For the last few weeks, protesters have camped out in New York City to express their grievances with Wall Street. The complaints are somewhat familiar and to some extent, I can understand where they’re coming from. They are upset with what they see as government colluding with corporations for taxpayer-funded bailouts during very tough economics times.
The frustration with corporatism is understandable, libertarians and free market conservatives have expressed the same sentiment for years only to take a back seat to the idea that what’s “good for business” is good policy. But as we’ve come to learn, so-called “pro-business” policies aren’t always a good deal for taxpayers. And by that I mean that we truly want a level playing field, but not through excessive taxation or regulation. Rather, keeping government out of the business of picking winners and losers.
But some members of the nascent “Occupy Wall Street” have expressed demands (note that these demands are unofficial), which for all of their supposed distrust of government, these guys have a very utopian idea of what government should be — likely enough to make Karl Marx and Che Guevara proud. Nevermind that they would be economic suicide.
Among the suggested demands for the movement are (with my comments next to them):
Ayn Rand’s novel Atlas Shrugged regained a great deal of attention recently, what with the economic crisis looming and much of the rhetoric coming out of Washington matching the rhetoric uttered by Rand’s various villains. References to the 1957 novel have made their way onto talk radio, cable television, and Tea Party protests throughout the land. In the book, the great minds of the world go on strike, and even sort of compared to Atlas – who holds the world up on his shoulders – shrugging.
Unfortunately, it’s never going to happen.
In Rand’s book, all the minds share common ideals. They all believe they have a right to make whatever they make. They believed they’re entitled to the wealth they earned from the products of their own mind. They believed that their own self interest was sufficient cause for their actions.
Reality is another matter entirely. For the record, I’m a fan of the book. As I write this, I’m actually wearing a shirt with the first edition’s cover on it. I’ve read the book four times, and as anyone who’s read it can tell you, you do not read it four times unless you like the book. However, I can’t escape the fact that Atlas will never shrug.
The reason for that is that many of the minds, the people who make the things that make this nation run, are no different in their own ideologies from the James Taggarts and Wesley Mouchs of Rand’s imagination. Bill Gates is one of the most successful entrepreneurs of our day, and yet he leans left on most issues…and this is despite being hammered with antitrust violations in the past. Warren Buffett, the Oracle of Omaha, also tends to lean left on most issues.
The free market. Capitalism. Call it what you will. The truth is that people often don’t understand the difference between capitalism and what we currently have. They mistakenly call our current mixed economy capitalism, and they blame companies that try to stamp out competition as being capitalistic. They’re wrong.
Today, many companies spend a great deal of money on lobbyists that take their wish list to Congress. That wish list does occasionally call for relaxing of some regulations, but more often than not it calls of increases in regulation. Why? Because they like the idea of making in harder to enter the market and provide competition. Increase regulations also give them the benefit of possibly stamping out smaller competitors. That forces consumers to go to one of the big guys for their products.
This, my friends, is not capitalism in any way, shape, or form. It’s not. This is corporatism, plain and simple.
In capitalism, these regulations designed to stamp out the little guy wouldn’t exist. Would the little guy thrive? Maybe, maybe not. It would be up to that little guy to make it though. He (or she) would have to work hard, make good decisions, and convince his potential customers that they should be from his company. If all that comes together, then he’ll survive just fine. If not, well…it’s all on him.
Capitalism isn’t a pretty system, but it actually is the most fair. When progressives talk about fairness, they never consider capitalism as being just that. However, it really is. An open market, where each individual is free to determine their own destiny. If they want to start a company, there’s not a governmental body standing in the way trying to keep them from it. There’s nothing to it but their own determination and skill.
On Friday evening, a close friend and I filed to a local theater with about a 100 other movie-goers to catch the first of three installments of Atlas Shrugged on its opening night. We were both excited to see the movie, based on the book that is considered to be Ayn Rand’s magnum opus, but there was also skepticism because every fan of the book knows that this would not be an easy film to make.
