Thomas Sowell: Even Karl Marx recognized that "crackbrained meddling by the authorities" can "aggravate an existing crisis"

When people learn that you are an economist, they often want you to predict which way the economy is going. There seem to be more than the usual number of calls for such predictions lately. But an economist should be more aware than others are of how hazardous such predictions can be.

One reason is that what happens in the economy is affected by what politicians do in Washington-- and who can predict what politicians will do?

However, let me go out on a limb, and try to predict what politicians will not do.

What would probably get the economy recovering fastest and most completely would be for the President of the United States and Congressional leaders to shut up and stop meddling with the economy. But it is virtually impossible that they will do that.

Think about telling all the millions of people who have lost their jobs, their homes or their businesses: "I really messed you up but, hey, nobody's perfect. So I'm going to leave things alone now." In fact, that would be hard even to tell yourself.

If the stimulus isn't working, the true believers have to believe that it is only because it hasn't been tried long enough, or with enough money being spent.

There are always calls for the government to "do something" when things are going bad. Those who make such calls have almost never bothered to check out what actually happens when the government does something, as compared to what happens when the government does nothing.

It is not just free market economists who think the government can make a mess bigger with its interventions. It was none other than Karl Marx who wrote to his colleague Engels that "crackbrained meddling by the authorities" can "aggravate an existing crisis."

The history of the United States is full of evidence on the negative effects of government intervention. For the first 150 years of this country's existence, the federal government did not think it was its business to intervene when the economy turned down.

All of those downturns ended faster than the first downturn where the federal government intervened big time-- the Great Depression of the 1930s.

There are two conflicting assumptions about what happened during the Great Depression. The most popular assumption, especially among politicians, is that the market failed and the government had to intervene to save the economy.

Another assumption is that the market went down and was on its way back up when federal intervention sent it down again and led to massive unemployment. If you don't let facts get in the way, you can just pick whichever assumption you like-- and the first assumption wins that popularity contest, hands down.

But, if you look at the facts, they go like this: Unemployment never hit double digits in any of the 12 months following the big stock market crash of 1929 that is often blamed for the massive unemployment of the 1930s. Unemployment peaked at 9 percent, two months after the October 1929 crash, and then began drifting downward.

Unemployment was down to 6.3 percent by June 1930, when the first big federal intervention occurred. Within six months, the downward trend in unemployment reversed and hit double digits for the first time in December 1930.

America isn't in decline until Thomas Sowell says so...Gulp!

America, it seems, is always in decline.

Searching through Amazon.com reveals plenty of works arguing that America's best days are behind her. From the 1974 novel The Decline and Fall of America; to William Dietrich's 1991 book, In the Shadow of the Rising Sun: The Political Roots of American Economic Decline, about Japan's inevitable surpassing of America economically; to the more recent The Death of the West by the always upbeat Patrick Buchanan, most such works of gloom-and-doom have usually been followed by years of tremendous peace and prosperity. After a while it is hard to take any book about American decline seriously.

However, if there a reason to treat the idea of our society's fall with grave concern, it is that a book has now been written about it by Thomas Sowell.

Entitled Dismantling America, it is a collection of some of his more recent newspaper columns grouped into five sections -- government policies, political issues, economic issues, cultural issues, and legal issues -- with some added commentary beginning each section.

Sowell's thesis is encapsulated in the following passage:

The collapse of a civilization is not just the replacement of rulers or institutions with new rulers and new institutions. It is the destruction of a whole way of life and the painful, and sometimes pathetic, attempts to begin rebuilding amid the ruins.

Is that where American is headed? I believe it is. Our only saving grace is that we are not there yet.

Thomas Sowell: The dull and stupid can't do much; "For creating a truly monumental disaster, you need people with high IQs"

...(Thomas) Sowell does not view Obama so much as a cause of America's decline as the embodiment of trends set in motion decades ago. One such trend is the gradual relinquishing to an elite of intellectuals the liberty that rightly belongs with individuals. These elites -- comprised of politicians, academic, journalists and judges -- are infected with the belief that they are qualified to make decisions for the rest of us. Sowell warns of the disaster that they can do: "There is usually only a limited amount of damage that can be done by dull or stupid people. For creating a truly monumental disaster, you need people with high IQs."

Why should results be equal if effort and performance are not?

Native intelligence may indeed not vary by neighborhood but actual performance-- whether in schools, on the job or elsewhere-- involves far more than native intelligence. Wasted intelligence does nothing for an individual or society.

