Wednesday, June 2, 2010

The President on Government and the Economy

Extracts from a  speech by President Obama at Carnegie Mellon linked via facebook at

The recession has certainly made it worse, but that feeling of not being in control of your own economic future -- that sense that the American Dream might slowly be slipping away -- that’s been around for some time now.  And for better or for worse, our generation of Americans has been buffeted by tremendous forces of economic change.  Long gone are the days when a high school diploma could guarantee a job at a local factory -- not when so many of those factories had moved overseas…

…a good deal of the other party’s opposition to our agenda has also been rooted in their sincere and fundamental belief about the role of government.  It’s a belief that government has little or no role to play in helping this nation meet our collective challenges.  It’s an agenda that basically offers two answers to every problem we face:  more tax breaks for the wealthy and fewer rules for corporations…

The last administration called this recycled idea “the Ownership Society.”  But what it essentially means is that everyone is on their own.  No matter how hard you work, if your paycheck isn’t enough to pay for college or health care or childcare, well, you’re on your own.  If misfortune causes you to lose your job or your home, you’re on your own.  And if you’re a Wall Street bank or an insurance company or an oil company, you pretty much get to play by your own rules, regardless of the consequences for everybody else.

…Government cannot and should not replace businesses as the true engine of growth and job creation.  Government can’t instill good values and a sense of responsibility in our children.  That's a parent’s job.  Too much government can deprive us of choice and burden us with debt.  Poorly designed regulations can choke off competition and the capital that businesses need to thrive.

But I also understand that throughout our nation’s history, we have balanced the threat of overreaching government against the dangers of an unfettered market.  We've provided a basic safety net, because any one of us might experience hardship at some time in our lives and may need some help getting back on our feet.  And we've recognized that there have been times when only government has been able to do what individuals couldn't do and corporations wouldn't do.

That's how we have railroads and highways, public schools and police forces.  That's how we've made possible scientific research that has led to medical breakthroughs like the vaccine for Hepatitis B, and technological wonders like GPS.  That's how we have Social Security and a minimum wage, and laws to protect the food we eat and the water we drink and the air that we breathe.  That’s how we have rules to ensure that mines are safe and, yes, that oil companies pay for the spills that they cause.

In other words, the federal government has and will play a decisive role in the success or failure of the U.S. economy and society. This is not without precedent. Advances in mass production and machining that were the underpinnings of the Industrial Revolution in America were begun in federal arsenals during the 1790s. The telegraph was initially funded by an Act of Congress, before being developed by a number of private companies. Nowadays, if the government were to play a passive rather than an active role in the economy, then it would simply be allowing the greedy, mercenary corporate interests to dismantle and sell off the tattered remains of American prosperity.

But I suppose if you want to evaluate whether the administration is putting deeds behind words, you should watch what NASA is doing and whether its being funded.