As regular readers of EclectEcon would guess, I think gubmnt size is an important issue, and I think that in both Canada and the US, gubmnts are too big. I was pleased with the shrinking of gubmnt that occurred under US President Bill Clinton, and I was distressed with the increased gubmnt size that occurred under George Bush, especially during the last year of his second term.
For US President Obama's change of heart, check out the quotes in Snopes:
[in 2006, as a senator]: The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the US Government can not pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government's reckless fiscal policies. Increasing America's debt weakens us domestically and internationally. Leadership means that "the buck stops here." Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.
In contrast with
[in 2011, as President]: I think that it's important to understand the vantage point of a senator versus the vantage point of a president. When you're a senator, traditionally what's happened is, this is always a lousy vote. Nobody likes to be tagged as having increased the debt limit — for the United States by a trillion dollars. As president, you start realizing, you know what, we, we can't play around with this stuff. This is the full faith and credit of the United States. And so that was just an example of a new senator making what is a political vote as opposed to doing what was important for the country. And I'm the first one to acknowledge it.
The President's epiphany leaves me unimpressed. His initial attacks on raising the debt ceiling were clearly motivated by his political opposition to George Bush. But both clips seem superficial. And I am not at all impressed with his attempts to gloss over the important issues of
- regime uncertainty and the recession. So long as businesses and consumers are concerned about what the gubmnt might do next, they are less likely to invest for the longer run.
- the size of gubmnt. We have long passed the point at which the more economic activity is controlled by politicians and bureaucrats, the less efficient will the economy be and the lower will be our economic growth rates.