Separated at birth: Mikhail Sergeyevich Gorbachev and Barack Obama.
Both young, dynamic, smarter and smoother than their predecessors. Both hold a Masters in Law. Both have received the Nobel Peace Prize. Gorbachev, after he destroyed his evil empire; Obama before he destroys our wonderful country. From the very beginning both promised change.
As Barack Obama has done 23 years later, Gorbachev first concentrated on health care reform. In Gorbachev’s case it was an anti-alcohol campaign. What could be more popular and more admirable than a campaign to stop the consumption of alcohol, which was destroying the livers and productivity of millions of Russian men, women and children? It’s right up there with providing overnight health care benefits for 30 million uninsured Americans as the right thing to do.
Archie Brown, in his book The Gorbachev Factor, writes: “The changes in what used to be the Soviet Union have been so great that one forgets how modest were the expectations when Mikhail Gorbachev took over as top Soviet leader in March 1985. Neither Soviet citizens nor foreign observers imagined the USSR was about to be transformed out of existence.”
Think of that and think back to that little tingle we all felt as Barack Obama, perhaps the greatest presidential speaker in history, led his millions of chanting supporters in a chorus of “Yes we can, yes we can!” Did anyone think to ask, “Yes we can what?” Yes, we can tax this country into an economic meltdown.
Last week, AT&T announced it would take an immediate $1 billion write-down thanks to a new tax in President Obama’s health care bill (look for a hike in your phone bill). Other companies, like Caterpillar and Deere & Company, are doing the same. Look for the stock market to tank.
Did Gorbachev say “Yes we can” when he screwed it all up, starting with his anti-alcohol push? Here’s how it all started to unravel:
Revenues from alcohol sales (taxed up to 6,000 percent) were a major source of funding for the central government, generating enough to fund the entire medical budget. The anti-alcohol campaign ended when the government realized it was costing too much. The government’s budget began to lose 25 to 30 billion rubles per year. The anti-alcohol campaign did irreparable damage to the economy. With state revenues having been severely curtailed, an economic chain reaction set in that hurt every sector. The Central Bank began to print money, resulting in too much cash chasing too few goods. By 1990 the government had virtually lost control of economic conditions. Government spending increased sharply as an increasing number of unprofitable enterprises required state support.
Does this all sound familiar?
“We should all be thankful to the Soviets,” said Paul Craig Roberts, “because they have proved conclusively that socialism doesn’t work. No one can say they didn’t have enough power or enough bureaucracy or enough planners.” Now along comes Barack Obama and maybe he was absent when they talked about that in his economics class.
Yuri N. Maltsev, who worked as an economist on Mikhail Gorbachev’s economic reform team (whose book The Decline and Fall of Gorbachev and the Soviet State has provided most of the material in this column) wrote: “No one figure represents the confusion that destroyed the Soviet Union better than Mikhail Gorbachev. It was a Western fantasy that the man named to be general secretary of the Communist Party would not be a devoted Communist.”
Whose fantasy is it that the man elected president of the greatest capitalist country in the world is not devoted to capitalism? In the end, Gorbachev piled new regulations and ministries on top of the old, and never allowed private property and real buying and selling.
Then, he began to fear the worst: that the Soviets would not be able to pay the army or welfare payments, or run state enterprises unless something was done. Finance ministers were so alarmed that they sent a note to Gorbachev saying “the economy is on the brink of a catastrophe”— by which they meant the solvency of the central Soviet government. It was too late; the damage was done. The Soviet Union fell apart completely. And at the age of 74, on Dec. 8, 1991, the Soviet Union died.
Maltsev wrote: “The sad legacy of Marxism is the mindset of certain people, both in the East and West, who believe that the state can cure all economic ills and bring about social justice.”
Is that Barack Obama I hear chanting “Yes we can?”
Yes we can.
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