The reason a surgeon can operate on your heart, while someone of equal intelligence who is not a surgeon cannot, is because of what different people actually did with their intelligence. That has always varied, not only from individual to individual but from group to group-- and not only in this country, but in countries around the world and across the centuries of human history.

One of the biggest fallacies of our time is the notion that, if all groups are not proportionally represented in institutions, professions or income levels, that shows something wrong with society. The very possibility that people make their own choices, and that those choices have consequences-- for themselves and for others-- is ignored. Society is the universal scapegoat.

If "luck" is involved, it is the luck to be born into families and communities whose values and choices turn out to be productive for themselves and for others who benefit from the skills they acquire. Observers who blame tests or other criteria for the demographic imbalances which are the rule-- not the exception-- around the world, are blaming whatever conveys differences for creating those differences.

They blame the messenger who brings bad news.

Sowell slyly tries to educate Obama on the virtues of markets

The people who ran central planning agencies usually had more advanced education than the population at large, and probably higher IQs as well.

The central planners also had far more statistics and other facts at their disposal than the average person had. Moreover, there were usually specialized experts such as economists and statisticians on the staffs of the central planners, and outside consultants were available when needed. Finally, the central planners had the power of government behind them, to enforce the plans they created.

It is hardly surprising that conservatives, such as Prime Minister Margaret Thatcher in Britain and President Ronald Reagan in the United States, opposed this approach. What is remarkable is that, after a few decades of experience with central planning in some countries, or a few generations in others, even communists and socialists began to repudiate this approach.

As they replaced central planning with more reliance on markets, their countries' economic growth rate almost invariably increased, often dramatically. In the largest and most recent examples-- China and India-- people by the millions have risen above these countries' official poverty rates, after they freed their economies from many of their suffocating government controls.

China, where famines have repeatedly ravaged the country, now has a problem of obesity-- not a good thing in itself, but a big improvement over famines.

This has implications far beyond economics. Think about it: How was it even possible that transferring decisions from elites with more education, intellect, data and power to ordinary people could lead consistently to demonstrably better results?

One implication is that no one is smart enough to carry out social engineering, whether in the economy or in other areas where the results may not always be so easily quantifiable. We learn, not from our initial brilliance, but from trial and error adjustments to events as they unfold.

Thomas Sowell: "American democracy is being dismantled..."

In our times, American democracy is being dismantled, piece by piece, before our very eyes by the current administration in Washington, and few people seem to be concerned about it.

The president's poll numbers are going down because increasing numbers of people disagree with particular policies of his, but the damage being done to the fundamental structure of this nation goes far beyond particular counterproductive policies.

Just where in the Constitution of the United States does it say that a president has the authority to extract vast sums of money from a private enterprise and distribute it as he sees fit to whomever he deems worthy of compensation? Nowhere.

And yet that is precisely what is happening with a $20 billion fund to be provided by BP to compensate people harmed by their oil spill in the Gulf of Mexico.

Many among the public and in the media may think that the issue is simply whether BP's oil spill has damaged many people, who ought to be compensated.

But our government is supposed to be "a government of laws and not of men."

If our laws and our institutions determine that BP ought to pay $20 billion — or $50 billion or $100 billion — then so be it.

But the Constitution says that private property is not to be confiscated by the government without "due process of law."

Technically, it has not been confiscated by Barack Obama, but that is a distinction without a difference.

With vastly expanded powers of government available at the discretion of politicians and bureaucrats, private individuals and organizations can be forced into accepting the imposition of powers that were never granted to the government by the Constitution.

If you believe that the end justifies the means, then you don't believe in constitutional government.

And, without constitutional government, freedom cannot endure. There will always be a "crisis" — which, as the president's chief of staff has said, cannot be allowed to "go to waste" as an opportunity to expand the government's power.

From "Out of Work" by Richard Vedder and Lowell Gallaway.

Thomas Sowell: The depression era demonstrates that Obama's hyperactive pursuit of job gains is the wrong policy to pursue

The widespread belief is that government intervention is the key to getting the country out of a serious economic downturn. The example often cited is President Franklin D. Roosevelt's intervention, after the stock market crash of 1929 was followed by the Great Depression of the 1930s, with its massive and long-lasting unemployment.

This is more than just a question about history. Right here and right now there is a widespread belief that the unregulated market is what got us into our present economic predicament, and that the government must "do something" to get the economy moving again. FDR's intervention in the 1930s has often been cited by those who think this way.

