In these pages on Dec. 24, Ms. Tamara Crane of Woodinville tried to make the point that many have been trying to make in our schools and media for a generation: that the economy is a zero-sum game, that in order for someone (“Wall Street” or “big corporations”) to win, someone else (the middle class and poor) has to lose.
This is a false argument, because in spite of our “poor economy,” real per capita gross domestic product over the past 35 years has more than doubled. In fact, her letter demonstrates the complete dearth of economics education that is prevalent in our society. Yes, people are hurting, yes businesses are closing, but the reasons are not that “corporations” are sitting on two trillion in assets. Corporations are not unreasoning, evil creatures. If they could make money on those assets by reinvesting in their business, or expanding, or hiring, they would do it immediately! But government has set the rules on fire!
Until this past week, no one, not big corporations or small businesses alike, knew what the tax rates were going to be for the next month, let alone next year. Regulations, taxes, health-care costs, employment costs and just about every conceivable input cost for a business has gone up or is going up and has significant amounts of uncertainty attached to it. This fact makes every board, every small business wary of investing in anything. They are all just trying to make it from this month to next, and those with significant assets are just trying to keep their options open for survival.
Remember, “big” corporations are really just you and me, the stockholders and the boards of directors. Their job, their goal is to make money for their shareholders. Is that so wrong? You would think so listening to the lame-stream media and folks like Ms. Crane! But where do you think jobs and the creation of wealth comes from? President Obama? The Fed? No, government does not, cannot, “create jobs.” Government can only take from one, and give to another, with waste in between; I for one think we have had far too much of that for these past decades. Only private industry, and American entrepreneurial spirit, can create jobs and improve this economy. The Soviet Union clearly demonstrated for 75 years that a centrally planned and overly regulated economy cannot sustain itself. Why would anyone think that particular history would not repeat in this country?
The reason that folks and businesses are hurting is that government has continued to take a greater and greater portion of capital out of the economy, and to pick winners and losers. We have a federal reserve that is running the printing presses on warp-speed, and is now monetizing our federal debt. We have government motors, government insurance, government hurricane cleanup, government oil spill prevention. How’s that nanny state workin’ for ya? Government is seen by many to be the answer to all of our problems! But truly we have a government that is operating so far outside the boundaries of what our Constitution allows, that our country is hurting because of it. Government should not pick winners or losers, government should get out of the American people’s way. And as far as safety nets, the American people continue to demonstrate that they are the most charitable, the most supportive of the needy, in history.
Ms. Crane, I would suggest that you stop engaging in the politics of resentment, and go out and try to start a business. Everyone should do this once or twice in their life, it is an unforgettable experience and education. You might also want to read the “The 5,000-Year Leap” by W. Cleon Skousen to understand what our real form of government should be and why our founders wrote our Constitution the way they did. You might learn something on both counts.
Michael Ochoa, Bothell
