The West Is Turning Against Big Government - But What Comes Next?
THE DAILY TELEGRAPH: The struggle to curtail the social democratic state could have ugly consequences, says Janet Daley.

There seems to be only one political argument of interest left in the Western democracies: how “big” should the state be, and what are the proper limits of its responsibilities? Abstract as it may sound, this question has had a quite startling impact on the everyday experience – and voting habits – of people in the most advanced countries of the world.

In the United States, the electorate’s considered answer to it has humiliated a president and swept an extraordinary number of neophytes – whose primary attraction was their loathing of government power – into the most powerful legislature in history. In Britain, it has become the dominant theme (in fact, the raison d’être) of a coalition between a Left-of-centre party and a Right-of-centre one, which has managed to achieve a remarkable degree of agreement on the need to reduce – or, at least, to examine rigorously – the role of government intervention in all areas of social life.

The dominant economies of Europe, too, are going through quite momentous re-examinations of the post-war philosophy which accepted the state as an unquestionable source of benevolence and all-pervasive social justice. And this massive reassessment of the role of government has not come about simply because of the economic crisis, and the terrifying degree of sovereign debt which it produced. The governments of what were the richest countries in the world may be broke, but what is interesting is their response to this: the plan is not to make themselves rich enough once again to do all the things that they used to do, but to rethink the whole enterprise so that government never again finds itself so extravagantly overextended.

On this side of the Atlantic, there is now a broad understanding that the social democratic project itself is unsustainable: that it has grown wildly beyond the principles of its inception and that the consequences of this are not only unaffordable, but positively damaging to national life and character. The US, bizarrely, is running at least 10 years behind in this process, having elected a government which chose to embark on the social democratic experiment at precisely the moment when its Western European inventors were despairing of it, and desperately trying to find politically palatable ways of winding it down.

The American people – being made of rather different stuff and having historical roots which incline them to be distrustful of government in any form – immediately rejected the whole idea. But in Britain, too, among real people (as opposed to ideological androids) there is a general sense that governments – even when they are elected by a mass franchise – become out of touch and out of control, and that something essential to human dignity and potential is under threat from their overweening interference. Read on and comment >>> Janet Daley | Saturday, November 06, 2010

Finger-wagging Is Just Not Enough, Mr President
TIMES ONLINE: Apparently, during his big speech on financial reform last night, there were audible groans on the floor of the New York Stock Exchange when President Obama said that he had “always been a strong believer in the power of the free market”.

This was presumably because that particular element of the President’s audience thinks he is anything but. Applied to their own corner of the US economy, though, why they think as they do is anyone’s guess. One year on from the collapse of Lehmans, it looks to be business as usual on Wall Street, with big bonuses in the offing amid signs that, as Mr Obama said, the lessons of the crisis have been ignored by some.

But for all his finger-wagging, for all his promises to undertake serious financial reform, the President has actually done remarkably little so far.

Apart from trying to convince Americans that big government bailouts of financial institutions have come to an end, last night’s speech was all about trying to get that process back on track, which is why a key element of Mr Obama’s plans — a new consumer protection agency to oversee financial products such as mortgages and personal loans — was again flagged.

Yet the measure looks some way from ever reaching the statute book due to a formidable lobbying effort by the financial services industry.

Other elements of Mr Obama’s proposals, such as measuring and seeking to regulate systemic risk, are even further away. Similarly, while the Administration has tabled proposals which would ensure that many over-the-counter derivatives are traded on regulated exchanges, centrally cleared and more accurately reported, these plans are a long way from being enacted.

Part of the problem is that Mr Obama’s fellow Democrats, despite controlling Congress, seem far more determined to push through healthcare reforms before they ever turn their attention to an overhaul of financial regulation.

All of this is hugely regrettable and helps to explain why so many ordinary folk on Main Street believe that the President is in thrall to Wall Street.

Meanwhile, in fairness to those NYSE traders who groaned at Mr Obama’s comment last night, the President is giving them good reason to doubt his free-market credentials. >>> Ian King, Business commentary | Tuesday, September 15, 2009

Sarah Palin Talks Government And Her Future

Resistance Grows to Obama's Bigger Government
Photo of Obama courtesy of Reuters
REUTERS: WASHINGTON - A public furor over big bonuses paid by firms bailed out with U.S. taxpayer money is fueling resistance to President Barack Obama's ambitious plans to extend government intervention in the U.S. private sector.

Republican opponents say his commitment of huge sums to try to revive the ailing economy is driven by a philosophical belief in greater government intrusion in many areas, from healthcare to education, dubbing it socialism.

Obama is pursuing these policies just 13 years after President Bill Clinton, a fellow Democrat, disarmed Republican opponents by declaring: "The era of big government is over."

As the enormous cost of the Obama's effort to stimulate the economy grows, many are weighing just how far government should be extending its powers.

"We're in the midst of a huge political battle, which is being obscured behind a financial crisis," said Bruce Kogut, professor of ethics and corporate governance at Columbia University. "If the financial crisis wasn't here we'd be having this battle anyway."

"The question I think we need to figure out as a country is what is the proper role of government?" said David Moss, professor of economic history at Harvard Business School. >>> By Tabassum Zakaria – Analysis, Editing by David Store | Sunday, March 22, 2009