Free Market Maxims: An Obese Government Is Not the Answer

As the current economic crisis has sunk in and many of us have begun to accept that recovery from this massive downturn will not be as quick as any of us would like, we have begun to question the most basic of economic principles, what I call Free Market Maxims. As the current crisis is dealt with, let us recognize that the responses are those that are most appropriate during a crisis – not to replace basic economic norms, but simply to deal with a massive economic downturn of a magnitude not seen in three generations.

I have great respect for the intelligent strategies and suggestions put forth by our current administration. President Obama is clearly well-educated and articulate and his team seems to be of similar caliber. They have come into the Office of the Presidency under a great cloud of fear and destruction, where the failures of many, on both sides of the aisle – LEFT and RIGHT, as well as the complicit inaction of all of us have led to a dire economic climate. And they are responding as vigorously and as thoughtfully as they are able.

Short-term, I believe they cannot help but reinvigorate what has become an economy-in-retreat, and a consumer in hibernation. But I cannot imagine how successful their actions will be if, as they respond, they build rhetoric that continues to convince the American public and the world that the answer to our problems and our challenges is a permanently obese Government with all the answers and all the solutions.

Democrats have been and remain the worst violators, but the Bush administration exacerbated this nonsense with a ballooning deficit over the last eight years and ultra-orthodox policies that intruded in our private lives but ignored the public crimes that have led to our current crisis.

Government is not the answer – it is responsible to protect people’s rights, and provide safety nets (not safety hammocks) when people stumble. People are the answer, and providing the right incentives, the right infrastructure and the right access to resources and tools is the best way for governments to enable a climate of self-sustaining growth.

This is not a partisan issue. This is an issue about basic economic principles and not allowing ourselves to throw the baby out with the bathwater.

Comments

[Respirate:]

"An Obese Government Is Not the Answer"

True.

Neither is a banking / financial community that grossly overindulges, and by so doing robs us of financial stability.

A robust regulatory function of government is another form of "protect people’s rights" that you mention.

Mar 09 10:14 AM

[bigmoney:]

>> An Obese Government Is Not the Answer

the trouble with Keynesian theory is that government is supposed to cut back (get smaller) during plush times, which it never does. During feast, government gorges. And during famine, government gorges even more because famines are scary, so might as well accumulate as much fat as possible.

Mar 09 02:40 PM

[Aristophanes:]

On Mar 09 02:40 PM bigmoney wrote:

> the trouble with Keynesian theory is that government is supposed
> to cut back (get smaller) during plush times, which it never does.

1. It did under Clinton who balanced the budget and began paying down accumulated debt (60% of which came from Reagan).

2. It did in Canada which had 12 years of federal government surplus and paid down almost 50% of its accumulate debt. This was primarily a policy of the Liberal government.

It can be done.

Mar 09 10:31 PM

[Aristophanes:]

"… but ignored the public crimes that have led to our current crisis.

Government is not the answer – it is responsible to protect people’s rights, and provide safety nets (not safety hammocks) when people stumble."

A contradiction. "People" are not "stumbling". Direct manipulation by, unscrupulous agents have committed crimes against private citizens using the public mantra of deregulation. Citizens in distress now rely on public support precisely because they have been swindled. For the masses of unemployed this is no fault of their own. Their fate is largely out of their hands and will reside in the American community coming together to offer aid and support.

Quit blaming the victims. Blame the perpetrators.

Mar 09 10:37 PM

[fireball:]

the author is correct that this is an american issue. our federal govt. is beyond obese. adherence to our constitution would never have allowed the life-sucking policies. monopolies and cartels would have been dealt with. we have no more than a handful of public servants at one time. the rest are like greedy sucking pigs that bite and snap at each other lest one get one more drop of milk. meanwhile the old emaciated sow is dying because her pigs are way to big refusing to grow up and be weaned and they don't care if they kill the source as long as they cling to the tit and suck. 53% of the population apparently feels the same.
this is one reason marx and engles listed government (public) education as a plank in the manifiesto along with confiscation of private property and the progressive income tax.
now the population is so well programmed by government education, and the far left media they have come to believe the lie. it has been told, loud enough, often enough, for long enough americans embrace the nanny state and think it is fair for the productive to be forced to pay for the useless. they believe this is a democracy instead of a representative republic of laws to protect the minorities from the idiocy of the majority.
in a democracy each citizen votes on every issue. there are no representatives. a lynch mob is a good example.

Mar 10 10:52 AM

[milkchaser:]

According to Jefferson:
# A wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government.
# That government is best which governs the least, because its people discipline themselves.

Mar 11 09:15 AM

[milkchaser:]

Congress has the power of the purse. The Congresses of the 1980s were mostly controlled by Democrats who never passed a Reagan budget without increasing it substantially. The Congresses of the Clinton era were mostly controlled by Republicans, but neither Congress nor Clinton cut the size of the Federal gov't.

The cost of the Federal gov't has monotonically increased since the mid 1940s and before that since the early 1920s.

As Jefferson put it, "The natural progress of things is for liberty to yield and government to gain ground."

We hold out hope for reversing the natural progress of things and putting the Federal gov't on a diet. This is not likely to happen soon.


On Mar 09 10:31 PM Aristophanes wrote:

> 1. It did under Clinton who balanced the budget and
> began paying down accumulated debt (60% of which came
> from Reagan).

Mar 11 09:22 AM