I’m always fascinated by how the Federal government, through various Federal agencies, claims that it’s “helping” the free-market through bureaucratic intervention. Earlier this week, I stated that the USDA’s recent decision to “help” the Christmas tree industry promote itself demonstrates yet another example of government inefficiency. The USDA planned to, by collecting a fifteen cents tax on each tree bought and sold, launch an industry ad campaign promoting the purchase of fresh Christmas trees across the Country. Once public pressure reached a fever pitch, however, the White House decided to press the USDA to drop the proposal. In their defense, White House Press Secretary Jay Carney claimed that the Christmas tree tax was supported by the Christmas tree industry; therefore, the USDA was just doing the will of the private sector.
In the words of the old George Strait song, “if you’ll buy that I have some ocean front property in Arizona.”
If private-sector Christmas tree farms felt the need to have a fresh tree ad campaign, I assure you there would’ve been one by now. The truth is that the USDA formed a Federal Christmas Tree Promotion Board, which consists of appointed Christmas tree farmers. Don’t think for one minute that these appointed board members don’t have some sort of political connections; otherwise they wouldn’t be on this commission in the first place. What’s really happened here is that a few Christmas tree farmers (namely those on the USDA’s promotion board) support a Christmas tree tax, while the vast majority opposes it. Thus, Jay Carney was only partially lying when he said the “industry” supports it, for in the mind of this Administration the “industry” consists only of the portion partial to the president. If the private sector didn’t think the industry wide ad campaign was a good idea, and the government had to force it through additional taxes, then it wasn’t necessary in the first place.
Another example of this principle is the recent revelation that Indiana Senator Richard Lugar, a liberal Republican, helped to secure nearly $119 million for another failed alternative energy company. Electric car battery manufacturer EnerDel, which is owned by Russian millionaire Boris Zingarevich, received the Department of Energy stimulus grant at the urging of Senator Lugar. The battery manufacturer was already failing by the time the DOE approved the grant at Lugar’s request. Senator Lugar requested the DOE grant in the name of “economic development” in Indiana; however, EnerDel’s only has 33 full time positions in Indiana that were supported by the $119 million grant, meaning that each job cost over $3.5 million. I guess this is a great use of taxpayer funds in the minds of the DOE and Senator Lugar?
The Federal government is a fundamental failure as a venture-capitalist or, in its case, a “venture-socialist.” Only the government would “invest” $119 million in a company already swimming in a sea of red ink, which produces batteries for cars very few Americans even drive. Indiana GOP Treasurer Richard Mourdock, who is challenging Lugar in the Republican primary next year, said it best “the most troubling part of this entire story is that the American taxpayers are subsidizing a Russian millionaire’s company in order to promote President Obama’s vision of alternative energy. The problem is, alternative energy really isn’t an alternative when it must be subsidized by the government.” I couldn’t have said that better myself. If the government has to get involved to carry a project across the finish line, it wasn’t going to succeed in the first place.
The government needs to stop meddling in the private market, allow free citizens to freely act, and stop trying its hand at “venture-socialism.” They should leave investing to investors, who don’t throw good dollars at bad deals.