The View From 1776

Our nation has become hypnotized by the PR hype surrounding all presidents.  The proposed stimulus plan almost certainly will do little to boost employment, but it will give a huge boost to inflation.  In our economic ignorance, we desperately want to believe that presidents can take steps to manage the economy back to low unemployment and prosperity.  We therefore demand action, even if such action always leads to inflation that makes economic problems worse.

Chalk the misperception up to President Franklin Roosevelt (FDR).  He was the first president to operate on the hubristic presumption that a president could plan and successfully manage the entire economy to prosperity by imposing the liberal-progressive ideology of social justice.  Even Arthur Schlesinger, Jr., one of President Roosevelt’s most sycophantic eulogizers, was compelled to tie the New Deal to what he termed the imperial presidency.

Before FDR’s 1930s New Deal, presidents campaigned on broad programs for the nation’s benefit.  Such were support for westward expansion of our nation, the expansion of railroads, and Lincoln’s opposition to extension of slavery. No president before FDR, however, ever dreamed that he had the personal power to override the Constitution’s 9th and 10th amendments and to change completely both our national structure of government and the ownership and regulatory structure of the economy.

For that, we cannot blame President Obama.

But we can blame presidents who fail to address and to comprehend the lessons of history.  In too many cases, presidents come to believe their supporters who praise them as if they were Roman emperors to be worshipped as gods of the state.

President Roosevelt, a quintessential egotist, believed himself to be indispensable to the nation.  He was the only president to break the traditional two-term limit established by George Washington.  Roosevelt was elected to four terms, even though he knew that he was at death’s door in the final election.  Remaining in power was so important to him that he ignored the dangerous position he was creating for the nation, still at war around the globe.

His ideology of liberal-progressive state-planning was a retread version of the socialism outlined by French theorists in the first decades of the 19th century.  The New Deal was as unsuccessful as France’s dozen of more constitutions, restoration of the monarchy, and reinstitution of empires between 1789 and the end of the 19th century. France, like the New Deal, put the economy in an uproar with continual changes in basic economic structures.

England, sticking to its historical protection of private property rights, ran rings around France, economically and politically, during that period.

Since the New Deal, three generations of students have been taught the myth that FDR ended the Depression and that the Federal government has the ability to maintain and to restore economic prosperity. 

The problem every president faces is that human nature doesn’t change, despite Darwinian evolutionary doctrine applied to Marxian theories of the inevitable course of history.

No president has a team of economic analysts sufficiently computer-wired to collect real-time data on continually changing interactions of 300 million people, to interpret those actions, and to make timely and effective moves to steer all of them in the direction sought by socialist state-planners. 

Government planners, as yet, cannot force people to spend their savings during a recession, nor can they compel banks to lend more money to palpably poor credit risks in shaky economic conditions, and they can’t force manufacturers to increase production when their inventory pipelines are full of unsold goods and their production costs remain too high to produce at a profit.