Not-a-Lemming : capitalism

Mr. Obama, Don't Build That Wall!

FutbolGuru — Tue, 10 Nov 2009 14:44:00 GMT

This week we are celebrating the 20th Anniversary of one of the 20th Century's most shining moments - the Fall of the Berlin Wall. A barrier that represented far more than an edifice of concrete and steel. The Berlin Wall represented a rift across Europe and a major ideological divide between East and West. And as long as that wall remained, so loomed the specter of war. And when it fell, though it signaled the beginning of much work, it also spelled a major victory for the democracies of the West.

The Berlin Wall separated not just familes in a city but an entire nation. And as I mentioned in the preceeding paragraph, it also represented, in a much broader sense, an ideological gulf. A gulf in how cultures had decided to treat the human condition. The Soviets on the east side of that wall were led by the Russians and the philosophy of Marx which claimed it could elevate the common man to his rightful place in society while punishing the greed of the wealthy. In this philosophy the State was represented by the Communist Party which viewed human rights as secondary to the needs and aspirations of the State. In the Soviet Union humans were granted rights at the whim of the State.

Opposing this philosophy, The West, spearheaded by the United States, was armed with a much different view of human rights that was backed up by a unique Constitution. In America's Constitution it is the State that derives its power from the People and there is no sanctioned Party. The west, for the first time in history, viewed human rights as the center of our world view, codified in the precepts of freedom and liberty, and indeed superceding the wishes of the State. The State, in fact, was granted power from the people. These two governments had evolved along much different paths and by 1989 had arrived at vastly different places.

The Soviets, in their attempt to place the entire service and manufacturing sectors under the authority of their government in the hopes of being 'fair', had reached an unsustainable level of corruption and inefficiency. While their government promised retirement and health care to every citizen, both were services in name only. The fastest way to die in the Soviet Union was to check yourself into a state hospital - the only legitimate hospitals in the country. And pensioners had become paupers, living out their 'golden' years in crumbling tenements, entirely reliant on increasingly slim government subsidies. The only people with access to useful services were Communist Party members who used technically illegal private hospitals and doctors. And with their hands in the government coffer Party officials skimmed enough funds to fuel private Swiss accounts that ensured their golden years would indeed be golden.

In contrast, across the sea In America, hard work was being rewarded with stability and security. Wise investment resulted, over time, in net return. Those with the energy and tenacity to pursue the American dream nearly always found it. Sure, there was no free lunch, but Americans knew that a free lunch wasn't worth eating. There was, and remains, a poor class with little desire to work. And as a reward for their laziness they received little. Those putting in the time and energy were not punished for their achievements but rose to the middle and upper classes. Perks for fortitude were comfortable retirement, quality health care, and security. It was understood by many and for the most part, backed up by laws, that if you didn't work, you were going to pay the price. The result was a vibrant growing nation whose philosophy spread to the far corners of the globe and elevated those nations it touched with booming economies and strong middle classes.

And those behind the wall could only look across and dream. Little did they know that their dreams would soon become reality, and with the fall of the Wall in 1989 their own economies exploded. Nations like Poland, Germany (East), Hungary, The Czech Republic, and others have experienced unprecedented growth and affluence in the last 20 years. Sure, their people don't have the promise of free retirement and health care, but at least they now have the opportunity to pursue these goals since the promise was never anything more than a cruel lie. The fall of that Wall, more than any other event in history, proves the wisdom of the Founding Fathers and their vision of limited government.

So why, 20 years later, is the United States, brick by brick, rebuilding that Wall? The ideologies of the East proved the greatest social failure of all time. Never had so many people been so oppressed and deprived for so long, relative to their neighbors, throughout all of recorded history! And the very country that paved the way for the destruction of that heinous barrier is now adopting the ideologies that smothered those trapped behind it. If anything proves that health care, retirement, manufacturing, banking, and economic planning have no business in government, the Berlin Wall is it. Yet the United States, after spending trillions of dollars to first halt the expansion of that Wall, and then ultimately see its destruction, is step by irrevocable step, taking over health care, retirement, manufacturing, banking, and economic planning! We are building that Wall. And the two major political parties, neither of which is endorsed in our Constitution, are making it happen. The Democrats (aided by their willing accomplices in the media) through direct action and the Republicans (aided by their willing accomplices in the upper class) through direct inaction. And once that Wall is in place, as the one in Berlin showed us, it is incredibly difficult to dismantle and often comes at great pain and only after generations of oppression.

