Obama’s Speech on the Economy

President Obama gave a speech today on the economy and the agenda of his Administration and Congress, thus far into his presidency. I personally watched the speech. I have yet to go back and read it. I thought it might generate some good discussion, in collective analysis of the text. In the spirit of Easter, please engage with criticisms of his positions, not of his person or broad generalizations that are not necessary or charitable.

It has now been twelve weeks since my administration began.  And I think even our critics would agree that at the very least, we’ve been busy.  In just under three months, we have responded to an extraordinary set of economic challenges with extraordinary action – action that has been unprecedented in both its scale and its speed.

I know that some have accused us of taking on too much at once.  Others believe we haven’t done enough.  And many Americans are simply wondering how all of our different programs and policies fit together in a single, overarching strategy that will move this economy from recession to recovery and ultimately to prosperity.

So today, I want to step back for a moment and explain our strategy as clearly as I can.  I want to talk about what we’ve done, why we’ve done it, and what we have left to do.  I want to update you on the progress we’ve made, and be honest about the pitfalls that may lie ahead.

And most of all, I want every American to know that each action we take and each policy we pursue is driven by a larger vision of America’s future – a future where sustained economic growth creates good jobs and rising incomes; a future where prosperity is fueled not by excessive debt, reckless speculation, and fleeing profit, but is instead built by skilled, productive workers; by sound investments that will spread opportunity at home and allow this nation to lead the world in the technologies, innovations, and discoveries that will shape the 21st century.  That is the America I see.  That is the future I know we can have.

To understand how we get there, we first need to understand how we got here.

Recessions are not uncommon.  Markets and economies naturally ebb and flow, as we have seen many times in our history.  But this recession is different.  This recession was not caused by a normal downturn in the business cycle.  It was caused by a perfect storm of irresponsibility and poor decision-making that stretched from Wall Street to Washington to Main Street.

As has been widely reported, it started in the housing market.  During the course of the decade, the formula for buying a house changed:  instead of saving their pennies to buy their dream house, many Americans found they could take out loans that by traditional standards their incomes just could not support.  Others were tricked into signing these subprime loans by lenders who were trying to make a quick profit.  And the reason these loans were so readily available was that Wall Street saw big profits to be made.  Investment banks would buy and package together these questionable mortgages into securities, arguing that by pooling the mortgages, the risks had been reduced.  And credit agencies that are supposed to help investors determine the soundness of various investments stamped the securities with their safest rating when they should have been labeled “Buyer Beware.”

No one really knew what the actual value of these securities were, but since the housing market was booming and prices were rising, banks and investors kept buying and selling them, always passing off the risk to someone else for a greater profit without having to take any of the responsibility.  Banks took on more debt than they could handle.  The government-chartered companies Fannie Mae and Freddie Mac, whose traditional mandate was to help support traditional mortgages, decided to get in on the action by buying and holding billions of dollars of these securities. AIG, the biggest insurer in the world, decided to make profits by selling billions of dollars of complicated financial instruments that supposedly insured these securities.  Everybody was making record profits – except the wealth created was real only on paper.  And as the bubble grew, there was almost no accountability or oversight from anyone in Washington.

Then the housing bubble burst.  Home prices fell.  People began defaulting on their subprime mortgages.  The value of all those loans and securities plummeted.  Banks and investors couldn’t find anyone to buy them.  Greed gave way to fear. Investors pulled their money out of the market.  Large financial institutions that didn’t have enough money on hand to pay off all their obligations collapsed.  Other banks held on tight to the money they did have and simply stopped lending.

This is when the crisis spread from Wall Street to Main Street. After all, the ability to get a loan is how you finance the purchase of everything from a home to a car to a college education.  It’s how stores stock their shelves, farms buy equipment, and businesses make payroll.  So when banks stopped lending money, businesses started laying off workers.  When laid off workers had less money to spend, businesses were forced to lay off even more workers.  When people couldn’t get car loans, a bad situation at the auto companies became even worse.  When people couldn’t get home loans, the crisis in the housing market only deepened.  Because the infected securities were being traded worldwide and other nations also had weak regulations, this recession soon became global. And when other nations can’t afford to buy our goods, it slows our economy even further.

This is the situation we confronted on the day we took office.  And so our most urgent task has been to clear away the wreckage, repair the immediate damage to the economy, and do everything we can to prevent a larger collapse.  And since the problems we face are all working off each other to feed a vicious economic downturn, we’ve had no choice but to attack all fronts of our economic crisis at once.

The first step was to fight a severe shortage of demand in the economy.  The Federal Reserve did this by dramatically lowering interest rates last year in order to boost investment.  And my administration and Congress boosted demand by passing the largest recovery plan in our nation’s history.  It’s a plan that is already in the process of saving or creating 3.5 million jobs over the next two years. It is putting money directly in people’s pockets with a tax cut for 95% of working families that is now showing up in paychecks across America. And to cushion the blow of this recession, we also provided extended unemployment benefits and continued health care coverage to Americans who have lost their jobs through no fault of their own.

Now, some have argued that this recovery plan is a case of irresponsible government spending; that it is somehow to blame for our long-term deficit projections, and that the federal government should be cutting instead of increasing spending right now.  So let me tackle this argument head on.

To begin with, economists on both the left and right agree that the last thing a government should do in the middle of a recession is to cut back on spending.  You see, when this recession began, many families sat around their kitchen table and tried to figure out where they could cut back.  So do many businesses.  That is a completely responsible and understandable reaction.  But if every family in America cuts back, then no one is spending any money, which means there are more layoffs, and the economy gets even worse.  That’s why the government has to step in and temporarily boost spending in order to stimulate demand.  And that’s exactly what we’re doing right now.

Second of all, I absolutely agree that our long-term deficit is a major problem that we have to fix.  But the fact is that this recovery plan represents only a tiny fraction of that long-term deficit. As I will discuss in a moment, the key to dealing with our deficit and debt is to get a handle on out-of-control health care costs – not to stand idly by as the economy goes into free fall.

So the recovery plan has been the first step in confronting this economic crisis.  The second step has been to heal our financial system so that credit is once again flowing to the businesses and families who rely on it.

The heart of this financial crisis is that too many banks and other financial institutions simply stopped lending money.  In a climate of fear, banks were unable to replace their losses by raising new capital on their own, and they were unwilling to lend the money they did have because they were afraid that no one would pay it back.  It is for this reason that the last administration used the Troubled Asset Relief Program, or TARP, to provide these banks with temporary financial assistance in order to get them lending again.

Now, I don’t agree with some of the ways the TARP program was managed, but I do agree with the broader rationale that we must provide banks with the capital and the confidence necessary to start lending again.  That is the purpose of the stress tests that will soon tell us how much additional capital will be needed to support lending at our largest banks.  Ideally, these needs will be met by private investors.  But where this is not possible, and banks require substantial additional resources from the government, we will hold accountable those responsible, force the necessary adjustments, provide the support to clean up their balance sheets, and assure the continuity of a strong, viable institution that can serve our people and our economy.

