Faith and liberty

"Unusually uncertain" was last week's Federal Reserve Chairman Ben Bernanke's epicrisis of the American economy. Treasury Secretary Geithner also admitted recently of unknown long-term challenges resulting from the political spending spree of the last two years and the necessity to make a transition to "a recovery led by private investment." Such remarks from the chief engineers of American monetary and fiscal policies summarize the main reasons why the government should be less pro-active in steering or stimulating the market.

The simple truth is that the people who run the show in Washington, D.C., have no idea what the actual state of the economy is at any given time or where it is going. Bernanke cannot help Barack Obama channel our productive energy in a more desirable direction, and Barney Frank is as qualified in legislating financial stability as Barney Rubble. The methods of data collection are so imperfect. The models used to crunch the numbers---so unreliable. The time lags---so long. And the unintended consequences---so unpredictable. Thus the most productive course of action is trying to minimize the harm of perverse interventions by slowing down the political process---something that the opposition has been trying to do for months (although perhaps for the wrong reasons).

Government is like the alcoholic who staggers into his office on Monday morning, two hours late for work. "Why do you smell of whisky," asks his boss. "I had to take some because I was coming down with a cold." "How did you catch a cold?" "I had to jump in the freezing river." "Goodness gracious, were you trying to save someone from drowning?" "No, I had a hangover from last night's party and cold water usually helps with the symptoms."

Today, as in the days of the crisis that America faced in Ronald Reagan's first presidential term, the best the federal government can do is stop being a major part of our economic and broader social problems. We can't say it better than Frédéric Bastiat:

"And now that the legislators and do-gooders have so futilely inflicted so many systems upon society, may they finally end where they should have begun: May they reject all systems, and try liberty; for liberty is an acknowledgment of faith in God and His works."