That–as I have argued in the past–is what the Obama Administration is doing. And yes, I am pretty sure that the Administration knows that the more it augments the sense of economic crisis, the more it improves its chances of passing its economic program.

This, of course, makes the Administration’s public relations efforts deeply cynical. Is it too much to hope that it gets called on its fearmongering sometime soon?

While some may have thought that the Obama tax plan would sail through Congress relatively unopposed, the reality is turning out to be somewhat different:

President Barack Obama’s call to raise taxes on high earners and greenhouse gas polluters met fierce opposition Tuesday from congressional Republicans and also a few Democrats. “I would never want to adversely affect anything that is charitable or good,” Rep. Charles Rangel, D-N.Y., chairman of the tax-writing House Ways and Means Committee, said of Obama’s call to limit high-income taxpayers’ itemized deductions for charitable donations and mortgage interest.

When the Chairman of the House Ways and Means Committee says nyet to the plan–fallen figure though Charlie Rangel is–you have to think that there are problems. (On this issue, be sure to check out Ben Domenech’s piece on what he justly calls “The War on Philanthropy.) More problems with Democratic defections are detailed here.

Other problems may stem from this passage:

. . . the Treasury secretary acknowledged that consumers could face higher electric bills because Obama would impose fees on greenhouse gas producers, including power plants that burn fossil fuels, by auctioning off carbon pollution permits. The goal is to reduce the emissions blamed for global warming while raising a projected $646 billion over 10 years.

“Now, if people don’t change how they use energy, then they will face higher costs for energy,” Geithner said.

“Nice saving account you have there. Be a shame if anything happened to it.” Effectively, the Tim Geithner is threatening people with an energy tax. Is this part of the supposed tax cut for 95% of the population?

“The Audacity of Hype.” An excerpt:

Continuing the tradition he established back when he was Director of the Congressional Budget Office, Peter Orszag, the Director of the Office of Management and Budget has started a blog. I applaud this move if — if — it is meant to promote transparency. But while Orszag is a smart man and a formidable policy player, his blog appears to be more determined to spin than it is to enlighten.

Read it all for a discussion of Administration tax policy. For as we all know, delving deeply into tax policy is the ultimate thrill.

High earners are planning to reduce their incomes so that they will not have to pay as much in taxes.

This, of course, not only means that some people will take an income hit. It also means that an important segment of the population will be less productive economically. Cumulatively, this could have a very bad effect on the economy–especially when one considers its current parlous state.

“Heck of a job,” indeed. A purposeful economic saboteur could not do a better job at undermining the economy than this Administration is doing.

The awful Obama Administration budget and its promises of deficit reduction are premised on the Administration’s belief that we will have robust growth in the economy within relatively short order.

Trouble is that said assumption has no basis in reality:

A sense of disconnect between the projections by the White House and the grim realities of everyday American life was enhanced on Friday, as the Commerce Department gave a harsher assessment for the last three months of 2008. In place of an initial estimate that the economy contracted at an annualized rate of 3.8 percent — already abysmal — the government said that the pace of decline was actually 6.2 percent, making it the worst quarter since 1982.

[. . .]

Yet, in drawing up the budget, the White House assumed the economy would expand by a robust 3.2 percent in 2010, with growth accelerating to 4 percent over the next three years.

“It’s a hope, a wing and a prayer,” Mr. Sinai said. “It’s a return to a sanguine view of the economy that is simply not justified.”

If, as is widely anticipated, the economy grows more slowly than the White House assumes, revenue will be lower, forcing the government to cut spending, raise taxes or run larger deficits.

Oh, and if that is not cheery enough, note that people are throwing the word “depression” around. Chances are that it won’t get that bad but these kinds of predictions do feed on themselves, so perhaps, I am being too sanguine. In any event, given that the D-word is being bruited about and that work needs to be done to fight against any hint of a depression coming along, remind me again why it is that the Administration is raising taxes on anyone?

Remember: Government is presumably “reality-based” now.

They really don’t come as blunt as this:

“The taxing aspect of this is worse than Robin Hood,” said economist Peter Morici, a University of Maryland professor. “He’s resurrecting class warfare for political gain.”