What is on that one page in "Out of Work" that could change people's minds? Just a simple table, giving unemployment rates for every month during the entire decade of the 1930s.

Those who think that the stock market crash in October 1929 is what caused the huge unemployment rates of the 1930s will have a hard time reconciling that belief with the data in that table.

Although the big stock market crash occurred in October 1929, unemployment never reached double digits in any of the next 12 months after that crash. Unemployment peaked at 9 percent, two months after the stock market crashed-- and then began drifting generally downward over the next six months, falling to 6.3 percent by June 1930.

This was what happened in the market, before the federal government decided to "do something."

What the government decided to do in June 1930-- against the advice of literally a thousand economists, who took out newspaper ads warning against it-- was impose higher tariffs, in order to save American jobs by reducing imported goods.

This was the first massive federal intervention to rescue the economy, under President Herbert Hoover, who took pride in being the first President of the United States to intervene to try to get the economy out of an economic downturn.

Within six months after this government intervention, unemployment shot up into double digits-- and stayed in double digits in every month throughout the entire remainder of the decade of the 1930s, as the Roosevelt administration expanded federal intervention far beyond what Hoover had started.

If more government regulation of business is the magic answer that so many seem to think it is, the whole history of the 1930s would have been different. An economic study in 2004 concluded that New Deal policies prolonged the Great Depression. But the same story can be found on one page in "Out of Work."

Thomas Sowell: November election "may be the last chance to halt the dismantling of America"

What will it matter if Obama's current approval rating is below 50 percent among the current voting public, if he can ram through new legislation to create millions of new voters by granting citizenship to illegal immigrants? That can be enough to make him a two-term President, who can appoint enough Supreme Court justices to rubber-stamp further extensions of his power.

When all these newly minted citizens are rounded up on election night by ethnic organization activists and labor union supporters of the administration, that may be enough to salvage the Democrats' control of Congress as well.

The last opportunity that current American citizens may have to determine who will control Congress may well be the election in November of this year. Off-year elections don't usually bring out as many voters as Presidential election years. But the 2010 election may be the last chance to halt the dismantling of America. It can be the point of no return.

Pols & abettors "pose the greatest threat to liberty"

The bottom line is that it is politicians first and their supporters amongst intellectuals who pose the greatest threat to liberty. Dr. Thomas Sowell amply demonstrates this in his brand-new book, "Intellectuals and Society," in which he points out that: "Scarcely a mass-murdering dictator of the twentieth century was without his intellectual supporters, not simply in his own country, but also in foreign democracies ... Lenin, Stalin, Mao and Hitler all had their admirers, defenders and apologists among the intelligentsia in Western democratic nations, despite the fact that these dictators each ended up killing people of their own country on a scale unprecedented even by despotic regimes that preceded them."

While American politicians and intellectuals have not reached the depths of tyrants such as Lenin, Stalin, Mao and Hitler, they share a common vision. Tyrants denounce free markets and voluntary exchange. They are the chief supporters of reduced private property rights, reduced rights to profits, and they are anti-competition and pro-monopoly. They are pro-control and coercion, by the state.

These Americans who run Washington, and their intellectual supporters, believe they have superior wisdom and greater intelligence than the masses. They believe they have been ordained to forcibly impose that wisdom on the rest of us. Like any other tyrant, they have what they consider good reasons for restricting the freedom of others.

Thomas Sowell: Politicized "science" has too much invested to give up disgraced global warming yarn

Today, politicized "science" has too big a stake in the global warming hysteria to let the facts speak for themselves and let the chips fall where they may. Too many people — in politics and in the media, as well as among those climate scientists who are promoting global warming hysteria — let the raw data on which their calculations have been based fall into the "wrong hands."

People who talk about the corrupting influence of money seem to automatically assume that it is only private money that is corrupting. But, when governments have billions of dollars invested in the global warming crusade, massive programs underway and whole political careers at risk if that crusade gets undermined, do not expect the disinterested search for truth.

Among the intelligentsia, there have always been many who are ready to jump on virtually any bandwagon that will take them to the promised land, where the wise and noble few — like themselves — can take the rest of us poor dummies in hand and tell us how we had better change the way we live our lives.

No doubt some climate scientists honestly believe that global warming poses a threat. But other climate scientists honestly believe the opposite. That is why the raw data have had to be destroyed before the latter get their hands on it.

