- The Washington Times - Saturday, January 10, 2009

ANALYSIS/OPINION:

ANALYSIS/OPINION:

OP-ED:

Barack Obama’s election victory is a truly historic event. His eventual legacy as president, however, will be shaped by the success of his economic and energy policies.

Despite a lack of specifics, his campaign of “hope” and “change” nonetheless proved compelling to voters tired of the status quo of the administrations of Bill Clinton and George W. Bush. This was decisive in blunting his primary challenger Sen. Hillary Rodham Clinton and general election opponent Sen. John McCain.

Enthusiasm for and against Mr. Obama’s candidacy resulted in the 2008 election having the highest level of voter turnout in 40 years. More than 131 million votes were cast.

At the time this is being written, a record number of visitors are expected to descend on the nation’s capital to attend Mr. Obama’s swearing-in ceremony.

Mr. Obama’s election has several notable milestones. Most importantly, his victory is a capstone of sorts in the progression of blacks’ struggle for acceptance in America. After all, claims of institutional racism permeating American society now ring hollow after a majority of American voters selected someone of African descent to the highest office in the land. Pockets of racism still exist and always will, but the Obama victory shows that America is truly a place where opportunities are endless for those willing to work hard to gain success.

Mr. Obama broke with the victimization mantras of Al Sharpton and Jesse Jackson. Growing up in a modest household and left fatherless at a young age, Mr. Obama made the most of achieving the American Dream through hard work and perseverance. As a result, he was able to cross racial barriers in ways that Messrs. Sharpton and Jackson never could. Both Messrs. Jackson and Sharpton mounted their own White House campaigns, but it was the more congenial Mr. Obama who eventually made history.

Mr. Obama ran a masterful campaign. He artfully used his liberal credentials during the primaries by running to the left of Mrs. Clinton in calling for universal government funded health care, taxing windfall profits on “Big Oil,” canceling the Bush tax cuts and immediately ending the war in Iraq. During the general election, Mr. Obama ran toward the middle by toning down his rhetoric on Iraq and promising to “cut” taxes for 95 percent of citizens.

When the inaugural balls are over, the self-congratulation and adulation must be set aside for the hard work of leading America to begin. Mr. Obama will face new and challenging realities as commander-in-chief — daunting challenges such as a weakening economy, mounting job losses and continuing threats of terrorism.

With an economic team, deemed by many of his campaign supporters as too moderate and his decision to not eliminate the Bush tax cuts or pursue windfall profit taxes, some are hopeful he will govern from the middle. On the other hand, judging by his stimulus plan and nominations for key positions for energy and the environment, Mr. Obama is instead demonstrating he is liberal to the core.

Mr. Obama’s record as an elected official sheds little light on his true beliefs. While serving in the Illinois state Senate, he was known to vote a noncommittal “present” most of the time. As a first-term U.S. senator, the respected and politically-neutral National Journal magazine cited Mr. Obama for having the most liberal voting record. When he is challenged by the media, he has thus far been evasive and unwilling to provide details.

To confront the economic slowdown, Mr. Obama and his economic team are considering a massive economic stimulus plan estimated to cost $850 billion or more. With details still pending, it appears Mr. Obama’s major point of emphasis is improving the nation’s infrastructure such as construction and repair projects for roads, bridges and schools.

With this emphasis on infrastructure, Mr. Obama is repeating mistakes made to confront the Great Depression — where Franklin Roosevelt’s New Deal adopted Keynesian philosophy to stimulate economic growth through massive increases in government spending. Mr. Obama seems to be ignoring a more recent example from Japan, where infrastructure programs failed to achieve economic growth in that nation.

The fundamental problem with the infrastructure plan is that it relies on government spending to create jobs. It’s merely another wealth transfer program. When the projects are complete and the jobs are finished, the government is left with debt that requires more taxpayer money. It’s a vicious cycle that does not lead to long-term economic prosperity.