Of course, there are some who argue that the government should stand back and simply let these banks fail – especially since in many cases it was their bad decisions that helped create the crisis in the first place.  But whether we like it or not, history has repeatedly shown that when nations do not take early and aggressive action to get credit flowing again, they have crises that last years and years instead of months and months – years of low growth, low job creation, and low investment that cost those nations far more than a course of bold, upfront action.  And although there are a lot of Americans who understandably think that government money would be better spent going directly to families and businesses instead of banks – “where’s our bailout?,” they ask – the truth is that a dollar of capital in a bank can actually result in eight or ten dollars of loans to families and businesses, a multiplier effect that can ultimately lead to a faster pace of economic growth.

On the other hand, there have been some who don’t dispute that we need to shore up the banking system, but suggest that we have been too timid in how we go about it.  They say that the federal government should have already preemptively stepped in and taken over major financial institutions the way that the FDIC currently intervenes in smaller banks, and that our failure to do so is yet another example of Washington coddling Wall Street.  So let me be clear – the reason we have not taken this step has nothing to do with any ideological or political judgment we’ve made about government involvement in banks, and it’s certainly not because of any concern we have for the management and shareholders whose actions have helped cause this mess.

Rather, it is because we believe that preemptive government takeovers are likely to end up costing taxpayers even more in the end, and because it is more likely to undermine than to create confidence.  Governments should practice the same principle as doctors: first do no harm.  So rest assured – we will do whatever is necessary to get credit flowing again, but we will do so in ways that minimize risks to taxpayers and to the broader economy.  To that end, in addition to the program to provide capital to the banks, we have launched a plan that will pair government resources with private investment in order to clear away the old loans and securities – the so-called toxic assets – that are also preventing our banks from lending money.

Now, what we’ve also learned during this crisis is that our banks aren’t the only institutions affected by these toxic assets that are clogging the financial system.  A.I.G., for example, is not a bank.  And yet because it chose to insure trillions of dollars worth of risky assets, its failure could threaten the entire financial system and freeze lending even further.  This is why, as frustrating as it is – and I promise you, nobody is more frustrated than me – we’ve had to provide support for A.I.G.  It’s also why we need new legal authority so that we have the power to intervene in such financial institutions, just like a bankruptcy court does with businesses that hit hard times, so that we can restructure these businesses in an orderly way that does not induce panic – and can restructure inappropriate bonus contracts without creating a perception that government can just change compensation rules on a whim.

This is also why we’re moving aggressively to unfreeze markets and jumpstart lending outside the banking system, where more than half of all lending in America actually takes place.  To do this, we’ve started a program that will increase guarantees for small business loans and unlock the market for auto loans and student loans.  And to stabilize the housing market, we’ve launched a plan that will save up to four million responsible homeowners from foreclosure and help many millions more re-finance.

In a few weeks, we will also reassess the state of Chrysler and General Motors, two companies with an important place in our history and a large footprint in our economy – but two companies that have also fallen on hard times.

Late last year, the companies were given transitional loans by the previous administration to tide them over as they worked to develop viable business plans.  But the plans they developed fell short, and so we have given them some additional time to work these complex issues through.  We owed that, not to the executives whose bad bets contributed to the weakening of their companies, but to the hundreds of thousands of workers whose livelihoods hang in the balance.

It is our fervent hope that in the coming weeks, Chrysler will find a viable business partner and that GM will develop a business plan that will put it on a path to profitability without endless support from the American taxpayer.  In the meantime, we are taking steps to spur demand for American cars and provide relief to autoworkers and their communities.  And we will continue to reaffirm this nation’s commitment to a 21st century American auto industry that creates new jobs and builds the fuel-efficient cars and trucks that will carry us toward a clean energy future.

Finally, to coordinate a global response to this global recession, I went to the meeting of the G20 nations in London the other week.  Each nation has undertaken significant stimulus to spur demand.  All agreed to pursue tougher regulatory reforms.  We also agreed to triple the lending capacity of the International Monetary Fund, an international financial institution supported by all the major economies, and provide direct assistance to developing nations and vulnerable populations – because America’s success depends on whether other nations have the ability to buy what we sell.  We pledged to avoid the trade barriers and protectionism that hurts us all in the end.  And we decided to meet again in the fall to gauge our progress and take additional steps if necessary.

So all of these actions – the Recovery Act, the bank capitalization program, the housing plan, the strengthening of the non-bank credit market, the auto plan, and our work at the G20 – have been necessary pieces of the recovery puzzle.  They have been designed to increase aggregate demand, get credit flowing again to families and businesses, and help them ride out the storm.  And taken together, these actions are starting to generate signs of economic progress.  Because of our recovery plan, schools and police departments have cancelled planned layoffs. Clean energy companies and construction companies are re-hiring workers to build everything from energy efficient windows to new roads and highways. Our housing plan has helped lead to a spike in the number of homeowners who are taking advantage of historically-low mortgage rates by refinancing, which is like putting a $2,000 tax cut in your in pocket.  Our program to support the market for auto loans and student loans has started to unfreeze this market and securitize more of this lending in the last few weeks.  And small businesses are seeing a jump in loan activity for the first time in months.

This is all welcome and encouraging news, but it does not mean that hard times are over.  2009 will continue to be a difficult year for America’s economy.  The severity of this recession will cause more job loss, more foreclosures, and more pain before it ends.  The market will continue to rise and fall.  Credit is still not flowing nearly as easily as it should.  The process for restructuring AIG and the auto companies will involve difficult and sometimes unpopular choices.  All of this means that there is much more work to be done.  And all of this means that you can continue to expect an unrelenting, unyielding, day-by-day effort from this administration to fight for economic recovery on all fronts.

But even as we continue to clear away the wreckage and address the immediate crisis, it is my firm belief that our next task is to make sure such a crisis never happens again.  Even as we clean up balance sheets and get credit flowing; even as people start spending and business start hiring – we have to realize that we cannot go back to the bubble and bust economy that led us to this point.

It is simply not sustainable to have a 21st century financial system that is governed by 20th century rules and regulations that allowed the recklessness of a few to threaten the entire economy.  It is not sustainable to have an economy where in one year, 40% of our corporate profits came from a financial sector that was based too much on inflated home prices, maxed out credit cards, overleveraged banks and overvalued assets; or an economy where the incomes of the top 1% have skyrocketed while the typical working household has seen their income decline by nearly $2,000.

For even as too many were chasing ever-bigger bonuses and short-term profits over the last decade, we continued to neglect the long-term threats to our prosperity:  the crushing burden that the rising cost of health care is placing on families and businesses; the failure of our education system to prepare our workers for a new age; the progress that other nations are making on clean energy industries and technologies while we remain addicted to foreign oil; the growing debt that we’re passing on to our children.  And even after we emerge from the current recession, these challenges will still represent major obstacles that stand in the way of our success in the 21st century.

There is a parable at the end of the Sermon on the Mount that tells the story of two men.  The first built his house on a pile of sand, and it was destroyed as soon as the storm hit.  But the second is known as the wise man, for when “…the rain descended, and the floods came, and the winds blew, and beat upon that house…it fell not:  for it was founded upon a rock.”