Will we as Americans be the next generation of oppressors? Will we make the Soviet mistake even while those crushed by that terror, and those who corrected it are still alive? Many of whom are still in power? Will we doom ten generations of Americans to misery and corruption? Or is the mass suicide of the lemmings unavoidable? Lemmings, lacking a written word, a spoken language, and a culture, can be forgiven for their gullibility. Even if a lemming manages to survive being herded over a cliff by an overeager film maker, it can't warn its kin of the danger the next time around. But humans. Humans have no excuse. And should we decide to codify this path in law, not even our children - much less history - will remember us kindly. "You had a golden age and you threw it away." That's not me. Is it you?

Futbol Guru - www.not-a-lemming.com

"Any man who will trade liberty for security deserves neither." - Benjamin Franklin

Changing Perspectives: Conclusion

FutbolGuru — Mon, 23 Feb 2009 16:42:00 GMT

We tend to forget that government, politics, and economics are not the same thing. The word politics and the phrase political party don’t even occur in the U.S. Constitution or the Bill of Rights. Nor is the word economy even implied in either of these documents. In fact, George Washington, the founder of our nation warned strongly against political parties and said little if anything about economics. Government are the structures by which a society is administered, how it’s laws are made, enforced, and adjudicated, and how officials are installed and removed from office. Politics is the way that groups of people leverage their numbers to wield authority and shape policy. And economics refers to a system by which goods and services are created, traded, and disseminated throughout a society. Naturally these structures are inter-related in how they are manifest and some are more tightly coupled than others but they are not equivalent to one another.

Capitalism is an economic structure based upon leveraging capital to increase its value. It is not related to either a representative form of government or the political parties which vie for control of a government. Nor is it directly related to the concepts of freedom and liberty. In an ideal system capital is invested in an enterprise with the result being an increase in value of that enterprise beyond the sum of the original value plus the investment. For instance, upgrading an assembly process might allow a manufacturer to produce more of a product at a higher quality than before so that more of the product can be sold. Profits rise and value increases. Its only relationship to freedom is the concept that the money belongs to the owners and investors so the profits belong to the owners and investors.

Free market capitalism is perhaps the simplest, most basic and pure economic system with its natural checks and balances based on supply and demand. That, however, doesn’t mean that it can exist under any set of conditions. Indeed, capitalism, like any other system, requires the right conditions to thrive and always walks a fine line between sliding into either feudalism on one side and fascism on the other. As soon as business owners and investors begin to view themselves as isolated systems there is a danger that feudalism will arise. On the other hand, when a free-market capitalist economy stumbles, the first response is often protectionism and government bailouts which can quickly lead to fascism. Either way the result is the same, a rapidly shrinking middle class and the disappearance of avenues from the lower to the upper class.

For market capitalism to thrive there must first be capital, resources, and a market. If there is no money, nothing to invest in, and no consumers there is no value. But these basic conditions are not the whole story. Simply investing capital and reaping rewards is no different than Pharaoh’s use of corvee labor or southern plantation owners prior to the Civil War. That was capitalism, too, but here in the West we generally consider it a bad form of capitalism because over thousands of years great men and women realized, and often died, for the idea that humans should be treated better than animals. And that is backed up in our Constitution, the Bill of Rights, the Declaration of Independence, and the writings of the founding fathers. What they realized is that there is a form of capitalism that can benefit everyone. A limited form of capitalism that lets the benefits of technology and the struggles of man to be shared by all who are willing to participate.

So how is this capitalism different than pure capitalism? Most importantly it recognizes that business concerns are not isolated systems but are part of a larger community. Not the community of businesses, but the community of employees, citizens, and states. After all, without employees, consumers, and a stable government, any kind of enterprise becomes extremely risky. When a rising tide lifts all boats those without boats drown. Community-based capitalism means that those with the largest boats throw life rings to those without. It is of course the job of the swimmers to grab take the life ring, but without this act, capitalism becomes feudalism. When the acquisition of personal wealth (aka, greed) becomes the principle occupation of a business owner or a group of investors, flowing success down to the masses is the first thing to be cut, people start drowning, and the system fails. And in the end, leaving government to throw the life lines only makes things worse.

Community-based capitalism also requires the people engaging in business transactions to follow a basic code of ethics and honesty. Investing is founded on agreements. When agreements cease to be honored in both word and spirit, mistrust and animosity are the natural result. When an investment is made a product is the natural expectation, whether that product is a good, a service, or even some kind of financial instrument. When no product is received, and no product was ever planned on the part of the business owner, or the product was so risky as to have been misrepresented, the system fails. When this happens investors become cautious and owners become protectionist. While those at the bottom of the system feel this failure most immediately, it nevertheless affects everyone and the economy stops growing.

