Keith Hennessey

Responding to the President’s Carnegie Mellon economic speech

Yesterday I tried to neutrally summarize the President’s 5,000+ words economic speech delivered last week at Carnegie Mellon University.  Today I’ll give my views on the substance.

The new foundation is simply bigger government

Setting aside the tone, the President’s economic speech was simply an argument for bigger government.  It shouldn’t surprise anyone that the President is for bigger government.  I am a bit surprised that he’s willing to say it.

He frames the choice as one between Republican anarchy and his self-described reasonable middle ground balance of government and the private sector.

THE PRESIDENT:  But to be fair, a good deal of the other party’s opposition to our agenda has also been rooted in their sincere and fundamental belief about the role of government.  It’s a belief that government has little or no role to play in helping this nation meet our collective challenges. It’s an agenda that basically offers two answers to every problem we face:  more tax breaks for the wealthy and fewer rules for corporations.

The last administration called this recycled idea ‘The Ownership Society.’  But what it essentially means is that everyone is on their own.  No matter how hard you work, if your paycheck isn’t enough to pay for college or health care or childcare, well, you’re on your own.  If misfortune causes you to lose your job or your home, you’re on your own.  And if you’re a Wall Street bank or an insurance company or an oil company, you pretty much get to play by your own rules, regardless of the consequences for everybody else.

The President sets up three straw men to make his case:

  1. Republicans want a Lord of the Flies-like anarchy.
  2. His critics claim the President wants socialism.
  3. We are coming out of a “lost decade” of failed economic policies that we must reject for the future.

The choice America faces, the President argues, is between no government and a reasonable balance.

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