How the Bush Administration Bankrupted America; How the Obama Administration can Restore America's Prosperity

Conservatives are like the comedian Rodney Dangerfield these days, they can't get no respect. In the public mind, figures like Rush Limbaugh, Bobby Jindal, Joe the Plumber, and Sarah Palin are a source of bemusement, a slightly annoying but nonetheless chuckle-producing diversion from the calamities the conservative movement helped engineer.

The same cannot be said, alas, for conservative commentators like Charles Krauthhammer, Michael Gerson, and Sean Hannity (a trio of humorless blowhards oozing animus from every pore). I suspect their vinegary dispositions stem from the fact that their most cherished beliefs are constantly at variance with reality. As William James recognized, there is nothing more painful than false belief.

The financial pain America is currently facing can be traced to a set of false beliefs that constitute the core of conservatism's economic doctrine. These discredited principles include: the notion that tax cuts pay for themselves, the idea markets are self-correcting, and the belief that deregulation serves the common good.

Tax cuts are to conservatives what crack cocaine is to lab rats. The basic idea behind supply-side economics is that taxes must be lowered on America's most productive (i.e., wealthiest) citizens because they alone possess the wherewithal to put capital to work. Conversely, transferring resources to the poor, so the thinking goes, will only insure that wealth is squandered on unproductive forms of consumption.

The wealthy received their tax breaks under the Bush administration, but the promised investment glut never materialized. Conservatives have peddled the notion that taxes are a form of punishment, or a disincentive to productivity. But a truer view of taxes comes from Oliver Wendell Holmes, who held that taxes are the price of civilization. If Holmes is right, then it follows that those who benefit the most from society (i.e., the wealthiest) owe the greatest share in return.

The origins of the current financial crisis are complex. Americans had been living beyond their means on borrowed credit for too long. The United States staked its future on financial services and products, as opposed to manufactured goods. To make up for the trade deficit the United States borrowed heavily from countries like China to keep the good times rolling. Debt-ridden consumers, however, found they could no longer afford to products once housing prices were undermined by deadbeat sub-prime borrowers. By this stage, as British historian Niall Ferguson observes, the United States has become a sub-prime superpower.

To reverse America's economic fortunes, the Obama administration must increase the earnings power of the vast majority of ordinary Americans. Doing this will require substantial and sustained investment to upgrade public education, our healthcare system, and our infrastructure. Investments along these lines are necessary to insure that Americans are the brightest, healthiest, and productive workforce on the planet. When we are once again making the products and services the world wants to buy, then incomes will rise. This will revitalize consumer spending, leading to corporate profits, which will translate into rising stock prices.

Tax cuts disproportionally aimed at the wealthy did not lead to broad-based income gains or the kind of investments America needs to ensure sustainable prosperity. Free market fundamentalism has also proved to be a false creed. Put simply, if the last eight years have shown anything it is that free markers do not inexorably allocate resources efficiently or rationally. In fact, free market fundamentalism has proven to be nothing but a cover for crony capitalism, whereby the powerful and well-connected rewarded themselves by feeding at the public trough. The fact that the financial wizards that created the current crisis walked away with billions, while America's healthcare, education, and infrastructure needs were starved, illustrates the total intellectual and moral bankruptcy of free market fundamentalism.

Looting the financial system and cannibalizing companies could not have happened to the extent it did without wholesale deregulation. The invasion of Iraq was another conservative enterprise predicated on false premises that helped bankrupt the United States, and not just economically but morally too. Of course, conservatives are loath to admit they are wrong, which explains why Krauthhammer and others are trying to portray the Iraq War as a victory. A pyrrhic victory, perhaps, but mostly the Iraq War has been a strategic debacle that siphoned America's blood and treasure in a failed bid to leverage our military might to transform the Middle East. As the historian Arnold Toynbee recognized, societies that attempt to remake far off outposts on the periphery of empire are invariably less successful than societies that remake themselves.

