Thursday, April 14, 2011

Speech reaction

Yes, I watched President Obama's speech on the deficit and meant to have my reaction up sooner, but repeated computer problems got in the way. That said, here are some thoughts:
  • First off, isn't it amazing that the president gave a speech responding to a budget proposal from a mere congressman? It's clear who is setting the agenda here and driving the conversation.
  • The president opened with a paean to "free markets and free enterprise as the engine of America's wealth and prosperity," but then later vowed not to leave seniors at the "mercy of the insurance industry." Best to smile while delivering the shiv, I suppose.
  • Obama said that Rep. Ryan's plan is "a vision that says if our roads crumble and our bridges collapse, we can't afford to fix them." What a strawman. How utterly bogus. How dishonest.
  • The president hailed China for building solar facilities and the fact that Brazil "can run half their cars not on high-priced gasoline, but on biofuels." Why should we think that these poor developing countries have anything to teach us? What reason is there to think they represent models worth emulating? Are we supposed to lavish billions on solar power simply because the Chinese are doing it? The fact that Brazilians use so much ethanol, meanwhile, is largely a tribute to the distortionary power of taxation, with gasoline taxed in the country at 54 percent while ethanol is taxed at 12-30 percent.
  • President Obama claimed that implementation of Ryan's plan would lead to a "fundamentally different [country] than what we've known throughout our history." Wait, really? Is the president not aware that the welfare state traces its beginnings to the 1930s and was not fully formed until the 1960s? For the majority of this country's history we have been a country with a much smaller government than the one we have now. To the extent Ryan's plan goes against the grain of American history, it is by maintaining and restructing the welfare state rather than simply repealing it.
  • The president praised the country as "generous and compassionate" and a land of optimism. His actions, however, belie such lofty rhetoric. If he truly believed that the American people were generous and compassionate he would not advocate for a government that takes their wealth and redistributes it as politicians such as himself see fit, as the people would cheerfully assist the less fortunate without government coercion. Left-wing thought is deeply pessimistic and only makes sense if one believes people are inherently greedy and cold-hearted.
  • President Obama noted that President Reagan's former budget director, David Stockman, said that there's nothing "serious" or "courageous" about Ryan's plan. That's true. But Stockman is upset that Ryan's budget cutting doesn't go deep enough! And yet Ryan's comparatively mild cuts still elicit much hysteria and doom-mongering from Obama.
  • His call for $4 trillion in deficit reduction over 12 years is a clear illustration that the speech was nothing more than an exercise in public relations. He simply wanted to produce a number that was in the same ballpark as Ryan's ($4.3 trillion), but had to adjust the timeframe to 12 years instead of 10 in order to make the numbers add up.
  • Obama's proposal to cut spending by $750 billion over 12 years is unserious. It amounts to $62.5 billion per year, or 4.6 percent of discretionary spending based on the FY 2010 budget and 3.9 percent of this year's deficit. It's not at all commensurate with the situation we face, and yet Obama referred to them as "tough cuts."
  • I realize I have made this point before, but why on earth does the president think that serving as a venture capital fund for "clean energy" or providing broadband is a legitimate function of government? Is this rooted in anything deeper than his own whims?
  • While I applaud the president's call to cut defense spending, his proposal contained zero specifics and basically amounted to "TBD."
  • Early on in his speech the president criticized politicians who claim that "solving the [deficit] problem is just a matter of eliminating waste and abuse." Later on, however, he vowed to "eliminate waste and improve efficiency" at the Pentagon while on health care he called for reductions in "wasteful subsidies and erroneous payments," called for "using Medicare's purchasing power to drive greater efficiency" and empowering a commission that would "recommend the best ways to reduce unnecessary spending." Greater efficiency through central planning!
  • President Obama's call for increased taxes on the rich is politically cowardly and morally dubious. Why should they be the only ones who share this burden? It also won't do a whole lot for the revenue picture, with the Wall Street Journal noting that the Bush tax cuts reduced revenues by $3.7 trillion over 10 years, of which the rich account for $70 billion per year.
  • As Jonah Goldberg noted, the candidate who promised to be an agent of change now finds himself defending the status quo. Jake Tapper also dug up a quote which illustrates Obama's shift.
  • Lastly, none of this should surprise us. President Obama will never propose a budget which includes substantial budget cuts or reforms to our social welfare programs. Talk of a net spending cut or halving the deficit is merely to provide the veneer of centrism and fiscal responsibility. To actually carry out such actions would go against everything he believes in. To the extent the left has problems with Medicare, it's that it doesn't cover everyone. To the extent they have problems with government spending, it's that we don't spend more. The only thing these people are serious about is raising taxes.

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