Mark Steyn compares Obama's G20 plan to phone sex in this unhinged rant in the National Review. This is typical mudslinging by the Republicans who try to sling all the mud they possibly can and hope something sticks. This is a sign of a party that has no new ideas, no new plans, and has nothing else to live for. They are so devoid of ideas that their latest "budget" involved no figures whatsoever, just the same old failed rhetoric and failed politics of the last eight years.
Steyn uses a gaffe by the White House, in which they gave out the wrong number to listen in on a Hillary press conference, to lead into a typical Republican attack on Obama's plans.
Alas, what with the collapse of the newspaper industry and major metro dailies filing for bankruptcy every 20 minutes, sticking phone sex on your expense tab isn’t as easy as it once was. So many of these big-shot correspondents were forced to hang up, call the White House Press Office, get given the correct number, and listen to Hillary droning on about the NATO summit for half an hour. The deputy press secretary, Bill Burton, insisted that the White House handing out sex-line numbers was no big deal and only Fox News would make a fuss about "a corrected phone number."
I’m not sure why the White House needed to correct it. It’s the perfect radio ad for the administration. Call 1-900-OBAMA and Timothy Geithner will demand your credit-card number and ask whether you feel like getting nasty, because he certainly does. He’ll be wearing a steel-tipped basque, and the squeals in the background will be an AIG executive or the former CEO of General Motors hanging upside down in the Treasury Department basement while he feels the firm lash of government "regulation" from Barney Frank and Mistress Pelosi.
Well, we all hate "the rich," don’t we? Last week, David Paterson, the governor of New York, said that if he’d known his latest tax increase would persuade Rush Limbaugh to sell his Manhattan apartment and leave the city, he’d have raised taxes earlier. Ha-ha. Very funny. In New York City, as Mayor Bloomberg has pointed out, the wealthiest 1 percent contribute 50 percent of municipal revenue. How tiny a number of people does Governor Paterson have to drive out before it causes significant shortfalls in the public coffers?
The problem is that they brought it on themselves. The thing that led to this mess was an out of control mentality of borrow and spend, where borrowing was supposed to give us all the American Dream. Now, the bill has come due, and it is everyone who is suffering. Obama's plan is a start, but it will take a lot more to stabilize our system so that we don't go through this again. The first priority is to create short-term stability in the system; that is what Obama's plan has done. That has slowed down the recession and has turned around some key indicators. But it has not fixed any of the long-term structural flaws in our system that led to this in the first place. What must happen is that we have to learn to live within our means, diversify the ways in which we earn income, and not risk more than we can afford to lose.
But for Obama to turn this country around, we must do more -- and that means getting rid of the Bush tax cuts so that we can have the revenue to convert to a green economy and create affordable economy cars so that we can create jobs to replace the ones that we have lost. We must have a universal healthcare system because companies are locating more and more plants in Canada and other places with universal healthcare so that they will not have to pay out of control healthcare costs, such as what GM had to do.
But what Steyn would do is continue the ludicrous policy of tax shelters that deprive the US and other governments of billions of dollars worth of tax revenues. What the Republican Party has done is engage in a constant struggle to evade having to pay taxes and advocate for extreme policies such as the flat tax, the so-called "fair tax," and other gimmicks that would raise the deficit even more and would shift the burden onto the average taxpayer. And anti-tax extremism kills -- witness the Katrina disaster or the failure of Tim Pawlenty to make necessary repairs on the bridge that collapsed, causing tragic loss of life.
And then Steyn argues that part of the reason we are in this mess is because many nations are running out of people and thus running out of tax base. He thus implicitly blames the policy of birth control. But the reason is economic -- in places like Haiti, with a low standard of living, mothers living in extreme policy have as many as 10 children because they hope that 3-4 of them will survive. Kristof tells the story. But in places like France or other parts of Europe or here, the reason people don't have children is because they don't want to have them until they have the economic resources to take care of them. So, if not enough people are having children for a nation to maintain or grow its population, then that means that it is necessary for the government to to ensure that it is economically feasible for its people to have children and start families. That could mean requiring employers to have more maternity-friendly policies, for instance.
Nobody is suggesting, like Steyn claims, that we are somehow secretly trying to create some form of one-world currency. He is pandering more to the Black Helicopter Crowd than he is engaging in actual debate. But what is keeping this country afloat and what is fueling our ability to bail people out is the fact that investors around the world are parking their money in the US Treasury, because of the full faith and credit of the US Government in paying off loans. But that will not be sustainable in the long run if we are using one group of investors' money to pay off another group of investors. What must happen is that the government must create a tax base through healthcare and green jobs in order to replace the millions of jobs lost, reduce the deficit, and then live within its means. We were well on our way to doing that until Bush created record deficits with his tax cuts for the wealthy. When we return to the fiscal sanity of the Clinton administration, investors will continue to buy dollars and China's calls for a base currency to replace ours will fall on deaf ears and get relegated to a historical footnote.
Steyn then goes to discuss banking profits, which he says went from 16% of US corporate profits in the 1970's to 41% now. But he is right for the wrong reasons. He claims that it is because of all the burdensome taxes and regulations that government imposed. But that is simply not true. For instance, I manage a small business, and I paid zero taxes this year -- I was able to write all my taxes off through mileage, business expenses, and postage expenses. Steyn shows a blatant ignorance of how the tax system works. If we live within our means, then we don't have to worry about taxes in the first place.
Another reason that Steyn gives for the cycle of boom and bust was that investing got to the point where we just threw a dart at something and invested in it. That is one of the few things I agree with -- as a country, we have become totally illiterate when it comes to investment. What must happen is that we have to relearn the fundamentals of investment.
First of all, we must diversify our sources of income -- that means that even if we have a full-time job, it might be smart to take on a part-time job in order to have a source of income if one source fails. Or, it might be smart to do paintings or take photography or become a referee or something of that nature -- anything that can bring in a second source of income. Secondly of all, we should understand the risks of what we are undertaking -- if we take on a $50,000 a year job, that might be a much higher risk if the cost of living is also high -- a $24,000 a year job might be safer if the cost of living is low. It might be a lot riskier to own a home than it would be to rent one, for instance.
Thirdly of all, we should not invest in anything that we don't understand the nature of. That is the mistake a lot of people made when they took out adjustable-rate mortgages when buying a new home -- the end result was mortgage payments of thousands of dollars a month, which resulted in foreclosures even on people who were able to keep their jobs. That is the mistake that a lot of people made when they invested in Enron, for instance. Fourthly of all, if the collective mentality of something is that it will keep going up forever, then that is a good time to get your money out. That is what happened with the oil futures and Enron -- everyone kept saying that they would keep going up, and they crashed instead. Fifthly of all, we should not risk anything that we can't afford to lose. That one should be self-evident.
But Steyn omits one of the main reasons why we got into this mess, something that both Clinton and Bush are responsible for -- the elimination of Glass-Stegall. What that act did was force banks to stay out of the kind of risky investments that created this mess and that created the Great Depression as well. Plenty has changed since the creation of Glass-Stegall -- the financial industry is a lot more complicated than when it was originally passed. But what must happen is that the government must adapt to these changes and pass intelligent regulations that force banks to live within their means and that take into account the nature of changes in the financial services industry since the 1930's. Repealing it outright threw out the baby with the bathwater.