We all know that the economy is in dire straits. And economic gloom translates into real suffering for many American families, families that want relief.
Politicians are more than ready to take advantage of people’s fear and yearning by touting government as the answer to every woe.
One such “answer” was President Barack Obama’s $787 billion “American Reinvestment and Recovery Act,” better known as the stimulus package, that Congress passed in 2009.
In January of that year, Obama spoke to the American people and asserted, “only government can provide the short-term boost necessary to lift us from a recession this deep and severe.”
That month, unemployment was at 7.6 percent. Almost three years and hundreds of billions of dollars later, unemployment is at 9.1 percent and economists increasingly warn of a second recession.
But this hasn’t shaken the president’s faith in the near-omnipotence of government. Obama is now insisting on a second stimulus package, this time dubbed the “American Jobs Act,” with a price tag of $447 billion.
Congress should reject it.
Those who advance big government will always need just a little more power, just a few (billion) more bucks in order to achieve the beautiful, harmonious society we’re led to believe is just around the corner.
Why do we ever buy it? Could anybody conceivably manage something as infinitely complex as the entire U.S. economy?
If common sense and the failure of the first stimulus aren’t evidence enough that government intervention is not the answer, the Solyndra debacle should leave no doubt.
In September 2009 a program under the Department of Energy issued a $535 million loan — taxpayer funded at that — to a new-energy company Solyndra, which produced solar panels in a unique, new cylindrical design.
Two years later, on Sept. 6 of this year, Solyndra filed for bankruptcy.
Recently released emails reveal the trepidation expressed by many in the Office of Management and Budget about loaning to a company with such unsound financials. But the red flags went unheeded.
In December 2009 Larry Summers, Obama’s top economic advisor, discussed the administration’s economic policies with Solyndra investor Brad Jones through email.
Jones wrote, "The allocation of spending to clean energy is haphazard. The government is just not well equipped to decide which companies should get the money and how much.” He later added, “I can't imagine it's a good way for the government to use taxpayer money."
But Obama remained a true believer.
In May 2010 he told workers at Solyndra’s Fremont, Calif. headquarters, “Every day that you build this expanded facility, as you fill orders for solar panels to ship around the world, you’re demonstrating that the promise of clean energy isn’t just an article of faith — not anymore.”
For all his shortcomings, Rep. Ron Paul, R-Tex., said it best when he wrote on his website, “Real venture capitalists make decisions based not on politics and photo opportunities, but on complex economic estimations of risk and reward. They don’t simply throw piles of other people’s money at a factory and expect magic to happen.”
During a recent interview with George Stephanopoulos, Obama said of Solyndra, "It went through the regular review process and people felt that it was a good bet."
Perhaps politicians making “bets” with our money, whether good bets or bad bets, is exactly the problem.
Reach the columnist at dcolthar@asu.edu
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