More Government vs Less Government

[PaulKay]

I read a couple articles over the weekend that I find so incredibly ironic.

Is it governments role to fix the economy or just let the private sector fix itself?

news.yahoo.com/analysis-governments-role-fix-economy-072531745.html
.......
The economy needs to be fixed. On this, Democrats and Republicans agree. They part ways over how to do it and, specifically, what role the federal government should play.

"Ultimately," President Barack Obama tells Congress, "our recovery will be driven not by Washington, but by our businesses and our workers. But we can help." His argument that government has a responsibility to do so probably doesn't sit well with an America that's down on Washington.

Texas Gov. Rick Perry, former Massachusetts Gov. Mitt Romney and other Republicans competing for his job take a different tack as they court a tea party-infused GOP electorate: The economy will thrive, they say, if Washington simply gets out of the way. As Perry puts it: "Smaller government, less spending, fewer regulations."
..........

But totally contrary to the Less Government stance is this...

This is a NYT piece about manufacturing in the U.S. and how our government does so little to help build manufacturing here. The irony is that these business people who are making the arguments are very likely Republicans.
www.nytimes.com/2011/09/11/business/is-manufacturing-falling-off-the-us-radar-screen.html?src=me&ref=business

It would seem to me that if Obama came up with an industrial policy to help lure manufacturing back to the U.S. some tea party Republicans would be screaming Socialism....

[omaha]

Sept 12, 2011 8:39:14 GMT -5 PaulKay said:

It would seem to me that if Obama came up with an industrial policy to help lure manufacturing back to the U.S. some tea party Republicans would be screaming Socialism....

Zactly.

Tea Party Republicans are very much not the same thing as old-style crony-capitalism Republicans.

I'd like to think that the Solyndra fiasco settled that debate, but I doubt it.

[dradtke]

Tea Party Republicans are very much not the same thing as old-style crony-capitalism Republicans.

That comment makes you a Democrat. You're either with 'em or agin 'em.

[PaulKay]

Sept 12, 2011 8:51:13 GMT -5 @omaha said:

Sept 12, 2011 8:39:14 GMT -5 PaulKay said:

It would seem to me that if Obama came up with an industrial policy to help lure manufacturing back to the U.S. some tea party Republicans would be screaming Socialism....

Zactly.

Tea Party Republicans are very much not the same thing as old-style crony-capitalism Republicans.

I'd like to think that the Solyndra fiasco settled that debate, but I doubt it.

Clearly the solar panel deal was incredibly stupid, but GM and Chrysler were not. But there are many Reps who would have preferred those companies to fail and called it Socialism. I call it saving jobs; saving manufacturing; promoting manufacturing. So the irony is that the pro business republicans would be manufacturing's worst enemy.

[omaha]

Well, that begs the question regarding what would have become of GM and Chrysler without the bailout...which is of course a process of pure speculation. In pragmatic terms, both sides claim to be on the side of the angels, but neither can prove their case.

What I think is important is to understand and define how these decisions are made and will be made in the future, which leads me to a question (asked in all sincerity and with no snark intended): By what measure do you consider the GM/Chrysler bailouts to be a success?

[patrick]

Sept 12, 2011 8:51:13 GMT -5 @omaha said:

I'd like to think that the Solyndra fiasco settled that debate, but I doubt it.

The reason it won't is because Solyndra, and two other solar panel companies, including one backed by Intel, all got driven out of business because of rock bottom solar panel prices from China.

While the US pursues limp-wristed industrial policies to keep Republicans happy, we're getting crushed by the full-throated version from China.

But not to worry, we can just buy all our solar panels from China. Hey, maybe they'll buy the Solyndra technology to use there. With Chinese workers.

[majorminor]

I'm fairly conservative leaning except for apparently this issue. I simply feel we are better off as a nation with a higher % of manufacturing jobs. If that means stemming the tide with some import taxes or trade regulation so be it. It looks and feels to me we are becoming an economy based on buying and selling things made by others and the exportation of technology and ideas. I don't see the long term wisdom in that.

[omaha]

I'm not unsympathetic to that view, although if economists are certain of anything its that trade through comparative advantage makes both sides richer.

But in any case, it has nothing to do with Solyndra and the wisdom, or not, of direct government (ie "political") investment in private companies.

