^{This commentary was originallly published at Townhall.com. Comments welcome there.}

Are we facing the worst financial crisis since the Great Depression? If so, why?

The simple answer is “probably.” And we are facing that crisis in no small measure due to the actions that are taking place in Washington D.C. and not in the financial centers of New York.

The credit crisis of today has been brewing for a long time; more than a year ago you could read about the “credit crunch” hitting markets and businesses and of you need to go back years to find the root causes for the housing bubble.

But the problems of even a year ago did not have to become the crisis of today. Wall Street has weathered serious problems in the past without massive government intervention and without causing journalists and politicians to begin reminiscing about the 1930’s. What turned this particular problem into a financial disaster were the remarkably maladroit actions of policymakers in Washington D.C.

First, let’s acknowledge that imbalances in the market are at the root of the current troubles. There is no doubt that a housing and lending bubble formed, and that the popping of that bubble has helped lead us to where we are today. Others have shown how lending rules set by politicians and monetary policies set by the Fed helped distorted the market for housing, but even without those prods this or another asset bubble could easily have formed. Markets are not infallible.

The popping of bubbles are invariably painful, and it is no surprise that policymakers jumped in to avert as much of that pain as possible. In doing so they unwittingly helped transform the credit crunch into the current credit crisis.

Ironically, Washington’s initial attempts to stem the bleeding transformed the painful but necessary correction into today’s market rout. As in 1929 and the early 1930’s, it was government intervention into the workings of the market that turned a serious problem into a crisis.

In the 1930’s the government helped create the Great Depression by making a number of blunders that helped destroy the underlying financial system. In particular the Federal Reserve stood by as bank failures led to a massive contraction of the money supply, drying up credit and leading to massive deflation that destroyed the American economy. This time around nobody can accuse the Fed of being stingy with money.

So what did Washington do this time that was so damaging?

From early this year the Fed and Treasury seem to have been following what I would call a “reverse Goldilocks” strategy, doing both too much and too little and getting the policy just wrong.

It’s hard to date when exactly the financial crunch transformed into a full-fledged crisis, but a convenient starting point would be the bailout of Fannie Mae and Freddie Mac. It was at that point that it became abundantly clear that any chance of simply muddling through the credit crunch was not going to be possible. If the companies holding nearly 70% of America’s mortgages were on the verge of bankruptcy then just about any company might follow.

The Lehman Brothers bankruptcy followed closely the demise of Fannie and Freddie, and the AIG bailout came just a day after the government let Lehman fail.

Two things were made abundantly clear by this pattern of events: first, in the judgment of the Fed and Treasury our financial system was on the brink of collapse; and second, they had no plan for how to deal with the impending disaster. They were shooting from the hip, and that’s not a great way to aim.

It was signals sent by Washington that destroyed the underlying confidence that is the bedrock of any financial system. Investors, rationally viewing Washington’s actions, quickly rushed to the sidelines in order to wait and see what the government was going to do in order to clean up the mess.

Obviously it was going to do something—the bailout of Fannie, Freddie, and AIG all signaled that some action was imminent. The bankruptcy of Lehman ensured that nobody could guess what that something might be. The failure of Lehman was intended to signal that whatever was done, it would be limited.  It’s pretty hard to make rational decisions when you have no idea what tomorrow’s market conditions might be.

If Washington was going to act—and it was telling everyone it would—is it too much to ask that it have a plan before doing so? The unpredictable nature of Washington’s words and actions helped create the crisis atmosphere that is hurting our economy today.

Washington has done nothing to calm the rattled nerves of investors since. In fact, it has made things much worse. Almost every single action and statement coming from Washington has added to both the uncertainty and anxiety that investors are feeling right now. What was a problem last year is a crisis today.

By pushing the panic button when they had no plan to deal with the crisis, the “wise men” in Washington have made things unimaginably worse than if they had done nothing at all. It may or may not in fact be the case that there was no palatable path out of this mess without massive government intervention—a proposition that splits respectable economists, even free market ones—but it is certainly clear that having the most senior economic and political officials in Washington screaming that the sky is falling has been a sure path to creating, not tamping down, a sense of crisis.

Unfortunately the die is almost certainly cast. Now that the crisis is upon us it is almost impossible to conceive of a path out without massive government intervention. The whole world is waiting to see what Washington does, and until it acts in some decisive fashion markets will be in turmoil.

Washington now needs to buttress the confidence in our financial system that it has helped undermine. We can only hope that the policies they choose prove a lot more successful than the ones chosen in the 1930s

^{This commentary was originally published for Townhall.com. Comments welcome there.}

You have to give him credit; the Obama tax plan has a lot of appeal to the average voter. The sales pitch, repeatedly endlessly, is that under Obama 95% of Americans would see their taxes go down.

Of course, it’s not as simple as the Democratic candidate would like you to believe. Both the nature of the tax “cuts” Obama puts in place and the tax increases he is trying to sell could have serious impacts on future economic growth. Not to mention the ability of the American economy to get back on track building the number of jobs and growing wealth in this country.

John McCain’s tax plan is far from perfect, but at its core is reducing taxes on job creation and kick-starting the economy. The idea behind the plan is that a good job with a strong and growing business is a far better way to drive Americans’ incomes up than to distribute short-term government handouts, as the Obama plan does.

What is Obama offering? A witch’s brew of tax credits that are aimed at various groups rather than lower taxes for everybody.  Obama pays for these tax cuts by increasing the capital gains tax, keeping America’s 2^nd highest in the world corporate taxes, and whacking upper-income earners with dramatically higher taxes. All things aimed squarely at reducing economic growth.

Tax credits for some and raising taxes on the wealthy are standard fare for Democrats. Call it Robin Hood economics, which is based on the idea that the idea of wealth in Americais fixed and the role of government is to make sure that it gets into the right hands.

Such a plan would make sense if the economy were built on stealing from the poor and giving to the rich; then Obama would be the Robin Hood figure who was simply setting things right by reversing the transaction.

But modern economies build their wealth through investment and job creation, and Obama’s tax plan is aimed squarely at reducing investment and punishing wealth creation. Obama’s tax increases to pay for his new programs amount to billions of dollars on investments.

John McCain’s economic plan is aims to reduce the immediate tax burden of millions of ordinary citizens through tax cuts such as increasing the per-child personal exemption. But it also stimulates the economy by reducing the costs of doing business in theUnited States. More investment at home means more jobs and higher incomes for Americans.

Not to mention that millions of Americans are counting on their investments to help fund their retirement plans in the coming years, and Obama’s plan takes a bite out of their future wealth.

As anyone who has thought about outsourcing knows, Americacould and should be a much better place to do business than it is. The United States could and should be much more competitive than it is because of our high taxes and complicated regulations.

That’s the true story behind McCain’s plans to reduce corporate tax rates and cut taxes on dividends. Believe it or not, theUnited States actually has higher corporate tax rates than almost any other country. McCain aims to cut those taxes to stimulate economic growth, and keep rates on capital gains low to encourage Americans to invest in the future.

Obama wants to increase the tax on capital gains, cutting the investments that drive our economy—and history shows that higher capital gains rates actually means less tax revenue for the government as people change their investment behavior. That slows economic growth by making Americaless attractive to do business in.

Obama’s plan banks on Americans not understanding the basic economics of tax policy. It assumes that Americans would be willing to trade a more robust economy under McCain’s plan for a shot at some tax credits they may or may not qualify for.

That’s a bad bet for Americans and may well be a bad bet for the Obama campaign. His witches’ brew of tax increases for some and tax credits for others add up to a substantial increase in taxes overall. Those “middle class” tax cuts might be paid for with fewer jobs for Americans.

That’s a pretty high price to pay for a shot at a few tax credits.

This article was originally published at Townhall.com. Comments welcome there.

There has been a lot of loose talk in liberal circles that the current housing crunch, inflation, and spike in energy prices somehow prove that the free market is fatally flawed.

