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Partisan, united and behind the times

"Republicans who have jobs and are thwarting this stimulus package should be ashamed. More to the point, they should be dismissed with cause. They do not deserve to be laid off, but should be fired outright." – William Rivers Pitt

February 2, 2009
By Rob Lafferty

Alaska Gov. Sarah Palin, Florida Gov. Charlie Crist and Vermont Gov. Jim Douglas are Republican governors who've criticized government handouts in the past, but their states are in dire need of quick cash so they actively lobbied Congress to provide some financial help through the proposed $819 billion tax cut/new spending plan.

Despite their efforts not a single Republican member of the House of Representatives voted to support the plan, which was approved by the Democratic majority.

Louisiana Gov. Bobby Jindal said he would have voted against the bill if he were still in Congress, but he'll take the money that's being offered to his state, as will Minnesota Gov. Tim Pawlenty. No fools, those two they understand the need to set aside political ideology when faced with practical reality if you want to keep your job in a shifting political climate.

Mississippi Gov. Haley Barbour and South Carolina Gov. Mark Sanford have said that they might not accept federal money from the stimulus package as a matter of principle. Their constituents might be operating under a different set of principles, however; we'll soon see if those two gentlemen sway with the wind of public opinion or stand firm as the stalwart oaks that they claim to be. They've both compromised their principles in the past, so I'm betting they'll sway.

The spending bill now goes to the Senate, where Sen. John McCain and others have already said they will oppose it. A few Republican senators will probably vote in approval, but that bill will easily pass regardless of what they choose to do.

And so much for partisanship in Washington politics. The Democrats did make a few polite gestures towards the Republicans, but they don't really care what hard-core GOP members say or do right now. Democrats have comfortable majorities and the weight of public opinion behind them; the GOP is largely irrelevant at the moment.

Oddly enough, they're taking the traditionally prudent fiscal position of the conservative movement, a philosophy that dominated until three presidents Nixon and Reagan and Bush II beat it to death during four decades of abuse. Those three proclaimed that government spending was the problem, not the solution, to society's troubles. They stopped investing in the country and its people, yet increased government spending to strengthen their business interests at the same time. The Republican party isn't what it once was, but it can become what it was meant to be the voice that demands a balanced budget and wise investments and good accounting. They were meant to be the fiscal watchdogs of America, and to those roots they should return.

Meanwhile, it seems we'll be trying to kick-start an economic recovery with a massive infusion of public works projects. The history of our government's attempts to stimulate a slumping economy is mixed, at best, but good management can make any realistic project a successful one. Aside from an excellent military system and space program, however, we don't have much to brag about over the past forty years when it comes to public works.

And there's no way to predict if today's spending plan will have any positive impact. That's partly because only a few people truly understand the complexity of today's global economy, and none of them work in our government.

The idea of our government borrowing money to finance an economic recovery has a lot of folks spooked, and with good reason. We'll probably have to repay that debt, which means two generations will foot the bill for what is spent this year alone. But it might work. The idea of doing nothing and allowing the marketplace to work through its Time of Troubles seems pretty grim. Experts say it will work, but they're the same folks who claim that nobody could have seen the housing market crash. So by their own admission, a free market is unpredictable.

We just experienced a prime example of market volatility when the price of a barrel of gasoline jumped to new heights and dropped to surprising lows over a nine month span without any discernible cause, without little or no influence from the traditional rules of supply and demand. A long look at oil-related events around the world during that time leaves two distinct impressions - either there was price manipulation by a dozen or so very powerful individuals, or there is no human control at all over the market price of oil.

Even economic pros who make a living from gathering information are surprised by the next wave of doom that's poised to hit this year. Last December a company that markets foreclosed properties online, RealtyTrac, compared the multiple listing services in California, Maryland, Florida and Wisconsin against its database. They found for-sale listings for only one-third of the properties they knew were foreclosed, based on the court records used to compile their database.

That "ghost inventory" of foreclosed land will soon start flowing into an already flooded market. Property values will go down a bit more in most parts of the country and stay low for many years to come. The high-water mark of the real estate boom is far behind us now; the era of buying a house as an investment is over for anyone who doesn't own one already, while many homeowners owe more than their home is worth.

So let's hope the big infusion of borrowed cash is put to work wisely, because we're going to need it. We also need to make a national commitment to repay that debt as soon as possible. The right kind of investment can make that possible, and our government is the only method we have of making that investment.

Start with universal health care. Britain socialized medicine sixty years ago; Canada forty years ago; Australia thirty years ago. Senators here just approved an expansion of health care insurance for low-income children. Every dollar spent paying health care practitioners to examine and treat children pays huge dividends directly into the community.

Another is direct subsidy of well-run non-profit organizations that provide services directly to residents of our communities. Ten percent of the national workforce more than the auto and steel industries combined are employed by non-profit companies and agencies. Many organizations exist that have excellent track records of good money management and are known for getting a lot done with just a few resources. Every dollar they receive resonates throughout the community in diverse and unexpected ways.

Government is not the problem. Politics is the problem, because every moment spent politicking takes time and energy and resources away from those who are supposed to be governing. That's the first thing that must change in Washington, but there will need to be a deep internal change in the people already there or perhaps a whole new set of people in those positions two years from now.

Rob Lafferty is a former editor of the Haleakala Times. He can be reached via email at rob@moonvalleypress.com