With our government already deeply in debt, Mr. Obama may essentially be mortgaging our future to buy jobs today. This will hurt average Americans — and for black Americans in particular who are just now climbing the economic ladder — when it comes to efforts to save and to start and maintain small businesses.

The failure of New Deal spending to create jobs was summarized by Henry Morgenthau, Jr., Roosevelt’s own Treasury Secretary: “We have tried spending money. We are spending more than we have ever spent before and it does not work… I say after eight years of this administration, we have just as much unemployment as when we started. And enormous debt to boot.”

In the early 1990’s, Japan initiated an enormous infrastructure spending program to stimulate its economy, but it failed. “Learning from Japan: Infrastructure Spending Won’t Boost the Economy,” a study by The Heritage Foundation, reports: “After peaking at 86 percent of U.S. income in 1991 and 1992, Japanese income continually fell behind the U.S., and by 2000, Japan’s per capita gross national income had fallen to 73.7 percent of that of the U.S. despite the increased spending stimulus in Japan during the 1990s and into the 2000s. This decline in relative performance reflects the fact that the Japanese economy grew at an annual rate of only 0.6 percent between 1992 and 2007.”

While Mr. Obama’s infrastructure plans are troubling, his environmental policies are just as frightening. Mr. Obama is a passionate believer that burning fossil fuels — coal, natural gas and petroleum — are responsible for causing global warming. He is thus far packing his administration with individuals who are ardent supporters of laws designed to increase fossil fuel costs to discourage use.

This war on fossil fuels represents a significant challenge for the economy. Since 85 percent of U.S. energy comes from fossil fuels, discouraging their use by raising prices will lead to higher energy prices for households and business and slower economic growth for the nation.

The biggest energy source casualty would be coal which is responsible for about half of America’s electricity needs. Dr. Steven Chu, Mr. Obama’s Energy secretary-designee, is a vocal critic of fossil fuels. During a presentation in 2008, Mr. Chu said “Ok so let me go to the supply side of the energy problem. Now we have lots of fossil fuel. That’s really both good and bad news. We won’t run out of energy but there’s enough carbon in the ground to really cook us.” Additionally, he has said “coal is my worst nightmare.”

Emphasizing his commitment to addressing global warming, Mr. Obama selected the former head of the Environmental Protection Agency, Carol Browner, as “Energy Czarina” — a new position that would coordinate energy and climate change efforts among various government departments and agencies.

Ms. Browner is a disciple of Al Gore, believing global warming is “the greatest challenge ever faced,” and is a staunch advocate for regulation.For instance, she supports California’s effort to make automakers significantly reduce tailpipe emissions further than existing federal law and to have the EPA regulate carbon dioxide emissions under the Clean Air Act.

Reducing our fossil fuel use comes with a huge price tag. In the previous session of Congress, “America’s Climate Security Act” (S.2191) would have created a policy to regulate carbon emissions known as “cap-and-trade.” According to Charles River Associates International, this scheme would have resulted in a loss of 3.4 million jobs and cost up to $6 trillion over 40 years. Defeated last year, the chances of this scheme coming up again and being passed in the upcoming session of Congress — and with Mr. Obama as president to sign it into law — are much better.

This effort would fly in the face of the reality that a cheap and abundant supply of energy is required to revitalize the nation’s economy. Experimenting with untested policies to reduce carbon emissions could easily unleash a series of unintended consequences with dire human and economic costs.

Again, it is blacks — who are paying a larger percentage of their budgets to cover essentials such as utilities — who will end up with less money to save for education, health care and retirement security.

Although Mr. Obama’s victory is a significant milestone on many levels, his economic and energy plans are an odd liberal mix of failed Depression-era economic policies and 21st century environmental extremism. As we confront the greatest economic challenges of our time, Mr. Obama’s policies may end up being the type of change our country can do without.

Deneen Borelli is a Project 21 member.

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