We cannot rebuild this economy on the same pile of sand.  We must build our house upon a rock.  We must lay a new foundation for growth and prosperity – a foundation that will move us from an era of borrow and spend to one where we save and invest; where we consume less at home and send more exports abroad.

It’s a foundation built upon five pillars that will grow our economy and make this new century another American century:  new rules for Wall Street that will reward drive and innovation; new investments in education that will make our workforce more skilled and competitive; new investments in renewable energy and technology that will create new jobs and industries; new investments in health care that will cut costs for families and businesses; and new savings in our federal budget that will bring down the debt for future generations.  That is the new foundation we must build.  That must be our future – and my Administration’s policies are designed to achieve that future.
The first step we will take to build this foundation is to reform the outdated rules and regulations that allowed this crisis to happen in the first place.  It is time to lay down tough new rules of the road for Wall Street to ensure that we never find ourselves here again. Rules that punish short-cuts and abuse.  Rules that tie someone’s pay to their actual job performance.  Rules that protect typical American families when they buy a home, get a credit card or invest in a 401k.  We have already begun to work with Congress to shape this new regulatory framework – and I expect a bill to arrive on my desk for signature before the year is out.

The second pillar of this new foundation is an education system that finally prepares our workers for a 21st century economy.  In the 20th century, the GI Bill sent a generation to college, and for decades, we led the world in education and economic growth.  But in this new economy, we trail the world’s leaders in graduation rates and achievement.  That is why we have set a goal that will greatly enhance our ability to compete for the high-wage, high-tech jobs of the 21st century:  by 2020, America will once more have the highest proportion of college graduates in the world.

To meet that goal, we have already dramatically expanded early childhood education.  We are investing in innovative programs that have proven to help schools meet high standards and close achievement gaps.  We are creating new rewards tied to teacher performance and new pathways for advancement.  I have asked every American to commit to at least one year or more of higher education or career training, and we have provided tax credits to make a college education more affordable for every American.

The third pillar of this new foundation is to harness the renewable energy that can create millions of new jobs and new industries.  We all know that the country that harnesses this energy will lead the 21st century.  Yet we have allowed other countries to outpace us on this race to the future.

Well, I do not accept a future where the jobs and industries of tomorrow take root beyond our borders.  It is time for America to lead again.

The investments we made in the Recovery Act will double this nation’s supply of renewable energy in the next three years.  And we are putting Americans to work making our homes and buildings more efficient so that we can save billions on our energy bills and grow our economy at the same time.

But the only way to truly spark this transformation is through a gradual, market-based cap on carbon pollution, so that clean energy is the profitable kind of energy.  Some have argued that we shouldn’t attempt such a transition until the economy recovers, and they are right that we have to take the costs of transition into account.  But we can no longer delay putting a framework for a clean energy economy in place.  If businesses and entrepreneurs know today that we are closing this carbon pollution loophole, they will start investing in clean energy now.  And pretty soon, we’ll see more companies constructing solar panels, and workers building wind turbines, and car companies manufacturing fuel-efficient cars.  Investors will put some money into a new energy technology, and a small business will open to start selling it. That’s how we can grow this economy, enhance our security, and protect our planet at the same time.

The fourth pillar of the new foundation is a 21st century health care system where families, businesses, and government budgets aren’t dragged down by skyrocketing insurance premiums.

One and a half million Americans could lose their homes this year just because of a medical crisis.  Major American corporations are struggling to compete with their foreign counterparts, and small businesses are closing their doors.  We cannot allow the cost of health care to strangle our economy any longer.

That’s why our Recovery Act will invest in electronic health records with strict privacy standards that will save money and lives.  We’ve also made the largest investment ever in preventive care, because that is one of the best ways to keep costs under control. And included in the budgets that just passed Congress is an historic commitment to reform that will finally make quality health care affordable for every American.  So I look forward to working with both parties in Congress to make this reform a reality in the coming months.

Fixing our health care system will certainly require resources, but in my budget, we’ve made a commitment to fully pay for reform without increasing the deficit, and we’ve identified specific savings that will make the health care system more efficient and reduce costs for us all.

In fact, we have undertaken an unprecedented effort to find this kind of savings in every corner of the budget, because the final pillar in building our new foundation is restoring fiscal discipline once this economy recovers.  Already, we have identified two trillion dollars in deficit-reductions over the next decade.  We have announced procurement reform that will greatly reduce no-bid contracts and save the government $40 billion.  Secretary Gates recently announced a courageous set of reforms that go right at the hundreds of billions of dollars in waste and cost overruns that have bloated our defense budget without making America safer.  We will end education programs that don’t work, and root out waste, fraud, and abuse in our Medicare program.

Altogether, this budget will reduce discretionary spending for domestic programs as share of the economy by more than 10% over the next decade to the lowest level since we began keeping records nearly half a century ago.  And as we continue to go through the federal budget line by line, we will be announcing additional savings, secured by eliminating and consolidating programs we don’t need so that we can make room for the things we do need.

Now, I realize that for some, this isn’t enough.  I know there is a criticism out there that my administration has somehow been spending with reckless abandon, pushing a liberal social agenda while mortgaging our children’s future.

Well let me make three points.

First, as I said earlier, the worst thing that we could do in a recession this severe is to try to cut government spending at the same time as families and businesses around the world are cutting back on their spending.  So as serious as our deficit and debt problems are – and they are very serious – major efforts to deal with them have to focus on the medium and long-term budget picture.

Second, in tackling the deficit issue, we simply cannot sacrifice the long-term investments that we so desperately need to generate long-term prosperity.  Just as a cash-strapped family may cut back on luxuries but will insist on spending money to get their children through college, so we as a country have to make current choices with an eye on the future.  If we don’t invest now in renewable energy or a skilled workforce or a more affordable health care system, this economy simply won’t grow at the pace it needs to in two or five or ten years down the road.  If we don’t lay this new foundation, it won’t be long before we are right back where we are today.  And I can assure you that chronically slow growth will not help our long-term budget situation.

Third, the problem with our deficit and debt is not new.  It has been building dramatically over the past eight years, largely because big tax cuts combined with increased spending on two wars and the increased costs of government health care programs.  This structural gap in our budget, between the amount of money coming in and the amount going out, will only get worse as Baby Boomers age, and will in fact lead us down an unsustainable path.   But let’s not kid ourselves and suggest that we can do it by trimming a few earmarks or cutting the budget for the National Endowment for the Arts.  Along with defense and interest on the national debt, the biggest costs in our budget are entitlement programs like Medicare, Medicaid, and Social Security that get more and more expensive every year.  So if we want to get serious about fiscal discipline – and I do – then we are going to not only have to trim waste out of our discretionary budget, a process we have already begun – but we will also have to get serious about entitlement reform.

Nothing will be more important to this goal than passing health care reform that brings down costs across the system, including in Medicare and Medicaid.  Make no mistake: health care reform is entitlement reform.  That’s not just my opinion – that was the conclusion of a wide range of participants at the Fiscal Responsibility Summit we held at the White House in February, and that’s one of the reasons why I firmly believe we need to get health care reform done this year.

