It’s 2011, and you all know what that means. Time to dust off those pitchforks, light your torches, and batten down the hatches, because this election year is going to be a doozy. On September 22, 2011, Republican candidates answered Fox News/Google Debate questions, and boy was it an interesting night filled with, “Did he really just say what I think he said?” moments. I must admit, the spar over healthcare between Mitt Romney and Rick Perry was delightful to watch from the left side of the isle; like two first graders fighting over the last red crayon. There were too many topics to go after, so in light of keeping this simple to research, we’re going to start off at the very beginning.
Not even five minutes into the debate a small business owner from Orlando, FL. asked what the candidates would do to help grow small businesses. The question was first sent to Gov. Rick Perry who stated that, “…over the past decade, Rick Scott and I have competed everyday trying to get jobs into our state by lowering the states tax burden on all small business, and sweeping toward the 2003 reform we passed…”. 2003 to 2011, that’s quiet long enough for reform in a state to start making a difference right? So why are we, as a country and individual states, in a worse financial situation than 2003? Rick Perry makes it sound as if he did Texas a huge favor. Now let’s stop here for a second. This all boils down to the overwhelming agreement among the GOP that by helping big business, they will some how stimulate the economy. This is called pure, 100%, undeniable, laissez faire, a.k.a Capitalism at it’s finest, or worst if you ask me; and here is why I believe this:
When America was an agricultural state, and our currency was backed by gold and silver, Capitalism was the best infrastructure for the country. This I have no doubt of. If you got a job working for someone else and saved money, eventually you could start your own business — it’s the American dream! If you work hard at that, and are innovative you turn a profit which can be re-invested into your company. You open more stores, net even bigger gains, so on and so forth; the cycle repeats itself. It was possible, at that time, to go from rags to riches as it were. Why? Because communication was so limited, it was possible for many different companies to produce the same product in many different areas because, even if the company 1,500 miles away could make the product cheaper because they had larger production facilities, by the time they transported it to your area, the price was outrageous. And even if they could get it to your area cheaper, how the hell did you know about them? There were no TV commercials and advertisement was limited at best. Thus, if the small guy was innovative, and hard working, he could become rich. The distribution of wealth was fairly even, that is to say, the middle class was the majority of the people.
Now, because of internet, television, airplanes, trains, automobiles, telephones, and satellites; the U.S. farmers, for loose example, can produce and ship corn to Guatemala cheaper and more efficiently than the farmers who grow it three miles away! Why? because they have purchased the farms from the little guy, and created a conglomeration of farms, or they buy the corn from the little guy at such a discounted price they can still turn a huge profit, or, even worse; the government just pays the little guy not to grow corn. Yikes! You see, where there used to be thousands upon thousands of independent businesses supplying the country and world; now, there are thousands of businesses supplying the world, but those businesses are all owned by a very small amount of very large corporations. It is no longer possible to compete in the market. If you make something great, a big business will offer to buy it from you, if you refuse, they will simply create something similar, perhaps of lower quality (as not to break patent laws, assuming you can actually afford one) have it mass-produced in China, and set the price so low that it forces you out of the market. So one way, or another you are forced to work for someone else. Give me a C!- Give me a A!- Give me a P! Give me a — well, you know where I’m going with this.
Lastly, the federal reserve system. Yep. That scary seven letter word also known as ( dun! dun! dun! ) The Fed. A great example of how this is detrimental to our economy is the “mortgage crisis.” There is a great video called “Money As Debt” that explains why money has no real value, as I have already taken up enough space, I won’t get into it. But it is suffice to say that the dollar holds only the value that we, and the rest of the world, believe it holds. Another fact needed to understand the “crisis” is that banks can loan out nine times more money than they actually have on hand so, essentially, every time a bank gives a loan, it is creating, out of thin air about 85% of what it is loaning out. Are you thinking, “Hey! That’s not fair!”? Well, you’d be right. So, banks loan people money –People take the money and buy a house –These people can no longer afford their mortgage payments because of their variable(increasing) interest rates –The bank forecloses on the mortgage and gets the house and land. Yes, the bank is out a large portion of the money it loaned, however, the bank never had that money in the first place. It’s hard to miss something you never had; not to mention they write it off on their taxes (and get a nice huge check from the government to bail them out).
So what have we learned? To put this in perspective: The bank created money (that holds no real value anyway) gave it to people to buy a house, then the bank takes the house back. Money has no real value, that is to say, you can always make more of it, so the demand can always be quenched. Land however, will always hold value because there is a scarcity of it. So the banks essentially bought tons and tons of land for free.
Now, not only do big corporations own all the businesses, but now they own much of the land. In years to come, the dollar will be worthless, but the land that the banks “bought” with the dollar will still have value. Actually, since there will be many more people in the world, the value of the land will have increased greatly.
So, in the short run, Capitalism is a great way to make money by doing whatever you want. In the long run however, capitalism is nothing more than the transfer of wealth from the middle class to the upper class, or the elimination of the middle class over a period of time. What’s that called again when all the upper class owns the land, and the lower class is forced to work it for a fraction of the profit? Oh yeah! — Feudalism. Capitalism + innovation is nothing but a slow crawl toward feudalism. This being said, Capitalism shouldn’t be completely torn from the American economy. It’s evident in past civilizations that both pure Capitalism and pure Socialism is not the answer. It seems though, however, by using the best aspects of both economic systems, a country can gain prosperity. And as always I leave my readers with this simple fact: Put down the remotes and pick up a book!