Future Technocrat in Chief Newt Gingrich Supports the Right Subsidies
Embittered Mensa reject Newt Gingrich sat down with Glenn Beck today to discuss the ways in which Newt Gingrich is the right person to be in charge of America. The interview was "gaffe-free," according to Beck, unless one considers a GOP presidential candidate endorsing Solyndra-style command-and-tickle of the U.S. economy a gaffe (I do):
GLENN: Regulation and the government scares the crap out of me and I think most Tea Party kind of leaning conservatives, and Theodore Roosevelt was the guy who started the Progressive Party. How would you characterize your relationship with the progressive ideals of Theodore Roosevelt?
GINGRICH: Well, that depends on which phase of Roosevelt you're talking about. The 1912, he's become a big government, centralized power advocate running an a third party candidate which, for example, Roosevelt advocated the Food and Drug Act after he was eating ?? and this supposedly the story, after he was eating sausage and eggs while reading up to Sinclair's The Jungle, which has a scene in which a man falls into a vat at the sausage factory and becomes part of the sausage. And if you go back to that era where people had ?? dealing with the Chinese where the people had doctored food, they had put all sorts of junk in food, they ?? you know, I as a child who lived in Europe and I always marveled at the fact that American water is drinkable virtually anywhere.
So there are minimum regulatory standards of public health and safety that are I think really important.
GLENN: Okay. So you're a minimum regulation guy on making sure the people don't fall into the vats of sausage?
GINGRICH: Yeah. What I'm against is the government trying to implement things because bureaucracy's such a bad implementer, and I'm against government trying to pick winners and losers. I mean, there's no accident that the Smithsonian got $50,000 from the Pierre plane and failed and the ?? from the Congress, and that the Wright brothers invented the airplane because ??
GLENN: Okay.
GINGRICH: But I do think ?? and I think almost everybody will see this, I believe. You want to make sure, for example, if you buy certain electric things that they don't start fires in your house.
GLENN: Sure. But you have selected a winner when you are for, quite strongly, the ethanol subsidies.
GINGRICH: Well, you know, that's just in question. When Obama suggested eliminating the $14 billion a year incentive for exploring for oil and gas, everybody in the oil patch who's against subsidizing ethanol jumped up and said, hey, you can't do that. If you do that, you're going to wipe out 80% of exploration, which is all done by small independent companies, not by the majors. I supported, I favored the incentive to go out and find more oil and gas. Now, that's a tax subsidy. It's a bigger tax subsidy than oil ever got. But I want American energy to drive out Saudi Arabia and Iranian and Iraqi energy and Venezuelan energy. And so I am for all sources of American energy in order to make us not just independent but to create a reservoir so that if something does happen in the Persian Gulf in the Straits of Hormuz, the world's industrial system doesn't crash into a deep depression.
GLENN: Why would we, why would we go into subsidies, though? Isn't ?? aren't subsidies really some of the biggest problems that we have with our spending and out?of?control picking of winners and losers?
GINGRICH: Well, it depends on what you're subsidizing. The idea of having economic incentives for manufacturing goes back to Alexander Hamilton's first report of manufacturing which I believe was 1791. We have always had a bias in favor of investing in the future. We built the transcontinental railroads that way. The Erie Canal was built that way. We've always believed that having a strong infrastructure and having a strong energy system are net advantages because they've made us richer and more powerful than any country in the world. But what I object to is subsidizing things that don't work and things that aren't creating a better future. And the problem with the modern welfare state is it actually encourages people to the wrong behaviors, encourages them not to work, encourages them not to study.
At least he got the date right on Hamilton's "Report on Manufactures." As for the idea that bureaucracy is "a bad implementer"—this is also true! But what Gingrich suggests as an alternative is that government support companies and industries that would be winners without government supporting them. At least, this is what he seems to mean when he says, "What I object to is subsidizing things that don't work and things that aren't creating a better future." By Gingrich's logic, government would not be "picking" a winner, it would be recognizing one. And yet, products and ideas that work—Facebook! iPod! Pot!—work not because government says they work, but because people use/buy them. Some people would call Gingrich's line of reasoning "counterintuitive." I say it's like putting a monocle on a coma patient and telling his family that he is deep in thought.
To test the former House Speaker's theory, let's ask ourselves (and maybe Gingrich?) the following questions: Do things that things that work need government recognition for consumers to know that they work? And is ethanol—which Gingrich should probably be embalmed with—creating a better future?