4/04/2009

History Shows Us The Outcome Of Obama's Grand Plans

While many of us in the moderate and conservative blogosphere have been decrying President Obama's plans, others have been looking at history to see if the situation where we now find ourselves – meaning the profligate spending and taxes proposed by Obama, expansion of labor union power, and rapid growth of the government bureaucracies – have existed before. It turns out there are two shining examples, one from the mid 20th Century and the other of a more recent vintage, that illustrate quite well the outcome of Obama's plans.

First, we only need to look at Argentina's past and see how it went from an economic power house to a basket case in a very short time. It had nothing to do with world economic conditions and everything to do with those running the country and their incompetence in doing so.

The disastrous path on which America is currently embarked was tried in another country - in the Western Hemisphere: Juan Peron's Argentina. During the 1940s until a 1955 coup ousted him from power, Peron presided over a fascist state.

What is not commonly known about Argentina is that prior to World War II, it was an economic powerhouse. Beginning in the 1880s and continuing through the 1920s and 1930s, it was regarded as one of the most prosperous and advanced nations in the world.

Argentina had a strong industrial base, thriving agricultural exports and a broad and expanding middle class. Like America, it served as a magnet for immigrants from all over the world, especially Italians. Within 15 years, however, Argentina went from being one of the richest to one of the poorest countries.

This was due largely to Peronist policies. Upon coming to office, Peron, along with his popular wife, Eva, established a corporatist state characterized by lavish social spending, elaborate welfare programs, protectionism, confiscatory taxation and runaway deficits.

Peron used strident class warfare rhetoric, attacking big business, the banks, corporations and the propertied class. He greatly strengthened labor unions, making them pivotal allies of his regime.

Peronism transformed the Argentine state. The bloated bureaucracy and massive government intervention fostered widespread corruption. Central economic planning destroyed productivity and growth. Investment capital fled. Inflation and interest rates soared. The middle class was wiped out. The independent judiciary was undermined and eventually smashed. The fawning media class became co-opted by Peron's allies. His -and Eva's - cult of personality fostered a climate of violence and political persecution of the regime's enemies. Argentina degenerated into the Latin American basket case that it is today.

The failure of Peronism should serve as a warning: Socialism and a sky-rocketing national debt can permanently impoverish even the wealthiest nations. America is not immune from the laws of economics. Prosperous republics - ancient Rome, the Italian city-states, Argentina - have seen their wealth squandered, never to recover.

Mr. Obama is taking the first dangerous steps toward an American version of Peronism. His followers see him as a political messiah, a revolutionary change agent who will foster national cohesion and unity. He and the Democrats are plundering the state, using it as a vehicle to reward supporters (and punish foes). He is our Dear Leader, whose image is everywhere from magazine covers to T-shirts to baseball caps. His wife, Michelle, is the Eva Peron of our time - glamorous, chic, a fashion trend-setter who is beloved by the media.

Most ominously, Mr. Obama is repeating the statist populism that didn't work in Argentina, and will not work in America. Professor Philip Jenkins wryly observes that the United States of America risks becoming "the United States of Argentina." He is right. Those who fail to learn from history are condemned to repeat it.

Everything laid out above is exactly what President Obama is proposing for America, though he uses more obscure rhetoric to describe what he's doing and why. What's worse is the leftists in Congress are willing to follow him on his quest to impoverish the nation all in the name of “fairness”. We've seen this before, though as laid out in fiction in Ayn Rand's Atlas Shrugged. Rand borrowed heavily from the situation in the old Soviet Union as well as what had happened in Argentina to lay out the folly and dangers of socialism, much like what we're seeing being foisted upon us now.

A more recent example of how Obama's plans will heavily damage, if not destroy, the American economy is Hugo Chavez's Venezuela.

Venezuela had a thriving economy and an open and free society. The socialist strong man Chavez was elected, he having made many of the same promises we're hearing from Obama. Once in office, he implemented his ideas and plans. In a very short time the economy started contracting and eventually collapsed as Chavez tightened control over it, instituting price controls that bankrupted farmers and business owners, created shortages that could not be filled, crippled the country's petroleum industry, eliminated most of the civil rights, turned the justice system and the media into puppets that followed his wishes, allowed vital infrastructure to fall into disrepair, and creating many new social programs that stripped wealth away from the producers, leaving him with no way to fund them.

Venezuela is an economic basket case, no longer able to meet the needs of its citizens. None of it was due to economic conditions in the world. It was all Chavez's doing, despite his claims to the contrary. He still blames outside forces, meaning the US, for all of Venezuela's ills. But every bit of Venezuela's fall comes back to the cult of personality that is Hugo Chavez. He has only himself to blame for his country's problems.

And so it will be for Barack Obama, should he successfully lead us down the path of economic destruction he's created for us. He has chosen to ignore history, chosen to make the same mistakes even though the outcome will be no different this time.

By my definition, that makes him insane. (My definition of insanity: Doing the same thing over and over again, but expecting the results to be different this time.)

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