Alexander's Column

Breaking the Back of Free Enterprise

The "Fundamental Transformation"

By Mark Alexander · Jul. 8, 2010
“An unlimited power to tax involves, necessarily, a power to destroy; because there is a limit beyond which no institution and no property can bear taxation.” –John Marshall

Folks with extensive training in strategic analysis tend to have a very different viewpoint of the macro-political machinations from that of folks in the trenches who have a more tactical perspective. As such, strategic viewpoints are many times received with great skepticism.

At ground level, for example, one might have a problem with the following strategic analytical conclusion: Barack Hussein Obama’s macro agenda to achieve his objective of “fundamentally transforming the United States of America,” depends on the success of his plan to break the back of capitalism under the weight of national debt accumulation associated with welfare spending, and in the ensuing crisis, implement “emergency” government intervention which will, ultimately, replace the last vestiges of free enterprise with a democratic socialist framework (centralized economic planning and regulation with full-spectrum income redistribution).

If that analysis makes you uncomfortable, prepare to become far more so if his agenda succeeds. To avoid a total economic collapse under the burden of trillions of dollars in debt resulting from Obama’s spending programs, the Left will implement dramatic tax increases and devalue the dollar (inflate the price of services and commodities).

As one with perhaps excessive formal training in the art of strategic analysis, I can assure you that Obama’s plan, as outlined above, is progressing on schedule. Of course, my perspective is influenced by the presupposition that liberty is “endowed by our creator,” but as Alexander Hamilton noted, “In disquisitions of every kind there are certain primary truths, or first principles, upon which all subsequent reasoning must depend.”

In regard to the failing economy, Obama recently said, “Make no mistake, we are headed in the right direction, but … we’re not headed there fast enough for a lot of Americans.”

Many people hear those words and interpret them to mean that we’re progressing toward economic recovery. However, the strategic analyst hears that the Left’s objective of a socialized economy is just upon the horizon, that Obama and company would like to bring it to dock at a much faster pace and with such forceful momentum to ensure that the “fundamental transformation of America” can’t be undone.

House Minority Leader John Boehner gets it. In regard to House Democrats' passage of Obama’s so called “economic reform plan,” Boehner responded, “The writing is on the wall for President Obama’s ‘stimulus’ policies and everyone – taxpayers, economists, and the rest of the world – sees it but him. How much longer are we going to continue with this disastrous spending spree that is scaring the hell out of the American people and piling debt on our kids and grandkids?”

Answer: As long as it takes to fulfill their Leftist agenda. Obama’s “stimulus plan” is closely modeled on the Cloward–Piven strategy – which he studied in depth as a student at Columbia University. This plan calls for overloading the government welfare system to the point of crisis, requiring the replacement of that system with a state-directed national system of “guaranteed annual income and thus an end to poverty.”

Some of the most experienced conservatives did not get it soon enough. In a recent interview, Newt Gingrich admitted, in a self effacing response to a question about Obama’s Leftist agenda, that he understood Obama was liberal but “laughed at friends” who suggested he was a Socialist. Now Gingrich says, it is abundantly clear Obama is a Socialist, but why did he, like so many astute political thinkers, miss it?

Perhaps too much Potomac kool-aid and Beltway fumes.

“We had to take some tough steps to pull the country out of the free fall we faced when I took office,” says the blame-shifting Obama.

For the record, the current economic debacle began when a group of Jihadi terrorists, who came to the United States on Bill Clinton’s watch, attacked our nation: 9/11. That attack crippled the U.S. economy, but the ultimate blow was a crisis of confidence in the U.S. housing and security markets – a crisis largely driven by Democrat policies and their refusal to rein in the government-sponsored mortgage enterprises known as Fannie Mae and Freddie Mac.

The ensuing financial market collapse in the weeks ahead of the 2008 presidential election resulted in the selection of a charismatic radical Leftist community organizer as president of the United States.

Commenting on the agenda of his newly elected boss, White House Chief of Staff Rahm Emanuel said infamously, “Never allow a crisis to go to waste.” And they haven’t.

