The Corner

The Meaning of the Inaugural Address

Prune away the usual soaring rhetoric and purple passages, and there were no serious outlines in today’s speech to restore the economy or deal with the fiscal implosion on the horizon — or even hints to be fleshed out in the State of the Union to come.

Instead, the president believes that record near-zero interest rates will allow him to borrow $10–12 trillion dollars over his eight-year tenure, and that the dangers of running up such a resulting gargantuan $20 trillion aggregate debt are well worth the risks. 

He apparently believes that, in a postindustrial world, government, or government-owned industries from now on will have to create the majority of jobs, and that such jobs should largely go to those whom he sees as having been traditionally shortchanged. 

In addition, in just four years, record numbers are now on food stamps, unemployment, and disability, and exempt from federal income taxes, and those percentages will only grow in the next term. Part of the remaking of America is the forging of a new constituency who feel that government employment and entitlements are a birth right and that those who in Washington ensure it deserve unquestioned political fealty.

By the same token, the astronomical borrowing will endlessly accelerate pressures to raise taxes on the “rich,” whether through income-tax rates, or the elimination of deductions, or both. The “pay their fair share” and “you didn’t build that” rhetoric will only sharpen, as the public is prepped to expect that “fat cats” can pay an aggregate 60—70 percent of their income in local, payroll, state, Obamacare, and federal income taxes. The only mystery is whether these unsustainable debts are designed primarily to redistribute income through forced higher taxes, or to marry the livelihoods of loyal millions to big government, or so that we can create a sort of centralized EU that actually works.  

There are three dangers to the new unbound Obamism. One, he assumes the private sector has nowhere to go, and thus that, although it always will bitch about higher taxes, serial class warfare rhetoric, Obamacare, and more regulations, at some point its captains have to get back to work, make those hefty profits and so pay what they owe us in new higher taxes. I am not sure that will happen; instead, the present high unemployment, low growth, and crushing debt may be the new European-like stagflating norm. 

Two, even if inflation and interest rates don’t rise, we have not seen yet the bitter wars to come over gun control and the actual implementation of the details of Obamacare, or blanket amnesty, and they may resemble the tea-party fights of 2010. 

Three, the bitter election wars to achieve and maintain a 51–53 percent majority (the noble 99 percent versus the selfish 1 percent, the greens versus the polluters, the young and hip versus the stodgy and uncool, the wisely unarmed versus the redneck assault-weapon owners, women versus the sexists, gays versus the bigots, Latinos versus the nativists, blacks versus the “get over it” spiteful and resentful, the noble public sector versus the “you didn’t build that” profiteers, Colin Powell/Chuck Hagel/reasonable Republicans versus neanderthal House tea-party zealots), in Nixonian fashion have left a lot of bitter divisions that lie just beneath the surface of a thinning veneer.


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