Markets haven’t worked, the argument goes, so bigger government is surely the answer.

It doesn’t take a genius to show that there is already massive intervention in the housing and energy markets, and that the current bout of inflation is also driven by government policies set by Congress, the Federal Reserve and the Treasury. The United State’s economy, far from being a completely free market, is already massively regulated.

But let’s assume for a moment that our current economic woes are primarily driven by factors within the free market system. After all, it is well-known that business cycles are a natural part of the capitalism. Free markets, in other words, do not always give you the results you want.

What does that mean for the argument that free markets are superior to a supposedly well-regulated economy? Are our current economic problems “proof” that markets don’t work and that government is the solution?

Of course not.

The superiority of free markets to government regulation is not based upon a magical ability of businesses or even markets to operate flawlessly or at optimal efficiency at all times. Businesses often make huge mistakes, and we have known for centuries that markets are constantly fluctuating, even wildly. Recently the tech bubble and now the housing bubble show that even entire segments of the market get so out of whack that we all wind up suffering painful corrections.

Markets, though, correct. Because they are ultimately tied to basic forces such as supply and demand, customer desires, and of course competition, they are anchored to real forces within the economy as a whole. No matter how out of whack they get, the long-term trend is always going to be in the right direction. More economic growth, satisfying customer demands, better quality at lower prices, and increased productivity and efficiency.

Now consider how government regulation works. Politicians identify a goal they want to achieve and pass a law to make it happen. Bureaucracies are created, civil servants are hired, statistics are collected (which by the time they are actually used are out-of-date), rules and regulations are instituted, and then even more civil servants enforce those rules.

Top-down regulation like this simply cannot work as well as a free market. In a free market, market forces such as supply and demand make the system self-correcting. Not so with a highly regulated market.

Regulation doesn’t respond to anything but political pressure. The loudest voices and the most politically powerful shape the rules that determines who gets what.

Far from protecting the “little guy,” regulations are often used to maximize the profits of particular interest groups. State and Federal laws set minimum prices for commodities such as milk and gasoline—ensuring that competition doesn’t drive down prices. “Prevailing wage” laws are used to ensure that the wages paid to workers on government projects are much higher than wages in the private sector—ensuring that taxpayers get the minimum value for their tax dollars.

It’s a whole lot easier to lobby for profits than compete for them. When government sets the rules, powerful interest groups often get to write them.

Markets work well—not perfectly, but well—because they are not engineered from the top-down. They are chaotic. They encourage experimentation. They allow mistakes. In markets, even the mighty can fall. Not so in regulated markets.

The belief that bigger government and more regulation are magic bullets that can correct the flaws of the marketplace is based upon the idea that politicians and bureaucrats can engineer an economy and do so for the benefit of all—pretty much the same idea that was tried under socialism. Instead what happens is that government becomes another tool of big interest groups and the rest of us are left holding the bag.

###

David Strom is President of the Minnesota Free Market Institute.

^{This article was originally published at Townhall.com. Comments welcome there.}

It has become popular for politicians to advocate going after oil companies for their seemingly outsized profits. Otherwise rational people turn red-faced with anger when they think about the tens of billions of dollars flowing into the coffers of “big oil.”

The most often talked about “solution” to—really punishment of—big oil’s big profits is the imposition of a “windfall profits” tax. Such a tax would set an arbitrary limit to what oil companies can make and then slap an extra tax on profits if they exceed that limit.

Now set aside the question of whether it makes sense for politicians to determine what profits companies should earn; a belief that politicians should be the arbiters of economic rewards seems to be a continually recurring idiocy that we will have to fight indefinitely.

Also set aside the fact that oil company profits are actually much more modest than the profits in other industries, including agriculture which has seen its profits recently skyrocket faster than oil companies have. Nobody is calling for confiscating farmers’ profits, which are bolstered substantially by agriculture subsidies and mandates that would make oil company executives blush if they we offered similar treatment.

Instead, let’s just examine the immediate and discernable results from the imposition of such a tax. What, exactly, would happen in the oil markets if Washington decided to impose a windfall profits tax on oil companies?