Once we tackle rising health care costs, we must also work to put Social Security on firmer footing.  It is time for both parties to come together and find a way to keep the promise of a sound retirement for future generations.  And we should restore a sense of fairness and balance to our tax code by shutting down corporate loopholes and ensuring that everyone pays what they owe.

All of these efforts will require tough choices and compromises.  But the difficulties can’t serve as an excuse for inaction.  Not anymore.

This brings up one final point I’d like to make today.  I’ve talked a lot about the fundamental weakness in our economy that led us to this day of reckoning.  But we also arrived here because of a fundamental weakness in our political system.

For too long, too many in Washington put off hard decisions for some other time on some other day.  There’s been a tendency to score political points instead of rolling up sleeves to solve real problems. There is also an impatience that characterizes this town – an attention span that has only grown shorter with the twenty-four hour news cycle, and insists on instant gratification in the form of immediate results or higher poll numbers.  When a crisis hits, there’s all too often a lurch from shock to trance, with everyone responding to the tempest of the moment until the furor has died away and the media coverage has moved on, instead of confronting the major challenges that will shape our future in a sustained and focused way.

This can’t be one of those times.  The challenges are too great.  The stakes are too high.  I know how difficult it is for Members of Congress in both parties to grapple with some of the big decisions we face right now.  It’s more than most congresses and most presidents have to deal with in a lifetime.

But we have been called to govern in extraordinary times.  And that requires an extraordinary sense of responsibility – to ourselves, to the men and women who sent us here, and to the many generations whose lives will be affected for good or for ill because of what we do here.

There is no doubt that times are still tough. By no means are we out of the woods just yet.  But from where we stand, for the very first time, we are beginning to see glimmers of hope.  And beyond that, way off in the distance, we can see a vision of an America’s future that is far different than our troubled economic past.  It’s an America teeming with new industry and commerce; humming with new energy and discoveries that light the world once more.  A place where anyone from anywhere with a good idea or the will to work can live the dream they’ve heard so much about.

It is that house upon the rock.  Proud, sturdy, and unwavering in the face of the greatest storm.  We will not finish it in one year or even many, but if we use this moment to lay that new foundation; if we come together and begin the hard work of rebuilding; if we persist and persevere against the disappointments and setbacks that will surely lie ahead, then I have no doubt that this house will stand and the dream of our founders will live on in our time.  Thank you, God Bless you, and may God Bless the United States of America.

Thoughts? Criticisms?

33 Responses to Obama’s Speech on the Economy

  1. Joe Hargrave says:

    I think it was a fine speech that accurately explained the origins and potential solutions to the long-term problems we face. I am 100% on board with clean energy solutions and health care reform. I particularly agreed with this:

    “There is also an impatience that characterizes this town – an attention span that has only grown shorter with the twenty-four hour news cycle, and insists on instant gratification in the form of immediate results or higher poll numbers. When a crisis hits, there’s all too often a lurch from shock to trance, with everyone responding to the tempest of the moment until the furor has died away and the media coverage has moved on…”

    His abhorrent, frightening views on abortion and life-issues don’t diminish the truth of statements such as these.

  2. Donald R. McClarey says:

    We are spending ourselves into a hole that it will take generations to dig out of, assuming that much of the debt won’t utlimately be repudiated by the government. This nonsense began under Bush with the Bailout Swindle of 2008 and it continued with the Bankrupt the Nation Act of 2009. We do not have a fiscal policy, we have fiscal madness. Future generations will look at this time period, shake their heads and wonder what we were thinking. The problem is that we are not thinking at all. We have taken a standard financial panic and transformed it, with massive government spending unprecedented in our history, into a first class financial disaster.

  3. On the positive side, doing a lengthy address in which he attempts to explain the full scope of what is going on (as he sees it) and what he’s doing to deal with the issue is just the sort of thing I would like to see major politicians have the respect for their constituents to do more often.

    And much of what he says about how we got where were are is, in the main, correct. Though he slips in a few rather self-serving digs at the previous administration which are more political finger pointing than honest economics.

    And I’m impressed that he had the gumption to explain why the financial industry seemed like a much more reasonable bailout candidate than other industries. (Though I’m at this point wondering if I was wrong to support the bailout.)

    However, I think his major Keynsian argument here is not very good, and in a sense the attempt to explain it simply highlights why it isn’t very good — and he only gets by that with lots of hand waving.

    It’s true that you don’t want to indiscriminately cut spending during a downturn, however rather than focusing on getting money _to_ people and paying for greater safety net services for those out of work, the “stimulus” bill that was passed layered on a lot of Democratic wish list spending that in many cases still won’t happen for more than a year. Making those commitments now helps no one except politicians and interest groups, and arguably could tie his hands when it comes to providing for more real help now.

    The thing that really yawned open for me on that section, however, was the standard question about how well Keynsian stimulus can really jump start the economy: If people know that this is short term government spending funded by long term borrowing and that this level of spending won’t continue, will it really re-start the economic cycle, or will people take the money and stash it away because they expect things to tighten up again shortly. Basically, the stimulus only works if people imagine that this is a long term spending program they can rely on, and they go back to their free spending ways. In the real world, no one is being fooled. So I’m not really sure how well that will work.

    On health care and alternative energy — I’m more skeptical of course. I doubt very much that the sort of plans popular with Obama would actually save much of any money, though they might cover more people which would be good in another way. And the alternative energy push and carbon credits will actually cost a good deal more in the short run and will slow down the economy in the way that the sudden spike in oil prices last summer did.

  4. Matt McDonald says:


    you repeatedly deny an affection for socialism, but it seems there is rarely a socialist policy you don’t embrace, what happened to distributism?

    Just curious.

  5. Eric Brown says:


    I hope I’m not infringing here. But, I would like to attempt to clarify something, if I may.

    I’m not sure what your working definition of “socialism” is. Therefore, I can only presume.

    Now, I agree with Joe’s response here. I wouldn’t call myself a socialist. I’m confused as to what in the statement constitutes the claim.

    In regard to the speech, I agree with Joe (and Darwin) that the description of the economic downturn and how it occured is, more or less, accurate.

    It seems to me, Joe is giving the Obama Administration credit in saying that they may have “potential” solutions. In some sense, one might believe that the overall direction might be right, but this doesn’t necessarily entail that one agrees to the minutest detail with whatever piece of legislation comes out of the chambers of Congress.

    For example, I think President Obama is absolutely correct that because the economy is in recession families spend less, which leads to layoffs, which leads to less spending, and its a spiraling cycle. I think it is reasonable to suggest that there is a role for the government in the matter, at the very least, a limited and temporary role.

    Now whether that means we have to tackle every issue all at once and increase federal spending that is another matter.

