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Obama Channels FDR on Stimulus

As military history buffs know, one of General George Patton’s many idiosyncrasies was that he believed in reincarnation. He used to bore his aides, and anyone else willing to listen to him, with tales of his exploits as a military leader in his earlier lives.

I have never believed that God allows human beings to come back to Earth for a second shot at life, and I still don’t, although President Obama is forcing me to give the idea at least a cursory second look. The Obama presidency is so similar to Franklin D. Roosevelt’s that I’m half tempted to think that General Patton was on to something.

In my last post I looked at how the two Presidents have both violated the normal White House chain of command. Today’s topic is the circumstances each inherited from his Republican predecessor, and how he proceeded upon taking office.

When the Great Depression started in 1929, Republican President Herbert Hoover did something unprecedented in American history. He tried to use the power of government to “fix” the problems in the nation’s economy. (Regular readers know how often I cite my favorite Reagan quip, and I apologize for bring it up yet again; but here it is: “The most terrifying words in the English language are ‘We’re from the government, and we’re here to help’.”)

The nation had suffered severe economic contractions before 1929; including some really nasty ones in 1873, 1893, and 1920; and no one in the federal government had suggested that it was the government’s role to solve economic problems. President Hoover presided over the first US government that ever tried to legislate prosperity.

In 2012 dollars, President Hoover and the Congress doubled federal spending from $42 billion to $81 billion in response to the Depression. Much of the money was spent on public works projects like Hoover Dam. Hoover also signed the Smoot Hawley tarriff, whose unintended consequence was a trade war with most of America’s erstwhile trading partners.

 Similarly, Republican President George W. Bush worked with a mostly-Republican Congress to greatly increase federal spending during his eight years in office. Bush, like Hoover, believed that the federal government should have the answers to any economic problems the nation might be going through. Bush’s version of the Smoot Hawley tariff was the Troubled Asset Relief Program, or TARP, in which money borrowed against future taxes was used to bail out financial institutions that had made poor investments.

Back in 1933, when FDR succeeded Hoover in the White House, he made the spending increases his Republican predecessory had engineered seem like small change. Before the US entered World War II Roosevelt had increased federal spending from $81 billion to $214 billion in 2012 dollars. (After the US declared war the spending went up even more.)

Roosevelt also greatly increased the government’s control over ordinary private sector business. To cite one illustrative example, poulterers were required by the Roosevelt government to stop letting their customers choose which chicken they wanted to buy. Some genius in the Roosevelt administration decreed that chicken buyers had to accept randomly-selected chickens. (This particular government intrusion became the basis of a lawsuit that went all the way to the US Supreme Court.)

When President Obama succeeded President Bush in 2009, he followed the same pattern. Not content with the rapid increases in federal spending under his Republican predecessor, he immediately engineered a “stimulus” program that increased the federal deficit by hundreds of billions of dollars. Obama-backed legislation soon greatly increased the role of government in society, and the dependency of large segments of the population. The President also promoted and signed legislation that allowed the government to micro-manage the American economy in many areas, and particularly in the health care industry.

Currently the Supreme Court is deciding whether to rein in the worst of this President’s abuses. This is another parallel, but that will have to be the subject of a future post.