Here’s a schedule of events for tomorrow’s inauguration.
This is a good time to take a look back as well as ahead. So in addition to watching Obama’s swearing-in and inaugural address tomorrow, I would recommend watching Reagan’s swearing-in and inaugural address from 1981:
I still love Reagan’s timeless line: “Government is not the solution to the problem. Government is the problem.” This is still true today, even though many have (once again) come to think the opposite.
It is not that government has no role to play. The problem is that government — as has been the almost universal case throughout human history — tends to vastly overstep its proper role.
As Thomas Sowell has often said, here is what typically happens: The government creates a certain policy or takes a certain action that affects the free market (in the case of the recent financial crisis, two such actions were the Community Reinvestment Act and keeping interest rates too low for too long after 9/11). That governmental action then creates unintended consequences which damage the economy.
But because of the time that it takes for these unintended consequences to become manifest, people don’t realize the connection between the governmental policy and the economic results. Instead, the free market gets blamed. The government then announces that it must step in to “fix the market” or solve the problem, and the cycle is repeated.
Reagan got this, and therefore realized that the solution to the stagflation and extended economic slump of the 70’s was less government, not more. The result was the longest economic expansion in history. Today, many people think that this era of expansion is over. Some people think that’s a good thing because, to their way of thinking, a thriving economy simply fuels materialism.
But that’s not a compassionate way to think. The problem with a lagging economy is not that you can’t buy as much stuff. The problem is that opportunity starts to dry up.
Obama, fortunately, does not think like the people who want to see our economy in the gutter for an extended period. The problem, though, is that Obama does not appear to understand what Reagan did. Maybe he will learn it — I am holding out hope for that. But in the meantime, he appears poised to deliver us another dose of what makes economies tank in the first place — an overreaching government.