By Douglas V. Gibbs
In the British mercantilist system of the 1700s the government granted monopolies to certain industries, effectively becoming a business partner of the favored companies, and sharing in a large portion of the profits. Certain parts of the industries were subsidized as well, for protection against foreign competition, making the government indispensable to local industries competing internationally. The British government gave away tax dollars to businesses, instituted protective tariffs and quotas, and dictated to the industries what their wages offered, and the profits earned, should be.
The founders of the United States felt that such a system would limit the growth of the American economy, and that instead the nation's markets should follow a more laissez-fair approach that was accompanied by a wise and frugal government that protected the lives and liberties of its citizens, while allowing the people to be free to earn a living without government interference.
Thomas Jefferson stated that "the sum of good government" was to leave men "free to regulate their own pursuits," which is a contrary opinion to today's liberal belief that we should have a government-directed economy. Today's leftists makes it clear that they believe Americans should not be left to their own pursuits without government regulation. When you break it down, in considering big government proposals, they are quite totalitarian in nature. The Left will not consent to policies that do not allow them to seize what they believe to be wrong, and impress upon the people their own judgement which they believe to be best.
The liberal Democrats are meddling interventionists that do not understand how goods and services can be sold in the marketplace without government somehow being in charge. They cannot fathom that individuals, pursuing their own self-interests, and motivated by the desire to improve their lives and the lives of their families, can work together without governmental guidance. The need to care for themselves and their families is sufficient incentive to spark entrepreneurship, and create economic prosperity. Government intervention only gets in the way, and stifles robust economic activity.
Liberty builds human cooperation and specialization, and a system that leads to a standard of living that to the peoples of other societies would seem unimaginable. To achieve such a prosperous condition the government must not be involved with planning any part of the economy. The federal government should only provide law and order, protection of property, protection of persons, national defense, and a generally stable society. Government's role, per the Constitution, is a limited and specific one, for a reason.
Politicians grow governments, and are self-interested in their power and the gold they can drop into their pockets. In turn, political self-interests are almost always at odds with the interests of the masses. When government becomes actively involved with economic planning, its regulations and restrictions stifle competition by granting special rights to certain, politically connected, industries. These entities are then granted monopoly rights by the government, while the same government prohibits foreign competition in order to protect local interests. This corrupt tactic is called mercantilism, and it benefits chosen businesses at the expense of the consumer who loses because of the elimination of true competition.
The British Empire's manufacturing industries, as well as elsewhere in Europe, originally developed without any government planning. As the government intervened, however, it invariably stifled industrialization.
Leftism has the foolish notion that government intervention in the form of regulations and tax-financed subsidies (or bail-outs) are necessary for manufacturing to develop, or in order to protect such businesses from failing (which is erroneously thought to be damaging to an economy). The idea that government intervention spurns growth is dubious, at best. Government bureaucrats have no way of knowing which industries will thrive and which will not. The government has no personal stake in the success or failure of the business entity, no care about the financial investment since, if they lose, they can always print more money to cover the loss.
Private industries, with good business decisions produces goods and services that please the consumer, and are rewarded with profits. Poor business decisions results in failed businesses that lead to heavy financial losses, and could lead to bankruptcy. No market feedback such as this exists for the government when they subsidize businesses. In fact, government subsidies prop up business failures (like AIG), keeping in existence failed corporations that feed like leeches on the taxpayer, while doing nothing to grow the economy. Government bureaucrats are not penalized for these poor decisions, however, and often are rewarded with bigger budgets so that they may use the taxpayer dollars to subsidize or bail out more businesses that would fail and no longer hurt the economy should they be left alone by the government.
These big government policies actually reduce the wealth of a nation, raising costs of production, and wasting resources while sucking from the taxpayer to the point of bringing the system to a point of collapse.
Failure seems to be a dirty word of the Left. They wish to provide subsidies so that businesses won't be afraid to fail, but taking chances is a part of what made this nation great. Business successfully competes against rivals, regardless of size, and the perceived "perfection" of their business model. Competition is a never ending process that dethrones the big corporations when a newcomer shows up with the next best thing, or the better idea. A capitalistic free market is a dynamic, rivalrous process of entrepreneurship, a never-ending struggle for profit by improving products and reducing price.
A move back in the direction of government subsidies, heavy government regulation, and a system that quells individual chance, is a move that would be taking us back into the direction of life under the British Empire. The American Economy has prospered for over two centuries precisely because the marketplace has functioned without government intervention.
An economy under the control of government is a system that is unable to grow. Without growth, interest rates rise, unemployment rates climb, and more people give up and wind up on the government dole.
The key to ending our economic downturn is less government involvement. The drive for less government must reverse their control of one-sixth of the economy through the Health Care legislation. The key to defeating the madness the Leftists offer is through state sovereignty. The states must stand united in rejecting the Health Care legislation, and all other attempts to expand the federal government and compromise state sovereignty. Only then can liberty return to prosperity, and government return to its limited role enumerated in to it in the U.S. Constitution.
-- Political Pistachio Conservative News and Commentary
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