It is no small irony that on the very day Obama asserted the economy is “headed in the right direction,” the non-partisan Congressional Budget Office reported, based on the implementation of Obama’s “economic recovery” agenda thus far, that the current accumulation of debt will exceed 100 percent of gross domestic production by 2025, and will total almost twice GDP by 2035. Of course, if one includes the Social Security “lockbox” IOU, the national debt is already 92 percent of GDP.

But not to worry, I suspect our economy will collapse long before our national debt reaches that level. The burden of debt accumulation at current levels makes the current economic problems of socialist European states seem like gnats on an elephant’s … uh, rear.

The CBO report concludes, “Large budget deficits would reduce national saving, leading to higher interest rates, more borrowing from abroad, and less domestic investment – which in turn would lower income growth in the United States. Growing debt would also reduce lawmakers' ability to respond to economic downturns and other challenges. Over time, higher debt would increase the probability of a fiscal crisis in which investors would lose confidence in the government's ability to manage its budget, and the government would be forced to pay much more to borrow money.”

In other words, unless Obama’s agenda is overturned, the U.S. will one day be a subsidiary of Red China.

On the principles of free enterprise, Obama proclaims, “We already tried the other side’s ideas. We already know where their theories led us. And now we have a choice as a nation. We can return to the failed economic policies of the past, or we can keep building a stronger future. We can go backward, or we can keep moving forward. I don’t know about you, but I want to move forward.”

Obama apparently hopes a majority of Americans have no idea where the Left’s theories led in places like the Soviet Union. Unfortunately, he’s probably right, given that many of his constituents are little more than sycophantic lemmings, having been sufficiently dumbed down in our government-run education institutions.

Obama’s primary co-conspirator in this extra-constitutional folly to undermine the economy is House Speaker Nancy Pelosi, she of the following ridiculous claim: “When I became Speaker of the House, the very first day we passed legislation that made Paygo the rule of the House. The federal government will pay as it goes.”

In other words, she promised that Congress would not pass unfunded spending bills. But that would mean either radically reining in spending, or implementing vast new tax initiatives on virtually all income earners, which she and Obama promised they would not do. Thus, Pelosi’s Congress has added more than $1 trillion to the national debt, taking the U.S. Debt Clock beyond the $13 trillion mark.

To put their plan into perspective, national debt was about 40 percent of GDP when Obama took office, but with the economic recession resulting in greatly reduced tax revenues, the national debt will be 62 percent of GDP by the end of this year. That would be an increase of more than 50 percent in just two years. (I recommend you read this paragraph at least twice!)

For a complete analysis of federal waste, see the Heritage Foundation’s study, “30,543 Reasons Spending Is Out of Control.”

To make matters worse, Obama continues to inflate the bloated central government beyond any recognition of its constitutional authority even as American families and businesses must cut back to make ends meet. Adding insult to injury, non-military federal employee salaries are now 40 percent higher than private sector salaries on average, and while private sector benefit packages average $9,882, government employee benefits average $32,115.

This week, Obama laughingly launched his annual “SAVE” Award dog and pony show, ostensibly encouraging federal employees to recommend how to save taxpayer dollars. He notes, “This contest is part of a larger effort to make sure that we invest taxpayer dollars in programs and initiatives that have proven records of success and fix or end programs that do not.” I have more than a few ideas, but Obama did not ask taxpayers how to save taxpayer dollars.

That old sage Will Rogers once quipped, “Be thankful we’re not getting all the government we’re paying for.” If he only knew…

Demonstrating the extent to which government has exceeded its constitutional mandate, my colleague Walter Williams wrote, “In 1794, when Congress appropriated $15,000 to assist some French refugees, James Madison, the acknowledged father of our Constitution, stood on the floor of the House to object, saying, ‘I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents.’ He later added, ‘[T]he government of the United States is a definite government, confined to specified objects. It is not like the state governments, whose powers are more general. Charity is no part of the legislative duty of the government.’”

Professor Williams concludes, “Two hundred years later, at least two-thirds of a multi-trillion-dollar federal budget is spent on charity or ‘objects of benevolence.’”

Is there still time to restore the primacy of Free Enterprise over Socialism before Obama and his Leftist ilk have broken the back of Capitalism?

