Volume 11, Issue 4: January 26, 2009
- Obamas Internal Drama
- Pork-Filled Stimulus Unlikely to Work as Advertised
- Civil Rights after Guantánamo
- Charismatic Presidents Are Overrated
- This Week in The Beacon
In his latest syndicated column, Independent Institute Senior Fellow Alvaro Vargas Llosa argues that the nation’s economic challenges will force President Barack Obama to choose between his socialistic intellectual influences, on the one hand, and his restraint-leaning temperament, on the other.
“If Obama’s temperament prevails, he could be one of this country’s great leaders,” writes Vargas Llosa. “If he does not, his remarkable journey will signify only a stirring symbol.”
During recessions in the 19th century, according to Vargas Llosa, Democrats and Republicans joined to resist pressures to expand the money supply and grow the size of the government, and thereby laid the groundwork for longer economic recoveries. In contrast, in recent months the money supply has grown extremely quickly, thereby risking the possibility of significant inflation in the future. And then there is the stimulus package. However, Obama has two economic advisors who could help usher in policies of greater monetary and fiscal restraint, writes Vargas Llosa: “Paul Volker, whose tight-money policy at the Federal Reserve in the 1970s facilitated the prosperity of the Reagan years, and Christina Roemer, whose 1994 paper ‘What Ends Recessions?’ sought to prove that fiscal spending was not the cause of recovery after the eight recessions that took place between World War II and the early 1990s.”
Lessons from the Poor: Triumph of the Entrepreneurial Spirit, edited by Alvaro Vargas Llosa
Liberty for Latin America: How to Undo Five Hundred Years of State Oppression, by Alvaro Vargas Llosa
“Contrary to economist Paul Krugman and others, the federal government cannot spend us out of an economic quagmire,” writes Independent Institute Research Fellow Dominick T. Armentano in a new op-ed. Bailouts of faltering banks and automakers actually delay economic recovery, he argues, because they divert capital and labor away from better-managed enterprises.
“We do need more prudent private and public spending, lower taxes on income and investment, and a responsible monetary policy from the Federal Reserve,” Armentano writes. “And we still need lower prices and bankruptcies to finally correct the mistakes of the boom.”
On a similar note, in an op-ed published in Investor’s Business Daily and elsewhere, Independent Institute Senior Fellow William F. Shughart II focuses his aim on Obama’s transportation infrastructure proposal: although it will generate visible economic activity in some sectors, such as construction materials, “it is unlikely to give the economy much of a boost,” Shughart writes. For one thing, Congress will likely require contractors to pay union wages, which means that less-skilled workers will be priced out of construction jobs. In addition, transportation infrastructure spending, such as for the federal highway system, has historically been loaded with pork. Much of that spending will be wasted in inefficient projects, but the waste may be hard to detect. It will, however, improve the odds of reelection for those politicians in districts receiving the funds.
Taxing Choice: The Predatory Politics of Fiscal Discrimination, edited by William F. Shughart II
For Barack Obama to restore the integrity of the United States legal system, he must go beyond merely halting the military trials at Guantánamo Bay, or closing the detention center altogether, according to Independent Institute Research Analyst Anthony Gregory. For starters, the new president should prosecute the Gitmo terror suspects in regular U.S. courts, as was done successfully with Oklahoma City bomber Timothy McVeigh, “American Taliban” John Walker Lindh, and “20th hijacker” Zacarias Moussaoui. In a televised interview with George Stephanopoulos earlier this month, however, Obama suggested that a less desirable alternative may be in store for the detainees: prosecution in a new court system in the United States created just for them, where civil procedures such as habeas corpus are somehow “balanced” against U.S. security interests.
“A new court system at home designed for assumed terrorists and lacking traditional due process could be a step backwards,” writes Gregory in a new op-ed. “If Americans tolerate military tribunals on their own soil, what will be next?”
Although Obama benefited from public dissatisfaction with the Bush administration’s record on civil liberties, Gregory notes that as a senator Obama voted in favor of Bush’s warrantless surveillance program and for indemnity for the telecom companies that facilitated it. Given Obama’s history and the tendency for power to corrupt Gregory urges Americans who seek to restore the country’s reputation for upholding the rule of law to “demand it as loudly as they did under Bush.”
“Obama’s Guantánamo Opportunity,” by Anthony Gregory (1/26/08)
John F. Kennedy had a scant legislative record but nearly triggered a nuclear war so as not to appear weak before the 1962 midterm election. Ronald Reagan left office vastly more popular than the policies he enacted. Theodore Roosevelt is well remembered but was not nearly as important for the presidency as his bland predecessor William McKinley. Yet all three, we are told, are noteworthy for their abundance of charisma.
In truth, there is no meaningful correlation between a president’s “charisma” and his abilities in the Oval Office, according to Independent Institute Senior Fellow Ivan Eland. Whatever their status as popular icons, Kennedy, Reagan, and Teddy Roosevelt are vastly overrated by journalists, historians, and the public.
“Barack Obama has all the qualities these writers and analysts love,” writes Eland. “But charisma and cool and other characteristics that typically impress journalists and historians such as the handling of crises, public speaking abilities, and a take-charge ‘presidential’ management style don’t make a great president. Presidents should be judged only on outcomes that is, presidential policies that affect the country and set precedents for subsequent chief executives. And those policies should be judged by whether, and to what degree, they promote peace, prosperity and liberty. . . . Only time will tell [whether Obama’s] policies meet the test of a great president.”
“Presidencies of JFK, Reagan, and Teddy Roosevelt Show Style Trumps Policies,” by Ivan Eland (1/26/09)
The Empire Has No Clothes: U.S. Foreign Policy Exposed, by Ivan Eland
Below are the past week's offerings from The Beacon, the web log of the Independent Institute.
- “More ‘Complicated’ Data on Global Warming,” by Mary Theroux (1/26/09)
- “El Krug,” by Peter Klein (1/26/09)
- “Obama and the War on Terror,” by Anthony Gregory (1/26/09)
- “The California State Budget Disaster,” by David Theroux (1/25/09)
- “Fannie Mae’s First Chief Credit Officer Blames Government for Sub-Prime Meltdown,” by David Theroux (1/22/09)
- “Big ‘Duh,’ No. 1,” by Mary Theroux (1/22/08)
- “Halbrook Testimony on C-SPAN on Nominee Eric Holder for Attorney General,” David Theroux (1/22/09)
- “New Libertarian E-Journal,” by Peter Klein (1/22/09)
- “Oh, Joyful, Joyful Coronation Day,” by Robert Higgs (1/20/09)
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