Posts tagged with: government

This past week, President Obama forced the CEO of General Motors to resign. The real significance of this may be lost on most people. Some might say, “Well, if General Motors is not doing well, the CEO should be replaced.” The major difficulty with this is that this is a special power of the GM Board of Directors, not the President of the United States. Effectively, this makes President Obama the Board of Directors of General Motors, and any other company he wants to control, and makes the Board a mere figurehead. Slowly but surely, this is moving us to a fascist form of government. In fascism, the companies still exist, but the government tells them what to do. This was similar to Mercantilism, which was the predominant economic system in Europe from about the 1600s until 1800, more or less. Mercantilism was the system of economics that Adam Smith wrote against in his famous An Inquiry into the Nature and Causes of the Wealth of Nations, which most people shorten to the cryptic Wealth of Nations. Smith was trying to show that government control of business impoverishes nations. Instead, he posited “a system of natural liberty,” which allowed people to follow their natural pursuits, take on the risk of doing so, and allow the market, that is, the countless decisions of people, to decide the outcome. It was the realization of the truth that Smith expressed in his work that subsequently brought prosperity to countless nations.

Now we are returning to the old system, under a new guise. Secretary of the Treasury Timothy Geithner recently asked Congress to grant him unprecedented power to shut down any company that, in his opinion, is dangerous to the overall economy. Note that there are no specifics to this power—it would be at his discretion. For those who have read my blog entries “The Economics of Politics,” you can see that all of this is a grab for what politicians live for—power, and power alone. Politics attracts those kinds of people. When asked by a Congresswoman where in the Constitution he went to get justification for this type of power, Geithner expressed incoherent babbling. It did not seem ever to cross his mind that he needed Constitutional justification for such an assumption of power. Again, this is typical of fascism. A crisis is, if not created, then hyped, panic flamed up, and people in this panic are willing to trade their freedom for security. Only too late will they realize that the situation was not as bad as the self-interested government officials portrayed it. The power will have been granted, and only a miracle will pry it away from the hands of the government. Once taken, government almost always keeps a power.

Getting back to General Motors, its problems go all the way back to government-imposed protective tariffs, which are a remnant of Mercantilism. Corporations seek to be protected from foreign competition so they do not have to work to keep up. The government, bowing to pressure and false economic theories, puts tariffs and quotas on imports to raise their prices higher than those of the domestic product; in this case, cars. The car makers then can do whatever they want because consumers face a choice of either us or nothing. In the 1970s, when we began allowing imports, the American car companies were caught, and almost went out of business. They finally got their act together when a new wave of government regulation on cars was imposed, thus raising the cost of domestic cars. To boot, the latest situation is that the Federal government is dictating to the car companies what types of cars to make, all in an effort to be “green.” The problem is that the market does not want these cars, so the company is forced to spend millions on cars they cannot sell. Then the government says, “Oh, it would be terrible if the companies failed; so many would be put out of work. So we have to bail them out again, and since we are ponying up the money, we now have a controlling interest in them, we can call the shots, we can tell the company what to produce, we can fire the executives, and when the company comes in with a loss, we blame the company again, bail them out again . . . .” And the circle continues. Remember, this government is the same one that has brought us the Post Office, the Department of Motor Vehicles and the public school system. All those who believe that the government can bring us out of a recession should remember that it was the government that caused it in the first place. Remember the housing bubble?

What a racket!

Read more from Dr. Luckey at “Catholic Truths on Economics.”

Blog author: jballor
Monday, March 30, 2009

From the question of performance-enhancing drugs to antitrust issues in the BCS, government involvement in professional sports is a common occurrence nowadays. Then-President-elect Obama said that he would favor a playoff system for Division I college football and that he would “throw” his weight around a little bit in pursuit of that agenda. Congress recently announced plans to take up the question of antitrust issues with the BCS.

The powerful influence of professional sports on today’s culture raises complex questions about the intersection between business and government, as well as education and moral formation. Perhaps nowhere is this influence more apparent than in the midst of March Madness.

It is timely then that tomorrow the Acton Institute’s Rome office hosts a talk by Fr. Kevin Lixey, LC, head of the Church and Sport Section of the Pontifical Council for the Laity. Fr. Lixey’s talk is titled, “Fighting the good fight: The promise and peril of sports as a training ground for virtue,” and is introduced in this way:

2000 years ago, St. Paul wrote “athletes are disciplined in every way.” But in nearly every country and every popular sport, the news reports as much scandal as inspiration. Can sports still foster human virtues? Or has the desire to win at all costs, please the crowds and increase profits destroyed the nobility of athletic competition? In this year dedicated to St. Paul, would he still use sports as an example for Christians?

So this week’s PowerBlog Ramblings topic takes up Fr. Lixey’s question: “Can sports still foster human virtues?”

Blog author: rnothstine
Tuesday, March 24, 2009

In response to the question, “What form will journalism take in the age of new media?” I came across this Reuters story highlighting a proposal to allow newspapers to file for nonprofit status. The legislation was put forward by Maryland Senator Benjamin Cardin, (D-Md.) and he suggests the nonprofit action could be a possible solution for smaller community minded newspapers.

