Saturday, June 12, 2010

The Continued Development of the Obama Domestic Doctrine

Recently I have been chronicling the development of a specific and even systematic economic policy in the Obama Administration. It is a program that is based on the simple idea that a bad economy is a good thing, because of the long term "reforms" such can produce.

This policy was articulated early in the Obama administration as seen in an interview White House Chief of Staff Rahm Emanuel had with the Wall Street Journal, stating that "You never want a serious crisis to go to waste, and what I mean by that is an opportunity to do things that you didn't think you could do before." Emanuel was noting that it is difficult to make major public policy changes when the economy is strong and healthy. In other words, if everything is well, why do you need “change?” When things are bad, however, you have some justification.

This view was further reiterated recently by Attorney General Eric Holder, who told graduates at Boston University that "Positive change is the consequence of unfavorable and not favorable circumstance. Progress is the product of darkness, not light. Whenever you look into our past, this is true... It was economic turmoil that brought us the progressive era and the New Deal." In other words, the Great Depression led to 25 percent unemployment, but look at the amazing Leviathan called big government we received from it. In the end, "the Great Depression was a good thing." This is a hard concept for most Americans to buy.

The theme continued with one of the President’s key allies in the Senate, Christopher Dodd (D-Conn.) who, upon passage of a very controversial and far reaching banking bill, is quoted by the Washington Post (with tears in his eyes) as saying that "It's a great moment. I'm proud to have been here. No one will know until this is actually in place how it works. But we believe we've done something that has been needed for a long time. It took a crisis to bring us to the point where we could actually get this job done” (emphasis added). This bill could damage the lending abilities of banks, could take away the ability of the middle and lower income groups to even be able to get a checking account, and have even greater implications on individuals and businesses. With a crisis though, you can do things you cannot do under normal circumstances. In fact, you can even make sweeping policies, without knowing their implications, as seen in this far reaching banking legislation.

I have never been comfortable with conspiracy theories. After all, a conspiracy theory looks at the types of choices that are made and (particularly if the results are negative) the theorist makes conclusions on the intent of the policy. We are naturally uncomfortable with such, because no one wishes to judge the motives of others. The Obama Domestic Doctrine is neither a conspiracy nor a theory, but a stated policy intention reinforced by senior officials in the administration and its allies in other areas of government. The administration has made its view clear: economic hardships and the bad policies necessary to achieve such, are a "good thing" for the economy in the long term, because of the "positive" long term effects. Furthermore, policies that would actually relieve economic hardship may be "harmful," since such could undermine the need for government expansion. I wonder how many American had such in mind when they voted for this President and this Congress.


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