The short answer is, yes. Next week Part 2 of this essay, “Reversing Course and Restoring Liberty,” will clearly outline how to restore the constitutional role of government.

(Read Part 2 of this essay, Reversing Course and Restoring Liberty)

View all comments


RogueRat in Oregon said:

Spot on analysis of the current Socialist agenda. I only disagree with one point, and that is that this is Obama's plan. It's not his plan. He isn't smart enough to have planned anything no matter what the mummies at McNews think about his "brilliance". He's being told what to do by persons unknown. He's somewhat like the Sorcerer's Apprentice. Who is the Sorcerer? That's the question of the year. Consider that Obama has placed a moratorium on offshore oil drilling while at the same time has committed some 2 billion dollars of taxpayer money to Petrobas in Brazil to assist them in their offshore drilling. Seems confusing at first, but George Soros is a major investor in Petrobas. There seems to be a pattern here. Soros is well known for his dislike for America and its free enterprise system. Soros gets my vote for Sorcerer and Emmanuel/Axlerod could be the conduit to Soros. Watch for the "crisis" that brings about a declaration of martial law. There's your sign.

Thursday, July 8, 2010 at 11:15 AM

RedBaker in Florida said:

The national debt is $13.2 trillion. GDP is $14.4 trillion. Therefore the debt as percent of GDP is 91.7%. See is a pity that so many commentators, even conservatives, express the national debt as a percent of "public debt" and thus omit the debt owed to social security. Things are far, far worse than is expressed above. Even Obama admits the path is unsustainable. Government is about 45% of GDP (federal, state, local) plus another 10-15% of GDP in the cost of complying with regulations. The business of the US is now big government. The federal government is borrowing 43% of its spending every year. It is clearly bankrupt already. It is time for massive cuts in spending and taxes. We need a constitutional amendment to limit the federal government. I suggest 15% of GDP maximum, except for direct costs of declared wars. That means eliminating 40% of federal spending.

Thursday, July 8, 2010 at 11:18 AM

RedBaker in Florida said:

The "external debt" as opposed to "public debt" is newly available on going to the right margin, and at the top clicking "External". They show the US national external debt at 94.37% of GDP. The default view is "public debt" showing only 60.88% of GDP. Let's not fool ourselves that the lower figure is a fair gauge national finances.

Thursday, July 8, 2010 at 11:28 AM

Bob W said:

Re: OregonBuzz,Martial law will only serve to bring about civil war. Local and state citizens will up rise against martial law and a civil war will ensue. I don't believe the majority of our Armed Services will side with Obama. The majority seem to despise him and his increasingly obvious Socialist policies. It would be foolish for Obama and this government to declare martial law unless they want a protracted, drawn out, bloody ideological war. On a positive side of such a scenario, the majority of liberals are anti-gun and disdain firearms. Because of that, sad to say, attrition would quickly limit their numbers.Let’s hope and pray such a scenario does not have to play out; but if it does, I can guarantee them that we are more prepared then they are.

Thursday, July 8, 2010 at 11:30 AM

ann kitay said:

Can't wait until next week - looking forward to any sane course of action. Re: offshore drilling referred to earlier - last summer at a townhall meeting asked our state representative, Ron Paul, about Obama supporting same in Brazil - and he denied any knowledge of the 'loan'. Scary all around. Otherwise have respect for said representative. Stay informed, my friends.

Thursday, July 8, 2010 at 11:33 AM

John W. said:

I'd like to respond something like an old Steam Locomotive on that article: "WHEEEEWWWWW-eeeewwwwwwwww!" How many gold stars do we have over there.....this guy just got an A++++++++

Thursday, July 8, 2010 at 11:36 AM

Jim taber said:

In response to the portion of 7/8/10 Alexander's Essays that reads: "Adding insult to injury, non-military federal employee salaries are now 40 percent higher than private sector salaries on average, and while private sector benefit packages average $9,882, government employee benefits average $32,115." I must strongly dissagree with that statement. Perhaps, in Washington in the political circle, that is correct. Out here in the Defense Depots where we support the War Fighter and there systems and equipments, hardly true. We make good money but definately not 40% higher than the equivilant industry. And yes, we are about 99% conservative and anti socialist and definately not on board with the current administrations bumbling. A lot of us subscribe to the Patriot Post and donate.

