantages, focus and clarity of vision among them. Most presidents are one or the other. So far Mr. Obama seems neither.

Very well said, Peggy.

Some Hard Truths

Fellow conservative blogger Donald Douglas has an interesting post up that cites Robert Bork's recent book entitled: A Time To Speak:Selected Writings and Arguments. Many of you will remember Bork as having been one of the most significant victims of left-wing demagoguery during his 1987 Senate confirmation hearings after Ronald Reagan nominated him for the U.S. Supreme Court. Though beaten, Bork has been unbowed in using his prodigious intellectual talents to influence the debate via his writings. As Douglas recounts, Bork wrote back in 1995 with uncanny prescience in his essay Hard Truths About the Culture War that we face a real and growing threat from liberalism that is destroying our culture:

Modern liberalism is most particularly a disease of our cultural elites, the people who control the institutions that manufacture or disseminate ideas, attitudes, and symbols-universities, some churches, Hollywood, the national press (print and electronic), much of the congressional Democratic party and some of the congressional Republicans as well, large sections of the judiciary, foundation staffs, and almost all the "public interest" organizations that exercise a profound if largely unseen effect on public policy. So pervasive is the influence of those who occupy the commanding heights of our culture that it is not entirely accurate to call the United States a majoritarian democracy. The elites of modern liberalism do not win all the battles, but despite their relatively small numbers, they win more than their share and move the culture always in one direction ....

What we are seeing in modern liberalism is the ultimate triumph of the New Left of the 1960s - the New Left that collapsed as a unified political movement and splintered into a multitude of intense, single-issue groups. We now have, to name but a few, radical feminists, black extremists, animal rights groups, radical environmentalists, activist homosexual groups, multiculturalists, People for the American Way, Planned Parenthood, the American Civil Liberties Union, and many more. In a real sense, however, the New Left did not collapse. Each of its splinters pursues a leftist agenda, but there is no publicly announced overarching philosophy that enables people to see easily that the separate groups and causes add up to a general radical left philosophy. The groups support one another and come together easily on many issues. In that sense, the splintering of the New Left made it less visible and therefore more powerful, its goals more attainable, than ever before.

In their final stages, radical egalitarianism becomes tyranny and radical individualism descends into hedonism. These translate as bread and circuses. Government grows larger and more intrusive in order to direct the distribution of goods and services in an ever more equal fashion, while people are diverted, led to believe that their freedoms are increasing, by a great variety of entertainments featuring violence and sex ...

As Douglas points out, the "splintered" left-wing groups that Bork described in 1995 look a lot like the various liberal organizations that have now organized to make change within the Obama Administration. An excellent example of this can be found in Ben Smith's recent article at Politico.com entitled Unity '09 -- Dem Groups Quietly Align:

A broad coalition of left-leaning groups is quietly closing ranks into a new coalition, "Unity '09," aimed at helping President Barack Obama push his agenda through Congress.

Conceived at a New York meeting before the November election, two Democrats familiar with the planning said, Unity '09 will draw together money and grassroots organizations to pressure lawmakers in their home states to back White House legislation and other progressive causes.

The online-based MoveOn.org is a central player in the nascent organization, but other groups involved in planning Unity '09 span a broad spectrum of interests, from the American Civil Liberties Union to the National Council of La Raza to Planned Parenthood, as well as labor unions and environmental groups.

The obvious point to be made here is that the most radical of left-wing interest groups are organizing to have a major impact on public policy in the Obama White House. What follows logically from this is a pro-choice, pro-illegal immigration, pro-tort/pro-defendant and pro-union orientation that will systematically weaken the foundation of our nation and our economy. Just today, for example, it was revealed that estimates for Obama’s “Cap and Trade” environmental protection regime will cost the economy well over $1 trillion over the next several years — a huge tax on business in the name of satisfying the global warming alarmists who seek curbs on carbon at any cost.

With the Obama presidency we have opened the West Wing to the worst kind of single-minded interest groups — for whom the word “compromise” and “in the national interest” have absolutely no meaning. There is no quid-pro-quo among the true believers, who have organized their lives around unyielding belief in the importance of a single issue — be it abortion, immigration, torture, civil liberties or the environment. For these disciples, there is no second place – total victory is the only option. And for those of us who believe in open, honest debate, this is a hard truth, indeed.

There will be blood

Recently I wrote a post that noted that Obama's economic policies are less about fixing the economy and more about retributive justice -- a pernicious form of wealth redistribution designed to achieve a liberal social agenda. This agenda is at the heart of Obama's philosophical orientation -- that same "spreading the wealth around" view that he inadvertently let slip to "Joe the Plumber" on the campaign trail. Many didn't pay attention to this off-hand comment -- but we know now just how revealing it was.