There are other conditions necessary for capitalism to thrive but arguably none is more important than the concept of reward. It is deeply ingrained in our psyche that hard work and honest ambition should be met with increasing success; the rising tide. While this can’t be guaranteed, a boat with a hole in it is no good at all. Most people start with little or nothing. The only way they can move forward is through help from others, whether that help is direct investment or simply being given a chance. This isn’t charity to the poor. This is recognition of talent and ambition and a helping hand to realize potentials. New blood is the life blood of any enterprise. That is why America has stayed so innovative, the constant arrival of literal, new blood. It is just as true in business. True innovation almost always comes from the outside, because attacking problems in a unique way almost always comes from a different kind of thinking. Not everyone is ambitious and innovative, and most people realize when they aren’t, but for those who are, they must receive the help they need to succeed or they will simply stop trying at some point and a key driver of community-based capitalism is lost.

We’re a capitalist nation but we tried to be different. And for a long time we were. I’m not so foolish or idealistic as to believe that prior to 1950 American business was kind, charitable, and generous. However it is incontestable that the spirit of community that once pervaded this land is gone, or is only a faint glimmer of what it was. When someone starts an enterprise it is always hoped that riches will be the result, and this is natural, but should riches be the only desire? The idea of building something of lasting value that also serves the larger community seems to be gone to have been replaced by building a business as fast as possible, selling it for as much as possible, and moving to the beach. Not only does this mindset ignore the hard work of the employees who also built the business, the government that kept the economy stable while the business was growing, but most importantly it minimizes the many relationships formed over years of hard work – which often have no relationship to the business itself. Because when you move to the beach your friends don’t usually move with you, though they probably helped you along the way if only for emotional support. Undoubtedly the high divorce rate in America stems from this same phenomenon; if a relationship isn't profitable, it is cast aside with no more thought than a book that failed to deliver as hoped. And since this has been the plan all along - acquire, cash in, unplug - what does it say about the value of relationship and community? When greed is the only metric, money is the only thing that matters, and that is a very good way to describe relationships in modern America; money is the only thing that matters.

When money is the only thing that matters, honesty and ethics are nothing but inconvenient liabilities. As long as things are done legally – which generally means that the contract was written by a very slick lawyer – a business owner can retire with a ‘clean’ conscience. No matter that the financial system of the entire nation has been destroyed and countless boats have been torpedoed, no matter that untold resources have been sucked from a community, the beach house, college for kids, and vacations are secure. The elimination of greed and dishonesty as vices, and the elevation of them to a twisted virtue, has done more damage to this nation than any other single thing. Whether it is toxic mortgage assets, cashing out and pulling out, or driving the automotive market with unsustainable products, greed and dishonesty have crippled this nation. The only thing more damaging is that those responsible have been allowed to keep their winnings only making them, and their practices, all the more enviable.

So why should I, or anyone else who is ambitious and innovative, work hard for a reward? There was a time when nepotism was looked down upon. It happens sure, and it’s only natural to want to leave something for the family. But when that legacy eliminates the just-as-natural cycle of hard work and reward, innovation will pay the price. But cashing in and pulling out can’t happen as fast when there are other boats in the picture. Far easier to make the anchor chain of others so short that their boats flood and sink. After all it is very easy to say that, “Success isn’t a guarantee,” and wash one’s hands of the matter. And this problem is only exacerbated by those who’ve enjoyed their success through dishonesty or cronyism. Those who’ve cheated are not generally disposed to helping others, and those who’ve been granted their lordship have no empathy for those still struggling. In fact, they usually feel they’ve lifted themselves by their own bootstraps and advise others to do the same.

Dwindling access to resources. Wealth hoarding. Lack of community. Dishonest and unethical behavior. More work for ever less or no reward. The failure to punish those responsible for fraud and waste. Toxic politics. Corrupt government. Public money used to sustain the dying enterprises of swindlers. Nepotism and cronyism. Hedonism. Materialism. Selfishness. Paranoia. Relationship abandonment. The conclusion is only too obvious. The conditions for healthy capitalism no longer exist in America.

To be, or not to be... In Touch With Reality

FutbolGuru — Mon, 09 Feb 2009 17:02:00 GMT

One of the selling points of Mr. Obama as leader of the ‘free’ world was that he was/is in touch with reality. By this, of course, it is meant that his struggles have been similar to ours so he shares our values, ideals, and sensibilities. Naturally we assume this about him because he did not grow up the privileged son of a wealthy, decorated, World War II pilot. Or the son of an Admiral. He wasn’t a movie-star. He hadn’t been in elected office his entire professional life. The spoon in President Obama’s mouth was not silver but more like the spoons in our own humble mouths; stainless steel or plastic.

