Thursday, February 02, 2006

Two speeches

On Tuesday night, two speeches were given to Congress and the nation.

In one speech, the benefits of smaller government were proclaimed. The speech called for lower taxes, more free markets, less government interference with the economy, and more individual liberty. This speech acknowledged that capitalism, freedom, open trade, and the diligence and innovation of the American people are the greatest forces for progress and economic growth.

In the other speech, government was the solution to every problem. Increased government spending was touted as the great fix-all. More taxes, more regulation, and more government programs were presented as the path to prosperity.

What is truly odd is that both speeches were given by the same person.

Speaking as a fiscal conservative, President Bush made a strong case for lower taxes, tax code reform, and Social Security reform. He called on Congress to reign in runaway spending by cutting wasteful programs. He asked for the line-item-veto to help eliminate earmarks. At times he sounded almost like Ronald Reagan declaring that "In this crisis, Government is not the solution to our problem. Government is the problem."

Unfortunately, the second speech sounded more like Lyndon Johnson than Ronald Reagan. President Bush proposed more than two-dozen new or increased spending initiatives.

He proposed a 22% increase in government subsidy into clean energy research and development. He also promised government money to build new nuclear power plants and to produce ethanol from wood chips. If these technologies were economically viable, the private sector would make the investment. Tax money should not be used to subsidize the development of new technologies which are not cost effective.

The President proposed spending tax money on the development of hydrogen-powered cars. Again, if this technology was economically beneficial, private businesses would undertake the effort. The President appears to have forgotten about the billions of dollars which President Clinton poured into a government program to develop hybrid technology, the Partnership for a New Generation of Vehicles. The program never produced the hybrid cars they promised. However, foreign automakers, Honda and Toyota, privately developed the technology which can be purchased by Americans today.

Bush also proposed increasing federal "investment" in math and science education. Vast amounts of research show that there is little connection between spending and educational results, and federal spending is the least effective way to improve the quality of education. Surely the President is aware that America did not become a world leader in technology and scientific advancement because of government subsidies. We have long surpassed the countries who tried to achieve success this way.

The president called for more government subsidies and tax preferences for health care. This ignores the fact that the current problems with our health-care system result largely because of government intrusion and subsidies which subvert the market forces of price and quality competition.

After listening to the contradictions in these two speeches, one was forced to ask "Which one do I believe?"

The first speech presented a real roadmap to progress and prosperity through opportunity and freedom.

However, the President's laundry list of new government programs and increased government spending is more in line with how Congress and President Bush have actually operated for the past five years. Since 2000, government spending has increased 40 percent, a figure larger than Clinton's entire eight years. The reality is that the American public expects a government solution to every problem, and any politician who does not promise more government money for every societal ill is committing political suicide. For real change to occur, Americans need to stop looking to the government as their paternal caretaker and start making the most of the opportunities we each have to achieve our own potential.

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