I’ll let somebody with more expertise regarding print journalism take a crack at the deeper consequences of such an action, but it seems to me that it wouldn’t assist with what should be the main goal of media, securing a free and independent press. At least many of the arguments put forward for saving papers is tied to the notion that they serve in the capacity as a civic watchdog over government. Obviously you can’t serve that goal as effectively with a tax-exempt status.

Nonprofits are having to sort through their own serious financial struggles as well, so the financial benefits may not be much of a saving force in the end. I am sure there are a lot of papers that are surviving and thriving in the free market even now and their credibility will look even better when put up against a paper dependent on government recognition for their status.

Here is a story from Real Clear Politics which alludes to a greater fear, at least when it comes to even more federal involvement in the private sector, and that is “the legislation is a starting point for discussions already under way on ideas to help the industry.”

In today’s commentary, Sam Gregg writes that “there is little reason to be optimistic about the probable effects of the Obama Administration’s interventionist approach to mortgage relief. In fact, it is most likely to be counterproductive.” More government complacency about moral hazard?

Read the commentary at the Acton Website and share your comments below.

Blog author: kschmiesing
Friday, February 27, 2009

Somewhere in the United States today, government officials are writing a plan that will profoundly affect other people’s lives, incomes, and property. Though it may be written with the best intentions, the plan will go horribly wrong. The costs will be far higher than anticipated, the benefits will prove far smaller, and various unintended consequences will turn out to be worse than even the plan’s critics predicted.

That’s the first paragraph of Randal O’Toole’s wonderful book, The Best Laid Plans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future.

It’s not a new book (2007), but it is timely, for reasons that should be obvious. O’Toole’s prime example is the US Forest Service, which he investigated on behalf of environmental groups for many years. From there he moves on to land use and transportation, churning through a number of sub-topics along the way. You might expect the book to be a polemic, but it isn’t. O’Toole is a careful researcher and he gives public employees their due. He simply lays out in devastating detail the impossibility of the tasks set before government planners, especially when it comes to long-term agendas of five or ten years. A refreshingly sensible analysis of senseless bureaucratic bungling.

In response to the question, “What are the moral lessons of the American Recovery and Reinvestment Act (ARRA)?”

Does the ARRA mark the dawn of a new era of government accountability, from a government “of the people, by the people, for the people”?

President Obama seems to think so. He says as much in a video statement tied to the launch of, “a website that lets you, the taxpayer, figure out where the money from the American Recovery and Reinvestment Act is going.”

The site claims that “the American Recovery and Reinvestment Act will be carried out with full transparency and accountability — and is the centerpiece of that effort.”

In his brief statement, President Obama says, “The size and scale of this plan demand unprecedented efforts to root out waste, inefficiency, and unnecessary spending.”

Your Money at Work from White House on Vimeo.

Call me cynical, but somehow I doubt that a package that was rushed through without time for reflection and public examination is going to ex post facto become accountable to the people.

Let’s just say that if the “transparency” of the way the TARP funds have been distributed and used is any model for what’s going to happen with ARRA, we’ll be a long way from a new era of government accountability. looks a lot more like window dressing, or better yet an arranging of the deck chairs on the Titanic after the ship has already sailed.

Government is most surely a divinely-ordained reality, and a blessing that we must celebrate. But governments realize their task when they recognize their own divinely-ordained limits.

Government exists as a form of common grace to preserve the world for Christ’s coming, when the government as an order of preservation will give way to a divine monarchy (“Every knee will bow.”). In the words of Dietrich Bonhoeffer, the government is here to keep “open” the orders of the world for Christ.

But when government oversteps this mandate, it tyrannizes the other orders of preservation and undermines the basis for its own existence. It then becomes a force for destruction as much as for preservation.

In addition to strident debate and firm resolution in public affairs, satire is a powerful tool in calling the government to heed its limits. It is in this spirit that the following two items are offered.

First, “The Heaviest Element Known to Science.”

Lawrence Livermore Laboratories has discovered the heaviest element yet known to science. The new element, Governmentium (Gv), has one neutron, 25 assistant neutrons, 88 deputy neutrons, and 198 assistant deputy neutrons, giving it an atomic mass of 312. These 312 particles are held together by forces called morons, which are surrounded by vast quantities of lepton-like particles called peons. Since Governmentium has no electrons, it is inert; however, it can be detected, because it impedes every reaction with which it comes into contact. A tiny amount of Governmentium can cause reaction that would normally take less than a second, to take from 4 days to 4 years to complete. Governmentium has a normal half-life of 2-6 years. It does not decay, but instead undergoes a reorganization in which a portion of the assistant neutrons and deputy neutrons exchange places. In fact, Governmentium’s mass will actually increase over time, since each reorganization will cause more morons to become neutrons, forming isodopes. This characteristic of moron promotion leads some scientists to believe that Governmentium is formed whenever morons reach a critical concentration. This hypothetical quantity is referred to as critical morass. When catalysed with money, Governmentium becomes Administratium, an element that radiates just as much energy as Governmentium since it has half as many peons but twice as many morons.

And second,

As Bonhoeffer wrote in his 1933 essay, “The Church and the Jewish Question,” a basic task of the church is to “continually ask the state whether its action can be justified as legitimate action of the state, i.e. as action which leads to law and order, and not to lawlessness and disorder.” In so doing, the church shows itself to be the state’s “most faithful servant.”

After all, pointing out the excesses, sins, and errors of another can be the most sublime act of love.