This is tragically the case as regards many other issues, besides global warming, where data are made available only to the true believers and kept out of the hands of those who think otherwise.

Thomas Sowell: If politicians meddled only with things they understand, they wouldn't do much

If politicians stopped meddling with things they don't understand, there would be a more drastic reduction in the size of government than anyone in either party advocates.

It was fascinating to see Barack Obama warning us not to leap to conclusions about the killings at Fort Hood, Texas-- after the way he leaped to conclusions over the arrest of Henry Louis Gates, when he knew less about the facts than we already know about the massacre at Fort Hood.

My first column, more than 30 years ago, was titled "The Profits of Doom." Recent news stories about the millions of dollars that Al Gore has made out of his "global warming" hysteria suggest that some things haven't changed much in three decades.

Although the Federal Deposit Insurance Corporation backs up bank accounts, a recent audit suggests that the FDIC does not have enough money in its own account to do its job. No doubt more money will be printed in Washington if necessary. But what this means is that even the record-breaking federal deficit understates the government's real financial liabilities, because agencies like FDIC and the Federal Housing Authority are likely to need increased amounts of money to keep going.

An e-mail from a reader says that liberals like to take the moral high ground, even though their own moral relativism means that there is no moral high ground.

Thomas Sowell:Critics of Obama up against fan base heavily invested in his success

Here too, it seems as if so many people have invested so much hope and trust in Barack Obama that it is intolerable that anyone should come along and stir up any doubts that could threaten their house of cards.

Among the most pathetic letters and e-mails I receive are those from people who ask why I don't write more "positively" about Obama or "give him the benefit of the doubt."

No one-- not even the President of the United States-- has an entitlement to a "positive" response to his actions. The entitlement mentality has eroded the once common belief that you earned things, including respect, instead of being given them.

As for the benefit of the doubt, no one-- especially not the President of the United States-- is entitled to that, when his actions can jeopardize the rights of 300 million Americans domestically and the security of the nation in an international jungle, where nuclear weapons may soon be in the hands of people with suicidal fanaticism. Will it take a mushroom cloud over an American city to make that clear? Was 9/11 not enough?

When a President of the United States has begun the process of dismantling America from within, and exposing us to dangerous enemies outside, the time is long past for being concerned about his public image.

Internationally, Barack Obama has made every mistake that was made by the Western democracies in the 1930s, mistakes that put Hitler in a position to start World War II-- and come dangerously close to winning it.

At the heart of those mistakes was trying to mollify your enemies by throwing your friends to the wolves.

Thomas Sowell asks, "Does any of this sound like America?" The answeer is, "no"

Just one year ago, would you have believed that an unelected government official, not even a Cabinet member confirmed by the Senate but simply one of the many "czars" appointed by the President, could arbitrarily cut the pay of executives in private businesses by 50 percent or 90 percent?

Did you think that another "czar" would be talking about restricting talk radio? That there would be plans afloat to subsidize newspapers-- that is, to create a situation where some newspapers' survival would depend on the government liking what they publish?

Did you imagine that anyone would even be talking about having a panel of so-called "experts" deciding who could and could not get life-saving medical treatments?

Scary as that is from a medical standpoint, it is also chilling from the standpoint of freedom. If you have a mother who needs a heart operation or a child with some dire medical condition, how free would you feel to speak out against an administration that has the power to make life and death decisions about your loved ones?

Does any of this sound like America?

Thomas Sowell looks at the extreme urgency of Barack Obama

"He tried to rush Congress into passing a massive government takeover of the nation's medical care before the August recess-- for a program that would not take effect until 2013!"

(snip)

"...he wanted to get this massive government takeover of medical care passed into law before the public understood what was in it.

Moreover, he wanted to get re-elected in 2012 before the public experienced what its actual consequences would be."

(snip)

"...he wanted to get this massive government takeover of medical care passed into law before the public understood what was in it.

Moreover, he wanted to get re-elected in 2012 before the public experienced what its actual consequences would be."

"Mercy to the guilty is cruelty to the innocent"

From Townhall

"Britain's release of Abdel Baset al-Megrahi-- the Libyan terrorist whose bomb blew up a plane over Lockerbie, Scotland in 1988, killing 270 people-- is galling enough in itself. But it is even more profoundly troubling as a sign of a larger mood that has been growing in the Western democracies in our time.

In ways large and small, domestically and internationally, the West is surrendering on the installment plan to Islamic extremists.

