All American Blogger » The Worst of the New Deal Repeated Today – Government to Buy 17,600 Cars to Boost Economy

The Worst of the New Deal Repeated Today – Government to Buy 17,600 Cars to Boost Economy

Posted by Duane Lester on Apr 13th, 2009 • Clicks

When the country was facing the Great Depression, the federal government did some pretty ridiculous things to try to correct the situation. As I wrote in “How We Got to $286 Billion in Corporate Welfare: A Short History of Farm Subsidies,” the government set a price on wheat and cotton that forced the government to buy the commodities if the market price fell below it. This resulted in farmers who were growing other crops to switch to wheat and cotton, flooding the market and causing the price to plummet.

The federal government ended up buying 250 million bushels of wheat and 10 million bales of cotton. The purchase and storage of these crops quickly burned through the program’s $500 million budget and the government ended up either giving the crops away, or selling them at a huge loss.

Another thing they did was pay farmers not to grow crops. But they instituted this policy after the growing season had started and it was looking to be a great season. You might be surprised what the government did then:

On June 19, 1933 the government announced that in order to raise the prices of the crops, farmers would be paid to plow the fields under. The goal was to destroy 25 percent of the current crop, or 10 million acres. They reached it.

Finally, the government ended up paying over $30,000,000 for the destruction of six million hogs. Adjusted for inflation, that would be $493,817,082.94 today.

At a time when people were starving, the government was destroying food, but importing the products of what they were destroying. It sounds like lunacy, but in the mind of the leftists in the Roosevelt administration, they were doing what was best for America.

Fast forward to today, where we have another economic crisis and another leftist trying to solve it by spending and more spending. Today, we find the same thinking that we found back in 1933. Only rather than wasting money on crops, we are wasting money on cars:

Obama made the announcement Thursday in a statement issued by the White House, saying the General Services Administration will spend $285 million of Recovery Act Funds to purchase the vehicles for the government fleet.

All purchases will be made from manufacturers with an existing contract with the GSA, which are General Motors Corp. (NYSE: GM), Chrysler LLC, which operates an engine plant in Kenosha, and Ford Motor Co. (NYSE: F). This includes the purchase of 2,500 hybrid sedans that will be ordered by April 15.

Yes, I saw it. Before you smarmy liberal commenters start in, I saw it. “…existing contract with the GSA.”

So, it is probable that tax dollars would have been spent on new cars anyway. That’s not the wasteful part of this. This is:

“As a part of our commitment to the American auto industry, I charged my administration with using Recovery Act funds to purchase a new fleet of fuel-efficient government vehicles to increase demand for our American auto companies and stimulate the economy,” Obama said in a statement announcing the decision.

“This is only a first step, but I will continue to ensure that we are working to support the American auto industry during this difficult period of restructuring,” he said.

How exactly does the government purchase of 17,600 cars “increase demand for our American auto companies?” I know I am just a simple, mouth-breathing Republican, but never ever have I seen a car with government plates and thought, “Oh, I GOT to have one of those!”

And here’s a nice aside regarding the “commitment to the American auto industry.” From the L.A. Times, “Obama’s team actually prefers foreign car brands “

Ooops, it seems that many on President Obama’s team, including those seeking to save the American automobile industry, do not actually drive vehicles from the American automobile industry.

According to a study by the Detroit News and a White House parking lot survey by Politico.com, neither do Obama’s White House staffers.

…

The Politico survey of cars parked next to the White House found only five U.S. brand cars out of 23 (a Dodge, two Fords, a Jeep and a Cadillac). The News found that Treasury Secretary Timothy Geithner, who didn’t have the money to pay his $20,000+ in back taxes until they became a confirmation problem, did acquire a 2008 Acura.

Lawrence Summers, head of the president’s National Economic Council, drives a Mazda. Director of the Office of Management and Budget Peter Orszag drives a Honda and a Volvo. Economic advisor Austan Goolsbee drives a Toyota. VP Joe Biden’s economic advisor Jared Bernstein prefers a Honda.

They won’t spend their own money on a Detroit car, but they are more than happy to spend part of your paycheck on one.

Photo Credit:

smaedli

Hat Tip: Michelle Malkin