Free Markets, Free People
Reality Begins To Dawn In America
For the first time since 1975, Social Security recipients will not get a cost of living allowance increase in their Social Security check. Another in a long line of ominous indicators that, to quote President Obama’s favorite disavowed preacher, the fiscal “chickens are coming home to roost.”
We seem to have been living in a dream world for the last few decades where the majority of Americans ignored the reality and believed we could continue to increase the size of the welfare state forever with no ill consequences. The small coterie of realists claiming that it was indeed a fantasy world we were living in were declared alarmists who were using scare tactics and dismissed by the politicians.
Now, with huge deficits, we’re about to see the US go from one of the least-indebted developed nations to one of the most indebted. The IMF reports that for the US, general government debt as a percentage of GDP will rise from 63 percent in 2007 to 88.8 percent this year and to 99.8 percent of GDP next year.
That’s huge and, with the revised deficit of almost 10 trillion over 10 years, getting larger.
Even without the numbers and reports, Americans have increasingly come to understand that the government we have and the programs it funds through our tax dollars and massive borrowing are unsustainable. And, as I’ve pointed out, that realization has been brought to a head by the recent financial problems we’ve suffered and government’s reaction (under both the Bush and Obama administrations) to that problem. And yet the supposedly tuned-in Obama and the Democrats simply don’t seem to understand that, or, perhaps worse, don’t want to believe it, given the agenda they’ve undertaken. Matt Welch lays it out well:
After 11 months of federal bailouts and freakouts, Americans have become bone tired of panicky power grabs from Washington. It’s the big government, stupid.
The message of the various Tea Party protests, which predated this summer’s ahistorical media panic over town hall “lynch mobs,” has been pretty simple, says Matt Kibbe, president of FreedomWorks, the nonprofit that has helped organize the protests, told Reason magazine this spring. “It was: stop spending so much money, stop borrowing so much money, and stop bailing out people who were irresponsible.”
It’s a reality that surely haunts the politically sensitive Obama administration: Ever since George W. Bush first tried to cram the Troubled Assets Relief Program (TARP) down the throats of largely unwilling citizens, bailouts of failed institutions, from AIG to American Axle, have been enormously unpopular.
What Obama and the Democrats are left with then, when pursuing an agenda that is a naked attempt at even more government expansion, is a natural resistance that has been building since before this administration took office. Either the Democrats and Obama completely misread the election results and assumed a mandate that wasn’t at all present, or their natural hubris left them believing that even if that was the country’s attitude, they would be able to allay the fears and talk them into supporting more big government.
As is obvious, it’s not working. And the mood of the country seems to be at a point where it is swinging in exactly the opposite direction.
You have some Democrats who are realizing that - Senator Kent Conrad (D-SD) among them – who are talking about a vastly scaled back health care bill (I stick by my claim that Democrats realize they must pass something called “Health Care Reform” or the Obama presidency is DOA). But that too flies in the face of polling which says that a majority of Americans would like to see this version scrapped and for lawmakers to start over. The obvious implication of that poll result is the public is not happy with the size, depth of intrusion and cost of the current proposals.
Bill Clinton once famously said that the era of big government was over. And most cheered. But that turned out to be a mirage as Republicans took over, became Democrat-lite and expanded government yet again. Big government came back with a vengeance. As pointed out by Welch, the Tea Parties, which were the first public evidence of discontent within the country, began under George Bush and had absolutely nothing to do with Barack Obama.
If, as with most protests, the protesters represent the tip of the iceberg, we may be seeing the political sea change that many government minimalists have been hoping for for decades.
The winning political issue is out there for the politician and party smart enough to grab it. Smaller and less expensive and intrusive government.
Who will grab it and how will turn it into a winner is at this point unknown. But Americans are very uneasy right now and their anger at being marginalized by their politicians and ignored is mounting. Not only is 2010 going to be a very interesting year, but depending on who emerges on the right and how they approach addressing this anger, 2012 could be equally as interesting.