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Capitalism: My Love Story

Capitalism isn't the sort of girl that you want to be seen in public with these days, is she?  But I don't care what the other guys say anymore - I'll gladly take her to a Washington D.C. dinner party  - and sit her right down next to those shallow, brainless trophy wives that couldn't win a debate with the mirror if they tried.  My honey's a keeper, and I'm not afraid to tell you why.

I don't love Capitalism because she's made me rich (although, compared to the worldwide standard of living, I suppose she has), I love her because she keeps me free; she allows me to live my life for my own purposes without some Parent-state telling me what I can and can't do.  

As an American, I'm so used to this freedom that I really can't imagine what life would be without it.  A few hundred years ago my forefathers got sick of Nanny Britain bossing them around, so they up and moved out - and I'd say they did pretty well for themselves.  Now, I sense my country on the verge of moving in with that that meddling woman Socialism (who in a scary-old-lady way seems friendly with that crotchety Marx character from the fitness club).  

But why would I leave the woman who has made my dreams come true?

So, I've set out to list my reasons for loving Capitalism - the free market system.  If I'm moving anywhere, she's going with me.  And if I know her the way I think I do, any move I make with her will be an upgrade.

I know I'm incurring the arrogant grins and chuckles of too-good-to-be-me university professors and White House staffers.  Laugh on, and toast to Mao or Mussolini or your mother-in-law.  I don't care.  Because my woman has never done me wrong.  I'm proud to be in love with Capitalism, and I want to the whole world to know.  (If you've ever been in love before, you understand.)  So, here are my reasons, America:

America's Debt = Moral Failure, p.1

I'll leave it to the economists and pundits to discuss the specific numbers of our skyrocketing national debt.  I believe debt can be a positive factor in an economy if it is used as a tool of investment.  In other words, if we "borrow money to make money," and the new money created services the debt and makes us all more prosperous, then - cherio - print those bonds!

Great examples of debt-financed investment might be the interstate highway system, capital improvements to our military, building a canal, cleaning up a disaster area, etc. The most brilliant use of investment debt in American history was probably that incurred by Thomas Jefferson in the purchase of the Louisiana territory - a dramatic expansion of land for a bargain-basement price.  

There is an obvious limitation on this borrow-to-get-rich scheme in government: politicians are unable to distinguish between politically-expedient spending splurges and real investments for the nation.  

Obamath: Multiplication by Division

Here's the fundamental equation of Obamath: OM (/$=+$)      (The division of wealth equals additional wealth).  Think about that for a second.   The basic principle behind Obamath is that we can improve the lives of Americans by forcibly redistributing their wealth.  Taxing one person (or borrowing from their future taxes) and handing cash to someone else (in the form of health care, car rebates, etc.) will somehow add value to the economy, or organize it more efficiently than the free market.  That's the theory, at least. The problem is that it can't work.

Creating Wealth for America - Part 2

What is wealth, really?

It's value. 

To create wealth, all we have to do is add value to something, and then either use it or trade it.  Yet when I hear politicans talking about economic fixes these days, I don't hear much discussion about this - the real answer.

Creating Wealth for America - Part 1

We all want things - lots of them.  And we know that to get them, we have to trade with others.  If you have something I'd like, I have to figure out a good "deal" I can make with you - I trade my resources for yours.  Money is just the medium we use to make the process of wealth-trading smoother.

If "Joe" wants to buy a car, he's going to need some wealth he can trade with the car dealer.  Where will he get it?

- He can create wealth.

- He can borrow wealth from others and pay it back later.

- He can trade wealth he already has.

- He can forcibly take wealth other people have created.

Assuming the fourth option is out (that one's only legal for the government), and assuming the third option isn't available to Joe, he's probably looking at a mix of the first two, right?

He might borrow some wealth-units (dollars) from someone else (like a bank), and then pay them back as he creates wealth in the future, at his job.

So far, so good.  But what happens when Joe overextends - when he borrows more than he can possibly create and pay back? 

Roundabout Cycle: Misery or Prosperity?

Everyone wishes they had more money – the rich, the poor, the government, and probably you too. I've got a plan to make it happen - for you, Uncle Sam, that rich guy on the other side of town, your mother-in-law, and your grandchildren-to-be.  It's simple and involves creating a roundabout cycle of prosperity.

Capitalism Works Its Magic

Long before Washington politicians provide a real answer to high fuel costs, good ole' American capitalism (you know, the greedy kind) may lower the cost of fuel, provide us with greener technology than ever before, and give us a smooth ride along the way.

GM (that's right, a profit-making, non-government organization that shamelessly asks customers to pay for its products) is developing a mostly-electric car that will allow many Americans to virtually eliminate gas pump fillups - and for those that do fillup, to provide 150 MPG economy.

Now, if the government would just leave it alone - get out of the way - we might get our dream car from Detroit.

Get Your Dose of Optimism

In a media culture dominated by doom, gloom and scary music in the background, it's refreshing to hear a voice like Steve Conover's, of The Skeptical Optimist.  I check his economics blog regularly to find the  "good news" - and to gain a little education on the way the world really works. If you've been fear-mongered on topics like currency valuation and the national debt, and believe general "heading for financial hell in handbasket" rhetoric, you need to see the evidence Steve presents.

Do you have the right to work?

Imagine applying for a job at a major U.S. corporation – only to discover that a condition of your employment is that you join a union.

No big deal, right?

What if, however, you discover that not only will the union require a slice of your paycheck; it will also take that slice and fund groups and causes you strongly disagree with?  Your union dues, paid supposedly to protect you (the worker) from those nasty, evil employers (the people who give you your job) are being used to support politicians with which you morally disagree.

Can you opt out?

Attracting Jobs to the USA

We’ve all heard the story: John lost his job when the company moved south of the border; Sally's corporation outsourced her position to a partner in the Far East.

How can American companies can compete in the long-run, with higher labor costs and stricter environmental regulations than other countries, and with a tax code that penalizes success? It’s a fair question, even though, to date, the problem of job “loss” has been overblown. (Sure, jobs are “lost,” but they are just as quickly replaced by other types of jobs, in most cases. That’s why the “unemployment rate” has remained roughly the same for many years.)

However, for all the talk in the media about job “loss,” few solutions are set forward other than more government hand-holding for those who’ve lost a job – no one addresses the root issues (Why were the jobs were lost in the first place? Is it good or bad for the economy that this happened? What the best way to build and keep quality businesses?).

 

Even better than job loss prevention, Americans ought to be interested in quality job attraction. 

I have an idea: let’s lay out a welcome mat for businesses large and small at the doorstep of America.