A Voice in the Wilderness In Defense of "Mere Conservatism"

Keynes Rides Again

Speaker of the House Nancy Pelosi had this to say about unemployment benefits:

This is Keynesian Economics in its purest form. John Maynard Keynes was a 20th century economist who postulated (to the delight of socialists, collectivists, and Marxists everywhere) that due to the volatile nature of the free market economy, the federal government must move from its role as umpire and become one of the key players in the economic game. Speaker Pelosi has taken this dis-proven theory to new lows by flatly stating that unemployment checks from Uncle Sam should now be considered the equivalent of private sector job creation.

But who is paying for those "stimulus" checks?

Liberal and progressive Democrats do not wish to be bogged down with the messy details of economics. There is no self-congratulatory rush of warm emotions from telling the American people that fiscal responsibility (and math) dictate that we cannot sustain our current parade of government hand-outs. Nowhere better than in Illinois do we understand that unsustainable nature of Leftist economic policies.

As the former British Prime Minister Margaret Thatcher used to say: "The problem with socialism is that eventually you run out of other peoples' money."

Economic lessons from the Germans?

Stop me if you've heard this one: You know your country's on the road to unsustainable top-down socialism if...German leaders are schooling your president in the benefits of deficit reductions.

From Bloomberg:

Chancellor Angela Merkel championed German export strength as “the right thing” for her country, spurning President Barack Obama’s call to boost private spending as both leaders prepare for Group of 20 talks.

Merkel, addressing a business audience in Berlin today, said she told Obama in a phone call that cutting government debt is “absolutely important for us,” exposing a second point of contention ahead of the June 26-27 G-20 summit in Canada.

Reducing the budget deficit by 10 billion euros ($12 billion) per year “won’t put a brake on the world’s economic growth,” Merkel said, relating what she told Obama yesterday. Germans are more likely to spend money if they feel the government “is taking precautions” to ensure solid finances, she said.

Europe has tried the welfare state as its governing economic worldview, and it has failed.  Miserably.  As former British Prime Minister Margaret Thatcher once put it: "The problem with socialism is that eventually you run out of other peoples' money."

For all the talk of pragmatism and rational, prudent judgment when media pundits describe President Obama's governing style, the man seems to know very little about how economics (aka "math") works in the real world.  The administration has been putting pressure on Germany not to get their own financial house in order, but to "Spend, Baby, Spend!"

Four days before world leaders meet in Toronto, Germany is heading for conflict with the rest of the G-20 over tighter financial regulation, a banking levy and U.S. calls to boost growth rather than cut debt.

Of course none of this is a surprise to the voters in a city like Chicago and of a state like Illinois.  Higher taxes, stifling regulation on business, unchecked spending, and rampant corruption all follow the economic policies of big-government liberals wherever they go.

Whether we're talking about Berwyn, IL, or Berlin, Germany, we desperately need political leaders who are willing to take tough, perhaps even unpopular, stances when it comes to government spending.

Here is Dr. Walter E. Williams, an economist at George Mason University, explaining some of the problems that stem from debt, deficits, and inflation spending: