So where does the state belong?

From Glenn Reynolds' link to Larry Kudlow, my attention was drawn to an earlier Kudlow piece which (after noting a near-300 point stock plunge over new fears of bank nationalization), Kudlow looks at the vexing question of what to call all of this:

An old friend e-mailed me this week about how to characterize Obama's economic interventions into the banking and auto sectors (with health care next on the list). He says it's not really socialism. Nor is it fascism. He suggests it's state capitalism. But I think of it more as corporate capitalism. Or even crony capitalism, as Cato's Dan Mitchell puts it.

It's not socialism because the government won't actually own the means of production. It's not fascism because America is a democracy, not a dictatorship, and Obama's program doesn't reach way down through all the sectors, but merely seeks to control certain troubled areas. And in the Obama model, it would appear there's virtually no room for business failure. So the state props up distressed segments of the economy in some sort of 21st-century copy-cat version of Western Europe's old social-market economy.

So call it corporate capitalism or state capitalism or government-directed capitalism. But it still represents a huge change from the American economic tradition. It's a far cry from the free-market principles that governed the three-decade-long Reagan expansion, which now seems in jeopardy. And with cap-and-trade looming, this corporate capitalism will only grow more intense.

This is all very disturbing.....

To call it "very disturbing" may be understatement, as it's scary as hell to watch this country's dramatic slide from economic freedom to socialism in a period of months.

More ominously, the environmentalist schemes may be the final nail in the coffin. It's not enough for the government to regulate the economy; they want to interfere with virtually all use of energy, and even regulate the air we exhale as a "poison" -- in supposed furtherance of a theory that retarding human progress will beneficially cool the planet. (Hardly a cheerful thought when contemplating the 32 degree April weather this morning.....)

Dick Morris looks at a key feature of the Obama plan (changing the nature of the acquired stock), and sees pure, unadulterated socialism: changing this fundamental element of the TARP plan, Obama will give Washington a voting majority among the common stockholders of these banks and other financial institutions. The almost 500 companies receiving TARP money will be, in effect, run by Washington.

And whoever controls the banks controls the credit and, therefore, the economy. That's called socialism.

Obama is dressing up the idea of the switch to common stock by noting that the conversion would provide the banks with capital they could use without a further taxpayer appropriation. While this is true, it flies in the face of the fact that an increasing number of big banks and brokerage houses are clamoring to give back the TARP money. Goldman-Sachs, for example, wants to buy back its freedom, as do many banks. Even AIG is selling off assets to dig its way out from under federal control. The reason, of course, is that company executives do not like the restrictions on executive pay and compensation that come with TARP money. It is for this reason that Chrysler Motors refused TARP funds.

With bank profits up and financial institutions trying to give back their money, there is no need for the conversion of the government stock from preferred to common -- except to advance the political socialist agenda of this administration.

Under these circumstances, no one ought to be surprised that venture capital is under assault. Once again, the question seems to involve whether this is incompetence or design:
Obama is either in clearly in over his head, or else he is working to undermine the foundations of the capitalist system from within in order to strengthen the centralized power of the state.
Notwithstanding my penchant for finding humor in such things, this is starting not to be funny anymore.

However, hypocrisy and double standards often amuse me -- especially in the context of the "Culture War." So naturally, I found it amusing that when a pleasant young woman I'd never heard of before had the temerity to echo Barack Obama's position on gay marriage, she found herself savagely insulted by intolerant gay activists. Via Glenn Reynolds, who asks, "Why is it okay for Obama to oppose gay marriage, but not okay for Miss California to?" Apparently it's OK if he's lying. (Well, he says opposes it for religious reasons. Does that mean invoking religion in a dishonest manner is OK?)

Anyway, while I did feel sorry for Miss California (as I don't like seeing people unjustly attacked), the gay marriage activists may have inadvertently caused career doors to open for her. So the joke is on them, really. Perhaps Ms. Prejean should thank her rude and thoughtless critics.

Meanwhile, some conservatives think it's time for a big showdown on gay marriage. Unless we are married to the state, I'm not convinced of the worthiness of either "side" of such a cause. Marriage has long seemed to me to be more of a personal matter between two people than an "institution," and the clamor over a "right" to a marriage license thus strikes me as side-stepping the issue of whether the state is just being given another invitation into the bedrooms of people who in historical terms only recently succeeded in getting the state out of their bedrooms.

I can understand the philosophical debates about whether same sex marriage is a good idea, but I think debates over state regulation (like federalization of marriage) miss the point.

If only it were as conservative to advocate getting the state out of marriage as it is to advocate getting it out of the economy...

MORE: It is entirely possible that I (along with many others who attempt serious analsis of Barack Obama) could be barking up the wrong tree. According to Frank J. Fleming,

All of these goofy gaffes by the president prove that he's really Sacha Baron Cohen and we're all in his next movie.
Borat Obama?

Say it isn't so!

(As seen on Google!)

posted by Eric on 04.23.09 at 09:51 AM


"the issue of whether the state is just being given another invitation into the bedrooms of people"

That's my thought. I don't want the government to approve homosexual marriage. I don't want the government to approve heterosexual marriage. I want them the hell out of the marriage business entirely.

And out of just about every other business as well.

guy   ·  April 23, 2009 1:12 PM

Actually, state sanctioned marriage is a matter of contract law and the state can not discriminate against one group of people in this matter.

Donavon   ·  April 23, 2009 5:02 PM

Marriage is a peculiar legal relationship that has come to be governed by the state -- especially family law, which is not the same as contract law.

Civil unions would be a matter of contract law.

Eric Scheie   ·  April 23, 2009 7:44 PM

Oddly, the few gay people I've actually talked with about the idea of not having the government in the marriage business at all thought it was a horrible idea.

I don't get it. Or maybe I do and I don't want to think about it.

I don't get GroupThink.

silvermine   ·  April 23, 2009 8:49 PM

State subsidized intellectuals. Rope. Tree.

Brett   ·  April 24, 2009 1:17 AM

I swear I didn't read this before my latest post "Plural Marriage". Great minds... :-)

M. Simon   ·  April 24, 2009 11:20 AM

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