Regnery: Who's Better Off?

Not long ago I was talking to an old friend who has spent his life in behind-the-scenes electoral politics in Chicago (and as a Republican has never even tried to get elected to anything). He got to know Barack Obama when he was first running for the Illinois State Senate in 1996, and has kept an eye on him ever since.  

At the end of the day, he told me, Obama has two overriding interests – interests, if you will, which trump virtually everything else, and which become apparent with a close look at his position on practically anything. And what might those be? First is redistributing the wealth. Second is empowering labor unions.

I’ll take the liberty of adding a third, an interest which has become more apparent since Obama became President – a conviction that the world would be a safer place if the United States were not the only superpower, but a country whose status and power was more akin to countries like Britain, Germany, France and Japan.

“Are you better off now than you were four years ago?” Ronald Reagan famously asked Americans of their standard of living under incumbent Jimmy Carter during the 1980 campaign. The question has again become one of the standards of the 2012 campaign, and in response both sides produce charts, graphs and statistics which show, in Obama’s case, that we are better off, and in Romney’s that we are not. The question goes to the essence of what reelecting a President is all about – a referendum on his first term. The followup question – whether the incumbent deserve another term – is, in the final analysis, the basis on which Mr. Obama will be reelected or not.

It has often been said that the answer to Mr. Reagan’s question depends on who you are. Under Obama, who’s better off and who’s not are questions best answered by looking at those three overriding interests of wealth redistribution, empowering labor unions, and weakening the United States in the eyes of the rest of the world. So, how have the Welfare State, Big Labor, and U.S. primacy fared under Obama?

Mr. Obama made no bones about his desire to “spread the wealth around,” as he told Joe the Plumber during the 2008 campaign. As Campaigner-in-Chief this time around, he makes the point every time he talks about taxing the “rich folks” and making the millionaires and billionaires pay their fair share, and his constant use of the word “fairness” is simply code for redistribution. 

Stanley Kurtz, in his recent book Spreading the Wealth: How Obama Is Robbing the Suburbs to Pay for the Cities, tells us that redistribution is not, in Obama’s lexicon, just among individuals. He also wants to redistribute money from wealthier suburbs into poorer inner cities. And although there has not been a large tax hike yet, the expiration of the so-called Bush tax cuts in January 2013 would make the Internal Revenue Code yet more progressive, or redistributive, than it already is. 

The ultimate transfer mechanism, for Obama and for all liberals, lies in the many-headed American Welfare State, which transfers income from the better-off to those on the other end of the stick on a massive, massive scale. America spends nearly $1 trillion annually on 126 different federal, state, or municipal anti-poverty programs. That amounts to $20,610 for every poor person in America, or $61,830 per poor family of three.

These include entitlement programs like Temporary Assistance for Needy Families (TANF) a.k.a. food stamps, Medicaid, housing assistance, and broader entitlements like Medicare and Social Security, which redistribute income on a mass scale and are generally justified on the grounds that they reduce poverty among the elderly. Since Mr. Obama took office, federal welfare spending has increased by more than $193 billion per year, according to analysis by the Cato Institute’s Michael Tanner.

You would think the recipients of those transfers are better off, and they are if you simply look at the amount of money they are getting for nothing (since LBJ first declared war on poverty, Americans have spent nearly $15 trillion on welfare). Just as one example, there are 44% more Americans on food stamps than there were in January 2009, with the average benefit up by 18%. Although few will deny that entitlements, which pay for most of these programs, need massive revamping, the Obama Administration has done nothing in that regard. 

And to the extent that his Administration has attempted entitlement reform, they have only exacerbated the problem. By creating more entitlements and expanding existing programs through Obamacare, the Administration has made it more difficult to successfully reform Medicaid and Medicare. And by attempting to circumvent TANF work requirements, he has only confirmed that his idea of entitlement “reform” is one of expansion and entrenchment.

But perhaps his most egregious “reform” effort is his unserious approach to the national debt – an approach embodied in his Administration’s sequestration legislation. Entitlement programs – which comprise 60% of federal spending – are exempt under sequestration, meaning Mr. Obama’s end all be all debt deal effectively ignores the majority of federal spending, and these exempt programs also happen to be the largest drivers of our national debt. 

Even ObamaCare is ultimately more about wealth redistribution than health care. According to the New York Times, it “is the federal government’s biggest attack on economic inequality since inequality began rising more than three decades ago.”

The irony – and a predictable irony from the standpoint of any critic of wealth redistribution, is that these programs may take money from one crowd and give it to another, but it does not make people any better off. The U.S. Census Bureau recently reported that more Americans live in poverty now than when Bill Clinton was elected in 1992, with more than 46 million people living below the federally-determined poverty line. Those 46 million people cannot claim that they are any better off, despite all the bones that have been tossed to them. Nor are the nearly 800,000 women who have lost their jobs under Obama better off, and if those women took a careful look, they might wonder just who it is that is waging war on them. By the same token, black Americans struggling to find work are not better off under Obama. While the unemployment rate has been stuck above 8 percent for the general population since 2009, unemployment among black Americans has been even worse, consistently exceeding 13 percent. One can conclude that in Obama’s view of things, it is more important to tear down the rich than to build up the poor.

How about the labor unions? We don’t have to look very far for evidence that Big Labor is much better off than it was in January 2009. Not only have virtually all appointments to the Labor Department, the National Labor Relations Board, and even the Federal Courts been at best pro-union and at worst union organizers (read: thugs), unions have been given massive financial benefits. According to Mallory Factor, author of the best-seller Shadowbosses, “A whopping $115 billion in 2009 stimulus funds went to educational spending which the Department of Education claims retained 367,524 education related jobs, which conveniently happens to benefit the teachers unions.” 

