The Problem of Government Expansion

By: Laura Adelmann



As General Motors entered bankruptcy to trim its girth in the hope that it will survive to build happy environmentally friendly cars that no one wants, President Obama claimed 60% of the shares of GM stock for the government. Obama described this move as temporary and expressed, yet again, his reluctance to insert the government into the day to day decision making of America’s automotive industry. But, is this reluctance sincere, or the first step in Obama’s plan to grow government’s control over our lives?

First they came for the banks. Banks were forced to take bailout money and all the strings those came with, namely the government’s desire to control wages and determine bonuses for executives. Banks who received bailout funds are now limited in their ability to attract talent with financial incentives.

Then they promised stimulus, but it came with conditions. States who accept stimulus funds have to agree to the conditions that are wedded to those funds. For example, California is facing a budget crisis and needs to make deep cuts after a ballot measure to cut the deficit failed, but if they cut too deeply, they can lose access to stimulus funds they desperately need. So, they have to spend money they don’t have to get money?

Government Motors? Will Obama be hands off as he claims? Doubtful. First he fired GM CEO Rick Wagoner and replaced him with Fritz Henderson. Then Obama’s team pushed GM to drop a few brands. Finally, they pushed them into bankruptcy. Whether this was the best decision for GM (and I believe this should have happened earlier and without wasted bailout funds and attempts to salvage the company) or not, this all came at the behest of our leader. Obama forced bond holders to take huge losses, but required minimal bending from the United Auto Workers. Obama states that GM will be governed by its board of directors, not by him or by Congress. However, with Obama’s team selecting all but two of the new members of the board of directors the difference is negligible at best. Obama’s hands-off approach also seems to include a command to produce environmentally friendly, low emission compact cars. No, he’s not involved at all.

Finally, Obama is now rubbing his hands together at the prospect of going into the healthcare business. After all these successful maneuvers to bloat government, why not one more? Obama will likely build on Medicare, which is a wasteful mess, creating a similar program for those under 65 years who do not qualify for Medicaid or SCHIP and do not have private insurance (or are not satisfied with their coverage). Launching the government further into the insurance business creates a new entitlement which will inevitably become permanent and will surely grow.

President Obama continues to deny that he wants government to run the banks, run GM, run healthcare, but his actions speak louder than his words. As government expands, so does it’s control over our lives, breeding dependence and wasteful spending. Criticism of Obama is coming from the Right as expected, but as time passes and these temporary interventions become permanent, hopefully Americans will remember their small government roots and call for the government to get out of our lives and our businesses.

Link: The Random Blog Post Generator Service