The Right has gone mad, it’s true. The conservative
head, already suffering traumatic brain injury after insisting that pre-emptive
war, waterboarding, and debt are enduring Western values, finally went blank
when Barack Obama ascended the federal throne. Tea-party activists say that a
Kenyan Nazi is readying a death panel for Sarah Palin. Fascism is liberal
nowadays; communism, too. It’s all connected. Glenn Beck is chalking lines
between Keith Olberman, Levi Johnston, and Leon Trotsky. How can the Right
fight an enemy that will not release its birth certificate?
Fortunately, Timothy P. Carney has a cure for such dementia: muckraking
journalism, of the sort he ably exhibits in Obamanomics: How Barack Obama Is Bankrupting You and
Enriching His Wall Street Friends, Corporate Lobbyists, and Union Bosses.
Don’t let the Fox-appearance-fetching title throw you: George W. Bush comes in
for nearly as much abuse as Obama. A reporter for the Washington Examiner and a
protégé of the late Robert Novak, Carney has carved out a career of picking
apart Washington’s latest regulations on industry and exposing the lobbyists
and corporations getting rich in the name of public interest.
In Obamanomics,
he demonstrates time and again how Big Business and Big Government are natural
allies: an incumbent business loves nothing better than a regulator that raises
overhead costs for its smaller competitors or introduces legislation that
ensures all Americans are compelled to buy its products.
Carney doesn’t bother drawing ideological lines between Rahm Emanuel and
Karl Marx. He is too busy documenting how Emanuel deals with his former
partners at Goldman Sachs or reporting the activities of former Senate Majority
Leader Tom Daschle, who now splits his time between advising the president on
healthcare reform and cashing checks from health-industry clients.
Carney points out how the media treat nefarious partnerships between
large corporations and government regulators as a surprise or as “proof that
the case for reform is overwhelming,” when in fact cooperation is routine and
often involves easily discernible financial interests. As he puts it, “The
economic law underlying Obamanomics—opaque to most journalists and contrary to
conventional wisdom—is this: increased government control centralizes
industries and favors the biggest businesses.” So while liberal bloggers like
Matt Yglesias and Ezra Klein welcome the support of red-state behemoth retailer
Wal-Mart on their side of the healthcare debate, Carney points out that
Wal-Mart is using government regulation to raise overhead costs for Target,
which offers fewer health benefits than Wal-Mart.
Obamanomics also puts the lie to Obama’s campaign rhetoric,
in which he excoriated corrupt Republicans for promoting deregulation because
they were subservient to large corporate interests and told lobbyists that
their days were numbered. Obama claimed, for instance, that McCain had voted 23
times against “alternative energy like solar, and wind, and biodiesel.” Carney
notes, however, that most of these votes were against ethanol subsidies—a
government program that acts as a simple wealth-transfer scheme from taxpayers
to agribusiness giant Archer Daniels Midland, with no broader economic or
environmental benefits.
Chapter 9, “GE: The For-Profit Arm of the Obama Administration,” is
worth the price of the book and provides a perfect case study. Just days after
Obama’s inauguration, General Electric CEO Jeff Immelt wrote to shareholders,
“The global economy, and capitalism, will be ‘reset’ in several important ways.
The interaction between government and business will change forever. In a reset
economy, the government will be a regulator; and also an industry policy
champion, a financier, and a key partner.” Translation: Washington will
subsidize our industry, provide grants for our research, and mandate our
products for environmental reasons. Kaching! “The company makes light bulbs and
refrigerators, sure,” writes Carney, “but it also has a finance arm, a
transportation arm, a healthcare arm, a communications arm, and more. The above
letter from Immelt reveals what these arms all have in common: they all reach
out for government favors.”
Let us count the ways. GE launched its own PAC to solicit donations from
its employees for candidates “who share GE’s values and goals.” Unsurprisingly,
Obama received more money from GE employees than any other politician. Immelt
now sits on Obama’s economic recovery board and enjoys a weekly phone call with
White House economic adviser Austan Goolsbee. In the past decade, GE has spent
more on lobbying than BlueCross, Exxon, or Altria, the owners of Philip Morris.
Former Sens. Trent Lott (R) and John Breaux (D) lobby for GE. And former Rep.
Dick Gephardt, tribune of the working man, lobbies for NBC Universal, which as
we go to press is a subsidiary of the GE conglomerate. If by any chance Obama
forgets to ask himself “What would Jeff Immelt do?” before signing legislation,
GE has recruited Linda Daschle, wife of that authentic North Dakotan voice of
reform, Tom, as another of its lobbyists.
