STEYN: Regulation, globally speaking

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By Mark Steyn

COMMENTARY:

Writing in the Chicago Tribune last week, President Obama fell back on one of his favorite rhetorical tricks: "But I also know," he wrote, "that we need not choose between a chaotic and unforgiving capitalism and an oppressive government-run economy. That is a false choice that will not serve our people or any people."

Really? For the moment, it's a "false choice" mainly in the sense that he's not offering it: "a chaotic and unforgiving capitalism" is not on the menu, which leaves "an oppressive government-run economy" as pretty much the only game in town. How oppressive is yet to be determined: To be sure, the official position remains that only "the richest 5 percent" will have taxes increased. But you'll be surprised at the percentage of Americans who wind up in the richest 5 percent.

This year, federal spending will rise to 28.5 percent of gross domestic product, the highest ever, with the exception of the peak of World War II. The 44th president is proposing to add more to the national debt than the first 43 presidents combined, doubling it in the next six years, and tripling it within the decade.

But talking about it in percentages of this and trillions of that misses the point. It's not about bookkeeping, it's about government annexation of the economy, and thus of life - government supervision, government regulation, government control. No matter how small your small business is - plumbing, hairdressing, maple sugaring - the state will burden you with more permits, more paperwork and more bureaucracy.

And don't plan on moving. Ahead of this week's Group of 20 summit in London, Treasury Secretary Timothy F. Geithner, America's beloved Toxic Asset, called for "global regulation." "Our hope," said Toxic Tim, "is that we can work with Europe on a global framework, a global infrastructure which has appropriate global oversight." "Global oversight." Hmm. There's a phrase to savor. "We can't," he continued, "allow institutions to cherry-pick among competing regulators and ship risk to where it faces the lowest standards and weakest constraints."

Just as a matter of interest - why not? If you don't want to be subject to the punitive "oversight" of economically illiterate, demagogic legislators-for-life like Rep. Barney Frank, Massachusetts Democrat, why shouldn't you be "allowed" to move your business to some jurisdiction with a lighter regulatory touch?

Borders give you choices. Your town has a crummy grade school? Move 10 miles north and there's a better one. Sick of Massachusetts taxes? Move to New Hampshire, as thousands do. To modify the abortionists' bumper sticker: "I'm Pro-Choice And I Vote With My Feet." That's part of the self-correcting dynamism of capitalism: For example, Bono, the global do-gooder who was last in Washington to play at the Obama Inauguration, recently moved much of his business from Ireland to the Netherlands in order to pay lower taxes.

And good for him. To be sure, he's always calling on governments to give more money to Africa and whatnot, but it's heartening to know that, when it comes to his wallet as opposed to yours, Bono, like Mr. Geithner, has no desire to toss any more of his money into the great sucking maw of the government Treasury than the absolute minimum he can get away with.

I'm with Bono and Tim: They can spend their money more effectively than hack bureaucrats can. We should do as they do, not as they say.

If you listen to the principal spokesmen for U.S. economic policy - Mr. Obama and Mr. Geithner - they grow daily ever more explicitly hostile to the private sector and ever more comfortable with the language of micromanaged, government-approved capitalism. That, of course, isn't capitalism at all. They'll have an easier time getting away with it in a world of "global oversight" where there's nowhere to move to.

Unfortunately, even then it won't work. Think about it: It takes extraordinary skill to create and manage a billion-dollar company; there are very few human beings on Earth who can do it. Now look at Mr. Obama and Mr. Geithner, the two men currently "managing" more money than any individuals in human history - not billions but trillions of dollars.

Notwithstanding the Treasury secretary's protestations that the Yes/No prompt buttons of Turbo Tax were too complex for a simple soul such as himself, it's no reflection on the hapless Mr. Geithner that he is unable to fix the planet. When the Bolsheviks chose to introduce Russians to the blessings of a "command economy" 90 years ago, they were dealing with a relatively simple agricultural society largely contained within national borders. Mr. Obama and Mr. Geithner are trying to do it with a sophisticated global economy in which North American consumers, European bankers, Asian suppliers, Saudi investors and Chinese debt-holders are more tangled than an octopus orgy.

Even with "global oversight" - with the Toxic Tims of Germany, Argentina and India all agreeing on how to fix the game - it can't be done.

Mr. Obama, even when he's not yukking it up on "60 Minutes," barely disguises his indifference to economic matters. He is not an economist, a political philosopher, a geopolitical strategist. He is the president as social engineer, the community-organizer-in-chief. His plan to reduce tax deductions for charitable giving is not intended primarily to raise revenue, but to advance government as the distributor of largess and diminish alternative sources of societal organization, such as civic groups. His big plans for socialized health care, a green economy, universal college education are likewise about extending the reach of the state.

Unfortunately, it all costs money he doesn't have. So he has to borrow it, in your name. Where does the world's hyperpower go to borrow more dough than anyone has ever borrowed in human history? More to the point, given that, partly at the behest of Mr. Obama and Mr. Geithner, almost every other Western government is ramping up national debt to cover massive bank bailouts and other phony-baloney "stimuli," is there enough money out there to buy up the debt already incurred?

Last week, at the official British Treasury auction, investors failed to buy the full complement of so-called "gilt-edged" 40-year bonds. Two such auctions have already failed in Germany. The U.S. Treasury faced similar investor reluctance to snap up $34 billion worth of five-year notes and had to increase the interest it will pay on them.

The Chinese and the Saudis have long taken the view that it's to their advantage to own as much of the Western world as they can snaffle up, but it's unclear whether even they have pockets deep enough for what America and the many Bailoutistans of Europe propose spending.

In their first two months, Mr. Obama and Mr. Geithner have done nothing but vaporize your wealth and your children's future. What began as an economic crisis is now principally a political usurpation. And, to return to the president's "false choice," that "chaotic and unforgiving capitalism" is exactly what we need right now. It's the quickest, cheapest, fairest, most efficient route to economic stabilization and renewal. A regimented and eternally forgiving global command economy with no moral hazard will destroy us all.

Mark Steyn is the author of the New York Times best-seller "America Alone" and is an internationally syndicated columnist.