Today I spent part of my day at a local small family-run business, and listened to the owner gripe about excise tariffs on equipment from abroad, immigration difficulties, and frustration about the redistribution of wealth from his business to the federal government’s warfare and welfare programs. As I was leaving to make another house call and visit a single mother of three children, he had one request which was to listen to the 1970 song “Monster” by Steppenwolf. The ending of this song is an appropriate lead-in to my comments on today’s State of the Union address (transcript here).
While his oratory skills are to be admired, President Obama assumed the role of a master central planner where the government must intervene or else the economy fails. The key planners in any market economy should be individuals, not the government as I learned while living in China. Obama made no mention of the true root cause of the depression – the excessive money-printing and credit expansion of the Federal Reserve. There was no mention that government bailouts, stimulus plan spending, and interventions have changed what would have been a sharp and brief recession into a prolonged depression. There was no mention that bank balance sheets are still impaired by billions of toxic assets and deficit spending in all areas of government is out of control.
There is no mention that the Bureau of Labor and Statistics U-6 unemployment level is at 17%, and reputable non-government sources have unemployment estimated at 22%, which is a more reasonable number if one walks around the neighborhood in the Lehigh Valley. Government central planning has been a true disaster as I pointed out in “The Government’s “War” on Main Street” and “Why the Stimulus Plan Will Fail… (And a Better Alternative).”
The problems of excessive spending will not be cured by yet more spending. The American government should be heavily slashing government spending on all non-safety net programs and simultaneously cutting taxes to provide relief. If we want to stimulate more people to work, the obvious answer is an income tax holiday – or better yet, abolish the tax completely as I have proposed. With all of the figures tossed around – a $1.1 trillion stimulus plan, $0.9 health care tax, $0.8 bailout – it is plainly obvious that slashing the $1.2 billion federal income tax is the easiest and best solution to assist the American people.
I do believe the President’s proposed pay-go restraints on portions of the federal budget are a step in the right direction, but waiting until 2011 is far too late, though at least I will be in office in less than a year’s time. There is such a thing as “too little, too late.” I outlined my 3-step plan for budget cuts and monetary policy changes last week in “Talk on Monetary Policy to Concerned Citizens of Upper Perkiomen Valley for Smaller Government.”
It is interesting that in a State of the Union address, the President 1) spent little time on and 2) left the costly wars abroad to very late in the speech. America should immediately end the costly occupations of Iraq and begin an orderly withdrawal from Afghanistan where there will be close to 100,000 troops pursuing less than 100 members of Al Qaeda per the NSA in 2010. This works out to about $1 billion dollars spent this year for each Al-Qaeda terrorist/insurgent. Terrorists and Al-Qaeda should be pursued by small teams who are formally issued constitutionally letters of marque or reprisal to bring specific named and indicted terrorists to justice as stated here. One of the most telling graphs on SOME of our military spending is below, read “Guns or Health Care?” for more details.
No time was spent upon removing infringements to civil liberties such as warrantless wiretapping from the Patriot Act, the ability of the IRS to view every credit card transaction, the upcoming complete loss of medical record privacy to the government, and reigning in the powers of the CIA.
No time was spent discussing the devaluing of the dollar, and its very serious potential consequences for the American people as I warned about repeatedly in “Is the Dollar a Ponzi Scheme?” and many other posts.
Perhaps the really critical news today was the edict issued by the unelected bureaucrats at the Securities and Exchange Commission (SEC) that money market funds can now block redemptions of shares by investors if they so choose. This seals yet another escape hatch in the Keynesian submarine that I have written about in “Sound Money and Jobs” and “The Real Interest Rate.”
Any questions, feel free to ask them below or call-in during my online radio show “The Freedom News Hour” tomorrow between 6-7 PM EST. There is a campaign flyer blitz in Allentown on Saturday and a “Towne” Hall on Monday. Details here!
Despite the optimism in Obama’s speech, I remain short-term pessimistic but long-term optimistic, if only enough people can wake up before it is too late from the siren call of the government “monster” as Steppenwolf aptly calls it.
Jake Towne is running for U.S. Congress in Pennsylvania’s 15th District in the 2010 election as a citizen unaffiliated with any political parties.
We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.
As always, unlike the NFL, the author grants full permission to allow any accounts of, rebroadcasts, retransmissions, repostings of this article to your blog or anywhere else in order to promote the Restoration of our Republic.
Veritas numquam perit. Veritas odit moras. Veritas vincit. Truth never perishes. Truth hates delay. Truth conquers.
Tu ne cede malis sed contra audentior ito. Do not give in to evil but proceed ever more boldly against it.