Where’s the profit in all this influence? For one, GE has been investing
in “carbon offset” assets that have almost no value unless the Obama
administration institutes its cap-and-trade energy plans. Sure enough, HR 2454,
the American Clean Energy and Security Act of 2009, is a GE lobbyist’s dream
come true. The bill aims to provide manufacturers with “incentives” to sell
energy-efficient appliances. Those enticements would mean that GE stands to
reap $75 of taxpayer money for each dishwasher it sells until 2013, $200 for
each refrigerator, and up to $300 for each hot-water heater. As an added bonus,
GE gets tax breaks and billions in loan guarantees for its wind-power projects.
More egregiously, GE lobbied for the ban on its own incandescent light
bulbs, a reliable product that for more than a century has turned a profit and
employed thousands of factory workers in Kentucky and Ohio. Why would they do
that? So they could blame “government regulation” for closing down their costly
American plants, of course. GE manufactures its more expensive fluorescent
bulbs—generally hated, but now federally mandated—in China and the Philippines.
Though Carney spends the bulk of Obamanomics uncovering the dirty deals and
following the money as it sloshes around K Street, he does take one chapter to
suggest a method of political resistance, and an intriguing one: libertarian
populism. He sets out an opposition agenda for the GOP that includes
making HMO’s compete for business across state lines and lifting re-importation
bans on pharmaceuticals, thus forcing drug companies to work against Canadian
and European price controls. Carney’s Republicans would end energy subsidies,
oppose cap-and-trade, and recall the bailouts to pay down the national debt.
Carney even picks up the banner for Ron Paul’s dream of auditing and abolishing
the Federal Reserve.
Such a populist-libertarian agenda would seek to shutter the den of
corporate welfare known as the Department of Commerce. In its place, Carney
would implement Cato Institute scholar Stephen Slivinski’s plan for a
bipartisan anti-corporate-welfare commission. The commission would have
authority to send a bill to Congress closing down all corporate giveaways.
Political opponents would be forced to defend in public the enrichment of
Goldman Sachs, GE, and Boeing over any other cause that might be looking for a
$100 billion government handout. “Imagine the debate,” fantasizes Carney,
“Obama arguing explicitly on GM’s and Goldman Sachs’ side, with Republicans
arguing to protect taxpayers and Main Street. It would be a good political
cudgel, as well as excellent policy.”
Perhaps Carney lets his anti-statist fancies soar too high. He even
dreams of a constitutional amendment to ban the government from buying
companies or offering private businesses subsidized loans. And pork might fly.
Still, positive reform requires this kind of zeal.
Carney admits that his ideal GOP would “turn off traditional Republican
donors” such as Boeing. He insists, however, that Republicans can reorient
their income streams. Corporate funding of the Right has always been skittish,
short-term, and issue-driven. “[Republicans] still could haul cash from rich
people,” Carney suggests, “but from entrepreneurs rather than Fortune 500
CEOs.”
Obamanomics offers an attractive fusion of populism and
libertarianism. Yet that blend could be taken further both politically and
theoretically. It’s fun to imagine what Republicans could do if they labeled
Jeff Immelt a welfare queen and attacked Goldman Sachs executives as
free-riding loafers. It would be the completion of a century-long process of
realignment. Bank-hating heartlanders could finally sign up with the party of
Nelson Rockefeller. But why not include conservatism’s inadequate, yet
politically potent, cultural populism in the same anti-corporate coalition?
After all, most Americans do not suffer lectures from “diversity consultants”
at their local town hall but in their corporate office parks. Outside of
state-funded schools, the government is not responsible for the cultural
revolution that traditionalists detest. The average American is more likely to
encounter ruthlessly enforced speech codes, racial-awareness training, and
instruction in “tolerance” at the behest of his employer. It’s time to say so.
Though the greedy collusion and hypocrisy Carney exposes should be
sufficient to motivate a political movement, the intellectuals and polemicists
of the Right need to reconnect with a broader, richer conservative philosophy—a
worldview that distrusts the corporatist state in all its forms, not just in
its individual corruptions. Let them rediscover Justus Möser’s criticisms of
large combines. Let our scribblers dilate on Hilaire Belloc’s vision of the
servile state in which government and business co-opt us into indentured labor
in the name of economic security. Let them rhapsodize, Ayn Rand-like, on the erotic
qualities of entrepreneurs and the flaccidity of public and private
bureaucracy. Or how about using James Burnham’s Managerial
Revolution as inspiration? He connected the emergence of the
corporation as the dominant economic unit with the flourishing of the executive
branch. Conservatism never should have been mere apologetics for
state-capitalism.
If Obamanomics and
the ideas that inform Carney’s writing infiltrate the tea-party set, American
conservatism has a shot at becoming something worthwhile again. But the book
may be just as important for self-styled anti-movement conservatives.
Localists, traditionalists, and other politically endangered species usually
turn against libertarian policy goals. They fear the unregulated corrosion of
traditional norms and values by the market. Yet as Carney shows us, Big
Business, far from regarding Washington as its enemy, sees the state as a
“financier,” “champion,” and “partner”—to quote GE’s Immelt. If you want to
whack big corporations, aim at Washington first
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