Posted on 05/15/2009 6:25:42 PM PDT by Natty Bumppo@frontier.net
Author's note: I've spent a couple of weeks overseas recently, where the newspapers and television reminded me of what happens to countries where the rule of law breaks down. More often than not, it starts with CIVIL laws, and not the criminal ones. DJA
It has been said that bankruptcy is a form of “structured failure” – a means of preventing businesses from collapsing chaotically. Plainly, the Obama Administration is trying to prevent the chaotic collapse of major American businesses and financial institutions, and has exerted an unprecedented level of structure over them. But one should not forget: It all still leads to failure.
No one likes to contemplate failure, and there have been no shortage of diversions from the deconstruction of American capitalism. Democrats strive to criminalize the policy decisions of the previous President, while Nancy Pelosi single-handedly seeks to sabotage those efforts. The President flips and flops between making theatrical gestures of institutional contrition while tripping over national security interests. Generals are being hired and fired. The flu gags the news cycle. The collective American eye is off the ball.
Meanwhile, the President is “structuring” the economy – for failure. Government control of industry grows, while paybacks to supporters expand at a level second only to economies like Russia and Myanmar. The Administration certainly appears to be pursuing, as George F. Will puts it, a “dependency agenda – maximizing the number of people and institutions dependent on the federal government.”
This is a strategy well known to "statesmen" like Robert Mugabe and Hugo Chavez – the more voters depend on the government, the more voters are likely to keep it in place. Handouts are a powerful incentive for loyalty – just ask John Murtha, who can trash-talk constituents freely as long as he brings home the pork.
First, the government forced financial institutions to take bailout funds, in a heavy-handed way only just revealed by Freedom of Information releases. With major stakes in all these institutions, the government now refuses to accept repayment. With this level, the government hires and fires, sets salary limits, and forces more banks into the bailout tent.
With control of the banks, lenders, and investors, the government has exerted control over other major industries. GM was forced to fire their CEO, restructure in accordance with Administration dictates, close sales outlets, cut product advertising, and outsource jobs overseas. Lower production, fewer sales, fewer American jobs. If this is what a stimulated industry looks like, investors are likely to run, not walk, away from GM.
Chrysler was publicly forced to merge with a competitor, their negotiating edge gutted by Presidential pronouncements. United Auto Workers (UAW), an investor in the Obama campaign, was given a majority stake in the company, and unsecured UAW investments were repaid at almost twice the rate of the secured (and supposedly preferred) investors. Oddly, many of these stiffed investors are the same financial institutions strong-armed into accepting bailout monies. The Administration has clearly demonstrated that private investment is a losing proposition by reversing the rules on bankruptcy.
In the meantime, the Administration has sided with the Service Employees International Union (SEIU) over the state of California on addressing budget shortfalls. According to the White House, California can’t have stimulus funds if it balances the budget in a way that offends the union, which was a $60 million investor in the Obama campaign, and has a well-documented reputation for strong-arming competition as well as members.
Finally, the Administration and Democrats are pushing to enact the deceptively named “Employee Free-Choice Act” (EFCA), giving these unions an unfair leg-up on organizing and intimidating dissenters. Nationalizing banks, government control of major industries, populist giveaways to corrupt labor organizations – all of these used to be hallmarks of the putative “communist revolutions” around the world. Now they are landmarks of American capitalism, if such a thing can be said to exist any more.
The Administration may view this as merely exerting much-needed structure over the free market – and with enough people cashing in, it certainly has popular support. But it is still a structure for failure. Like bankruptcy, there is only one path: down.
The American economy may be in need of help right now, but helping it fail is not the answer.
It’s like avoiding a problem while boozing it up. It’s hard, but sometimes you have to throw yourself to the bottom and rebuild from there.
Laws that punish illegal behavior are fine. Laws that are enacted to shape behavior for political or dogmatic reasons are a step toward tyranny.
Good post!
Capitalism had a good run, but in the end the Capitalists just couldn’t resist turning into Crooks. So it goes.
A guy like Obama should not have been elected in the first place. GOP and corporate America needs to ask themselves why did it happen. Blame it on the MSM, that is part of it, yet Reagan won despite the MSM derided him as an actor and conservatism was too radical for the MSM to even report objectively, yet Reagan won and won again. The problem with businessmen and politicians is they view the world from their narrow professional world. I always wished everyone is forced to spend time in the military or any team sport where you as a group (leader or follower) must face intensive competition or challenges from another team unit. One of the things missing in the GOP and business world is psychology. I remember being in the military the mission came first, but the leader also understood the physical and psychological limits of his people. People are not resources, people are not commodities, and they should not be used like condoms. Sure a fast dynamic economic system can make money rapidly for people, but it also can cause disruptions in people’s lives. When a CEO pursues a leadership style or fosters an economic management style that creates cycles of employment and unemployment for his work force every seven years by off shoring, importing workers, turn a blind eye to illegal immigrant labor, pump and dump financial strategies that create boom and bust cycles occuring at a faster and faster frequency and then culminate it with a financial meltdown. It is no different from a commander depriving his troops of rest, food and water and volunteering them for every harrowing mission in succession with no rest or respite until the troops collapse from exhaustion and then wonder why one of his men try to frag him. And the GOP whole heartedly endorses such a economic system and management style, and then scratches its head when the general population revolts, throws them out of office and have after thoughts about capitalism, free trade and capitalism. Americans want peace, prosperity, common sense laws and most important stable JOBS!!!!!
Very good article by David J. Aland. Thanks for posting. The laboratories of democracy have become cesspools of socialism/collectivism/criminality.
“In the meantime, the Administration has sided with the Service Employees International Union (SEIU) over the state of California on addressing budget shortfalls. According to the White House, California can’t have stimulus funds if it balances the budget in a way that offends the union, which was a $60 million investor in the Obama campaign, and has a well-documented reputation for strong-arming competition as well as members.”
I need to find that article to back up my statement, but the same AH from Louisiana that founded ACORN also founded the SEIU. I’m looking at not only the attitude, the strong arming attitude, but the reciprocity between the Obama Administration to ACORN, and this action in California regarding the SEIU.
It’s damned obvious, but the Dems will get away with it all.
Oh my,,you surely will anger the gods of “free trade” with that well-reasoned analysis. The truth is that lazy stupid ignorant workers are the cause of everything happening. The superstar CEO culture *respects* its workers,,it clearly says so in the “mission statement” right there in their handbook!
TRUE!!!
Are you looking for a job?
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Yeah, turning those markets loose (damn the regulations, full speed ahead) really worked out well.
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