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Charles Koch fights back with Big Government critique

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Opinion,Lawrence Kudlow,Columnists,Obamacare,Big Government,Koch brothers,Capitalism,Cronyism

Is it too farfetched to connect the dots between a brilliant Wall Street Journal op-ed by Charles Koch, the chairman and CEO of Koch Industries, and the continued sluggish recovery in jobs, business investment and the overall economy? I don't think so.

In his piece, Koch seems to make a plea for a big dose of free-market capitalism. He argues, "The central belief and fatal conceit of the current administration is that you are incapable of running your own life, but those in power are capable of running it for you. This is the essence of big government and collectivism."

Charles Koch and his brother David have been vilified by the left for fighting hard to get political candidates with free-market points of view elected. Protected by U.S. Senate rules against libel, Democratic Majority Leader Harry Reid has called the Kochs virtually every name in the book — including "un-American." But now the Kochs are fighting back. And I hope they do more of it.

Charles Koch's op-ed reveals a consistency of thought. He writes, "I have spent decades opposing cronyism and all political favors, including mandates, subsidies and protective tariffs -- even when we benefit from them. I believe that cronyism is nothing more than welfare for the rich and powerful, and should be abolished."

Koch concludes that the current batch of administration policies "destroys value, raises costs, hinders innovation and relegates millions of citizens to a life of poverty, dependency and hopelessness."

This is strong stuff. And spot on.

Think of Obamacare as the ultimate central-planning, collectivist, big-government approach. The government is mandating what health care insurance to buy, and taxing you if you don't buy it. You may lose your favorite doctor or hospital or insurance plan, all while job hiring and work effort are undermined. These intellectual eggheads tell you what you can and cannot do, and where you can and cannot do it. And they prescribe a multi-trillion-dollar government expansion of spending and taxing while they're at it.

The good news here is that Obamacare is incredibly unpopular. The bad news is that it's going to be incredibly difficult to rewrite or replace this law.

But Koch's big fear is that collectivism can't and won't stop with Obamacare. He has a point. The Obama machine continues to roll out poverty-trap incentives, paying people not to work. Obama's Environmental Protection Agency is aiming to obliterate the entire coal industry and all the blue-collar workers in it. The president can't even give the okay to the Keystone XL pipeline, which is favored by all but the far-Left environmental radicals. Obama's National Labor Relations Board now wants to unionize college football players. Our corporate tax rates are the highest in the world. And the entire IRS tax system is so corrupt and complex, it has become a major hindrance to growth. I could go on and on.

So why is it surprising that the economic recovery is happening at only half the rate of a normal expansion? Sure, there was some decent news in the March jobs report. But it took nearly five years for private jobs to regain the peak reached in January 2008. In fact, this jobs recovery is the slowest on record since the Labor Department started tracking the data in 1939. And we are at least 5 million jobs below potential.

I don't want to be too pessimistic. The March employment report of 192,000 new jobs is at least keeping pace with the monthly changes of recent years, sluggish as that may be. And there was good news with a lengthening private workweek and a big jump in the small-business household-employment report.

However, wages were flat in March, and only 2.1 percent higher than a year ago. And the so-called U-6 labor-impairment unemployment rate — which includes people who have jobs they don't like — is stuck at a high 12.7 percent. A full 10.5 million Americans are unemployed, and 7.4 million are working part time.

One huge reason for the tepid jobs recovery is that long-term business investment in new plants, equipment, warehouses, office buildings and so forth remains very soft. Only recently, in last year's fourth quarter, did so-called cap-ex get back to its prior peak of early 2008.

High taxes are causing firms to deploy profits overseas. The president keeps bashing business with the threat of even higher taxes and regulations. And no one knows what Obamacare regulatory costs are ultimately going to be.

So with the economy only crawling toward recovery, the solution is not character assassination or more government collectivism. Mr. Charles Koch has it exactly right: We need more liberty and freedom to restore American values and economic prosperity. Politicians and regulators can't do it. Only hard-working and innovative people can.

So let's let them do it.

LAWRENCE KUDLOW, a Washington Examiner columnist, is nationally syndicated by Creators Syndicate.
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Lawrence Kudlow

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The Washington Examiner