Thanks for the comments – is why I enjoy writing for Pajamas. As always, events don’t wait for publishing queues, and the biggest one in the US politically-driven economy is the White House attack on the US Chamber of Commerce. I’m prepping for a presentation and can’t do the topic justice in an article, but will add a few thoughts here.
1. The White House attacked the US Chamber for its lobbying against health care, cap and trade, and financial sector reform. To me that says that the lobbying has been effective – perhaps its why there’s been such difficulty making “progress” on these issues.
2. Maybe you can be skeptical when Steve Forbes or Mitt Romney or Stephen Moore (or me although I’m not in that company) say that this administration is anti-business. When the White House actually attacks the leading organization of US businesses, that’s pretty damning evidence.
3. Whether the Chamber is a friend or foe is open to debate – they supported immigration reform and probably would support moderate health care reform. Like most business organizations, they are center-right with the emphasis on center.
4. In effect, the Chamber’s dream world is one in which companies have free reign to make profits while all expenses are picked up by the taxpayer via social services. That world can not exist – you have to tax someone to pay for all of this stuff, and one by one industries will be targeted. Yesterday its finance, today its sodas, tomorrow its health care, etc. US industry via the chamber is compromising itself to oblivion, like a moderate Republican. Conservatives should not consider the chamber an ally because they will fold at the drop of a hat in an effort to be “reasonable” with unreasonable demands.
5. And let’s put this in perspective – the government is demanding that every American buy health care insurance while the it heavily subsidizes a low-cost provider and taxes everyone else. That is an unreasonable demand.
6. However the fact that the US chamber is centrist is a good thing politically right now, because when President Obama attacks them, he looks more like the far-left anti-business idealist that we know he is. The attack on Fox News was ineffective – this attack will be even worse, because in some ways you are defined by your enemies.
So that’s the chamber – don’t assume they are allies, but this may be an indication that the moderates are breaking our way on some issues.
One other point that didn’t quite make it into the article. The reason the government can print more money and inflation is still low is because inflation is not just money supply but money velocity. Velocity is how fast you spend the money in your pocket, and in a recession (depression?) velocity plummets. In some ways, Obama’s anti-business rhetoric helps to keep inflation low and the government’s borrowing and purchasing power intact so long as our expectations remain low.
