Yesterday was Part III of Captain Kirk and the Unintended Consequence of Compassion. The moral of the Captain Kirk episode was applied to today’s economic woes. Though ugly and painful, market corrections necessary to a prosperous long-term economy. If government and society dampens the pain, a multi-generational war of our own creation might result. This war has a name—Socialism.
You don’t buy it? You think socialism has a bad rap? My question to you is this: have you traveled to Cuba lately?
In yesterday’s post, I cited the source of my conviction:
If you have any sense of history, you know that the prosperity created by the American free market system is without precedence. This is especially true as it pertains to the middle class. Never has a society created such a large and prosperous middle class. Also unique in the American society is how often an individual can start poor and end up wealthy. Regardless of where you grew up, what color your skin is, or what you believe in, you have a bonafide opportunity to achieve wealth.
My question today is “Can American be better?” That is, can we build on all that is good and make it even better? After all, this is the promise that got Barack Obama elected. Well, this promise AND the legacy of George Bush. AND an opposing candidate who was uninspiring and up there in age. AND an economy that was unraveling in the days leading up to the election. AND an opponent’s running mate that though hot, ready-to-be-president she was not.
Let’s get back on track. “Can America be better?” Sure. You bet we can. That is part of what makes us great. But here is my point:
We need to do this cautiously, and we need to do it with great humility. In our tangled mess of an economic system, there is a recipe that works. It inspires people to work hard. It rewards creativity. It gives the underprivileged a bona fide shot at success. It creates great wealth–enough to allow America to ship billions of dollars oversees to help people throughout the world. Let us marvel at how well our economic system works.
My issue with Washington is not that they aspire to make our system better. I understand the altruistic desires around “healthcare, education, and a green earth”. My concern stems from the lack of appreciation of what our economic system has achieved in its current form. Many seem to despise the system or, at a minimum, ignore its accomplishments. Instead of honest debate about how to make it better, massive changes were railroaded in without allowing time to even understand what was being done. For decades, we might need to live with a mess that we do not yet understand. In our quest to make all better, we might damage what has made our economic system so special.
The unintended consequence of our compassion might cripple an individual’s ability to prosper from their own hard work, smarts, persistence, and good fortune. Misguided social engineering might level the playing field by greatly reducing society’s overall prosperity.
Again I will ask: have you traveled to Cuba lately?
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Is socialism the problem or is it oligarchy? (see http://www.theatlantic.com/doc/200905/imf-advice)
I agree that intervening in market corrections is dangerous but programs like PPIP are much more likely to bail out the rich (bankers, hedge funds, etc) than the masses.
It’s not clear to me that compassion for the people is our biggest risk here – The government seems to have a significant bias for the super-wealthy that could be a far greater problem.
Very well done and carefully worded. Could not agree with you more. Not sure I agree with the previous comment about the super wealthy being biased by the current administration. I think govt is taking social engineering to new heights (or lows).
This nation was founded by those that believed in a Republic, over the centuries we turned that republic into a democracy, we have a handful of very evil market makes that want an oligarcy and may be in a league of others around the world.
Oligarchs win hands down because they have control of the only entity that could possibly stop them(the government) specifically the individuals in regualtory, law enforcement, executive, legislative and judicial branches…Oligarchs thrive when there is a majority in government that tend to be more socialist in their approach to solving problems. They also win because invaribaly they control the media.
This administration and the majority in the legislative branch are starting to prove they are just as arrogant,and stupid as the prvious administration. I am now convinced that obama is very naive and is turning into a puppet for radical views, that ultimately will keep oligarchs very appeased and pleased. Oligarchy hates innovation, self reliance, and the very values our founders held dear.
To take their power you must build more slef reliance, be keen to details and start a revolution.
All that Obama is doing is transfering wealth, follow the money and this is proved. Where does it say in our Constitution a sitting President has the authority to fire a CEO and nationalize anything. the tobacco excise tax being raised is another example fo reckless regard for anyone’s rights. I for one would like to see where exactly this new $33B is going to go to.
My guess it will not go directly to the children it is inteneded to go to, but to every middle man in between and in the end very few children will see any benefit if at all.
We ahve a current administration that is selling us down the river and are too stupid to see it…I do not see anyone that understands true free markets or even udnerstand that in real free markets regualtion is not needed, because the system corrects itself, the real issue is that ALL politicians for at least the last 20 years,and especially Grennspan refused to let the system work as it was intended to.