Actually, the problem with China trade makes the Solyndra story even more indefensible: Did the administration not know about the risks that Solyndra faced? Assuming for the moment that Patrick's analysis is correct (and to be clear, I've read other analyses that said Solyndra failed because it offered a fundamentally non-competitive technology...not all solar cells are created equal), what does it tell us about government investment in private business that they dropped $500 million on Solyndra while allowing that investment to be compromised by a risk factor under their (the government's) control? Does their right hand not know what their left hand is doing?

[millring]

The government tail wags the dog, makes a decision to back something on pure speculation and if that something ends up successful, the government says, "See? ...we told you the market needed governmental direction." If what it backs fails, it was going to fail anyway. Win/win.

The other problem with what the government wants to back is that it is ideologically driven -- like solar or wind energy, based solely on the morality/religion of environmentalism (another good reason why religion shouldn't be able to use the government to evangelize).

[Deleted]

One of the fundamental objections to the concept of corporations being treated as citizens is that they are not held to the same moral, eithical or legal standards. An individual who shifts massive resources, opportunities, secrets and value to China, or another country, may be considered unpatriotic, slimy, or even criminal. yet, we actually expect corporations to do exactly that, if it benefits their shareholders (who may be citizens of either country).

I confess I was not always opposed to the concept of international free trade. It seemed, (and still does, vaguely) that the more humans can do to deemphasize the concept of national borders the better. I'm kind of rethinking that. Seems like free trade is looking very much like a race to the bottom to pimp national resources (including environment and labor) to the lowest bidder. What sounded like a great idea ends up being just another way to shift wealth and power even more toward oligarchs. And, I think the analogy is seen within the US in the growth, and eventual political control of corporations. Once considered an illegal entity, individual states began enticing them in the eighteenth century, each offering more immunity, benefits, and power to the oligarch which would locate or incorporate there. Deleware, New Jersey, and New York each tried to outdo the other in offering power and control. Other states got into the act by offering damn near total control as a "business-friendly" jurisdiction. And, we lost the damn country.

So, no one should have the least bit of anticipation as to how any trade battle will resolve itself. That train left a hundred years ago. There will be no restrictions on trade, or the ability of your corporate masters to relocate assets, jobs, resources, or anything else on the part of the US. That battle is LOST. Best we can hope for is that the system of shopping for cheap labor and unprotected environments is undermined or collapses from resistance in other nations. Send donations to foriegn resistance groups pledging to socialize or organize labor in the wage-slave nations that lure the corporations. There is still some hope that the relocations prove so disastrous or costly, that it becomes a deterrent.

[Russell Letson]

John, I expect a more rigorous use of language from someone with your level of theological and linguistic sophistication. "Religion" is a subset of "ideology," otherwise various politically conservative positions would be as "religious" as, say, environmentalism. Neither ethics nor morality is inevitably tied to religion--otherwise the canard that atheists and agnostics lack a basis for moral behavior would not be easily disproved by examining the behavior of, say, me.

As far as the proper "size" of government goes: How long is a piece of string? I would think that a more useful question is "What social, organization, logistical, etc. problems can be addressed by 'government,' and what are the most effective and efficient means 'government' can employ to do so?" The "government is too big" talk operates on an abstraction level that just about guarantees that nothing useful will come out of the discussion. How big does a water-supply system need to be? How big does a continent-spanning transport system need to be? How big and intrusive does a public-health system need to be? How extensive does a taxation system that funds such enterprises need to be? And those are just the most concrete, physical- and logistical-problem questsions. Matters of the interface between the organizations that operate the public machinery and the private realm where people carry on their ordinary lives get all kinds of complicated as all that private behavior connects with the public realm and with other private behavior.

First principles are interesting entities--they might look simple, and they make nifty bumper stickers or placards, but they conceal universes of complexity as they get applied to the real world.

[Doug]

Other countries don't have free trade so not a level playing field.

Something for government to do to level playing field: Use the same regulations that other countries do, (no company in the US can be owned by a non citizen. If ANY products are tariffed into another country then all products from that country are tariffed.

The need for the GM/Chrysler bailout was caused by the government regulation. Why do we only have one US car company (Ford) in the most car country in the world when in 1950 we had at least ten, because the government drove them out of business.

Government's only legitimate roll is defense of the borders (not imperialistic wars) which they have failed at. And preventing the states from going to war against each other.

All Republicans since Ronnie Rayguns have just been Democrats.