The late Aleksandr Solzhenitsyn put his finger on the problem when he said: "The timid civilized world has found nothing with which to oppose the onslaught of a sudden revival of barefaced barbarity, other than concessions and smiles."

(snip)

"The ostensible reason for releasing al-Megrahi was compassion for a man terminally ill. It is ironic that this was said in Scotland, for exactly 250 years ago another Scotsman-- Adam Smith-- said, "Mercy to the guilty is cruelty to the innocent."

(snip)

"...bending over backward to be nice to our enemies is one of the many self-indulgences of those who engage in moral preening.

But getting other people killed so that you can feel puffed up about yourself is profoundly immoral. So is betraying the country you took an oath to protect."

Rely on government rescues, forget responsibility

"No small part of the current confusion between 'health care' and medical care comes from failing to recognize that Americans can have the best medical care in the world without having the best health or longevity because so many people choose to live in ways that shorten their lives.

There can be grave practical consequences of a dogmatic insistence on external explanations that allow individuals to escape personal responsibility. Americans can end up ruining the best medical care in the world in the vain hope that a government takeover will give us better health.

Economic issues are approached in the same way. People with low incomes are seen as a problem for other people to solve. Studies which follow the same individuals over time show that the vast majority of working people who are in the bottom 20 percent of income earners at a given time end up rising out of that bracket.

Many are simply beginners who get beginners' wages but whose pay rises as they acquire more skills and experience. Yet there is a small minority of workers who do not rise and a large number of people who seldom work and who-- surprise!-- have low incomes as a result."

Sotomayor a racist who "cooed" at the right time

"Since no one seems overly concerned about putting a racist on the Supreme Court-- provided it is a politically correct racist-- the moral of the story seems to be that if it looks like a duck, walks like a duck and quacks like a duck, that doesn't matter if it coos like a dove at Senate confirmation hearings."

(snip}

"How long will it be before the public gets tired of the little know-it-all sermonettes by Barack Obama-- especially since nothing that he is doing is actually working?"

Sowell: Obama leading U.S. toward disaster

"...if the worst that Barack Obama does is ruin the economy, I will breathe a sigh of relief.

He is heading this country toward disaster on many fronts, including a nuclear Iran, which has every prospect of being an irretrievable disaster of almost unimaginable magnitude. We cannot put that genie back in the bottle-- and neither can generations yet unborn. They may yet curse us all for leaving them hostages to nuclear terror."

(snip)

"The desire of many Americans for a "post-racial" society is well-founded, though the belief that Barack Obama would move in that direction was extremely ill-advised, given the history of his actions and associations.

This is a president on a mission to remake American society in every aspect, by whatever means are necessary and available. That requires taking all kinds of decisions out of the hands of ordinary Americans and transferring them to Washington elites-- and ultimately the number one elite, Barack Obama himself.

Like so many before him who have ruined countries around the world, Obama has a greatly inflated idea of his own capabilities and the prospects of what can be accomplished by rhetoric or even by political power. Often this has been accompanied by an ignorance of history, including the history of how many people before him have tried similar things with disastrous results."

http://www.realclearpolitics.com/articles/2009/07/30/obamas_amateurism_and_incompetence.html

Obama, still organizing resentments and grievances

"Those who were shocked at President Obama's cheap shot at the Cambridge police for being "stupid" in arresting Henry Louis Gates must have been among those who let their wishes prevail over the obvious implications of Obama's 20 years of association with the Reverend Jeremiah Wright. Anyone who can believe that Obama did not understand what the racist rants of Jeremiah Wright meant can believe anything.

With race-- as with campaign finance, transparency and the
rest-- Barack Obama knows what the public wants to hear and that is what he has said. But his policies as president have been the opposite of his rhetoric, with race as with other issues.

As a state senator in Illinois, Obama pushed the "racial profiling" issue, so it is hardly surprising that he jumped to the conclusion that a policeman was racial profiling when in fact the cop was investigating a report received from a neighbor that someone seemed to be breaking into the house that Professor Gates was renting in Cambridge."

(snip)

"President Obama's background as a community organizer has received far too little attention...What does a community organizer do? What he does not do is organize a community. What he organizes are the resentments and paranoia within a community, directing those feelings against other communities, from whom either benefits or revenge are to be gotten, using whatever rhetoric or tactics will accomplish that purpose."

http://www.realclearpolitics.com/articles/2009/07/28/a_post-racial_president_97642.html