    Now, if supporting clean energy is socialist; I suppose I’m a socialist too. If supporting reforming the health care system is socialist, then I’m a socialist too. After taking a course studying environmental issues, I think the political dichotomy of environment or economy is a false one. I’m not going to say you are saying there is a dichotomy because I am not sure entirely what you meant. Support for clean energy surely isn’t a license for either side to do whatever it pleases; I’m just saying I am not opposed to clean energy — in the literal sense of the word, this has no implication of what we start calling “clean energy” and how we go about it.

    In the same way, I think there is valid reason to support reforming the health care system. The current system is broken. Right now, insurance companies profit most by not covering people. Once premiums are collected, the less money spent, the more money made. I don’t for one think that pregnancy constitutes as a “sickness” and a “pre-existing condition” — this is the reflection of a society that doesn’t value children. In the same way, a large volume of people not covered only creates a bigger problem — when they do go to the emergency rooms, the costs are spread amongst everyone else and for high-cost health care. In the same way, hospitals and doctors are on a pay-for-service structure, therefore, a direct incentive is not toward the quality of the care, but rather the volume — whether it be unnecessary tests, surgeries, medications, or whatever. The volume reaps the cost and not the volume. Now, I’m saying that you *must* support a universal health care system — that isn’t a moral requirement. I’m saying reasonable people can arrive at that conclusion and not be socialists. The health care infrastructure of many parts of Canada and the U.K. where the government not only provides federal funding of health care, but actually owns and runs the hospital via administration is none of the proposals here. There is a fundamental difference between such a system and that of France, or Germany, or Japan. You might have a problem with those systems as well. But I’m just pointing out that those “systems” have fundamental differences and work in different ways, which includes public-private partnerships — predominantly the private sector.

    So, again, I’m not sure what constitutes being a “socialist”…which is to say, now I’m curious.

  6. Eric Brown says:

    This comment is just general (so it is that — a general comment). I think that past conflicts with statist planned economies, i.e. communism led to a greater emphasis on free-markets. Perhaps, rightly so. However, I think this has created a tendency to view government intervention as an evil in itself. And this has created an individualism where everything in terms of economics is a matter of personal choice and any sort of taxation or government involvement is an infringement on an absolute right to economic autonomy or is a form of theft. It presupposes no collective obligation, or collective goods that are best viewed in that light. Thus, anything contrary is dismissed as “socialism” and I’m not sure if that’s fair or always accurate.

  7. Joe Hargrave says:


    It seems there is rarely a comment I can make without expecting some sort of veiled accusation from you.

    I don’t know what you think “socialism” is. If it means any government involvement whatsoever with the direction of the economy, then the Catholic Church’s teachings on the State and the economy are socialist.

    I have no ideological objection to government leadership on a critical issue such as clean energy or health care, provided that the principle of subsidiarity is respected. National health insurance does not violate this principle, because there are a lot of complicated medical procedures that are way out of the price range of the majority of Americans and way beyond the capacity of the local doctor’s office to supply. Providing incentives for green energy doesn’t violate it either.

    I have yet to see Obama or anyone else in the administration argue that the government should completely take over either health care or energy, that people should not be able to choose their doctors or be forced to buy a hybrid car.

    At best there are those whose entire political perspective revolves around the inevitability of slippery slopes and conspiracy theories.

    The question “are you a socialist” to someone who happens to think Obama’s economic plans sound rational and reasonable is no different than the question “are you a fascist” to someone who thought the same of Bush. The right has rapidly become what the left was during the eight years of Bush, a mirror image in terms of shrillness and invective, rash judgment and animus. It would be amusing if it weren’t so miserable.

    When I was indeed active on the left I couldn’t dare breath a word about my pro-life convictions for fear of reprisal. Is this how it will be for me among conservative Catholics with respect to Obama’s economic policies? Will the insults “reactionary”, “counterrevolutionary”, “anti-woman” and “proto-fascist” be replaced with “instrument of Satan”, “communist lackey”, “enemy of freedom”, and, heaven forbid, “socialist”?

    I sincerely hope not.

  8. John Henry says:

    Is this how it will be for me among conservative Catholics with respect to Obama’s economic policies? Will the insults “reactionary”, “counterrevolutionary”, “anti-woman” and “proto-fascist” be replaced with “instrument of Satan”, “communist lackey”, “enemy of freedom”, and, heaven forbid, “socialist”?

    Yes, there will always be over-aggressive partisans, no matter what political position you take. That’s the nature of the internet. Witness Michael I’s bizarre attacks on the Knights of Columbus as another example. The question is how many such accusations are worth responding to. I am not criticizing you; just suggesting for your consideration that not all interlocutors are good candidates for dialogue.

  9. Matt says:

    John Henry,

    read MY post not just Joe’s paranoid response. I did not do what he accuses me of doing, and it’s shameful for you to pile on based on a falsehood. Buzz off.

    Matt said:
    you repeatedly deny an affection for socialism, but it seems there is rarely a socialist policy you don’t embrace, what happened to distributism?

    Eric said:
    wouldn’t call myself a socialist.

    Nor did I make the accusation against Joe or you, or Obama, or the Queen of Sheba. I merely made the observation of an affection for Socialist policies. If I have failed to make a similiar observation on your comments it’s perhaps because you seem more moderate and praising socialist policies doesn’t seem to be your main focus.

    giving the Obama Administration credit in saying that they may have “potential” solutions.

    giving credit for claiming to have “potential” solutions seems to be giving praise for, well, nothing accomplished. Furthermore, the “potential” solutions have been proven in the past to be devastating and destructive to the very people they’re meant to assist (read the Great Depression).

    Obama’s “spendulus” bill is not what is generally thought of as stimulus by “Keynesian” economists (who I disagree with anyway). Obama’s packagage is a massive increase in spending in the public sector (which already enjoys a very low unemployment rate). This will ultimately and permanently lead to a large transfer of money from the private economy to the public sector. That is socialist.

    Don’t even start with me on government ownership of banks, insurance companies and auto makers! That is SOCIALIST.

    Now, if supporting clean energy is socialist; I suppose I’m a socialist too.

    I support clean energy too:
    – Natural Gas is far cleaner than coal or fuel oil. I support the building of terminals to increase imports, Obama’s administration opposes this.
    – Hydroelectric power is proven, infinitely renewable, inexpensive, and incredibly clean. I support this, I don’t believe Obama does, he certainly doesn’t endorse it.
    – Nuclear energy is the cleanest viable energy source which would be sufficient to eliminate all of the “dirty” forms… Obama opposes it’s use

    What IS Obama’s energy policy… It is to tax all who benefit from processes which release Carbon Dioxide into the atmosphere. A little science here. CO2 is NOT pollution, it is PLANT FOOD, it is expelled by all animals. This tax will impact all consumers of electricity, all consumers of plastics, and chemials. Consumers, yes, that means YOU. Obama will take this money and spend it on energy technologies that are unproven and unlikely to EVER fulfil the energy needs of the United States. He is taking money from the private economy, and placing it in the public sector on a large scale, that IS socialist.

    Listen, we are all conservationists and believe that we must be good stewards of the land, seas and air, but these “earth worshipping” approaches are simply an end run to government control of daily life. That is socialist.