Revitalizing America is a herculean task facing Obama. Conservative commentators have generally heaped scorn upon the Obama administration's approach, which will make government a more central partner in shaping the economic landscape of the future. As Michael Gerson ludicrously puts it, "governments don't invest, they spend." Obviously, Gerson is thinking of the Bush administration, not the far-sighted administrations that initiated the GI bill, the interstate highway system, and the Internet.

Krauthammer is even more obtuse than Gerson. The dyspeptic Krauthammer completely fails to see how healthcare has anything to do with the current financial crisis or its cure. Let me enlighten this vapid windbag. The current healthcare system is an inefficient monstrosity with private insurance companies gobbling up resources to feed a vast bureaucratic apparatus collecting premiums from those who don't need healthcare while denying treatment to those who need it.

Ok, that's a bit of a caricature, but it captures an essential truth: private insurers represent a vast layer absorbing our healthcare dollars, but this layer does not deliver healthcare. This system has become an albatross for businesses and individuals. For instance, the cost of health insurance has to be factored into every product, which makes U.S. goods less competitive. Additionally, it stifles individual initiative – i.e., under the current system, employees will be less inclined to leave dead end jobs to pursue more rewarding opportunities if they fear they'll lose their health coverage in the process.

Conservatives like Krauthhammer, Gerson, and Hannity appear congenitally incapable of connecting the dots. These guys are like Rodney Dangerfield – the joke always seems to be on them and they don't get no respect.

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Charles Krauthammer: Mission Accomplished II

The physicist Wolfgang Pauli once remarked to a colleague about the lecture they were attending, noting that the speaker was so off the mark that "he isn't even wrong." I often have the same feeling reading Charles Krauthammer’s mediocre missives in the Washington Post. According to Krauthammer, Iraq is on the verge of turning out as a major strategic accomplishment for the United States. Before Krauthammer declares Mission Accomplished II, however, there are some inconvenient facts he needs to reckon with.

Krauthammer argues that an enduring U.S. military presence in Iraq will insure America has a critical ally in the heart of the Middle East. Neither the American people nor the Iraqis have signed on to the idea having permanent U.S. bases in Iraq. If the heavily fortified bunker complex that is the Green Zone is any indication, then America’s presence will be like Fort Apache in injun territory – i.e., an unwelcome presence that continues to fuel extremist resentment against what the jihadists view as an imperial and infidel occupation. Put simply, a large American footprint in Iraq is more likely to inspire extremism than defuse it.

General Petraeus’ counterinsurgency strategy is certainly a marked improvement over what came before. However, the welcome reduction in violence probably has much to do with the fact that many of the factions in Iraq are simply waiting the Americans out. They know, for instance, that the surge is temporary and that the Bush administration’s days are numbered. As one Iraqi put it, the current lull in violence is part of the "great deception" as the various Iraq militias prepare for the day when the United States is forced to scale back forces. Iraqis various factions, after all, would rather fight one another tomorrow than take on American firepower today.

What are the prospects for a political reconciliation in Iraq? The whole point of the surge, after all, was to buy time for the various factions to hammer out oil revenue sharing agreements and the like. In fact, pervasive corruption and black market activity – not to mention the reality that petro-politics in the Middle East is a invariably a zero-sum game – makes it highly unlikely that the various factions can arrive at a sustainable political settlement. Presently, the U.S. military is buying off Iraq’s private militias (convincing them it is better to take our money than fight us), but unless the Bush administration can manage a breakthrough on the political front this approach is likely to prove ephemeral.

The Iraq war must be understood in the context of our larger strategic interests. It has hampered our efforts in Afghanistan, diverted resources from capturing or killing bin Laden, worked to the advantage of America’s chief adversary in the region (Iran), and radicalized a new generation of anti-American extremists. The invasion of Iraq has also decimated America’s credibility, leaving it isolated and drained at a time when China appears on a trajectory to eclipse the United States within the next several decades. The extraordinary costs of the whole enterprise (by some estimates the invasion will cost each American $9,250 by the end of the decade), coupled with a very uncertain potential payoff (a less radicalized Arab world), make the whole venture seem about as sensible as buying Lotto tickets to avoid foreclosing on a mortgage one can’t afford.