Daniel Henninger reinforces the retributive justice argument in an op-ed in the Wall Street Journal today and highlights the underlying theory that alights the Obama redistribution plan. He cites a graph created by Thomas Piketty and Emmanuel Saez, French economists, are rock stars of the intellectual left. Their specialty is "earnings inequality" and "wealth concentration" -- code words for socialist theory designed to validate confiscatory economic policies. It turns out that Piketty and Saez are for Obama what Arthur Laffer was to Ronald Reagan. Perhaps it tells you all you need to know about Barack Obama that his economic philosophy comes from French economists -- that nation of stagnant growth, high taxes and huge public sector unionization. That in itself should be troubling enough.

Piketty and Saez have provided the Obama Administration with their rationale for "soaking the rich". See the following graph:

As described in Mr. Obama's budget, these two economists have shown that by the end of 2004, the top 1% of taxpayers "took home" more than 22% of total national income. This trend, Fig. 9 notes, began during the Reagan presidency, skyrocketed through the Clinton years, dipped after George Bush beat Al Gore, then marched upward. Widening its own definition of money-grubbers, the budget says the top 10% of households "held" 70% of total wealth.

This kind of income inequality is anathema to those who see an equality of outcomes in society. Never mind, of course, that the top 1% of earners pay almost 40% of all Federal income taxes to begin with, and that from these earners come a huge percentage of the jobs that fuel the economy. Socialists like Piketty and Saez would prefer that everyone dumb down to a common denominator where so-called "winners" and "losers" were much closer together. They would prefer that everyone be mediocre rather than have a few big winners who raise the tide for everyone. And it is exactly the economic philosophy that Obama has now embraced. Massive wealth transfer as social policy.

And it matters not that it is bad economic policy, because fixing the economy is a poor second to the need to dumb America down. In Obama's own words:

While middle-class families have been playing by the rules, living up to their responsibilities as neighbors and citizens, those at the commanding heights of our economy have not.

Prudent investments in education, clean energy, health care and infrastructure were sacrificed for huge tax cuts for the wealthy and well-connected.

There's nothing wrong with making money, but there is something wrong when we allow the playing field to be tilted so far in the favor of so few. . . . It's a legacy of irresponsibility, and it is our duty to change it.

So if you made a lot of money you somehow cheated -- not living up to your responsibilities, even though you paid your fair share of taxes in what is already a highly progressive tax code.

What a tremendously offensive statement.

This is class warfare pure and simple. Or, as Henninger says, "the primary goal is a massive re-flowing of "wealth" from the top toward the bottom, to stop the moral failure they see in the budget's "Top One Percent of Earners" chart.

And for those top earners -- the engine of our economy -- there will be blood.

Good and Hard

I'm a big fan of Newt Gingrich -- who is one of the conservative's leading intellectual lights. He is a man of big ideas -- and he represents what the Republican party must get back to if it wants to have any chance of rolling back the socialist steam roller that is now engulfing us.

Here's from a recent column by Gingrich entitled "Exactly Wrong on the Economy":

Way back in November, when the Obama team was still flush with victory in the election, Obama White House Chief of Staff Rahm Emanuel laid out what he called "Rule One":

"Never let a crisis go to waste."

The Obama budget plan unveiled last week is proof that the goal of the administration is not economic recovery. The goal is an unprecedented shift of power to politicians and bureaucrats.

Which America Do We Want?

Ronald Reagan believed that at the center of American life was the individual. The entrepreneur. The worker. The doer. The family man and woman.The Obama budget reveals a very different vision of the men and women at the center of American life. They are the politicians. The bureaucrats. The interest groups that support an ever expanding government sector.

And so the American people are presented with a real choice: Which America do we want?An America in which citizens and entrepreneurs are free and hold the power? Or an American in which politicians and bureaucrats dominate and are in charge?

What kind of America do we want? Do we want one in which the president is using a crisis to further a radical agenda? Where every idea that ever popped into a liberal head is now going to get funded on the backs of American taxpayers? Card Check, the Fairness Doctrine, universal health care, increased unionization, global warming legislation -- you name it, it's now on the table. Over the next four years the mental midgets in the Congress will fund all manner of programs that will saddle us for generations with debt and regulation. We are strangling our golden goose -- the entrepreneurial class -- that creates the real jobs and real wealth in this economy.

Every day the news gets worse and every day it becomes more clear that Rahm Emanuel and the children who now inhabit Washington are going to screw us into the ground. And who do we have to blame? Ourselves. Or, rather, we have the millions of independents and Republicans who voted for Obama -- who fell for his lies about hope, change and bipartisanship. There was never, ever ANY doubt in my mind --or on the pages of this blog -- that Barack Obama was a socialist with big government aspirations who wants to spread YOUR wealth around. To have thought differently was to be ignorant. The facts were out there. People chose to ignore the facts -- and we all will suffer for it.

So I again go back to my favorite quote from H.L. Mencken: "Democracy is the theory that the common people know what they want and deserve to get it good and hard."

And you'll like it, too. Because the government says so.