    If supporting reforming the health care system is socialist, then I’m a socialist too.

    Supporting reform of health care is not necessarily the same as nationalizing it to a single-payer (GOVERNMENT) system. I am for reform, let’s start with the easiest – tort reform…oops, can’t do that, the trial lawyers might starve to death, and we all know they have a powerful lobby with Obama and the Democrat party. How about taking the power of health care choices from big business and putting it in the hands of the consumer? No way! Can’t do that, let’s just make the government look after it, we know how EFFICIENT the government is.

    Nationalizing health care is SOCIALIST.

  10. Matt says:

    ps. I wouldn’t call George Bush a socialist, but I do believe he did furthered socialist policies on occasion.

    So that we’re on the same page, are we all comfortable with this definition of socialism and it’s policies:
    Socialism refers to a broad set of economic theories of social organization advocating public or state ownership and administration of the means of production and distribution of goods, and a society characterized by equality for all individuals, with a fair or egalitarian method of compensation.

  11. John Henry says:

    read MY post not just Joe’s paranoid response. I did not do what he accuses me of doing, and it’s shameful for you to pile on based on a falsehood. Buzz off.

    Matt, I will take your suggestion. But first let me clarify that I didn’t say you used all of those insults, just that they will inevitably appear on the internet. Do I think you’re too aggressive sometimes? Yes. Do I think you are excessively partisan sometimes? Yes. But I did not accuse you of anything other than that. And let me say that many people can be accused of the same thing in varying degrees, myself included.

  12. Donald R. McClarey says:

    Matt, I usually agree with your comments, as I do with the substance of your comments in this thread, but you do not strengthen your arguments with phrases such as “paranoid response” or by telling John Henry to “buzz off”. This isn’t one of my threads so I’ll leave it at that.

  13. Matt says:

    John Henry,

    Matt, I will take your suggestion. But first let me clarify that I didn’t say you used all of those insults, just that they will inevitably appear on the internet.

    You were referring to Joe’s response to ME, so I can only conclude that you’re talking about me and equating my post with such insults.

    Do I think you’re too aggressive sometimes? Yes.


    Do I think you are excessively partisan sometimes? Yes.

    I don’t think that’s fair if you’re referring to “Republican” vs. “Democrat”. I think the Republicans have serious problems and have made deep errors in tax and spend which led to their defeat in 2006, I just think they are the best vehicle for good and moral policy.

  14. Matt says:


    noted, but there was no call for JH to lump me in with such as Michael I, or make such personal attacks on me:

    over-aggressive partisans

    not all interlocutors are good candidates for dialogue

  15. Donald R. McClarey says:

    As always Matt civility from all sides is the remedy for overheated combox dialogues.

  16. Joe Hargrave says:


    I find it interesting that you’ve spent all of this time arguing about me, to others, when you could have simply answered my question.

    Will I have to suffer the label “socialist” from people such as yourself if I agree with aspects of Obama’s economic policies? It’s a simple question, and if the answer is no, then we can move on.

  17. Matt McDonald says:


    I find it interesting that you’ve spent all of this time arguing about me, to others, when you could have simply answered my question.

    Will I have to suffer the label “socialist” from people such as yourself if I agree with aspects of Obama’s economic policies? It’s a simple question, and if the answer is no, then we can move on.

    Of course not. Firstly I did not affix such a label to you as a person, I affixed such a label to specific policies of the Obama administration. If you want to associate yourself with socialist policies that is your business, I will continue to NOT affix such a label to you personally.

    By the way, to support even some of Obama’s policies (and certainly the ones you advocate above) at the same time claiming to respect subsidiarity seems to be a contradiction, since apparently ALL of Obama’s policies entail moving control to the Federal government which properly belongs to the individual, family, community and local government.

  18. e. says:

    It’s either a defect in one’s fundamental understanding of things or even in the cognitive capacity of the person himself if such person does not happen to regard Obama’s economic policies as being something other than what it actually is: socialist.

    Moreover, much of the policies hitherto enacted may very well result in greater harm to the economy as it will to many of the prominent businesses across the United States to the very detriment of the average American person and, in turn, to the typical American household.

    Really, do we actually want the federal government to command entire boards of companies, replacing executives at will, as well as even go so far as to control and even dictate the business strategy of entire corporations with respect to such matters that may in fact entail (and even require) a certain degree of risk-taking (as is usually the case in any ongoing concern of any variously sized enterprise with respect to current and even future prosperity)?

    Also, to actually think that an army of banks controlled by the central government is a good thing is either foolish or naive.

    I may not avidly subscribe to the Austrian school of economics & the rather idealistic notion of a completely free market; however, any sensible individual could see the kind of harm that policies such as these will do more to hurt rather than actually heal the economy, which very dire consequences will unfortunately happen perhaps only too late before we ultimately realize its very error.

  19. Joe Hargrave says:


    All I accused you of was a veiled accusation. Was it unreasonable for me to assume that since you think I haven’t met a “socialist” policy I didn’t like, that I might actually be one?

    That said, I’m glad you won’t pin the label on me, because I’m not a socialist, though I once was. I dropped the label when I read Quadragesimo Anno, where Pius XI says that a) there are some socialist ideas that are actually correct, but b) insofar as they resemble Christian ideas, one does not need to become a “socialist” to embrace them. It’s good advice. The things I really wanted as a socialist, I could have as a Christian. For the details, I can’t recommend that encyclical enough.

    On subsidiarity, I disagree that “all” of Obama’s policies violate the rule, because what is “proper” also has to take into account what is possible. We aren’t supposed to suffer for the sake of subsidiarity; if government can do something more easily and efficiently than the private sector, then wouldn’t it “properly” belong to it?

    Health care and the environment are faced with serious problems that the intervention of the federal government can help alleviate. Before concluding that Obama is usurping a role properly reserved to local institutions, I would like to know – what is it that he proposes to do that should be left at the local level?

    Will more people benefit from it, or fewer?

    Are we being asked to reject government involvement on the grounds that it is good to suffer for some abstract ideal such as free markets, or is there good reason to believe that government intervention will actually make things worse?

    The principle of subsidiarity premises a society whose foundations are actually conducive to local solutions. It can’t be looked at in isolation. We don’t have the Industries and Professions organizations spoken of by Pius, we don’t have widespread worker ownership and community involvement as spoken of by other Pontiffs. There is a lot of infrastructure that is needed for an effective subsidiarity that is not in place.

    I believe that our role as laymen can be to build such local structures. Only through doing so can we make an effective argument against government intervention, by being able to say, “see, we can handle this ourselves”. But it is evident that we aren’t there yet, that the ideological divide in this country is not between self-sufficient communities and an overbearing state, but rather atomized individuals, many of whom are adrift in the global economy, and see no other hope but government.

    In short, it is we who are responsible at the local level for making government less relevant. But an individualist ideology will never achieve it. Individualism will always be the fuel of statism, broken individuals will always be easier to control and seduce than confident communities.

