“You never want a serious crisis to go to waste,” Rahm Emanuel said, and he meant it.
The epic bankruptcies and near-bankruptcies, the credit crunch and dwindling consumer confidence, all compounded by the media’s hysterics have served to make despairing Americans uniquely pliant. Political leaders and financial giants are now rushing to parlay the nation’s panic into the easy passage of a massive government “stimulus” package.
The arguments most often employed in defense of the stimulus bill maintain that now is not the time for idle thinking but for bold action — any action. Tyler Cowen, a respectable economist, declares (without a hint of sarcasm) the following Warren Buffett rant to be “the best argument [he has] heard for the stimulus”:
The answer is nobody knows. The economists don’t know. All you know is you throw everything at it and whether it’s more effective if you’re fighting a fire to be concentrating the water flow on this part or that part. You’re going to use every weapon you have in fighting it. And people, they do not know exactly what the effects are. Economists like to talk about it, but in the end they’ve been very, very wrong and most of them in recent years on this. We don’t know the perfect answers on it. What we do know is to stand by and do nothing is a terrible mistake or to follow Hoover-like policies would be a mistake and we don’t know how effective in the short run we don’t know how effective this will be and how quickly things will right themselves. We do know over time the American machine works wonderfully and it will work wonderfully again.
Laissez faire is not even an option. The question, as Buffett and others would have it, is not whether anything at all ought to be done, but what must be done; not whether intervention is desirable, but how much intervention; not whether we need massive pork-barrel projects, but who gets the pork and how much do they get. The entire debate is now consumed by administrative details of little interest to a rattled public. Consider some of the preposterous and special-interest driven proposals in the “stimulus” bill:
• $726 million for an after-school snack program
• $650 million for coupons to help people switch old televisions to digital
• $209 million for maintenance work at the federal Agricultural Research Service’s research facilities across the country
• $200 million for fresh sod on the National Mall
• $150 for maintenance at the Smithsonian Institution
• $50 million for the NEA (Teachers’ Union)
• $50 million to make up for a lack of philanthropic support for the arts
• $6 million for broadband Internet access
At least the Bailout Bill was called by its correct name.
So far Americans have yet to receive a satisfactory explanation as to how redistributing nearly a trillion dollars of wealth from the pockets of individuals and businesses in the private sector into extravagant government waste is supposed to stimulate the economy. Buffett’s “throwing a trillion dollars into projects whose effects no economist can anticipate is better than doing nothing” just doesn’t cut it.
