Idle Musings of the Active Mind

A friend of mine asked me the other day if I thought the economy would recover. I immediately and without hesitation answered, “Not to the level we have just previously enjoyed, no.”

His question came in the midst of opining on the merit–or lack thereof–of Obama’s economic stimulus plan and package. We covered such areas as whether or not we felt the AIG bailout should have been allowed, whether or not the government should be allowed to step in and take over management of a business that it felt could have an economic impact if it failed, and whether or not we felt racking up $1.5 trillion in debt was something that would ever be paid back and eliminated.

He proceeded to quiz me on why I felt so strongly and confidently that the economy would not recover to previous levels. Here’s the upshot of my response…

I own two houses: one is in Minnesota, the other in Iowa. When we left MN and came back to IA, we tried to sell our house, but in 2007 the housing market was sluggish in the area where we lived. I could have sold it, but only if I dropped the price so low that I would, in essence, take a small loss. I wasn’t willing to do that. The property was, at one time, valued at around $275k (give or take $20k). Today, if I wanted to sell it, I’d have to drop the asking price to something near $100k–maybe less. So the question being asked, in my mind anyway, is whether or not I think my property in MN will ever have the potential to fetch $275k again. Realistically, I just don’t see how. So, no, I do not think the economy will recover to previous levels. 

Under Obamanomics, the idea seems to be able to be distilled down to a few simple ideas:

• Dump a ton of money into the economy.
• Increase government’s role in the private sector.
• Raise taxes on the wealthy and sustain them on the less wealthy.
• Convince everyone that the Obamanomic economists have accurately projected the rate of economic recovery.

 I was skeptical of Obama during his campaign. I can’t say I wasn’t caught up in the excitement of the prospect of having an African American as our president. And I don’t think Obama is a stupid man in any fashion. I have a genuine belief that he sincerely wants to do the right thing for our country. That being said, however, some of the things he is suggesting–or allowing the democratic controlled congress to suggest–just scares the hell out of me.

Part of what scares me is the notion that there are few, if any, bona fide altruists in the world. The idea that one of those few true spirits might choose a life of politics is just unfathomable to me. But an altruist is what is required if these Obamanomic practices become national law.

Think about this…

You start a business. It does well. You guide and steer your company to the point of it being a major corporation earning enormous profits. But then you start making bad decisions–or allowing others to make them for you. The size of the corporation and the nature of its products have risen to such a prominent level that should your company fail, you will affect the lives of 1000’s of people. Hmm. I hope to high heaven you are not an asshole, because if you are there is nothing to prevent you from driving the business into the ground as you play with the money and investing and the compensation payouts to line your already thick pockets with extra cash.

The government, when it recognizes what is happening, will step in suddenly and tell you how you are mismanaging your company and take over. Hmm. What’s the down side? Where’s the risk?

If government would stay out of the private sector, the risk is that you’d be broke at the end! Hey, there’s some incentive not to be a complete asshole! You’ll be poor in the end if you try that stunt.

Government’s role should be to keep the playing field leveled so that everyone has an equal opportunity to be successful. And by “leveled” I don’t mean handing out fistfulls of cash to any swinging dick that asks for it. There needs to be SOME level of oversight, but when I hear suggestions that government should step in and “partner with the private sector,” well, it just scares me to death.

To be fair, though, I have to admit I could just be an anti-change curmudgeon on this. Maybe it is time for America to embrace a new ideology; one that expects government to be involved in everything we do. Maybe we need that level of intervention for a while–say, for a couple of decades–as we plow through some evolutionary changes in technology and social interaction encouraged by the Internet and things like Web 2.0 technologies. The problem, though, is in figuring out how to decommission that intervention at an appropriate time. And making SURE that decommissioning activity actually happens.

If this kind of change is necessary, though, I want everything to be above board and transparent, analyzed by experts and reviewed in the court of public opinion before it happens. And to be clear on this, I am not referring to airing the information on television networks, edited and spin-doctored by an agenda-driven press. I want it to be available in a coherent, concise, undertandable form that solicits and gathers my feedback and opinion. I don’t want the responsibility abdicated to a bunch of talking heads who think news and the media is about entertaining the public.

What’s that, you say? Impossible?

I agree. It does not, however, change my opinion on the matter one iota.