Barone and SWNID to Obama: Give Up the Grand Plan

Tuesday President Obama gave another major speech, this time outlining what he characterizes as the coherent policy vision that undergirds what have seemed like ad hoc initiatives. Everything, he says, is geared to bring about a specific outcome, expressed in five pillars:

• effective regulation for Wall Street
• investment in education
• investment in renewable energy and technology
• health-care reform
• deficit reduction

Since some of these five seems to us less significant than others, and some prompt so obvious a response, we'll say the obvious first and then get to the significant and less obvious. Then we'll say what it all means.

Obviously, there's nothing in Obama's initiatives that bears the slightest resemblance to deficit reduction. All he's been able to claim, effectively, is that his deficits are smaller than they could have been had he spent more or taxed less. That fifth pillar is a sad joke. Politically he should drop it, as it casts a shadow of untruthfulness on everything.

Regulating Wall Street to ensure financial and corporate focus on the long term instead of the short term is a noble goal. Whether regulation can do that effectively is another matter. If regulators knew what one could do to guarantee long-term profits, certainly the word would be out already and would not require regulations to enforce compliance. Enforcing greater transparency might be a more effective objective.

We make similar remarks for investment in education. We believe that making education more effective and accessible is an important public priority for the good of all. However, we don't know that greater governmental involvement in education will accomplish that. Federal subsidies have had the effect of driving educational costs higher, as the inflation rate for education has exceeded the core inflation rate for years. Raising the Pell Grant sounded good, though it was not raised much relative to educational costs. But more government money gives institutions of higher education the opportunity to raise prices, as history seems to demonstrate amply. As to eliminating federally subsidized student loans and making them direct loans from the government, we doubt that the elimination of private profit will make for more efficiency or better service. As to P-12 education, Obama's resistance to initiatives that diversify educational supply don't auger well for progress on this front.

As to energy and health care, we agree with the esteemed Michael Barone: Obama's moves depend entirely on mathematical models that are far too subject to failure. The energy move is less a matter of toxins than carbon dioxide, harmless unless it indeed creates devastating climate change. The health-care move is premised on the notion that greater federal control of payment and standards will yield cost savings. Both depend on elaborate models that attempt to account for all contributory factors but which by nature simply cannot.

In other words, it's presumption bordering on insanity to expend large amounts of money on what is an inherently speculative enterprise. One initiative--reducing carbon emissions--assumes a disaster that may not happen, or if it does happen may not be a disaster. The other--health-care reform that involves offering federal standards for care and a federal program of insurance--offers no sure way to better care for more people.

Better, we say, to act on what we actually know. On energy, what we know is this:

• A diverse set of eneregy sources is less likely to create economic, political or environmental (we say again: "renewables" have huge environmental impact, as acres are devoted to solar or wind power and the transmission of that power across vast distances), problems than a non-diverse set. It is therefore wise to develop so-called renewables, but only as far as they are commercially viable. It is at least equally wise to develop other sources of "carbon" energy; that is, to drill domestic and offshore fields aggressively.
• The prospect of gradual, marginal climate change is not so much a threat as an inevitability to which human populations will adapt. Directing resources toward preventing climate change--without knowing whether it is occurring, what causes it, or whether it can be stopped--simply makes it harder to do the adapting.

And on health care, what we know is this:

• There's no historical evidence that having the government pay for health care directly will make it cheaper (Medicare and Medicaid are cheaper than private care precisely because the government pays less by fiat, shifting the cost of capital investment to the privately insured). There's much to suggest that doing so will make it less available and less effective.
• The noble goal of providing health insurance for the uninsured is most effectively addressed by de-linking employment benefits and health insurance, reducing the number of mandates on what must be covered, creating a national market for health insurance instead of a state-by-state market, and providing a subsidy to individuals of low income to purchase insurance privately. These moves put decisions about health care costs and benefits in the hands of individuals, the very people whose lives are at stake in the doctor's office.

There's a theme running through all this. Obama's policies assume that the solutions to these problems lie with the imposition of a single set of rules and requirements for everyone. As a faithful son of our Republic, we resist that notion ideologically. As an informal but informed student of history and human nature, we find no example of such an outcome and no prospect of it, either. We doubt that a small group of humans, no matter how nobly motivated or well informed, can make such decisions effectively. Actually, we'd say all the evidence suggests the opposite.

And so, Mr. President, we ask that in place of your five pillars, you erect another pillar. It states that the government exists not to solve people's problems but to protect their liberties. With liberties, they are free to work together or on their own , experiment, fail and sometimes ultimately succeed in solving problems. But as citizens become clients, their liberties are lost, and with them are lost the individual's opportunity to make a difference for anyone's life, including his own.