Wednesday, January 21, 2009

Barack Obama Is No Abraham Lincoln

For a couple of months now, we have been told that Barack Obama's First Inaugural Address was going to be comparable to Abraham Lincoln's inaugural addresses. After all, Obama himself has built his political career on comparing himself with Lincoln. Obama has obviously thought a lot about this. And I have written posts about the Obama-Lincoln connection.

But today--with Obama's inaugural address--we see that Obama is no Lincoln. Obama's speech was utterly flat. He said nothing that will be remembered by anyone.

He did, however, set a somber tone by suggesting that the current economic crisis will not be overcome in a short time. Is he lowering expectations, because he knows how bad the situation is?

I remind you that last September and October, when so many people were saying we needed federal bailouts to pull us out of the financial crisis, I said that if we followed the path set by Bush, McCain, and Obama in going for federal bailouts, that we would prolong the economic crisis. I predicted that rather than an economic adjustment of one or two years, the rush to federal bailouts and other federal interventions in the economy would prolong the recession into a depression of five to ten years.

Well, I must say, sadly, that I see nothing to contradict my prediction. Isn't it clear that with the federal bailouts, we have now entered a long period of economic depression to rival the Great Depression of the 1930s?

I predicted that the Congress's unconstitutional delegation of unlimited power to the executive branch (the Treasury Department) to spend the bailout money as they wished would lead to corruption. Anyone understanding the imperfections in human nature--in knowledge and virtue--would predict that Paulson and others in the Treasury Department would use their power to reward their friends on Wall Street. Now the Congress is complaining about how no one really knows where the bailout money has gone. But wasn't this easily predictable?

I suspect that Obama is preparing us for this new depression. He knows that expanding the federal deficit to bailout one economic interest after another is not going to resolve the economic crisis. On the contrary, it will make it worse. But he has to appear to be doing something. His job, then, is to prepare us for five to ten years of depression--comparable to FDR's depression--by claiming that it's not his fault.

Get ready for a very rough ride.


John S. Wilkins said...

Obama may not have delivered a memorable speech at the inauguration, but his speech on race was at the level of Lincoln. I was disappointed with this one, but let's not miss that he already made the grade.

Kent Guida said...

Great post, Larry. I couldn't agree more about both the speech and the prospects for success of the mega-bailout strategy. Howeve, I think you may be giving him too much credit for knowing what he is doing.
Best regards,
Kent Guida