Where is the big money in the oil business? The profit margin on refining oil into gasoline and other oil products has actually narrowed by almost 50%–because the high price of oil and a decline in gasoline consumption has made refining less profitable. Ditto for gas stations, which have seen their profit margins decline as the price of gas went up.

The fact is that the spike in oil companies’ profits comes from selling the oil that they own and pump out of the ground. And increasing taxes on pumping oil will do one thing and one thing only: make it less attractive to pump that oil. A windfall profits tax would reduce the oil production of American companies(as it did last time we imposed a windfall profits tax on oil)–and guess who would pick up the slack?

Only a small fraction of the oil on the market is actually owned by “big oil.” Most of the rest—about 90%–is actually in the hands of governments such as Saudi Arabia, Iran, Russia, and Venezuela. And if you haven’t thought of it, none of those governments or non-American oil producers would have to pay that “windfall profits” tax.

So a windfall profits tax would guarantee one thing: Americans would be put in the unenviable position of sending even more of their hard-earned dollars overseas to mostly unfriendly governments to buy oil that could have been produced by American companies.

Driving American production down would also mean that the price of oil would go up. A windfall profits tax, in other words, would make for a nice windfall profit for all those unfriendly governments that currently own most of the market for oil anyway.

As you can see, even if you think that a “windfall profits” tax would somehow be fair or is economically justifiable, imposing it would still be profoundly stupid. All we would be doing is handing over more money and more power to foreigners who don’t like us very much.

^{This Column was originally published at Townhall.com Comments welcome there.}

Well, the secret is out. Conservatives’ willingness to destroy Mother Earth in pursuit of financial gain now makes sense.

The missing fact that helps explain the seemingly inexplicable willingness of Conservatives to destroy the planet was revealed last week by former astronaut Dr. Edgar Mitchell. You may or may not remember Mitchell as the astronaut who holds the record for the longest moonwalk.

Dr. Mitchell has broken a long-standing wall of silence and revealed that our government-and governments around the world-have been in secret contact with alien beings from another planet. Mitchell revealed the aliens to be “little people who look strange to us.”

Mitchell still refuses to put a name to cigarette-smoking man and other top government officials in on the conspiracy, but details are sure to follow. We can surely know that they are a cabal of neoconservatives.

The details don’t matter as much as this one fact: we now know why conservatives have felt free to destroy the Earth. They have negotiated passage to a new, better, and cleaner world elsewhere in the Universe!

Those little grey men with the big eyes and short, lithe bodies probably drove a hard bargain for passage to a new world. Who knows how many DVD players and Plasma TVs it took to entice them to open up their world to human settlement? It may even be that conservatives’ insistence on opening up ANWR and the continental shelf to oil drilling is part of their plan to pay off the aliens

How else to explain conservatives” propensity to doubt the wild claims of environmentalists about the imminent destruction of the planet? Conservatives first ignored Rachel Carson and her warnings about the coming “Silent Spring” that would follow from capitalism’s raping of Mother Earth. Now conservatives are casting doubt on the claims that the Earth’s climate is ultimately driven by mankind’s reckless burning of fossil fuels.

So-called “progressives” tell us that there is, and can be, no doubt about mankind’s destructive impact on global climate. And they warn us incessantly about the flooding, hurricanes, desertification, and even earthquakes (yes earthquakes!) that will be caused by global warming. “The Earth has a fever,” we are told, and anybody who questions that fact is a “denier” in the mold of holocaust deniers.

House Speaker Nancy Pelosi herself declared she was on a crusade to “save the planet”-presumably from we conservatives who want to destroy it.

The question many people had on their mind as they gave conservatives the benefit of the doubt was: how can conservatives actually be willing to abide the destruction of the planet, given that it and its climate will be the primary inheritance we leave our children and grandchildren?

Now the answer is out: Conservatives’ children will NOT be inheritors of planet Earth. As Dr. Edgar Mitchell’s revelations suggest, conservatives will have a whole new planet to escape to once they finish destroying our home planet.

