The Conservative Edge

There I was a couple of days ago, sitting in front of the computer, reading some columns featured on the Dayton Daily News website. I try to respond to one or two columns a week, just so I can feel good about contributing to a liberal newspaper from a conservative perspective. I noticed an article written by Thomas Friedman, a well-known columnist who writes for the New York Times. He states that America is losing ground in technological development and innovation. Part of this decline is due to the high cost of doing business in the U.S. Businesses here face extremely high corporate tax rates, and the federal government is reluctant to use subsidies or other financial incentives to keep corporations planted in American soil.

So, I felt the need to respond to Friedman’s column. I wrote that Friedman is actually correct in theory. There is no good reason that American companies should not prosper by operating here in the States. Furthermore, as companies grow, they usually provide cheaper goods and services, and employ larger numbers of people. This employment includes not just production workers, but research and development teams as well.

However, the Obama administration, and all Democratic leadership, consider corporate profits to be evil. Carter wanted to tax the oil companies, Clinton harassed Bill Gates and Microsoft, and now Obama has taken swings at the car companies, Wall Street, and the big banks. It seems impossible that Obama and his cohorts in the House and Senate could even think of reducing unemployment without stimulating business growth. They think they can increase taxes, pile on stricter financial and environmental regulations, and yet somehow realize positive growth of America’s GDP. I closed my remarks on the Dayton Daily News website with the statement “capitalism needs capital.”

Honestly, at the time I posted my comments, I had no idea that Jack Kemp had made that exact statement years ago. I didn’t read of his observation until today (March 6). He was right. Capitalism is the only economic engine that has allowed the rise of America’s middle class, and given so many individuals the chance to obtain real wealth. Capitalism also fueled the fantastic technological advances of the late 1800s and early 1900s. The capitalist system allowed the development of steam engines and railroads, and later the telegraph, electricity, motion pictures, radio and television, not to mention the automobile and the production line. None of these things would have progressed the same way under another economic system.

But we have a President, and a liberal Congress, that views capitalism as an evil institution. No wonder we are losing technological ground to China and Korea. No wonder that real unemployment hovers at 16 percent. No wonder that this country isn’t producing enough scientists and engineers. The only people prospering now are government administrators. Jack Kemp was right. Capitalism needs capital; and America needs capitalism.

Jonah Goldberg wrote a column that was recently featured in my local newspaper, the Dayton Daily News. Goldberg wrote about the statement made by Obama that he is not an “ideologue.” Goldberg countered that Obama is indeed an adherent to an ideology. Most politicians are, I suppose, but the liberals seem to be more radically aligned with an idea or set of ideals.

One of the editors from the Dayton Daily News claimed that Obama wasn’t an ideologue, but more of a pragmatist. That doesn’t explain why Obama took an entire year to realize he’d better do something about the economy. Anyway, I decided to respond to the editor on the newspaper’s website. I thought the response might make a good blog post, as follows:

“The liberals’ actions clearly reveal a consistent adherence to an ideology. Generally speaking, the principle components of liberal ideology are that corporate profits and individual wealth are both evil; wealth, in fact, must be redistributed; growth of government is necessary and good; and the rights of the individual are subordinate to the greater society. These ideas have caused every president since Jimmy Carter to punish the very businesses that provide goods and services. Carter had his obsession with “windfall profit taxes” against oil companies; and one of the first acts of the Obama administration was to levy outrageous taxes on tobacco, another industry hated by liberals.

“The liberals seek to create a dependency on government. That is why they want to reduce our wealth by way of taxes and redistribution; eliminate our right to self-defense; and restrict our right to pursue happiness, especially if that happiness comes from enjoying a cigar (just ask Michael Jordan), driving a fast car, or building a profitable business. Jimmy Carter tried to accuse the American people of harboring a “malaise.” He never stopped to think, as liberals seldom do, that the liberal ideology created,and still creates, a despair among free Americans.”

You can view the editorial opinion page of the Dayton Daily News here. Feel free to tell the editors what you think about the liberal ideology.

Winston Churchill once said that “The farther backwards you can look, the farther forward you are likely to see.” He meant, of course, that history is a great teacher. Even the Old Testament philosopher said that there is nothing new under the sun; everything we see now has happened before.

And so it is with the American auto industry. With GM’s bankruptcy now likely to occur, many people may be wondering if we will ever again have a vibrant auto manufacturing industry. There are thousands of people losing their jobs, not just with GM or Chrysler, but at the smaller factories where parts are made and then sent to the big auto plants. Everyone from machine operators to engineers, from electricians to toolmakers, are seeing their jobs disappear.