  20. Joe Hargrave says:


    “It’s either a defect in one’s fundamental understanding of things or even in the cognitive capacity of the person himself if such person does not happen to regard Obama’s economic policies as being something other than what it actually is: socialist.”

    In other words, anyone who doesn’t share your precise definition of socialism, even your exact vision of the world today, is an idiot.

    Brilliant argument.

  21. e. says:

    “In other words, anyone who doesn’t share your precise definition of socialism, even your exact vision of the world today, is an idiot.”

    1. How do you define ‘socialism’? By the way, you didn’t happen to be one of those blokes who actually attended those America First rallies in Princeton back in the days?

    At any rate, if you so prefer, perhaps the policies aren’t so socialist as they are so incredibly ‘socialist-leaning’!

    2. Concerning the latter, it’s a remarkable talent that you have there of persistently forcing words into my mouth. Yet, I do happen to regard your argumentum ad hominem an equally brilliant form of argumentation that no doubt many would find compellingly logical as it is persuasive.

  22. Joe Hargrave says:

    Words in your mouth?

    This is what came out of your mouth:

    “It’s either a defect in one’s fundamental understanding of things or even in the cognitive capacity of the person himself”

    Cognitive capacity. Another way of saying “intelligence”.

    Defect. Another way of saying, lacking something necessary.

    Idiot. Generally, someone who lacks intelligence.

    IF someone doesn’t agree that Obama’s policies are “socialist”, THEN they lack the necessary intelligence to see it. They’re an idiot.

    That really wasn’t so hard, but since you’re the master of logic here, I’ll let you decide, for yourself, if I’ve violated any of the dozens of formal rules of logic that people like to constantly invoke to show everyone what great debaters they are.

  23. Joe Hargrave says:

    As for how to define “socialism” –

    It’s nearly impossible. I guarantee you that any definition you come up with will vehemently contested by many self-identified socialists.

    I think the most accurate label for Obama is neo-Keyensian Social Democrat.

    Many socialists reject “Social Democracy” as a form of watered-down capitalism. Social Democrats sometimes call themselves socialists, sometimes partisans of a “third way” between the two.

    Capitalism is similarly hard to define. So we shouldn’t heap labels on people and then judge them according to those labels. I’m not totally against labeling but it can often lead to a great distortion of what a person actually believes.

  24. e. says:

    1. The following were not my words but yours:

    “In other words, anyone who doesn’t share your precise definition of socialism, even your exact vision of the world today, is an idiot.”

    Your interpretation of what I actually said is either a mistakened interpretation of what I did say or a deliberate attempt at making my comments appear sinister.

    2. Your latest comments all the more substantiates my above impression of not only your previous comments but your own character as well.

    To say that somebody has a defect in their understanding or even in cognitive capacity does not make one an “idiot”. Though it appears that you yourself would actually label such individuals with such a notoriously perjorative label.

  25. Joe Hargrave says:

    Right – you were extending your compassion and sympathy to those who disagree with you by suggesting they have mental defects. I’m the bad guy here.

    Begging your pardon, Saint E.

  26. e. says:

    A brilliant muslim scientist who I had the grand opportunity to work for — he believed Christians worshipped 3 gods. I consider that a “defect in one’s fundamental understanding” of the Trinity.

    Would I actually go on to call this person who had been inventor of several impressive chemical engineering designs an idiot as it seems you would? No.

    A fellow student in a fundamental chemistry course can hardly envision molecules in space but things about them in 2-dimension. Yet, the same person has been a well-noted author of several works in the field of literature. Would such a one actually be considered an idiot as well? Not by any means, but apparantly you would.

    So, it seems that unless somebody concurs with your interpretation of matters with respect to ‘Obamanomics’ and even insofar as their own comments are concerned, unless it is your interpretation that figures prominently, the opposition is both idiot as well as villain.

    So much for the matter of ‘projection’, no?

  27. Joe Hargrave says:

    Are you still trying to seriously argue that you meant anything other than to belittle and insult the intelligence of those who disagree with you?

    Is your ego really that colossal that you can’t just admit that what you did was out of line?

    If you intention was to write a treatise on problems of perception in otherwise intelligent persons, you could have made that clear from the get go.

    Do these poorly constructed charades dupe everyone you meet, or only the cognitively deficient?

  28. Joe Hargrave says:

    And I suppose you were paying homage to the hidden brilliance of all those otherwise misinformed souls when you also wrote,

    “Also, to actually think that an army of banks controlled by the central government is a good thing is either foolish or naive.”

    No, you’re right, I was a fool for thinking anything other than that your intentions were coated with sugar and honey. Next we’ll hear from you about how “foolish” is really a compliment, and “naive” has nothing to do with how realistic a person’s views are. I can’t wait.

    Unfortunately, I’m driving out of state now so I won’t be able to follow up this spectacle until much later this evening.

  29. JohnH says:

    Wow. Can I take a class in faux outrage from e.?

    Because it’s quite impressive, and he builds to a nice crescendo. Start by insulting someone, then insist that he insulted YOU by taking offense, and follow it up by insisting that he has, by proxy, insulted countless others.


  30. Matt says:

    Was it unreasonable for me to assume that since you think I haven’t met a “socialist” policy I didn’t like, that I might actually be one?

    not unreasonable at all. But I did not say it, you did. As you later mention, socialists consider Obama a “neo-keynesian social democrat”, whatever that is it certainly must entail a lot of socialist policies.

    I dropped the label when I read Quadragesimo Anno, where Pius XI says that a) there are some socialist ideas that are actually correct, but b) insofar as they resemble Christian ideas, one does not need to become a “socialist” to embrace them. It’s good advice. The things I really wanted as a socialist, I could have as a Christian.

    hmmm… I may be reading this wrong, but are you saying you dropped the label without reforming your ideas, and decided that the ideas are “christian” as well as socialist?

    For the details, I can’t recommend that encyclical enough.

    Since you mention it:

    2 …against the tenets of Socialism…He sought no help from either Liberalism or Socialism, for the one had proved that it was utterly unable to solve the social problem aright, and the other, proposing a remedy far worse than the evil itself, would have plunged human society into great dangers….

    15 …passing judgment on Socialism…

    111 …a position fundamentally contrary to Christian truth that was characteristic of Socialism…

    113 …One might say that, terrified by its own principles and by the conclusions drawn therefrom by Communism, Socialism inclines toward and in a certain measure approaches the truths which Christian tradition has always held sacred; for it cannot be denied that its demands at times come very near those that Christian reformers of society justly insist upon.

    115. Such just demands and desire have nothing in them now which is inconsistent with Christian truth, and much less are they special to Socialism. Those who work solely toward such ends have, therefore, no reason to become socialists.

    116. Yet let no one think that all the socialist groups or factions that are not communist have, without exception, recovered their senses to this extent either in fact or in name. For the most part they do not reject the class struggle or the abolition of ownership, but only in some degree modify them. Now if these false principles are modified and to some extent erased from the program, the question arises, or rather is raised without warrant by some, whether the principles of Christian truth cannot perhaps be also modified to some degree and be tempered so as to meet Socialism half-way and, as it were, by a middle course, come to agreement with it. There are some allured by the foolish hope that socialists in this way will be drawn to us. A vain hope! Those who want to be apostles among socialists ought to profess Christian truth whole and entire, openly and sincerely, and not connive at error in any way. If they truly wish to be heralds of the Gospel, let them above all strive to show to socialists that socialist claims, so far as they are just, are far more strongly supported by the principles of Christian faith and much more effectively promoted through the power of Christian charity.

