The View From 1776
Wednesday, December 12, 2012
Playing Politics With The Economy
When political leaders care more about gaining power than about promoting the general welfare, the Constitution is under attack.
The Constitution’s preamble cites among its purposes to “establish justice” and “promote the general welfare.” Which contributes more toward those aims? so-called social justice, i.e., forcibly redistributing wealth? or reviving the economy so that more people can find jobs and resume supporting themselves, while raising the overall standard of living for everyone?
Apparently, for the president, restructuring our economy and our political society in accordance with socialistic egalitarianism trumps all other considerations. He believes either that the negative incentives introduced by higher taxes are nugatory and that socialism can harmlessly proceed apace, or that working to complete Franklin Roosevelt’s New Deal socialism should be his major goal, regardless of the negative effects on economic recovery.
Some Keynesian economists have argued that, though economic conditions are not at all the same as during President Clinton’s terms in office, reverting to tax rates prevailing at that time will cause no economic harm. More economists fear that raising tax rates now, when economic recovery is so slow and unemployment so high, will push us toward a renewed recession. No economist, so far as I’m aware, has asserted that raising taxes now will aid economic recovery or do more than slightly reduce the extent of deficit spending.
Many commentators, including Obama himself, have characterized imposition of higher tax rates on “the rich” as a moral issue. It is indeed a matter of morals, but not in the way the president has in mind. One thing is certain: the majority of people polled want to see higher taxes on “the rich,” viewing it as punishment deserved by people whose acquisition of greater wealth presumably was, in some undefined fashion, the cause of our prolonged Great Recession.
Obama continually since his first days in office has fostered that view in his speeches and press conferences. His is the typical politician’s scape-goating a minority, typified by Adolph Hitler in the 1920s and 1930s, seeking political power through fomenting class warfare.
Appealing to the baser instincts of the economically illiterate masses, while ignoring rational judgment, is demagoguery. Obama’s appeal is in the mode first appearing in a democratic society during the fifth century BC. Athenian demagogues appealed to the emotions of the masses by misstating facts and promising to take from the rich and give to the poor in exchange for granting establishment of tyranny.
Demagogues unfailingly corrupted Athenian public morals and undermined the political order introduced by Solon’s constitution, which had created a balance of power among landed aristocrats, merchants, and laborers. Under the demagogues, constitutional government degenerated into rash mob action that ultimately destroyed Athenian economic and political power in the Peloponnesian War with Sparta.
Our founding generation who wrote the Constitution were very mindful of that danger. The Bill of Rights is intended to protect minority rights against what Alexis de Tocqueville (in Democracy in America) called tyranny of the majority. “The rich” are among the minority groups who are supposed to be protected against rash action by the Bill of Rights.
...in Federalist No. 10, Madison compares the proposed federal form of government to the weakness of pure democracies, in which all questions are decided by majority vote, without regard to existing law or tradition:
Hence it is that such democracies have ever been spectacles of turbulence and contention; have ever been found incompatible with personal security or the rights of property; and have in general been as short in their lives as they have been violent in their deaths.
In the next to last paragraph of Federalist No. 10, speaking of the problem of special interests, Madison says:
A rage for paper money, for an abolition of debts, for an equal division of property, or for any other improper or wicked project, will be less apt to pervade the whole body of the Union than a particular member of it.
Unfortunately, since the 20th century’s rise of liberal-progressivism, first under President Woodrow Wilson, then under President Franklin Roosevelt, the checks and balances of the Constitution have been steadily weakened and more power concentrated at the Federal level, especially in the executive branch.
President Obama’s four years of non-stop campaign speeches are quintessential demagoguery, intended to bring mobs of labor union thugs and unsophisticated young students into the streets threatening “blood” if their demands are not met for punishment of “the rich” and expansion of the socialist welfare state.
The political stability and social order established by the Constitution is mortally threatened by this liberal-progressive onslaught.