Bob Meade - Then & now

We are mindful of the adage that, those who don't learn from history are doomed to repeat it. As we approach the upcoming election, an election that may actually be the most important in our lifetime, it is worth taking the time to reflect on how history has dealt with issues similar to what we face today.

Franklin D. Roosevelt was inaugurated into office in March of 1933, during the Great Depression. He had run for office on the promise of a "New Deal" and, one of his first acts was to sign into law, the National Recovery Act (NRA). That act called for industry, labor, and government to work together to eliminate competition, and to regulate prices, wages, hours, and so on. Roosevelt's aim was to have a "government planned economy". The NRA spurred growth and power for the unions but did little to improve the economy or employment. In 1935, the Supreme Court ruled that the NRA was unconstitutional. However, Roosevelt had it quickly replace by the Wagner act which incorporated many of the items that were in the NRA.

Many of Roosevelt's programs essentially put the citizenry on the government payroll — the Office of Price Administration (OPA), the Works Progress Administration (WPA), the Tennessee Valley Authority (TVA), and others. In spite of the myriad programs designed to get people working, until World War II started, unemployment ranged from 14.6 percent to 23.6 percent. Roosevelt increased the top tax bracket from 63 percent up to 94 percent of earnings. While he is most noted for the passage of the Social Security System, which was the first giant step towards a socialist structure, it must be noted that his actions in expanding the federal government and imposing it into the business community, did not increase private sector jobs. It is believed that those actions actually extended the life of the Great Depression.

The next bit of historical perspective is about Lyndon B. Johnson, who was a powerful senator from Texas, and the Senate majority leader for six years while Eisenhower was president. He was selected to be John Kennedy's running mate in the 1960 election, and he became president when Kennedy was assassinated.

Johnson took the next truly giant steps toward socialism as he was able to pass legislation for Medicare and Medicaid, the 1964 Civil Rights act, immigration reform, the "War on Poverty", and other social programs. To provide for the initial funding of these programs, Johnson convinced Congress to authorize use of unspent surplus Social Security funds for the programs. In exchange for those funds, government securities were put into the proverbial Social Security "lock box".

While each of the programs can be argued on its own merits, the accumulative costs of them have contributed greatly to the financial crisis that exists today. As far back as 2004, the Cato Institute calculated that the "War on Poverty" had consumed over $9 trillion, with little change in the level of poverty to show for it. The fundamental problem being that those on poverty are most often those just entering the work force and/or those who have left it, the elderly. This year, Medicare announced that it estimated its un-funded liabilities to be in excess of $38 trillion. The Social Security and Medicare programs will be greatly impacted by the fact that 10,000 people per day are retiring and those numbers will continue for the next nineteen years as "Baby Boomers" take their retirement. The IOU's in the Social Security lock box will have to be redeemed, which mean that during that period, new securities will be sold in order to have the funds to redeem them.

Under President Kennedy, the top marginal tax rates were reduced from 91 percent down to 70 percent. The drop in rates caused a substantial increase in tax revenues. During his tenure, President Johnson increased the rate from 70 percent up to 77 percent. Unemployment numbers were excellent, ranging from 3.8 percent to 5.2 percent. President Johnson's social programs were an enormous step towards a socialist system but, as you can see, the cost of those programs is being passed down to future generations.

When President Obama was elected, with the help of a Democrat controlled House and Senate, he followed the lead of Roosevelt and Johnson and took the third giant step towards socializing this country. He did so by passing the Affordable Care Act, aka "ObamaCare".

With his party having total control over the Legislative Branch, Obama had the opportunity to address the economy and employment issues, which had been devastated by the bursting of the housing bubble. Rather than address those issues, the president chose to spend his capital in pursuit of ObamaCare. The bill was forced through both houses without a single Republican vote. Essentially, ObamaCare expands Medicare into covering the entire population. There can be no doubt that rationing of medical care will result, and services will be curtailed. While there is currently a shortage of primary care physicians, that condition will only worsen as bright young people choose other professions rather that becoming government-controlled physicians.

When Obama was inaugurated, the unemployment rate was 7.6 percent. Since that time the rate has ranged from 8.1 percent to 9 percent, except for this month when it dipped to 7.8 percent. However, that rate is somewhat suspect as it does not include a report from one of the largest states. Like Roosevelt, President Obama has spent considerable resources without diminishing or eliminating the basic economic and jobs problems. And, like Johnson, he has presided over a huge expansion of government with no defined plan on how to pay for it.

Your vote may decide if we are to be a government of, by, and for the people, or, if we are to follow the European model on the road to serfdom.

(Bob Meade is a resident of Laconia.)