There has been talk of trying to bring this very long, very in-depth novel to the Silver Screen for close to 40 years. Albert Ruddy, producer of The Godfather, approached Rand in 1972 about bringing the novel to life. Rand wanted final approval of the script, and because of this, Ruddy declined to proceed. Talk of turning Atlas Shrugged into a movie or miniseries would come and go throughout the several years. As recently as three years ago, it was reported that the movie was in the works, it would have a $70 million budget, and Angelina Jolie would play Dagny Taggart, the book’s heroine. In all too familiar fashion, it fell apart.
Capitalism gets a bad rap these days, as evidenced by Michael Moore’s documentary Capitalism: A Love Story. Like so many people though, Moore – and most of Hollywood – get it wrong. What they decry, greedy individuals exploiting others and using government regulations and rules as a shield isn’t capitalism in the least. That’s called corporatism, as evidenced in the video that Jason posted recently from Reason.tv.
Corporatism is defined as:
Today, corporatism or neo-corporatism is used in reference to tendencies in politics for legislators and administrations to be influenced or dominated by the interests of business enterprises (limited liability corporations).
Basically, corporatism is a system where corporations make the calls on laws. Some would argue that for capitalists, this is a good thing. Unfortunately for those folks, they don’t have a clue what they’re talking about.
We currently see in our government’s actions through things like bailouts for banks and the auto industry (though in all fairness, the auto bailout probably had more to do with politicians being beholden to the United Auto Workers than to GM and Chrysler). That wasn’t capitalism, contrary to what some people argue. Capitalism would have let the banking industry eat their own. Let AIG break up and be bought up by others who are more solvent. Let General Motors break up and be purchased by whoever wanted to own a car company. If no one did, then it’s time for the company to die. It sucks, but it’s the nature of the beast.
****Warning: Spoiler Alert! Part of this post may give away more information than you want to know if you have not yet seen Avatar****
Yesterday, I saw the new blockbuster movie Avatar. Already grossing over $1 billion in ticket sales globally (one of only four movies to do so), the massive investment of around $400 million seems to have paid off. What I want to talk about it the clear political themes that play out in the film, and how conservatives who attack the film are making fools of themselves.
The major concerns that conservatives have brought up about the film is that it attacks capitalism, the military, and pushes the environmental agenda. These claims are unfounded and show the folly in the thought process of such “conservatives.”
First of all this movie does not attack capitalism. In the movie the RDA corporation has set up a mining operation on the planet Pandora. They employ former marines for “protection.” The head of the mining operation has made it clear that he will stop at nothing to gain access to a rich mineral reserve directly under the home of the Na’vi people. They end up sending an all-out military assault which ends in the destruction of the “home tree.” This is hardly an attack on capitalism, if you understand what capitalism truly is.
Naturally a recurrent theme of this lecture was monetary policy, specifically having to do with the dollar’s spiral toward hyper-inflation in the midst of the current economic collapse. Schiff stressed that sooner than later the rest of the world, more importantly those still buying our debt would wise up to our inability to repay those fiscal obligations. He told a short story about a wily old man in a certain neighborhood who had hoodwinked the neighborhood kids into vying for the job of painting his fence. He related the metaphor by surmising, “We’ve got the world painting our fences, as if they don’t have their own fences to paint.” Essentially, he said the way it is now, we get all the stuff and they only get the jobs. He then fittingly asked, “What good are jobs without stuff?” In short, we are barreling straight toward a currency crisis.
Milton Friedman answers tough questions with well-reasoned answers, pointing out that many of the arguments against the free-enterprise system are based on questionable assumptions.
This is a great video follow up to the full-page ad CATO published listing hundreds of economists who don’t believe that a “stimulus package” is the best option for American taxpayers.
We all grew up hearing the story of the first Thanksgiving- the deprivation and starvation, the help of the native Americans and the bountiful harvest that marked the first Thanksgiving.
What we rarely hear about is the method of economy the Puritans employed upon reaching the new shore- socialism. They endeavored to share the work and the fruits of their labor, eschewing the principles of private property and the free-market.
And how well did this work? Their Governor Bradford in his own words-