On Edit:
The proper size for a water supply is individual. Drill your own damn well. ;D

[fatstrat]

It is true that American politics has become so polarized that even if one side had the perfect solution, the other would instinctively oppose it.
But on this issue, IMO the answer can easily be seen by looking at Europe. European style socialism is what Obama & the Democrats seem to want. All the while we see it failing in Europe.
Free Market Capitalism is what helped make the U.S. great. The idea that if you build a better mousetrap, you might get rich. It's not perfect, but it has seemed to work better than anything else we've seen. The Govt needs to get out of the way and let it work.

[omaha]

Now that is a proper first posting.

[timfarney]

The American conservative movement that has preached "small government" for going on four decades now has only made government bigger when they were in charge of it. Even if I believed smaller, not better government was a solution to anything (which is a fundamentally stupid thing to believe), why would I believe them?

Tim

[patrick]

Sept 12, 2011 11:31:52 GMT -5 @omaha said:

Actually, the problem with China trade makes the Solyndra story even more indefensible: Did the administration not know about the risks that Solyndra faced? Assuming for the moment that Patrick's analysis is correct (and to be clear, I've read other analyses that said Solyndra failed because it offered a fundamentally non-competitive technology...not all solar cells are created equal), what does it tell us about government investment in private business that they dropped $500 million on Solyndra while allowing that investment to be compromised by a risk factor under their (the government's) control? Does their right hand not know what their left hand is doing?

What exactly was under the government's control in this? Does the US control the Chinese govt's investments?

Solyndra's product had significant advantages over other solar panels on the market, including the ones currently pouring out of China. Solyndra's panels were a flexible film that could be mounted on almost anything. Their challenge was to make their manufacturing cheap enough, and that's where getting hit with a tsunami of cheap panels from China killed them along with other US manufacturers.

As far as whether the govt knew about the risk factors, apparently the govt was about as smart as Richard Branson, the Walton family, CMEA and US Venture Partners, who collectively lost far more.

[patrick]

Sept 12, 2011 15:54:46 GMT -5 @fatstrat said:

But on this issue, IMO the answer can easily be seen by looking at Europe. European style socialism is what Obama & the Democrats seem to want. All the while we see it failing in Europe.

Oddly enough, the German economy has far more socialism and government intervention than most, and Germany is growing like crazy.

But that's because Germany has protected its manufacturing base.

[fatstrat]

Sept 12, 2011 16:26:23 GMT -5 timfarney said:

The American conservative movement that has preached "small government" for going on four decades now has only made government bigger when they were in charge of it. Even if I believed smaller, not better government was a solution to anything (which is a fundamentally stupid thing to believe), why would I believe them?

Tim

I agree w/you to a point. That point being the divide between Conservative and Republican. Not so long ago they were one and the same. Or so WE THOUGHT. Mr. Bush quickly dispelled that idea for me and many others. And even more are seeing the light in recent years.
It's going to be hard to get away from "Big Govt". The country is big and has much more infrastructure than the founders ever envisioned. But there are so many ways we could trim govt that should be of benefit to "most" of us. The "most" being those that aren't parasites on society. Capitalism isn't meant to be easy. It's based on the idea that you should get out of it, what you put into it.
For example, funding of the Arts. Art is nice. But if an artist can't make a living on his own being an artist, maybe he should find something else to do. Why should you or I be forced to pay him?

[brucemacneill]

Sept 12, 2011 16:26:23 GMT -5 timfarney said:

The American conservative movement that has preached "small government" for going on four decades now has only made government bigger when they were in charge of it. Even if I believed smaller, not better government was a solution to anything (which is a fundamentally stupid thing to believe), why would I believe them?

Tim

That, Tim, is the problem, IMHO. No one has a good reason to believe either party. However, again IMHO, "Better government" vs. "More or less government" really depends upon which government we're talking about. We have several levels of government but we tend to talk about the federal government as if it was the only one that counted. I favor smaller Federal Government with the larger government sectors being at the state or below level. Washington has no idea what is needed at a locality and therefore their big plans are of necessity one-size-fits-all. I can't think of any reason to believe that can work and it doesn't work. The Constitution gave the Feds responsibility for the security of the country, foreign relations, resolving disputes between the states and very little else. IMHO, we should be working back toward that ideal because overall it wasn't a bad idea and screwing with it has proven to be a bad idea. Why now anyone would admit to being a progressive liberal democrat, favoring a large federal government is beyond my comprehension other than that it is difficult for some people to admit they have been wrong. So, I'll support whichever candidate appears to be moving in that direction whatever party they belong to, preferably neither of the big ones.

[omaha]

There is an interesting new book out called "Declaration of Independents" that posits a dramatic libertarian swing in the near future.

"Democrat" and "Republican" are dying brands.