    117 …We, in keeping with Our fatherly solicitude, may answer their petitions, We make this pronouncement: Whether considered as a doctrine, or an historical fact, or a movement, Socialism, if it remains truly Socialism, even after it has yielded to truth and justice on the points which we have mentioned, cannot be reconciled with the teachings of the Catholic Church because its concept of society itself is utterly foreign to Christian truth.

    Regarding subsidiarity. By your definition, anything which can in some instances be done better by the higher order may be usurped universally is deeply flawed and an almost complete reversal of this principle. It is not simply a pragmatic consideration, it is a principle which reflects the dignity of humanity, that his rights to fulfil his own obligations are respected.

    If I have a failure in discipline of my child can the state, in your opinion simply take over the raising of all of my current and future children? Worse yet, can they take my neighbors? Negative. Subsidiarity must still apply except where it is not possible for the obligations to be met at the level proper to them, and should only be acted upon in instances where this is true, never universally.

    I won’t at this point but surely could demonstrate that in PRACTICE your belief of government “efficiency” are quite false… those time tested words of Ronald Reagan (perhaps quoted from another): “the most frightening words in the English language – we’re from the government and we’re here to help you”.

  31. Matt says:


    honestly, I respect you a lot because of your passion in fighting for the right side, I do think that JH might have a point (though perhaps it was presented with excessive sarcasm and a little one sided).

    I have a similar fault at times, intellectuals have a habit of raising my dander.

  32. Eric Brown says:


    I don’t agree with all of your earlier criticisms. I find some valid, others not so much. I simply disagree. No need to go into detail there.

    Rather, I want to talk about some of the latter points.

    I’m ignorant of any statements about Obama on natural gas. I’ll trust your call on this. But…

    Natural gas is environmentally more friendly than other coal and fuel oils. This is a fact. However, there are in fact disadvantages to it, which is why I suspect — in terms of the market — there isn’t heavy investment in this alternative energy solution.

    For example, natural gas usually requires pipelines to deliver the gas from the field to where its being used. These pipelines have high maintenance costs because they are underground and require regular checks for leakage and pilferage. In other words, it is not the cheapest, therefore, Americans will choose what is cheaper even if it is not as effecient.

    I wrote a post about alternative energy a while back. The same problem is present in Hydroelectric power. Dams are extremely expensive to build and must be build to a very high standard. Additionally, people living in areas that would be flooded would be coerced to move. Additionally, altering influencing water flow alters the natural water table and its level. Often, there are unexpected consequences. If you were to consider New Orleans, or even Galveston, the damns in place there are causing faster erosion down stream which basically results in land subsiding at a faster rate. This is especially true of New Orleans.

    Now while I’m not entirely or objectively opposed to Hydroelectric power, it presents challenges that certainly need to be addressed. I’m not sure if Obama is opposed to it either, so on that, I suppose we will see.

    In regard to Nuclear power, I am very reluctant on that count for several reasons. Admittedly, nuclear energy is indeed very clean — there would be no carbon gases being emitted into the atmosphere at mammoth levels as has been the case since industrialization. That’s an incredible “pro” of this solution.

    However, nuclear energy has its problems. Number one, a criminal group or a nation with this sort of technology if in the possession of tested non-nuclear components of nuclear weapons can have those weapons within days or even hours with the money and the technology. This would present a political challenge and is in fact the current problem with Iran and North Korea. I’m weary of potential blackmail and sabotage from terrorists in this regard, if this practice became more widespread. But this is spectulative and can only remain to be seen. Though, I think it warrants some sort of pause, or at least, incredible safeguards and precautionary measures.

    Now reactor meltdowns of nuclear power is admittedly not the problem it once was. This is true. However, the disposal of the wastes would be a new challenge. Nuclear waste is very dangerous and is estimated to be radioactive for approximately up to 100,000 years. If for any reason, this were to effect the environment (the waste, that is), one cannot be sure of the consequences, which imaginably would not be good. So, it is the hestitations, again, which I think is key reasons why people are not investing heavily in this solution — economic feasibility and cost is again the question. So, I would support Obama in his opposition. I’m more hesitant than an outright opponent.

    In terms of health care, Obama actually does not support single-payer system. Even so, the government in single-payers systems don’t necessarily run the system, but rather collects all monies into a non-profit trust. I’m not saying support it, I’m saying it is an attempt to negotiate costs with health providers and drug companies, which is impossible with thousands upon thousands of insurers — a single payer, which collects monies from all those sources is an attempt to reign in costs.

    But even beyond a single-payer system. I have searched endlessly for a Republican health care proposal in the last sessions of Congress dating back to 1992. I have found zero, this far. So, if you could be of assistance that would be wonderful.

    However, there are other lobbying groups — just as powerful — who are a part of the Republican machine. So, this isn’t a partisan matter. And I would agree that “big business” is a part of the problem. I am (obviously) just as skeptical of relying solely on the private sector as I am in relying solely on the government. The health care “choices” that would be allegedly be lost to the government are already lost to the private sector insurance companies that informs you what doctors you can see, what will be covered, how long you can receive treatment, and what they will and will not pay for, leaving you yield to their decisions or pay for out of pocket. So, I can agree there. However, I’m not sure the private sector would actually come down in support of this because it certainly wouldn’t be as profitable. So, there is a clear competition of interests involved.

  33. Joe Hargrave says:


    “Regarding subsidiarity. By your definition, anything which can in some instances be done better by the higher order may be usurped universally is deeply flawed and an almost complete reversal of this principle.”

    The inclusion of “anything” was your idea, not mine. I never said anything.

    There is a hierarchy of values. It isn’t a great travesty of justice if government provides or simply provides leadership on issues that don’t actually usurp the proper role of individuals, families, or local governments.

    Raising children properly belongs to family.

    Health care and energy, on the other hand, can prudentially fall either to local or federal government depending on what is possible with the resources at hand.

    Subsidiarity is often invoked by those who want to say, “let the private sector do it”. But Catholic social teaching recognizing that there are many things the market cannot provide. So we are well within our rights to explore whether or not a service can be better provided by government, or preferably at least assisted by government in a private-public coordination.

    If it is evident that the local structures can’t provide the necessary service to everyone in question, then there is no principle of subsidiarity to worry about. It only applies when they can. Otherwise the principle is meaningless.

    I repeat once again that if our goal is less government, then it must also be more community. Meaning, ultimately, cooperative forms of ownership and control at the local level, so that everyone has a stake in their firms and neighborhoods and therefore actually gives a darn about them. Subsidiarity without distributism is just an apology for anarchy.

    And needless to say, I think RR’s sentiment was just ideology.

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