A Government Bailout of Government

Our media have been in awe of Barack Obama’s physique, his workouts and basketball skills. But his obvious deceptions about the economy are what really deserve scrutiny.

Mike Allen of Politico.com quoted Republican consultant Frank Luntz as complimenting Obama for coming up with the deceptive phrase, “American Recovery and Reinvestment Plan,” to describe the largest federal spending bill in history, labeled a “fiscal stimulus,” which would dramatically increase the federal deficit, already estimated at $1.2 trillion for this fiscal year. Obama himself predicted trillion dollar deficits “for years to come,” at a time when $8 trillion has already been spent by federal authorities on various bailouts of the U.S. economy.

Noting that Obama had said the country had arrived at this point through “profound irresponsibility,” comedian Jay Leno cracked, “there’s only one way out of it. Spend more money we don’t have. Yeah, that’s the ticket!”

Regarding the “American Recovery and Reinvestment Act,” Luntz told Politico that “Recovery says putting the country back on track, and reinvestment is the next step up from investment.”

Bloomberg.com revealed that Obama’s team was using polling and focus groups to develop the language necessary to sell the plan. That included the words “recovery” and “investment” to disguise the nature of the Big Government measure. 

Obama insisted the bill wouldn’t contain earmarks, but that was another deception. Most of it in fact constitutes a gigantic earmark for state and local governments that have already spent beyond their means.

Not surprisingly, left-wing labor unions that backed Obama supported the plan, anticipating jobs for their members.

Obama promises budget cuts, but the expectation of Obama’s “progressive” supporters is that he will slash the U.S. military, especially missile defense and weapons systems. Obama himself vowed during the campaign, “I will cut investments in unproven missile defense systems. I will not weaponize space. I will slow our development of future combat systems…I will not develop new nuclear weapons.”

This would leave America in a very dangerous situation. Because of our decline financially and economically, America’s military superiority is practically all that is left of our superpower status. 

A Washington Post article by Michael D. Shear referred to the proposal as “a massive recovery plan for the nation’s struggling economy.” The New York Times called it a “two-year economic recovery package.” Hence, major liberal papers were adopting the terminology of the Democrats.  

Obama’s January 3 radio address declared that “this plan must be designed in a new way—we can’t just fall into the old Washington habit of throwing money at the problem.” Yet this is just what his plan intends to do. Obama said that “we must restore fiscal responsibility and make the tough choices so that as the economy recovers, the deficit starts to come down.” The deficit will be increased so that it can eventually “come down?”

For too many families, “debts continue to mount,” he said. So the answer is for the federal government to go further into debt and pass on these costs to those who pay the bills—those same families.  

Senate GOP Leader Waffles

Since there is a great danger that the Obama plan will only deepen and prolong the recession, he wants to get Republicans to sign on, making it “bipartisan.”

Having rolled over for Bush and the Democrats on the $700-billion Wall Street bailout bill, Senate Republican Leader Mitch McConnell called Obama’s plan “the largest spending bill in the history of our country at a time when our national debt is already the largest in history.” But he then indicated he might support it.

However, on Neil Cavuto’s Fox News program on January 9, dissenting voices were heard. Former Republican Rep. Dick Armey, now with the group Freedom Works, said that the cost, which will be passed on to future generations, is “a curious form of fiscal child abuse.” Rep. Ron Paul said the alternative is to cut federal spending and debt and “change our philosophy of government” back to free enterprise.     

In a video for the Center for Freedom and Prosperity, Dan Mitchell of the Cato Institute said the stimulus plan is flawed because government can’t inject money into the economy that it doesn’t first take from the economy through borrowing or some other means.

Peter Schiff of Euro Pacific Capital explained, “When the government spends, the money has to come from some-where. If the govern-ment doesn’t have a surplus, then it must come from taxes. If taxes don’t go up, then it must come from increased borrowing. If lenders won’t lend, then it must come from the printing press, which is where all these bailouts are headed. But each additional dollar printed diminishes the value of those already in circulation.”

Despite McConnell’s apparent flip-flop, a resolution to be introduced at the January meeting of the Republican National Committee opposed the Obama plan and the preceding bailouts.

The resolution said that the bank bailout bill, whose cost rose to $850 billion after Congress added pork to it, “has neither reversed the economic crisis nor protected the taxpayers, but rather has added $850 billion dollars to their tax bill and raised the national debt ceiling from $10 trillion to $11.3 trillion, which has the potential long-term effect of further weakening the economy,” the resolution states.

Now, the resolution notes, Obama was proposing “a cleverly disguised Government Bailout Plan designed to bail out state and local governments…”

The liberal media, of course, will not refer to it in those stark but honest terms.

PUBLIC TV AND RADIO GET THEIR OWN BAILOUTS

Perhaps the media’s embrace of these never-ending bailouts stems from their need to please the powers that be in the Congress and the Obama Administration so that the Big Media can eventually receive a bailout of their own. It has already been reported that a Democratic Party politician from Connecticut, State Rep. Frank Nicastro, is talking about government aid for several failing local newspapers in that state. Bill Doak, editor of the East Hartford Gazette, was quoted as saying that the state ought to look at newspapers as manufacturing businesses that produce a product locally that people use on a regular basis. “It’s a manufacturing company that actually makes things,” he said. “It’s a useful product.”

One can anticipate somebody like Arthur Sulzberger, Jr. of the New York Times making a similar argument on a national level.

Of course, the federal government already subsidizes several entities, including National Public Radio and the Public Broadcasting Service. Back in 2005, when we analyzed this problem in detail, the subsidies amounted to $400 million a year. At that time, we had determined that the Congress had appropriated over $8 billion to the Corporation for Public Broadcasting, which funds public TV and radio, since 1969.

The Center for American Progress (CAP), whose president, John Podesta, was a co-chair of the Obama-Biden Transition Project, issued a report back in 2007 contending that commercial radio station owners “either play by the rules or pay.” This was a reference to rules for covering “local” issues.  Mark Lloyd of CAP threatened radio station owners, saying that if they “don’t want to be subject to local criticism of how they are meeting their license obligations, they should pay to support public broadcasters who will operate on behalf of the local community.”

This “localism” argument, as we have documented in the AIM Report, is designed to force national conservative broadcasters off the air and out of major media markets. If the “progressives” succeed in this approach, they won’t have to resort to the so-called “Fairness Doctrine.”

The CAP Report said that “If commercial radio broadcasters are unwilling to abide by these regulatory standards or the FCC is unable to ef­fectively regulate in the public interest, a spectrum use fee should be levied on owners to directly support local, regional, and national public broadcasting.

It urged a fee to be “distributed directly to the Corporation for Public Broadcast­ing [CPB] with clear mandates to support local news and public affairs programming and to cover controversial and political issues in a fair and balanced manner. We estimate that such a fee would net between $100 million and $250 million and would not overly burden commercial radio broadcasters.”

In this context, the George Soros-funded Free Press presented a report to the Obama-Biden Transition Project, “Economic Recovery and Public Media,” arguing that $575 million of the federal “stimulus” money should be given directly to the CPB to build “public media networks” and for other purposes.

In the future, of course, direct taxpayer bailouts of liberal media properties cannot be ruled out.  And this is one additional reason why the media will be so obsequious in their coverage of the Obama Administration.

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