On another front, the United Auto Workers union was awarded over 10% of General Motors and 40% of Chrysler by the Obama Administration. Both are better off, as are UAW members and pensioners, whose pensions were preserved in the takeover, unlike the 20,000 employees and pensioners of the non-union Delphi auto parts manufacturing company, whose pensions were terminated, according to the Daily Caller, at the behest of Obama’s Treasury Secretary Timothy Geithner. They are not better off. And GM bondholders, are not better off; they got the ultimate crew cut and received only pennies on the dollar for their investment.

Finally, let’s take a look at Obama’s view of the United States vis-à-vis the rest of the world, and we see that redistributing the wealth does not stop at the water’s edge. Interestingly, the President’s approach involves not lifting up lesser nations but tearing down and making low the great ones. Much as Obama’s doctrine of fairness seeks to regulate the advantages of wealth at home, so his approach to international relations seeks to check the advantages of wealthy and powerful nations, beginning with the United States. Whereas fairness at home derives from the welfare state, fairness in international policy may only be brought about by a systematic weakening of the United States, economically and militarily.

Since 2009, the US national debt has risen by some $5 trillion, or over 40%, to $16 trillion – and about three quarters of that is owed to foreign governments, investors and oil vendors. It is surely no surprise to Obama that trillions of dollars are being redistributed to the rest of the world, and doing so is part of his agenda. Recently he proposed sending nearly half a billion dollars overseas to fight global warming (he calls it climate change). All the debt makes our foreign creditors better off.

In the volatile Middle East, Obama’s embrace of the Arab Spring and his reticence to assert US resolve has already considerably changed the dynamic in that part of the world. According to a retired senior US intelligence officer with years of first-hand experience in the Arab world:

The Near East is going through one of its periodic Darwinian phases of violence now helped along by the digital revolution. To paraphrase the late but unlamented [Osama bin Laden], the people will always follow the “strong horse” over the “weak one.” The Arab Spring is not one phenomenon but plays out differently country-by-country. While the “Arab street” may or may not know yet who is the “strong horse,” in general they think they know who is currently the weak one.

And who benefits? Certainly not the United States but the Islamic radicals, who are far better off than they were four years ago.  

Or how about Russia’s Mr. Putin? Obama  naively “reset” our policy with Russia in 2009; that reset was a one-way street, a zero-sum game that redounded only to Putin’s benefit and returned nothing to the United States but contempt for Obama, his Secretary of State, and America’s Ambassador – the latter being treated little better than one of Russia’s dissidents, minus the incarceration. According to another former senior intelligence officer – and a great friend – who has almost five decades experience working on the Soviet Union, Russia, and other intelligence and counterintelligence questions:

We sacrificed our East European allies (e.g., reneging on the promised missile defense) for, well, nothing. Putin’s answer was the increase in tempo of intelligence and active measures assaults on the US, NATO, and the former Soviet and Bloc countries, that equaled or exceeded Cold War intensities. As with the Russians’ policies in the Middle East, Obama and Hillary Clinton’s response was to keep doing the same thing again and again in hopes of a different outcome. Even with Putin’s intransigence on Syria, they merely repeated the mantras of failure. Of course, Putin subtly juxtaposed his loyalty to his Syrian ally with Obama’s betrayals of ours.

In sum? Putin is better off; the US is not.

Russia is not the only “zero-sum game” in our relations with major powers. According to a former senior State Department official during the Reagan-Bush years who now consults with the federal government on the Far East (and must therefore remain anonymous), one of Obama’s most disappointing moves “is the Administration’s inability to see that China is neither a ‘partner’ or a ‘frenemy’. China is not a friend although we like to delude ourselves in thinking of it as such. It is a deadly enemy that sees our loss as its gain.” To Obama, what China is engaged in is just international politics. But as any student of von Clausewitz should recognize, what China is engaged in is a war in multiple dimensions — trade, currency, currying favor with developing nations, cyber, electronic, etc. – by other means.

To China, according to my source, “its relationship with the US is a ‘zero-sum’ operation. Rising Chinese nationalism requires a foreign enemy–and that is the US. Either the Administration recognizes China as a formidable opponent determined to eliminate US influence from East Asia, and takes steps to prevent that, or we will lose our friends and allies in the region and China’s dominance will, by 2030, extend to the Hawaiian Islands.” Although that end would certainly suit Obama’s desires vis-à-vis the influence of the United States, it might challenge his ability to vacation with friends and family on the beaches of Oahu. But China is certainly better off.  

And finally we arrive at the West’s arch-enemy: Iran. There is not much question that Mahmoud Ahmadinejad and his friends are better off now than four years ago. Obama’s light-handed approach to Iran’s pursuit of nuclear weapons has allowed the Iranian regime to accelerate considerably its “peaceful” uranium enrichment. The International Atomic Energy Agency – the United Nations’ nuclear watchdog – reported just last week that Iran had doubled enrichment capacity at its underground Fordo nuclear site. What the future holds for Iran, particularly in light of Israeli threats to stop its nuclear program in its tracks, is anybody’s guess. But it is safe to say, like Russia, China and Islamic terrorists in the rest of the Middle East, Iran’s nuclear program – which is making faster progress than that of the US — has improved its lot during Mr. Obama’s time as President.

Are you better off than you were four years ago? For most Americans the answer is, sadly, no, but for America’s enemies abroad, the answer, sadly, is yes.