The Adventures Of Hillary Hood

On Tuesday, Hillary Clinton made a statement that said much to define who she is and what she stands for. From CBS comes the specific details:

Sen. Hillary Clinton outlined a broad economic vision on Tuesday, saying it's time to replace an "on your own" society with one based on shared responsibility and prosperity.

The Democratic presidential hopeful said what the Bush administration touts as an "ownership society" really is an "on your own" society that has widened the gap between rich and poor.

Putting politics aside for a moment and taking a close look at these particular words gives us all an opportunity to examine her political and economic ideologies, with some much needed scrutiny and tells us much about how an economic system might look like, under a Hillary presidency. I also think it's extremely important to note that this economic view is not much different than what we have expected from Democrats (in general) over the years, one that began in a troubled time known as the Great Depression (the New Deal) and was exacerbated by LBJ's "so-called" Great Society.

One thing we must all consider in this is, FDR inherited an economy with 25% unemployment. And while the causes of this tanked economy can be debated into eternity, the fact remains that something had to be done as a means of emergency intervention. If not, there was the strong probability that suffering was going to become even more widespread than it already had become. In no way was public assistance intended to become a way of life like many people have made it, in the years that have followed.

If we contrast the New Deal with the Great Society, we will see a very different set of economic circumstances. When LBJ and his staff of liberals were propelled into what was perceived at that time to be a mandate for economic change (as a result of the 1964 election), they immediately enacted tax cuts that were originally proposed by JFK before his death. The unemployment rate in 1964 was around 5.2%, not the staggering 25% left in the lap of FDR three years after the Stock Market Crash of 1929. (The rate in 1963 was 5.7%.) And while the Great Society promoted programs that many felt were needed at the time, there was a lot of pork that was unnecessary and many felt were a hindrance to the improvement of the lives of the poor and underprivileged.

It can be argued that with Johnson's program came even lower unemployment rates. Unemployment bottomed out in 1969 at a meager 3.5%. But with that low rate came sky-rocketing inflation (5.46% in 1969). In fact, from 1965 to 1966 the nation watched inflation grow from 1.59% to 3.01%. It almost doubled and right at the time when Johnson began implementing his welfare state. Coincidence?

Although Jimmy Carter was not known for his coined economic phraseologies like FDR and LBJ, many of his programs were deemed directly responsible for inflation topping out at 13.58% in 1980 and an unemployment rate of 7.1 %, in the same year. And if you were in the workforce at this time, you no doubt remember that your cost of living increases were nowhere near 13% annually. Add to this a prime lending rate topping out at 20% in early 1980, and you have the makings of an economic disaster.

So, looking at giveaway programs coupled with high tax rates intended to level the playing field for all, we see that the ideology being promoted my Hillary has already been tested and tried by many before her, with some pretty harsh results. At the times this country has leaned more towards socialist policies, people were not helped (as was the intention), but were hindered as an unintended consequence.

When the lending rate was high, so were the payouts by banks in savings, money markets, and CDs. This did not encourage growth, because it was more advantageous for a rich man to put his money into savings than it was to invest in a new enterprise that would create jobs and more opportunities for those that were part of the labor force. Instead of building a new business or adding on to an existing business or industry, it was stashed in a bank and only created wealth for the select few that had the money and capital to create and produce. (If that's not enough to convince you, consider the former Soviet Union and China. Neither could effectively meet the needs of their populations until after the economies were shifted towards free-market enterprise.) Add to that this concept: There are many that look at socialist programs as a means of enslavement and nothing more than a modern-day version of feudalism (not to mention Jim Crow), with the masses dependent on government for their well-being (and not the individuals, themselves). And quite frankly, from where I sit, I agree with them.

This is precisely why, I am not an active proponent of more government control, but less. I say this because from where I sit, the more government can control in our lives, the more we will depend on them. The more we depend on them, the more they will fail us. Therefore, with this in mind, we must ask ourselves this all-important question: With more control yielded to government and more dependency resulting from that yielding, coupled with less potential for freedom of opportunity/self-sufficiency, where else could we turn when that government fails us, if not ourselves?

Can anyone see why I am very wary of proposed wealth re-distribution as a commonly promoted theme, especially when there is a Democratic President and Congress serving simultaneously?