The historian Arnold Toynbee observed that societies that remake themselves are more apt to succeed than societies that attempt to remake the rest of the world. Would the United States be better off investing in its own infrastructure and the energy efficiencies and alternative fuels of the future than pouring money into Iraq? We have truly outsourced our future. Of course, neoconservatives like Krauthammer will never admit just how far off the mark they’ve been all along.

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Is Bush’s Stem Cell Policy Vindicated?

Recently, scientists discovered a method of coaxing ordinary skin cells into becoming stem cells, thus avoiding the ethical quandary of having to harvest stem cells from embryos. Conservative commentators have seized on the apparent breakthrough to argue Bush’s stem cell policy – which denied federal funding for stem cell research derived from human embryos – has been vindicated. Indeed, Charles Krauthammer hyperventilates that "the embryonic stem cell debate is over. The verdict is clear: Rarely has a president -- so vilified for a moral stance -- been so thoroughly vindicated."

Not so fast. Conservative pundits have been taking a licking on issues like global warming, Iraq, and Bush’s counter terrorism strategy so it’s little wonder that they’d like to turn the tables for once and insist the "debate is over." A closer look at the issue, however, reveals that Bush’s stem cell stance yielded few, if any, genuine moral benefits. Indeed, the supposed "moral clarity" Bush exercised in delineating the bright red line around "human embryos" had far more to do with abortion politics than any ethically or scientifically defensible principle. To put it simply, Bush’s policy did not save lives or uphold the sanctity of life. But curtailing federal funding for stem cell lines created from human embryos will have an ongoing pernicious effect in so far as federal dollars and ethical oversight go hand in hand. Let me explain.

At the crux of the matter is the question: is a human embryo a person? The term "human embryo" is at least somewhat loaded in so far as it implies that an embryo meets the criteria to count as an individual. It does not, for this reason: as late as two weeks after conception a single embryo can spontaneously split in two and begin developing as twins. Simply put, individuality, personhood, and the soul are not concepts that can be appropriately applied at an embryo’s earliest stages. This point is reinforced by the fact that as many as 75% of fertilized embryos spontaneously abort before implanting. Nature is simply wasteful and indifferent in the extreme.

Right-to-life advocates, however, are wedded to the doctrine that life begins at conception. This view is often attended by wooly metaphysical dogma about the infusion of soul and body taking place at conception. This view, of course, is difficult to square with the facts cited above (the vast majority of embryos spontaneously abort and a single embryo can spontaneously become twins two weeks after conception).

It doesn’t follow from this, however, that the moral value of an embryo is nil. Given the right circumstances an embryo has the potential to become a human being. Thus, when we speak of a "human embryo" we should remember that we are using that designation primarily to refer to the genetic material as being distinct from that of other species, but we are not referring to a distinct individual that has the moral status of a human person. If we were, then it would be wrong to create surplus embryos to help infertile couples have children. But even most on the religious right aren’t too keen on creating a fuss over surplus embryos created as a byproduct of helping infertile couples have children.

Nevertheless, conservative pundits use the term "human embryo" as a rhetorical sleight of hand, subtly implying each and every embryo is a unique human being. But deep down, most serious people don’t believe this because, or there would be calls to ban in vitro fertilization and outlaw privately funded embryonic stem cell research. As it stands, Bush’s policy does not prohibit embryonic stem cell research that is privately funded. Since federal funding invariably entails greater ethical oversight, however, Bush’s policy actually creates the worst of all possible worlds; less dollars where they are needed and less oversight where it is needed.

The discovery that scientists can coax ordinary skin cells into becoming stem cells is a remarkable breakthrough. The ability to bypass even a perceived ethical quandary is welcome, but it would be mistaken and way premature to insist that this new procedure vindicates Bush’s decision, it does not. Bush’s decision, and the reasoning behind it, deserve respect as a serious effort to grapple with profound and difficult questions. The approach of countries like Great Britain, however, has been even more high-minded and serious because the debate there has not been distorted by abortion politics. Those crowing about Bush stem cell policy being vindicated should be a little way of declaring "mission accomplished."

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