Herbert Hoover was no laissez-faire president like Calvin Coolidge, however he did respect the constitution, and he never was willing to go as far as Franklin Roosevelt. He made a speech just before Roosevelt’s election to a third term, in which he made some salient points—ones we would still be wise to consider today. With Hitler, Mussolini and Stalin in power, and with a myriad of other dictators and authoritarian powers sprinkled across Europe, it was critical that the free citizens of America see the danger of handing over the …
Today is Friedrich Hayek’s birthday and it is an important year to celebrate his birth. Although the twentieth century was the century of Hayek, this year seems also to be the year of Hayek. As a country, we are belatedly remembering his warnings, and seeing the consequences of ignoring them for so long. Hayek explained many years ago the problems with centralized monetary policy, over-regulation and interference with prices. He understood the danger of subsidizing risk and loss and feeding a boom with easy money. He also understood that markets …
It seems that we keep being told that the policy is temporary, and is far short of nationalization, only for Congress to turn around after the legislation has passed and “convert” loans into stock: to turn a bailout into a nationalization. This has now happened with AIG, the car companies, and today we learn, with the banks too.
In the New York Times today, David Brooks has a column in which he describes two theories about the financial crisis: “greed” and “stupidity.” The “greed” theory is not what you might be thinking—it is not the simplistic notion that Wall Street is just full of greedy capitalists that swindle the people out of their money. It is a little bit more sophisticated than that, because it involves the government bailing out the banks. They do this, of course, because politicians earn handsome rewards for it. This theory has some …
The financial crisis has exposed a trend that has been in the works for some time. Since the fall of communism, some of the more socialist countries have learned lessons from the Soviet collapse: free markets work, and government planning does not. Meanwhile, the capitalist countries have slept through these lessons, and have been slowly becoming more socialist. The financial crisis has made this crystal clear. For example, US car companies, and now auto parts dealers, have received bailout money. Sweden, every liberal’s favorite social-democratic country, has let their signature …
South Carolina Gov. Mark Sanford made some very important, insightful points on Sunday. He said them very concisely, as politicians know how to do. They are just what we’ve been saying here for so many weeks and months, and are important points that every American must remember: “A problem that was created by building up of too much debt will not be solved with yet more debt.” “We’re moving precipitously close to what I would call a savior-based economy…what you see in Russia or Venezuela or Zimbabwe or places like …
The “cash for clunkers” plan recently proposed in Congress would provide a subsidy for a new car purchase to anyone willing to have their current car destroyed. But the economic rationale is eerily similar to the New Deal program most widely agreed to be a catastrophic failure: FDR’s agriculture plan that slaughtered pigs. The reasoning goes like this: Crushing the old car has two benefits. First, it ensures that the consumer’s purchase of a more efficient vehicle actually has a net environmental benefit. Second, it prevents a glut of used …
As Joel Kotkin detailed in the Washington Post this weekend, the Wall Street Bailout and Trillion Dollar Deficit Plan being pushed through Congress this month mark the transfer of power from commercial cities like Chicago, New York, and San Francisco, to Washington DC. In the business world, campaign contributions and lobbying efforts have replaced cost cutting as the way to maximize profit. Going to Washington with hands outstretched can prevent bankruptcy, and can provide a stimulus to the bottom line. Competing without such government aid is becoming more and more …
While he spoke about moving forward, and promised change as we look toward the future, in fact President Obama’s inaugural address was firmly entrenched in discredited policies of the past; policies that never worked. For example: “Now, there are some who question the scale of our ambitions — who suggest that our system cannot tolerate too many big plans. Their memories are short. For they have forgotten what this country has already done; what free men and women can achieve when imagination is joined to common purpose, and necessity to …
This year already we’ve heard calls for reintroduction of the Fairness Doctrine, and Internet censorship. Now, the first call for public funding for newspapers is here. Lining up behind GM and AIG, media outlets could join the many “distressed businesses” begging for government aid. But, government funding for media – nationalization of the press – is no small step. Right now we have just PBS and NPR. Generally seen as left-wing outlets, these media sources are not shy to support government expansion, but maintain some independence. However, this is assuredly …