The current crisis is not a political problem it’s a GREED problem and the banks, automakers, etc are not really the issue imho, it is far deeper it is a group of individuals that collapsed a system just because they could. I firmly believe there is no reason why Bear Stearns or Lehman had to collpase, other than oligarchy proving a point.
we can take it back, but it’s going to have to start by forcing every citizen to be educated and united. This challenge is going to be just like when you attempt to get a heroine addict clean & sober and it will be very painful and it will be a long journey down a very long road.
We have to understand just as any addict understands the path to recovery is not a short term fix, it is a lifestyle change.
Last comment on this whole affair.
Every Citizen should lay aside political and media rhetoric and really ask themselves some very important question’s.
WHO would benefit the most from collapsing the US economy?
WHO would benefit the most from positioning the US as the entity that caused the global collapse?
WHY is the IMF and now everyone including China so eager to help stem the collapse?
WHY is China still buying US treasury bonds, despite their strong vocal objections?
HOW could you take over republic ideals and the Nation for which they stand w/o firing a shot, invading the country or launching a missle at that Republic?
WHO would benefit the most from seeing a socialist and border line communist getting elected to lead a Republic?
WHO believe more than anything that Western nations and most importantly the US is what is wrong with the world today and whose citizens are the epitome of evil?
My theories and they are only theories are two fold
1) A global oligarchy cartel, including US Citizens that understand our system and loopholes, etc that are forming a
2) Could this have been a perfectly planned and executed terrorist attack? before anyone says that the radical muslim threat could not be smart enough to carry this out, let us not forget at all, that they were smart enough to take flying lessons and run them into the Twin Towers.
Dan,
I haven’t been to Cuba lately, but have you been to Detroit lately?
Good post Dan. Like most things there are three sides to every story.
Defining cuba as socialist is debatable. I would say Stalinist not socialist but that’s a debate on its own. True socialist states are rare and like unfettered capitalism, usually break down before their pure form due to greed and ultimately morph into something else. There are elements of multiple economic systems that work with examples all over the world yet here we seem to always end up at the black and white with no gray. Maybe we should look at other systems and take the best of all of them and evolve and progress for whatever we’re talking about be it economics, health care etc. I believe that America was called the great experiment so I highly doubt after less than 250 years we got it just right. We already have elements of nationalization but choose not to categorizes them as such for some fear of what… the slippery slope?
I keep hearing “We need to let it crash so it bounces back!”… like it’s some mechanical process in a vacuum. Does anyone really know how bad it would get if we did nothing at all? And can a government do nothing at all without suffering a fatal blow as we experience ‘lower lows’ for a period of time?
Johnny–I have not been to Detroit lately. If any city should understand the ramification of having a propped up uncompetitive industry, it is Detroit.
We need to let the market crash, just as we need wild forest fires to run their course. A wildfire is nature’s way of clearing out the brush, and bankruptcies are a way of clearing out those businesses/jobs that have become non-value added. Yes, some folks will lose their jobs, but out of these “ashes” will stronger employees and better companies arise.
Diane,
Are you a first time commenter? If so, thanks for commenting. The is a reason Charles Darwin is one of the most famous names in history.
Dan
The bankruptcy process and courts have worked very well for our country for many years. Why we need to bail out all of these banks and auto makers is beyond me. Please let the courts do their job. Now, I am a Democrat, have been for years. However, I cringe when I see government starting to “own” companies. The sad thing is the media isn’t even touching on it in any meaningful way.
I do think helping back automaker’s warrenties was a brilliant idea. Kind of like the FDIC for banks. Obama should have let the auto makers go into bankrupcy coupled with this idea. Perhaps he still will…
I think there is a good answer to the ecomonic crisis we are in. I beleive the FairTax would be the biggest boost to the economy Congress could do. However, it would weaken their power so America would have to force them to do it. It would encourage investment and bring trillions of US dollars back into America. It would also stem the tide of companies moving more jobs off-shore (can you say IBM)? It is unfortunate that we (America) aren’t taking advantage of this opportunity to catapult America out of this recession.
John,
Well said. I am a Republican and have been for years, and couldn’t agree with you more on this.