Oh, and say hello once again to Ms. Rosy Scenario. She is a lovely lady, to be sure, but quite often, she promises far, far, far more than she delivers.

It is kicking the stock market while it is down:

Stocks fell on Wednesday after President Barack Obama warned of stricter oversight for Wall Street, raising the specter of greater regulation that investors fear could sap profits.

Obama’s comments near the market close rattled investors when he said financial institutions that pose a serious risk to markets should be subject to serious government supervision.

“Whenever there is a question about how large the government role will be … the market doesn’t like that,” said Peter Kenny, managing director at Knight Equity Markets in Jersey City, New Jersey.

“As we came close to the bell we got the curveball: our president came on TV,” he said.

Trade was choppy on Wednesday, with stocks buffeted by uncertainty over Washington’s plan to shore up the banking system and weak housing sales. The market had turned briefly positive after the government gave details on stress tests of banks’ capital levels, with investors betting that banks would be able to withstand the news tests with relative ease, before finally falling in late trade.

The Dow Jones industrial average (DJI:^DJI - News) was down 80.05 points, or 1.09 percent, at 7,270.89. The Standard & Poor’s 500 Index (^SPX - News) was down 8.24 points, or 1.07 percent, at 764.90. The Nasdaq Composite Index (Nasdaq:^IXIC - News) was down 16.40 points, or 1.14 percent, at 1,425.43.

And how many more days of this is the market supposed to take? Once again, cast your minds back to 2000-2001, when Democratic leaders were accusing George W. Bush of “talking down the economy.” Isn’t that what the Obama Administration is plainly doing?

Found here. It’s sad that these defenses are necessary, but as George Shultz put it, everyone wanted to debate Milton Friedman . . . when Friedman wasn’t in the room. Now that Friedman has passed, the number of people volunteering to debate him has increased by massive amounts.

Too bad none of these people were brave enough to do it while he was alive. This alone should tell us something about the quality–or lack thereof–of their arguments. If Friedman were alive and his detractors were brave enough to try to debate him, he surely would have silenced them by alluding to this entirely accurate point.

He brings the snark and the serious.

The latter, of course, is especially worth reading, as it lays out an efficient and responsible bank reorganization process. But far be it from me to denigrate snark directed at big-government advocates of Keynesian stimulus, who in advocating their position, have abandoned all trappings of reality.

These people:

U.S. President Barack Obama said on Tuesday he still wants to reopen the North American Free Trade Agreement, despite a warning from Canada that this would be a mistake, but he said he did not want to end up curbing trade.

In an interview with the Canadian Broadcasting Corp, shortly before his visit to Ottawa on Thursday, Obama also declined to characterize oil from Canada’s vast oil sands region as “dirty oil” which should somehow be curtailed.

Obama had alarmed Canada during the Democratic primaries last year when he advocated renegotiating NAFTA, and he reiterated this goal on Tuesday while recognizing these were sensitive economic times.

“As I’ve said before, NAFTA, the basic framework of the agreement, has environmental and labor protections as side agreements. My argument has always been that we might as well incorporate them into the full agreement so that they’re fully enforceable,” he said in the interview with CBC television.

However, he also said: “I think there are a lot of sensitivities right now because of the huge decline in world trade.”

Obama noted there was $1.5 billion in trade between Canada and the United States every day, adding: “It is not in anybody’s interest to see that trade diminish.”

When Obama raised the issue of toughening up NAFTA on the campaign trail a year ago, Canadian Prime Minister Stephen Harper said if Washington “made the mistake” of opening the agreement, Ottawa would bring other issues to the table for renegotiation.

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Bradley Schiller calls shenanigans on the Obama Administration’s efforts to compare the current economic downturn to the Great Depression. And he brings in the factoids to back up his argument.

I have written this before, but it bears repeating: In December, 2000, George W. Bush accurately warned that the country was entering a recession. He was right, but he got attacked because he wasn’t Mr. Happy and Optimistic in his rhetoric. In the aftermath of 9/11, the former President told us that we would come through despite the calamity that had been inflicted on the country and urged us to continue our normal commercial activities by way of trying to maintain economic activity and prevent the country from falling into a deeper recession. For this, he was attacked for being excessively Mr. Happy and Optimistic. And no one batted an eyelash.

Now, Barack Obama is comparing our current recession to the Great Depression and completely getting away with it. There has been hardly any media pushback concerning his blatant misreading of history.

Think that effective and workable policies will emanate from this misreading of history?

Yeah, me neither.

It involves him getting thrown into the gladiatorial pit:

Last week Giulio Tremonti, Italy’s finance minister and Mr. Geithner’s host for the weekend, gave a tart review of the Obama administration’s stimulus in a local newspaper here.

“If the problem is an excess of debt, the cure is not adding more debt, whether that debt is public or private,” he wrote in the Corriere della Sera. Italy is one of the most indebted countries in Europe. Its debt surpasses its annual gross domestic product.

The national debt of the United States, by contrast, was about 40 percent of G.D.P. at the end of 2008, but Moody’s expects that to rise to 60 percent by 2010 as a result of the recession and spending tied to the federal bailout and stimulus programs.

On Saturday, Mr. Tremonti also spoke disdainfully of the “Buy America” provision in the stimulus plan, which covers iron, steel and manufactured goods, as a political slogan. He and other ministers emphasized the importance of keeping the American economy free of protectionism.

The president of the World Bank, Robert B. Zoellick, said he told ministers this weekend how crucial it was to keep the world economy open and to avoid the protectionist policy errors of the 1930s. “The Buy American provision is very dangerous,” he said.

HopeAndChange unites the world.

In a perfect world it would have been nice to have had more time to process it.

–Ilan Kayatsky, a spokesman for Rep. Jerrold Nadler (D-NY), discussing the fact that the stimulus package was drafted in haste and read not at all before it was voted on.

Compare and contrast. From the AP:

Democrats said the [stimulus] bill’s tax cuts would help 95 percent of all Americans, much of the relief in the form of a break of $400 for individuals and $800 for couples. At the insistence of the White House, people who do not earn enough money to owe income taxes are eligible, an attempt to offset the payroll taxes they pay.

How effective is that? Let’s ask an expert on the issue of tax breaks:

You’re getting $600. What can you do with that? Not to be ungrateful or anything. But maybe it pays down a bill, but it doesn’t pay down every bill every month.

–Michelle Obama on the Bush tax rebate of 2001. Somehow, the First Lady’s criticisms of paltry tax rebates was just not considered when the current stimulus bill was crafted.

This account of the current G-7 meeting contains the following hopeful passage concerning the G-7’s intent regarding the issue of free trade:

Amid signs some are attempting to shield domestic companies and workers from the fallout, the G-7 said it “remains committed to avoiding protectionist measures, which risks exacerbating the downturn.”

Sounds lovely. It is then followed by this:

A $787 billion package of tax cuts and spending increases passed two nights ago by the U.S. Congress encourages companies to “Buy American.” France is demanding carmakers keep production at home in return for aid.

Sounds significantly less lovely. Of course, protectionist measures undertaken by France can be dealt with under th auspices of the WTO and the rules it has promulgated. Why, however, was it necessary for the Obama Administrationa and Congressional Democrats to exacerbate economic tensions by resorting to destructive protectionist measures of its own?

Perhaps the Administration and its Congressional allies are merely angling for a condemnation to be issued concerning the protectionist measures found in the hastily-passed–comprehended-by-no-one-who-voted-in-favor-of-it stimulus package. I had no idea that that the Obama Administration and Democrats in Congress might masochistically desire the issuance of communiqués finding fault with their policy initiatives, but in the event that they do, they should certainly get what they ask for.

So, a stimulus bill that came in at nearly 800 pages long got passed by Congress a mere day after being agreed to in conference–promises that people would have longer to examine the package notwithstanding. Never mind that lobbyists got this bill before Representatives and Senators did. Never mind that no one in his/her right mind could possibly expect any Representatives and/or Senators to read legislation of that size and scope and comprehend all that the legislation entailed within the mere space of a single evening. And never mind that Congress was playing with nearly $800 billion of our money in the process. In any other situation, this approach to lawmaking would have been considered lunatic and appalling. In the United States, however, it is considered de rigueur these days.

It should not be, of course. As Veronique de Rugy points out here and here, the stimulus plan is deeply flawed and will bring about utterly deleterious policy consequences. Phil Levy emphasizes that the plan was crafted in the dead of night with a determined effort to avoid any and all public exposure concerning the details of the plan. Republicans were excluded from the crafting of the plan–something that Andrew Sullivan might want to remember the next time he accuses Congressional Republicans of denying his messiah a third time–and the odious and absurd “Buy American” provision was kept in, thus inviting trade retaliation from other countries and serving to retard our own efforts to get out of our current economic doldrums. Even as the drafters and enacters of the stimulus legislation denounced the “greed” that supposedly got us in this mess, they have worked to bring about a culture of–you guessed it–greed.

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I try anew to fight the good fight against protectionism in my latest article over at The New Ledger. An excerpt includes my hope that:

the Obama Administration will abandon “Buy American” provisions and other protectionist measures and instead, truly encourage the buying of American products by ensuring that free trade principles not only remain intact, but also thrive in the coming years. Only through the pursuit of free trade policies will the Obama Administration ensure the long term success of American products and services, and thus, the prosperity of American companies and the workers they employ. By use of a a famous parody, the great economist Frédéric Bastiat exposed the fundamental flaws and weaknesses of protectionism. We ought not paper over those flaws and obliterate our historical memory. Doing so will only serve to make a bad economic situation much, much worse.

Read on for more, which includes a cage match between me and Senator Sherrod Brown.

My thoughts over at the Arena. Concerning the Gregg issue, Andrew Sullivan–in his inimitable way–is claiming that the Gregg withdrawal is proof that the Republicans have “declared war” on Obama. Never mind the fact that other Cabinet nominees–at least, the ones that don’t have to withdraw from consideration because of obstacles like tax cheating–have been receiving overwhelming support from both parties in Senate confirmation votes. Never mind that Sullivan’s “proof” for his assertion includes spin from an anonymous Democratic Hill staffer, and self-selecting reader comments on a Manchester Union-Leader article. Never mind as well that accusations that the Gregg withdrawal has something to do with GOP malfeasance is undercut by this:

Gregg had kind words for the president, saying the administration is “doing an extraordinary job in trying to manage this financial crisis.” He acknowledged that his withdrawal now is “unfair in many ways,” but said that he could not be a “100 percent” team member.

“The president asked me to do it, and I said yes,” Gregg said. “That was my mistake, not his.”

Yeah, real declaration of war, that. I think that Gregg was right to withdraw, for the reasons I set out in my Arena post. But partisan sniping, this wasn’t.

Of course, don’t tell that to Sullivan, who will be more than glad to scapegoat anyone and everyone with an “R” next to his/her name for the vetting failures and staff blunders of the people working for his plaster-saint-for-the-moment.

As expected, the Obama Administration and Congressional allies are trying to ram the stimulus bill through without allowing the public to take a good, long look at it.

Does anyone actually believe that this sort of thing would go on if the Administration were even remotely confident in its work product?

Me neither. It’s time to call the Administration on its lack of transparency–a lack of transparency that explicitly goes against the campaign promises Barack Obama made to the public. Trillions of our dollars are being spent without either elected officials or the general public knowing how the stimulus plan is going to work. It is as if the Administration and its Congressional allies have decided not to outdo by leaps and bounds the parody of a secretive Dick Cheney they have cultivated for years.

Ugh. And yes, the wording of the title is deliberate; look at the story Mankiw links to and you will see that the protectionist measures being proposed by (surprise!) Canadian labor unions are modeled explicitly on the “Buy American” provisions in the stimulus bill. Heck, the labor unions in Canada even say that they have no problem with the Buy American provisions–I suppose that sentiment holds just so long as no one has any problems with Buy Canadian provisions either.

It’s no exaggeration to say that the President of the United States has done his part to give people in other countries an excuse to practice protectionism against the United States. Heck of a job, as they say these days.