Thursday, January 12, 2012

The Truth about the President’s Economic Policy Part 7

So, if none of our leaders will provide the truth about the President’s speech in Kansas, someone else will have to do it.

The collectivists in our universities who taught the President and his friends will tell you that the intellectual enemies of mankind are the ideas of reason and freedom. They will tell you that our economic salvation can be found only in collective joining by all members of society; that the able should sacrifice to lift up the group.

They may not tell you this outright. They may actually tell you that they value reason and freedom, but their definitions of these concepts are convoluted and distorted compared to the views of the Founders. They will hold out a promise of a better tomorrow while you, the average American, know, perhaps subconsciously, that a better tomorrow, on these terms, can only come if you work hard while others do nothing. You, the producer, are being vilified as the cause of the nation’s problems while those who do not work hard are being called the victims of your drive for profit. You’ll know that the decks are stacked against you, the rules are designed to punish you and, in spite of your being punished, you are supposed to accept the “justice” that represents your enslavement. As you watch while your freedom and prosperity are slipping away, you are supposed to believe that nothing has changed, that collectivism really works and that the able sacrificing to the unable is a desirable moral ideal.

Our politicians and university professors tell us that capitalism is the problem and we need to replace it with a system that fosters sacrifice for the collective; otherwise known as social justice. Is capitalism the problem? Does capitalism really mean that each person is left to fend for himself? Yes, and that is what makes it possible for capitalism to foster the creation of incredibly efficient products and services that immeasurably improve the lives of people. That principle means that you can live in security, affluence and enduring economic abundance.

Capitalism, as we’ve discussed, is a system that fosters cooperation. People use their minds to decide which products they will purchase and which they will offer for sale. As long as each individual is free to make his own rational judgments he can constantly improve his life. On the other hand, the financial crisis was caused by the requirement that bank managers drop their rational judgment and not evaluate prospective mortgage applications on their merits. Capitalism would have required that they make a rational evaluation of each loan, identify the borrower’s ability to pay and make a decision based upon the expectation that the bank would make money on the loan. This process would not have allowed the banking crisis; it would have prevented the banking crisis.

Does capitalism countenance people to play by their own rules? What does the President mean when he accuses people of playing by their own rules? The President uses the term in order to falsely equate production with theft and it results in the restriction of production and the liberation of theft. The destruction of society comes when you force people to do what government wants rather than what they want. To let people play by their own rules is to liberate them to use rational means to accomplish their survival. It is this that the President and his friends destroyed in 1994 with the strengthened CRA rules. The real prejudice was not that aimed at the poor or black or brown; it was the prejudice aimed at bank managers who were unfairly called racist bigots because they were making loans according to rational standards.

How does an honest businessman, playing by his own rules, enable his customers to survive? He does so by means of correctly ascertaining reality and developing viable products that improve their lives. This is not dog-eat-dog but human cooperation and trade. This is not playing by your own irrational rules but playing according to reality and the requirements of survival. It is survival that capitalism makes possible, not cheating, not thieving and not lying.

By characterizing capitalism as evil, the President creates for himself a powerful political weapon. By means of this prejudice against capitalism and banks, he can take advantage of envious hatred to loot banks of their capital. But there is one idea that makes anti-capitalism powerful and successful as a political tool. This tool is altruism. It would not be possible to vilify capitalism were it not for the pervasive influence in society of altruism. Were it not for the moral dominance of the idea of sacrifice, there would be no argument that could be used to gain coercive power in a free society.

The President knows that whenever someone advocates free markets all he has to do is point out that unchecked capitalism would take money from the poor and put it in the hands of ruthless profit-chasers. Whenever Tea Party protesters complain about massive spending by the President, all he has to do is tell us about our duty to help the poor and especially those exploited by Big Business. Whenever people demand that the spending stop all he has to do is accuse them of wanting to hurt the poor and take away services that help them survive in a world where jobs are lacking.

The truth is that the President's economic policy is nothing but song and dance that touts the value of sacrifice as a means to picking peoples' pockets. The idea that the poor need homes; that they need the “American Dream” at the expense of people who have worked hard and saved their money is a travesty and a lie. Only those people who diligently work, diligently save their money and who have the ability to pay their loans should be allowed to own homes. Only by applying a rational standard can banks make money.

Yet, the Republicans are incapable of defending capitalism and of proving that self-interest is the best, most productive, most moral idea today. They seldom point out that capitalism has created virtually all of the good in our society; that capitalism is, in fact, good. Instead, they cringe whenever someone accuses them of being in the pay of capitalists and of seeking only to advance greedy interests. They are afraid to stand up and argue that capitalism is the most moral economic system in history because it gives people the power to make rational choices and take moral actions that benefit their lives. Republicans are afraid to say that the most moral way to have an affluent society is to leave people alone.

In fact, Republicans agree with the Democrats that force is necessary to make capitalism “work”. They propose huge government programs to prove to the voters that they too believe the lie that government can do great things for people, denying to the public that they are contradicting themselves. To appeal to the voters, they pull out the “populist” message of Teddy Roosevelt, promising a “trust buster” attitude to make greedy businesspeople pay for their crimes, hoping that people will think the Republicans are principled fighters for the people against greedy acquisition.

In advocating regulations, in vilifying businesspeople, in promising to punish trusts, Republicans are helping the progressives establish the terms of economic debate. By refusing to take a moral stand for capitalism and for the right of people to make a living without interference, they make profits impossible and punish people for hard work and innovation. All they have to do is open their eyes to see the proof of the morality of capitalism. All they have to do is notice the hotels, limousines and airplanes that they get around in, visit the restaurants and factories and the teeming cities with tall buildings to get a sense of what it means to be free. Like the proverbial busy-body who never stops to smell the roses, the Republicans never stop to notice that freedom creates abundance and moral living.

And because of this, they are helpless in the face of the President's morality of sacrifice and re-distribution. They are just as much responsible for the mess we are in.

-to be continued.

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