- The Washington Times - Monday, April 6, 2009




During the Obama administration’s foray to London this last week, officials provided a special telephone number to journalists interested in discussing foreign-policy issues in an “on-the-record briefing call with Secretary of State Hillary Clinton and National Security Adviser Jim Jones.”

Unfortunately, as part of the curious run of bad luck afflicting our new secretary of state, upon dialing the number, the gentlemen of the press were greeted by a honey-voiced seductress, presumably not Mrs. Clinton, offering them “phone sex” and seeking their credit-card number if they “feel like getting nasty.”

No, it’s not a White House April Fool’s gag. This was April 2.

Alas, what with the collapse of the newspaper industry and major metropolitan dailies filing for bankruptcy every 20 minutes, sticking phone sex on your expense tab isn’t as easy as it once was. So many of these big-shot correspondents were forced to hang up, call the White House Press Office, get the correct number, and listen to Mrs. Clinton drone on about the NATO summit for half an hour. The deputy press secretary, Bill Burton, insisted that the White House handing out sex-line numbers was no big deal and that only Fox News would make a fuss about “a corrected phone number.”

I’m not sure why the White House needed to correct it. It’s the perfect radio ad for the administration. Call 1-900-OBAMA, and Treasury Secretary Timothy F. Geithner will demand your credit-card number and ask whether you feel like getting nasty, because he certainly does. He’ll be wearing a steel-tipped basque, and the squeals in the background will be an executive of American International Group Inc. or the former chief executive officer of General Motors Corp. hanging upside down in the Treasury Department basement while he feels the firm lash of government “regulation” from Barney Frank and Mistress Nancy Pelosi.

Well, we all hate “the rich,” don’t we? Last week, David Paterson, the governor of New York, said that if he had known his latest tax increase would persuade Rush Limbaugh to sell his Manhattan apartment and leave the city, he would have raised taxes earlier. Ha-ha. Very funny. In New York City, as Mayor Michael Bloomberg has pointed out, the wealthiest 1 percent contribute 50 percent of municipal revenue. How tiny a number of people does Mr. Paterson have to drive out before it causes significant shortfalls in the public coffers?

On the other hand, the rich can only be driven out if they’ve got somewhere to be driven to. At the ludicrous Group of 20 summit in London last week, the official communique crowed over a “clampdown” on tax havens - those British colonies in the Caribbean and a few other offshore pinpricks in the map. “The era of banking secrecy is over,” the G-20 proclaimed.

Does anyone seriously think a Swiss bank account or a post-office box in the Turks and Caicos is responsible for the global meltdown?

No, but the world’s governments have decided to focus on irrelevant scapegoats. In the current crisis, Japan, Germany and Italy (plus Russia) are in net population decline that will accelerate in the years ahead. So, unlike the United States, they can’t run up the national debt and stick it to their kids and grandkids, because they don’t have any kids and grandkids to stick it to. If New York is running out of rich people, Germany is running out of people, period. The Chinese and other buyers of Western debt know that. If you’re an investor and you’re not tracking gross domestic product (GDP) versus median age in the world’s major economies, you’re going to lose a lot of money.

If government has a role in this crisis, it ought to be to reverse the combination of unaffordable social programs and deathbed demographics that make a restoration of real GDP growth all but impossible in many European nations. But that would involve telling the citizenry unpleasant truths, and Continental politicians who wish to remain electorally viable aren’t willing to do that. French President Nicolas Sarkozy, The Times of London reported, “said that the summit provided a once-in-a-lifetime opportunity to give capitalism a conscience.”

What Mr. Sarkozy means by “a conscience” is a global regulatory regime that ensures there’s nowhere to move. If you’re France, which has a sluggish, uncompetitive, protectionist, high-unemployment business environment whose best and brightest abandon the country in ever-greater droves, it obviously makes sense to force the entire planet to submit to the same growth-killing measures that have done wonders for your own economy. But it’s not good news for the rest of the world. The building blocks for a global regulatory regime and even a global central bank with an embryo global currency (the International Monetary Fund and the enhanced role of “Special Drawing Rights”) are an ominous development.

Let it be said that in recent years in America, the United Kingdom and certain other countries the “financial sector” grew too big. In the Atlantic, Simon Johnson points out that, between 1973 and 1985, it was responsible for about 16 percent of U.S. corporate profits. By this decade, it was up to 41 percent. That’s higher than healthy, but it wouldn’t have gotten anywhere near that high if government didn’t annex so much of your wealth - through everything from income tax to small-business regulation - that it has become increasingly difficult to improve your lot by working hard, making stuff, selling it.

Instead, in order to fund a more comfortable retirement and much else, large numbers of people became “investors” - albeit not as the term is traditionally understood: Instead, you work for some company, and they put some money on your behalf in some sort of account that somebody on the 12th floor pools together with all the others and gives to somebody else in New York to disperse among various corporations hither and yon.

You have no idea what you’re “investing” in, but it keeps going up, so why do you care? That’s not like a 19th-century chappie saying he’s starting a rubber plantation in Malaya and, since the faster shipping routes are out of Singapore, it may be worth your while owning 25 percent of it. Or a guy in 1929 barking “Buy this!” and “Sell that!” at his broker every morning. Instead, an exaggerated return on mediocre assets became accepted as a permanent feature of life.

It’s not, and it can never be. Especially given the long-term structural defects in many Western nations. A serious G-20 summit would have seen France commit to the liberalization of its economy; Germany to serious natalist incentives; Britain to a reduction of the near-Soviet size of state spending in Scotland and Northern Ireland; and the United States to allowing its citizens to keep more of their hard-earned money and thus reduce both the dependency on ludicrous asset inflation as the only route to socioeconomic improvement and the risk of a Euro-style decline in birth rate caused by the unaffordability of kids.

Instead, the great powers are erecting a global regulatory regime to export their worst mistakes to the entire planet.

As they say on the State Department phone-sex line, it’s going to get nasty.

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

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times is switching its third-party commenting system from Disqus to Spot.IM. You will need to either create an account with Spot.im or if you wish to use your Disqus account look under the Conversation for the link "Have a Disqus Account?". Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide