As we welcome the new year and a new political season, having given considerable time to analyzing the meaning of the November elections, one thing is abundantly clear:  the mystique of the Obama narrative is over and the reality of governing has finally overtaken this administration.  Until now, President Obama has been significantly aloof, above it all, possessed of his own exceptionalism (not to be confused with the truly American brand) based on the strength of  his unique personal narrative, that he is not only different from those “ghosts”, as he has called them,  pictured on U. S. currency but somehow immune to their burdens.  Well, the people didn’t buy it.  In fact, they soundly rejected it, and any notion that it would have been different if the unemployment rate had been two points lower or GDP growth a couple of points higher is moot, but nonsense.  The basic underlying themes of domestic policy pursued by this regime are alien to the American psyche.  A student of history should have known this.

There is already disappointing drift from Republican Congressional leadership that the privatization of Fanne Mae and Freddie Mac must be delayed or at least phased in over a longer period because of the anticipated impact on available housing finance that would result from a precipitous removal of what is, in effect, a government-subsidized floor on housing prices.  Two truths emerge here:  one is that, yes,  government subsidies to these entities are artificially propping up housing prices, at a cost to taxpayers, so far, of $134 billion, and two, these same props are postponing the market clearance of the toxic mortgage markets and their underlying collateral and thereby greatly delaying the resolution of the problem and a return to a healthy housing market.  This facade has been in place for over three years, well known to all knowledgeable observers, including the sponsors of the new financial industry regulatory overhaul bill which did nothing to address this problem in the slightest.  There is no doubt that there will be an additional big hit to housing values when this day of reckoning comes (some observers predict as much as 20%)  but the sooner we take it and allow the market to clear, whatever the  pain, the sooner this debacle will be behind us, the uncertainty of the overhang reduced, and real recovery can proceed.

The 20th was popularly and widely known as “The American Century” for a lot of reasons, some of which are embodied in something I wrote at the end of the last century in response to a request by a publication to characterize it in 50 words or less, as follows:

“They (the Americans) reluctantly assumed the mantle of world leadership; challenged and ultimately defeated the primary instruments of totalitarianism; exported the principles of democracy and human rights to regions where those concepts were unknown; and, for better or worse, initiated popular cultural hegemony over a major portion of the world’s population.”

But it’s a new century, and many, including our own citizens, believe we are in decline.  Most point to economic factors.  We are no longer the colossus of the mid-20th century in terms of economic dominance, which has recently been vividly demonstrated by the Swedish professor Hans Rosling in his fascinating portrayal of the convergence of world standards of living over the past two centuries.  Other countries have dramatically closed the gap with us.  Some would have us believe that this represents a loss of our vaunted exceptionalism.

But the American brand of exceptionalism is not measured in GDP; it’s about our values and about who we are.  No nation has ever assimilated immigrants and foreign cultures as successfully as America; no other nation has been founded by a creed, particularly one which has been so severely tested over two centuries as America’s has; and no nation has so successfully embodied pluralism and tolerance in its strongly grounded religious culture.  The rising economic powers and competitors cannot compete with America in these cultural  foundations.  These are the basis for American exceptionalism.  It’s incumbent on us to select leaders who actually believe in it and won’t squander it.

I am constantly bemused by the very large crowd of political activists who wants us all to “just get along” or “get things done” or drop the partisanship or avoid “going negative” in policy or electoral debates.  My sense is that most of this comes from the pragmatic, “whatever works”  people who are only casually or periodically involved with either electoral politics or public policy advocacy, but it’s an attitude that I consider to be both naive and non-productive.  Moreover, it represents an essential misunderstanding of our republican system, which was not designed for ease in “getting things done”.  It was built and thrives on an inescapable condition–the ongoing clash of interests and ideas.

The most recent manifestation of this sentiment is the “No Labels” movement, which is comprised of some very capable, knowledgeable and well-intentioned leaders from around the country and the full ideological spectrum who are circulating a petition urging our political leaders to drop the “labels”, presumably the ideological or partisan ones, to come together to solve the crisis of governance.

I’m OK with dispensing with labels of the kind that bind us to an ideological pigeon hole or blind party discipline.  What bothers me is that many of these people seem to expect that we can dispense with our deepest held convictions in the interest of compromise and “getting things done”, or even the fantasy of bipartisanship.  There are quite a few things that shouldn’t get done and many more that have been done that should be undone.  As I have often written, there are some issues on which we cannot be neutral or even moderate.  For example, how about the second paragraph of the Declaration of Independence?  The overriding causes are ordered liberty and freedom from tyranny from whatever source, whether internal or external.  What’s the moderate or “no labels”  position on that?

” The moral case for unions–protecting working families from exploitation–does not apply to public employment.”–Tim Pawlenty, Governor of Minnesota.

Former British Prime Minister Margaret Thatcher once said that “the enemy within is much more difficult to fight than the enemy without, and more dangerous to liberty”.  She had reference to the public sector unions, who at the time were holding her country hostage.  Well, almost 30 years later one can say without fear of hyperbole that one of the most significant threats to self-government in America is the stranglehold of the public sector unions.  In fact, it is pretty easy to make the case that we are in a position close to that of Britain when Thatcher spoke.  In almost every state the primary fiscal problems are directly tied to the political and contract clout of the public sector unions or, in the case of the open shop right-to-work states, the power of their lobbies.  In virtually every public policy debate, this power weighs heavily in favor of a larger role for government, less accountability for performance, and larger benefits and legacy costs ultimately underwritten by the taxpayers.  In states like California, New Jersey, and Illinois it is no exaggeration to say that the public sector unions run the government.  The Kellogg School at Northwestern University estimates that our 50 largest cities have combined pension underfunding of $574 billion on top of the estimated actual liabilities of their states of well over $1 trillion.

Do we have the will to turn this around?  There is hope: governors in Wisconsin, New Jersey, Missouri, and Indiana are making bold steps, but much more courage is needed and should be possible during this budget crisis.  In addition, there is evidence that union solidarity is breaking down as  private sector union members are growing weary of subsidizing the employment protection and overly generous benefits of their brothers and sisters in the public sector while struggling with layoffs in their own industries.  But this is one of the most significant policy areas in which the new Republican majority in Congress and the state legislatures will need to be very bold in the face of enormous political intimidation from a constituency that takes no prisoners.

What don’t we understand about this?  If Julian Assange and his Wikileaks operation have not perpetrated an act of war against the United States, please supply the definition.  He has admitted that it has nothing to do with transparency or the public “right to know”; it is purely an act of war in the name of Assange’s notion of “cosmic justice”, a cover for his anti-American mission.  After all, we are already the most open and transparent society in history, but must continually deal in relative confidence with leaders who consistently lie to their own people with impunity,  so this is another example of how certain pockets of the American left seem to want to allow the use by our enemies of an American exceptionalism they no longer believe in to defeat us.

I know that there are weaknesses in the Espionage Act of 1917 and that it has been further undermined by the Supreme Court, but we should indict this guy under it anyway and demand extradition immediately.  The fact that President Obama has not ordered his feckless Attorney General to do so and has generally shown such a passive reaction to these acts of aggression should be as instructive to us as it is to our allies and enemies worldwide.

On at least a couple of occasions, I have mentioned The Battle, a book by Arthur C. Brooks of the American Enterprise Institute which defines a fast approaching pivotal moment in the form of a question that we must answer:  Does America recover its commitment to free enterprise and ordered liberty or does it continue to drift toward European-style welfare statism?  This he believes is the real culture war, and I believe that he is in many respects correct, primarily because the underlying question is in essence a moral issue.  In fact, we are in constant need of reminding ourselves that Adam Smith, the traditional godfather of capitalism, was not really an economist; he was a moral philosopher and his Theory of Moral Sentiments is much more instructive of the underpinnings of the capitalist system than his more widely acclaimed Wealth of Nations.

In a recent essay in National Affairs, Yuval Levin points out that the two key moral features of Smith’s political economy–its democratic or popular character and its disciplining effect–have been under assault in our time: the first by a growing collusion between government and large corporations, and the second by a welfare state that has expanded far beyond its needs.  And the case for capitalism is a case against these two trends against the morality of the system.

So back to the issue raised by Brooks.  Can we rise above the questions involving the functionality of government and get to the underlying moral questions suggested by Levin?  For it seems that the liberal vs. conservative battle has boiled down to a debate about which ideology is served by government, rather than the classic opposition between big and limited government, which is the moral debate we should be having.  As former Congressman Bill Archer once asked me, “would you rather balance the budget at 40% of GDP or 20%?”.  This is critical, for the impact on the underlying values that we subsidize with larger government is destructive in ways that Adam  Smith understood very well.   Business leadership is the key.   Will corporate leaders be in the forefront of this effort of moral restoration, or will they be largely rent-seekers from government?

The formula that triggered a democratic revolution in the Soviet Union had three components: people inside who yearned to be free, leaders outside who believed they could be, and policies that linked the free world’s relations with the USSR to the Soviet regime’s treatment of its own people……….It will work anywhere around the globe, including in the Arab world.–Natan Sharansky, The Case for Democracy

This is the ultimate article of faith among foreign policy idealists, and it formed the organizing principle for the Bush Doctrine.  In fact, George W. Bush was known to have spent quite a bit of time with Sharansky and his thought, which served as an inspiration for what will no doubt be a central legacy of his administration.  I believe that there is little doubt that the aspirations at least partly inspired by this doctrine are playing out in Eqypt as I write–credit or condemn it as you will, but the Bush Doctrine is alive and well in the Middle East.

Unfortunately, at critical times since the formulation of this doctrine, we blinked and hesitated–in Iraq when Bush felt obliged to de-emphasize freedom as the primary mission as the conflict bogged down in the dark months of 2005-06 before “the surge” won the day; in Iran in the summer of 2009 as we watched without encouragement and support as freedom fighters took to the streets in opposition to an evil regime and its fraudulent re-election; and in Egypt as we continued to defer to an authoritarian regime that ostensibly protected our interests in the region while consistently denying economic freedom and civil rights to its own people, thereby building rage and animosity over denied aspirations that finally burst into revolution.

At this point, there is no way to know how this will end, but it figures to be one of the most transformational events in the Middle East since the fall of the Ottoman Empire and the Caliphate at the end of World War I.  My reference to the choice of Qutb refers to the late Sayyid Qutb, an Egyptian and the intellectual founder of the Muslim Brotherhood, and in fact an inspiration for much of the ideology of Islamic jihadism as it is currently practiced, with a large following throughout the Arab world.  On the other hand, the Egyptian army is generally pro-Western and is clearly preferable in the interim as a transitional stabilizing element.  Question is, transition to what?  Are there any Jeffersons, Madisons,  Adamses, or Washingtons in the street?  No one knows, haven’t seen one yet, but if not, the void is partly our fault, and we must deal with it as best we can.  Freedom is messy and, needless to say, the stakes are pretty high.  If Qutb wins, we’re in big trouble.

I have said that the 1973 Supreme Court decision in Roe v. Wade was our generation’s Dred Scott case, and I still believe it is analogous from its position as the seminal event in the culture war that has persisted since.  Now we have a decision that I believe, upon final Supreme Court appeal, may be close to its equal in the public conscience as a bellwether in constitutional originalism.  When a Federal Judge quotes Federalist 51, the landmark argument by James Madison in the constitutional debate for a limited government of enumerated powers, in overturning the government overreach of the Obama health care law and rejects the use of the commerce clause as well as the “necessary and proper” clause in its defense, one can be sure that we are headed for a constitutional confrontation of real significance.

Lest one dismiss this as hyperbole, listen to Chief Justice Marshall in Marbury v. Madison (1803): “The powers of the legislature are defined and limited; and that those limits may not be mistaken, or forgotten, the Constitution is written.”

As the Wall Street Journal has noted, Judge Vinson has initiated a profound “constitutional moment” and introduced the Obama administration to both Madison and Marshall, much to the disdain of the liberal political establishment, which has dismissed earlier Republican gestures to the Constitution and its validation of proposed legislation as trifling symbolism.  This will no longer be possible.  In case the real meaning of the November election result was lost on them, this decision and its impact should help clarify it.

The quote in the title is from National Review magazine and I thought it appropos to the knee-jerk reaction across the board in the liberal establishment to the Tucson shooting rampage by the deranged, drug-addled kook Jared Lee Loughner.

I suppose that Richard Hofstadter is credited with beginning the current genre with his “The Paranoid Style in American Politics” in 1964, an update of Charles Mackey’s 19th century classic, Extraordinary Popular Delusions and the Madness of Crowds. These people and their camp followers are so ill that they must really believe that the conservative mindset and worldview leads one to be innately susceptible to violence and murder by metaphorical suggestion.  This pathology was given credence when the American political right wing was charged with complicity in the assassination of John F. Kennedy by “creating the atmosphere” in which he was killed.  And in fact, Jackie Kennedy lamented bitterly when she learned that her husband was killed by a warped leftist and said, “He didn’t have the satisfaction of being killed for civil rights; it had to be some silly little communist.  It even robs his death of any meaning.”  As James Piereson so well describes in his book, Camelot and the Cultural Revolution, this view, widely held by many in the liberal establishment, fed ultimately into the beginning of what he calls “punitive liberalism”, the assumption that conservative America was responsible for numerous crimes and misdeeds throughout its history.

All of this sentiment comes to fore when some nutcase goes on a rampage, except when the perpetrator’s ethnic or cultural background precludes condemnation for reasons of political correctness, such as with the shootings at Fort Hood by a confirmed Islamic jihadist sympathizer, and only when there is an opening to condemn Palin, Limbaugh, Beck, Fox News, the Tea Party, and the other usual suspects.

This country is in big trouble when loyal Americans are painted with an extremist brush while merely vigorously expressing their frustration that we have seriously drifted from our founding principles and who loudly demand that we return to them.  To demonize and delegitimize these sentiments as hateful and paranoid seems to be the only  remaining weapon of the progressive left, which has proven once again to be devoid of successful ideas.