Thursday, July 8, 2010 at 11:49 AM

The Editor replied:

That would be why Mr. Alexander specified "non-military federal employee salaries" meaning, non-military federal employee salaries!

Dale and Gloria said:

We TOTALLY support what you've written and give you a very loud "AMEN"!! My wife and I have been school teachers for 30+, and we have witnessed first-hand the "dumbing down" of our students--especially in the area of history. As a history major and a VietNam vet, I am appalled at the lack of knowledge found among our young people--especially in the past 5 years. They have been done a grave injustice as has our country. If we do not teach history with accuracy and factual information, we are doomed to repeat the same mistakes over and over and over again. GOD HELP AMERICA!!! Keep up the good work, Brother. Many out here support you and pray for you.

Thursday, July 8, 2010 at 11:50 AM

Mark P. said:

Reading "Barackracy, Pt. 1" is like hearing the clear ring of the Liberty Bell. Thank you for your passionate analysis. I hope that hundreds of thousands heed the call!

Thursday, July 8, 2010 at 11:51 AM

Sarah von Helfenstein said:

Dear Mark:I've been getting Patriot Post for several years and really look forward to each day's fare, especially your Thursday commentary. As an old-guard, long-term conservative, I have come to the conclusion that Obama and his handlers are absolutely intentionally destroying what is left of our economy and form of government, believing that swift action on all fronts will be impossible to combat by concerned citizens due to lack of time and resources to keep up with the full frontal assaults taking place. The BP oil spill continuance and the disastrous policies in Afghanistan, for example, are clearly planned ways to destroy our economy and our military - planned, not accidents. Yet, most of our conservative brethren and pundits do not see this as a Trojan horse betrayal. As long as it is viewed as ineptitude and not intent, people will remain troubled but not gain a sense of urgency required to stop this before it's too late. We may revert to "centrist" Republicanism, which is no better - or neo-conservatism, which is just the same thing in a different package.I am eager to join the fight but not sure where or how. My resources are limited and every day I get emails about new brush fires that need putting out.Perhaps there ought to be some focused, coordinated movement aimed at hitting the enemy hardest where it matters most. At this point, the O Administration sets up new battle fronts every day, making the fog of war so dense that no clear actions can be taken toward key targets.

Thursday, July 8, 2010 at 11:53 AM

Duke of Earl said:

Mark,Do NOT forget that one of 'Lefty's' economic advisorsis none other than Franklin Raines. The same Franklin Raines that ran Fannie Mae into the ground. The same Franklin Raines that was allowed to further foul things up by his new BFF, the Messiah.You absolutely correct that it was Chris Dodd and Barney Frank and their kind that refused to allow the Republicans the opportunity to potentially correct the problems. Though, with Hank Paulson running Bush II's Treasury; I don't think much could have been accomplished.How about a Constitutional Amendment to provide for the recall of elected officials that have proven to be inept, stupid and/or thieves?Duke

Thursday, July 8, 2010 at 12:04 PM

Paul B. said:

It's awfully hard to guve Adolp Hitler creddit for anything right, but when he said, "What good fortune for government that the people do not think." he hit the nail on the head.Paul B.

Thursday, July 8, 2010 at 12:07 PM

NMPatriot said:

Mark...Thank you for this work of truth.

Thursday, July 8, 2010 at 12:08 PM

karl anglin said:

If destuction be our lot, we must ourselvesbe its author and finisher. As a nation offree men, we must live through all time, ordie by suicide.---Abraham Lincoln (1809-1865)

Thursday, July 8, 2010 at 12:13 PM

Harry Singleton said:

You need to 'scream' louder! Not enough people, in the right positions, are doing what is necessary to stop this socialist - Hussein Obama. You also need to put more light on the problems caused by NAFTA, which opened the door to American job-loss. Makes me wonder whether or not we have any real Americans in Washington, or maybe they all belong to the same 'Brotherhood of the Pyramid'.

Thursday, July 8, 2010 at 12:16 PM