See, once all the facts are out, the seemingly feverish conspiracy theories of the left suddenly make sense. Once you understand that conservatives intend to leave poor Planet Earth behind (along with its billions of residents who cannot escape) the picture suddenly comes into focus.

My only question is: why haven’t I been invited to join the conservative exodus once it gets under way?

^{This column was originally published at Townhall.com. Comments welcome there.}

If you listen to the Man-Made-Global-Warming proponents, conservatives must be a pretty callous lot.

In fact, they must hate their own children. After all, according to these advocates we “deniers” are selling out the future of the planet just to get a few bucks.

That’s funny, because according to the research available conservatives are much more fertile than liberals – in fact, almost 50% more likely to have children.

Yet we know that it is conservatives and not liberals who are most likely to doubt the arguments for man made global warming. And by far they are less likely to call for massive intervention in the economy to prevent the “inevitable” destruction of the biosphere by mankind’s profligate use of fossil fuels.

What’s going on here? Are conservatives really so callous as to be willing to sacrifice their children’s future, or even their lives, just to drive a bigger car and use incandescent light bulbs instead of compact fluorescents? Are conservatives willing to sell their children’s future for a few bucks from big oil, big coal, or big auto manufacturers? Or to save a buck or two on the price of gas?

Of course not. What’s really going on here is that the debate over global warming is not an argument about the future of the environment, but about the future of the economy. It is about who controls the means of production – people or the government (or “government sponsored entities”).

The fight over climate change is primarily a fight about whether big government should control everything from the largest to the most minute aspects of economic activity, or whether our economy should remain at least relatively free. After all, control of energy production and use is tantamount to control of the entire economy.

This is the same battle we have been fighting since before Karl Marx declared that ownership of the means of production should be socialized and incorporated into the State. The Left says yes to socialism in some form or another, the right says no: freedom and free markets are inseparable.

In this context consider Al Gore’s proposal to completely eliminate fossil energy from the American economy in ten years-ten years!-at the cost of trillions of dollars and just about all our freedom. Imagine what it would take to replace about 80% of our electricity generation with zero carbon sources-and more importantly, how much government interference in our economy it would justify.

No serious person who understands our energy production believes that Gore’s goal is achievable or even desirable. But that’s not the point.

The point is that setting this goal and committing all the resources of the government to achieving it would require a massive restructuring of the U.S. economy, massive government subsidies and penalties, and the picking of winners and losers in the marketplace (and just who do you think would be raking in those trillions of dollars?).

All in all pursuing such a goal would be the greatest leap forward for socialism in the United States since the New Deal. Following Gore’s prescription would make the government interference in the economy during the New Deal look miniscule by comparison.

So why have conservatives been-to a great extent-on the losing side of this argument in the political realm? After all, the political (if not scientific) “consensus” behind Man Made Global Warming is strong enough that both major party candidates for President support making massive changes to the American economy to address it.

Conservatives have been, I believe, too afraid as a group to fire back when the so-called “Progressives” accuse them of selling out the environment and our children’s future for a few bucks in their pocket today.

Yet how hard would it be? Conservatives have more children and grandchildren than liberals. They in fact have a much greater stake in the future of the planet than a dual-income-no-kids liberal couple. And in reality the average conservative has little or no real financial interest in the fossil fuel industry beyond the need to put fuel in our cars and turn on the lights in our homes.

Can the same be said of the leading liberal proponents of the idea behind man-made global warming? How often do we hear from the proponents of the global warming hypothesis about how there is money to be made in moving to a carbon-neutral economy? Who do you think is investing heavily in biofuels, solar and wind power, and all the other Rube Goldberg schemes being pushed to “solve” the current “crisis?” Who is making money off all those carbon-offset credits and the like?

So tell me: who, really, is willing to sell our future down the river for a few bucks? Or at least sell out our freedoms for a chance to grab control over the energy backbone of the entire economy?

The bottom line is pretty easy to understand: if the proponents of radically changing our economy get their way they achieve two of their most cherished goals: moving our economy dramatically toward socialism, and getting rich off of the inevitable government mandates and subsidies required at the same time.

So getting back to the original question: do conservatives hate their children? Of course not. But do liberals hate Conservatives’ children? You be the judge.

^{This column was originally published at Townhall.com. Comments Welcome there.}

It’s been a while since I really angered a good chunk of my readers, so I guess it’s time.

In this spirit today I am rising up in defense of commodities speculators; more specifically, speculators in the price of oil and agricultural products.

There is no group more vilified today than the speculators, and few who are as unjustly attacked. Speculators have been taking a lot of heat from politicians and various other demagogues as the cause of the rapid rise in food and energy prices.

The latest group to get into the act of blaming speculators for rising prices is a coalition of a few big businesses (mainly airlines) that use a lot of fuel. They have banded together to create “Stop Oil Speculation Now,” a group dedicated to getting the government to seize more control over the futures trading market. One thing these businesses fail to tell you is that they were doing badly long before oil prices went up, mainly due to poor management.

If the idea of big businesses calling for more big government doesn’t frighten you, you must be a socialist already. These companies aren’t pushing this agenda for the common good of all of us—they want the government to bail them out by imposing price controls on oil through the back door of impeding the trading of futures in oil.

It’s hard to find an idea as dumb as this getting such serious attention.

Attacking speculators is akin to shooting fish in a barrel. Price speculation is as naked a profit-seeking activity as can be found in a free-market economy, and when consumers get angry about price increases or shortages there is not easier target than the “blood sucking” and “profit before people” speculators.

Of course, nobody mentions that without a futures exchange the modern market in commodities would come to a screeching halt. In fact, the history of futures exchanges—where so-called “speculators” do all their trading—goes as far back as 1710 in Japan and 1800 in America, and some argue that even the ancient Greeks had futures markets.

What good is a futures market in commodities such as oil and food (and gold and silver and…)? Why do we need speculators to make a modern economy work?

Growing food and mining gold and pumping oil are risky businesses. Prices fluctuate a lot, and the supply of those goods varies quite a bit over months and years. A particularly good or bad harvest, the discovery of new oil fields or the flare up of a war in the Middle East, and even the decision to print fewer or more dollars by the Treasury or Federal Reserve can all have tremendous impact on the value of commodities. Supply and demand constantly fluctuate in these markets, and prices along with them.

That makes it difficult for producers of commodities to make long-term investments. They have no idea how an investment today might pay off tomorrow. Will large investments today yield significant profits tomorrow? In just a few hours of one day—July 15th, 2008—the price of a barrel of crude dropped $10. From the point of view of somebody deciding whether to invest billions of dollars in a new oil drilling venture, the prospect of significant declines in the price of oil looks both real and frightening. Same goes for farmers buying new farm equipment, or mining companies investing in a new mining venture.

Of course if they can lock in a price for the delivery of their goods at some time in the future producers will be more willing to make investments in future production, because they have a pretty good idea of what the return will likely be. And that is what happens in futures markets. Producers sell the rights to take delivery of their product at some specified time in the future in exchange for a certain price today.

And who buys those rights? Speculators. They are making a bet that the product they are buying at a certain price today will be worth more tomorrow. Sometimes they win, and sometimes they lose. Often they sell off their rights to another speculator who has a different bet on what the price in the future will be of the product they are buying. (For a great short lesson on who speculators are visit the blog Market Power written by economist Phil Miller).

That’s what futures markets do, and that’s why they—and the speculators who make them work—are so important. Farmers will farm less if they are less sure of their profits. Oil companies will seek less oil if they worry that oil to have another price collapse—as happened in the 90s after the peak prices of the 1970s and 80’s. (No, high prices as far as the eye can see are NOT inevitable, history tells us).

It’s the futures markets that make being in the commodities business stable enough to function relatively efficiently. Without futures markets, fewer commodities would be produced and prices would be, on average, even higher than without futures markets. It is the futures markets that provide the necessary stability (most of the time) to the commodities markets to keep producers in the business of selling risky goods.

The government taking more control over futures markets would do nothing to hold down the price of oil or food—in fact, such a move would almost certainly make things worse in the long run. And I am willing to bet that the folks behind Stop Oil Speculation Now KNOW that it would make things worse for consumers.

But they aren’t worried about that. I think they are hoping that getting the government into the oil pricing business will lead to more explicit price controls and supply management, putting their “vital” businesses at the head of the line for cheaper fuel and avoiding the inevitable fuel shortages that price controls would bring.

We’ve been down this road before: in the 1970s the government got into the business of price and distribution controls for fuel, and it was not a pretty sight. For those of you who don’t remember, government interference in market in the 1970s brought us gas lines, fuel shortages, and eventually stagflation.

Markets always work better than government, so let me hear from you all: three cheers for speculators!

^{This article was originallly published on Townhall.com. Comments welcome there.}

Conservatives are in a funk—one that threatens to turn into a full-blown retreat from the battlefield of ideas.

Everywhere I turn I encounter conservatives ready to give up for the next few years. After all, many of us rightly feel a bit betrayed by our elected officials given how badly they performed over the past few years. And many conservatives are hoping that two or four years of liberals actually running things will wake America to the dangers they face.

It’s hard to blame people who feel that way, but they couldn’t be more wrong.

Even a mere two or four years of liberal ascendency in Washington policymaking could do immeasurable damage to our economy and our freedoms—damage that could take years or decades to repair, if ever. Once a liberal policy is in place it is almost impossible to reverse it.

Don’t think that a few years of liberals in charge is that dangerous? Just take a moment to consider what liberals dream of doing once they gain absolute power.

There is no aspect of our lives—none—that today’s liberals concede is off limits to the meddling use of government power. In their vision there is no dividing line between the public sphere and the private sphere. Limited government is a concept that makes no sense to them.

A great example of this phenomenon is Time magazine’s columnist Joe Klein’s recent proposal. Klein just recently called for—get this—a reduction or elimination of the use of air conditioning in America. (This is a measure that would be wildly popular in Arizona, Texas, and Florida I’m sure).

Air conditioning, you see, consumes 4% of the energy used in this country, and thus by his lights has become a serious threat to national security. Wars may soon be fought over air conditioning—or at least the energy we use to power it—so we must reduce or eliminate its use.

Air conditioning also adds to global warming, makes us more dependent upon foreign oil, and not coincidentally annoys the heck out of Joe Klein, who happens to like it warm or even hot and muggy.

Klein’s proposal is a perfect example of how liberals think: turn a personal goal or pet peeve into a matter of public concern, and then advocate the use of government power to achieve the desired result.

Klein’s vision is no mere pipe dream. You may recall that California’s Energy Commission recently sought control over every thermostat in the State as a means to save energy. And both the national and many state governments are mandating “renewable” energy and “renewable” fuels as part of the energy mix for the future.

Energy policies are just the tip of the iceberg—although control over energy gives government control over pretty much the entire economy already.

In a world run by liberals literally no aspect of our lives will be outside the legitimate regulation of government. That is because anything—even what temperature you like to keep your house—can be turned into a matter of legitimate public concern.

Everything we do, including breathing, eating and of course procreating, can be argued to have an impact on those around us or the great mother earth. And if it affects others, it can and should be regulated by those who know best, at least according to the liberals.

Liberals want to regulate just about everything: where we live, what fuels we use, what car we drive, whether we can drive or be forced to use government mass transit, where we send our kids to school, what doctor we see, and even to what extent we express our approval or disapproval of others’ lifestyles. It’s hard to find something liberals don’t want to regulate.

Is that a world you want to live in? A world where all our liberties are subject to the slightest whims of lawmakers and regulators?

Whatever our personal feelings, conservatives simply can’t afford to indulge in the funk many of us have fallen into. The price we pay for handing absolute power over to liberals is just too high.

What’s at stake are the very concepts of personal liberty and limits to government power.

We can’t afford to just walk away from this fight.