And now, here comes our government to the rescue. But it almost seems that the car companies are making deals with the devil. In exchange for government loans to continue operations, the companies are essentially giving up the right to make the kinds of cars to satisfy market demands. They are also being told that the government can fire their CEOs, and tell corporate officials how much money they can make. Maybe Nancy Pelosi and Barney Frank will start sketching prototype cars on the backside of bar napkins, and then send them to GM for manufacture.

Let’s look back a number of years to find a similar crisis facing a car company. In 1979 and 1980, there was much anxiety over the fate of Chrysler. Lots of experts were wondering how Chrysler could get in such sorry condition. There seemed to be some agreement that Chrysler’s problems stemmed from a combination of poor management and excessive government regulation. Lee Iaccoca came to Chrysler in 1979, and brought along some talented people from Ford, which resolved much of the management problems. But the company needed capital to stay in business long enough to revamp its product line. The federal government agreed to guarantee Chrysler up to $1.5 billion in loans.

In September, 1980, Ed Lapham wrote in Car and Driver that as part of the agreement, Chrysler had to get more than $450 million in wage and salary concessions from its employees. Chrysler then had to arrange $650 million in concessions from 400 banks; that was hard to do in times of high inflation and interest rates, especially with Chrysler’s credit rating. But the company eventually met all of the requirements for government loans. Iaccoca also worked hard to get everything in order. But his biggest challenge was holding his tongue while certain government officials inspected his company and then made public sport of it. Sound familiar?

In December, 1979, Tony Hogg said in Road and Track that “As far as government regulation is concerned, meeting a bunch of ill-conceived regulations…(is) absolutely devastating as soon as a business takes a turn for the worse…” Hogg also quoted then-Senator Carl Levin as saying “This situation was caused in part by the government…I think the government has an obligation to get Chrysler out of its problems. This is not a bail-out, but government help to solve a problem government has created.”

In 1980, a couple of months before the election, Iaccoca said “I suggested that we’ve had so much regulation in this country, how about declaring an economic crisis for 24 months and freezing all regulations in place. Everything. The air won’t get dirty. More people won’t get killed because side beams or bumpers aren’t meeting the new requirement.” Indeed, this whole realization that government was regulating the life out of American industry is what helped propel Ronald Reagan to the presidency.

But the Obama administration is set to add MORE regulation and legislation against American industry. How many millions of dollars will corporations have to spend to meet new piles of regulations, and to protect themselves against litigation? When you add these new costs to the higher taxes being imposed, it’s no wonder the American manufacturing industry is in such disarray. The auto industry revived in the 1980s because of a cooperative government (remember the repeal of the 55-mph speed limit). The auto industry will be crushed in the years ahead by an oppressive, anti-business government.

Churchill was right. History is a great teacher.

I’ve been listening to the debates over President Obama’s proposed stimulus plan. It seems that some people, like New York Times columnist Gail Collins, insist that there are no earmarks in the plan and that we should all just “give it a pat on the back” and accept it. Others, like columnist Paul Krugman, are accusing the Republicans of “trying to push the economy over the edge” as they object to the sheer size of the program. Of course, before Obama’s election, Mr. Krugman repeatedly charged the Republicans with overspending and running up the federal deficit. So much for his objectivity!

President Obama has ridiculed the Republican view that this stimulus is more about spending than about stimulating the economy. “What do you think a stimulus is?” he asked. Spending, he said, “is the whole point.” That callous response doesn’t make sense—common sense, that is. Most Americans understand the need to control their personal spending during tough times. Indeed, that’s partly why the economy is in a recession. People have tightened their budgets and expenditures; they’re saving money instead of spending it. How then can it be un-American to question the size and the intent of the stimulus plan? Didn’t the liberals question and over-analyze everything from the Patriot Act to Bush’s tax cuts?

The Democrats don’t understand (or won’t admit) that there may be ways to stimulate the economy without spending money like a shopaholic. For one, the government could slash the corporate tax rate, as America has the second-highest corporate tax rate in the world. Businesses might be able to retain more American workers, instead of sending production overseas to offset the high taxes. Many countries in Europe, for example, also subsidize corporate energy costs, making it even cheaper to produce goods. This puts American business at a huge disadvantage. But for some reason, the Democrats hate Big Business, especially oil companies and tobacco companies. They don’t seem to realize that when you create an environment in which business can grow, you create opportunities for employment growth as well.

Aren’t there any reductions in the stimulus plan? Can’t the supposedly intelligent, qualified members of Obama’s Cabinet (and other Democratic Representatives and Senators) find excess and redundancy in government and cut it out? Instead, they are focused on their efforts to make government even bigger, with a resulting increase in government control. When Ronald Reagan’s administration took office in 1981, James Baker recalls that their top three priorities were: economic recovery, economic recovery, and economic recovery. But now, the Obama administration’s priorities are: spend, spend, and spend some more.

Maybe more Americans would have a positive view of the stimulus plan if all the Democrats would pay their income taxes…