But is this assumption valid? For one thing there are many examples of people who came from humble beginnings only to have their world view twisted into something very different from that held by the common man. The easiest example of course has to be Bill Gates. He rose from nothing to become the wealthiest man in the world, and while his philanthropic efforts are laudable, a cursory look at his lifestyle leaves little doubt that he shares few sensibilities with you or I. Another excellent example is nearly every actor in Hollywood. The majority came from humble beginnings but it is far more difficult to find those with feet on the ground than their colleagues who’ve left planet Earth. Of course there are also examples of people who rise far above their origins yet retain their pragmatic view of life. Sam Walton comes to mind, who throughout his life continued to dress as he always had, drove pickup trucks, and visited his stores incognito. Doubtless he enjoyed his wealth and deservedly so, but those how knew him well always maintained that he was respectful and understanding of the average citizen. We all know examples from each group. We hold those in the former in disdain, and those in the latter in high regard.

Now back to Mr. Obama. It was difficult not to be swayed by the notion that his humble beginnings, which were played at length during the campaign, provided him with a world view consistent with prudence, frugality, and pragmatism. In other words, he wasn’t going to be irresponsible and wasteful and would try to reign in those who were. But I’m beginning to wonder if I may have missed the mark, or even been lied to. While Mr. Obama talked a lot about being in touch with reality, his actions since taking office speak a very different language. Most notably his decision to limit the bonuses paid to executives of failing banks.

Mr. Obama has proposed to limit the bonuses paid to executives of failing banks to $500,000. A half-million dollars. Let’s get this straight. These executives work for FAILING BANKS. They drove their business into the ground through greed and took your money with them. It got so bad in fact that they came to the government and begged – BEGGED – for more money. Your money. And for that we’re going to limit their bonus to $500,000? So last year the executive got $1,200,000 and $500,000 is a punishment? And Mr. Obama claims to be in touch with reality? What reality does he claim to be in touch with, because that decision doesn’t exist in my world view.

A half-million dollars. $500,000. How many of us could eliminate our lifetime debt, have money left over for college for our kids, and still knock ten years off our retirement age with $500,000? I’m talking mortgage, cars, credit, everything, wiped clean, and still not have to work for two or three years. Money is time. How much of your life is $500,000 worth. And that’s what he’s limiting as bonuses to failed executives? On top of their base, six-figure pay?

Perhaps it is just because $500,000 is so much less than $750,000,000,000 that he thought it would be okay. Or that it wouldn’t matter. Or that we wouldn’t notice. But this isn’t a matter of degree. The Nazis murdered 6,000,000 Jews during World War II. Does that mean we’re not supposed to prosecute people who only murder one person? What these executives deserve is to be fired, like would happen to you or I if we failed even far less spectacularly. What they should do, if they had a shred of honor and decency, is volunteer to work for free until the problem they created is fixed. Then maybe they can start drawing an hourly wage like the rest of us. But for some reason they, and our politicians, think they are entitled to a standard of living far above our own. And the most amazing thing about it all is that they’re using our money to get it! When they say this, what they really mean is, our lives aren’t important when it come to their standard of living. Feudalism.

In touch with reality. I think he needs a reality check.

-Futbol Guru, http://mises.org/community/blogs/not-a-lemming

The Return of Feudalism

FutbolGuru — Fri, 06 Feb 2009 16:09:00 GMT

They say things come to you in the shower. That doesn’t usually happen with me. More often, during the act of climbing into bed. Then I have to get up and write the idea down, for experience has taught me if I don’t write it down, no matter how Earth-shattering the thought, it will be gone the next morning. But this morning while I was shaving a light bulb went off.

There used to be something called a ‘Retirement Plan.’ You’d go to work for a company and they would begin a retirement plan. Basically they’d put a little money aside each month and when you were old and gray, they’d start siphoning it back to you. It would come agonizingly slow but at least it was there. Sort of like serfdom in the old Feudal systems of Europe. In exchange for work, the Lord provides care and protection.

But retirement plans became expensive. And people clamored about not having any personal control over ‘their’ money. Companies took the opportunity to eliminate the costly retirement plans in favor of giving executives larger bonuses. But our government, always looking out for the little guy, said there had to be something for the workers. (They must have known even then that Social Security wasn’t going to be there.) So they came up with the 401K. You have the option to place a portion of your income, pre-tax, into an investment vehicle over which you have ‘control.’ Some companies even put money in there for you. How nice. It can then grow with the market. Sounds good on paper. Or does it?

Think about what’s actually going on here. The portion of 401K provided by your employer isn’t a gift. It is money that could have just as well come to you in the form of compensation. Sort of like FICA which the government takes for your retirement plan. You pay 7.5% and your employer picks up the other 7.5%. Of course they don’t ‘pick it up.’ They pull it out of funds you earned for a total of 15%. So 15% of your income goes to FICA retirement. Then your company, or you, puts some money into your 401K, in my case 15% for your, uh, retirement. That’s 30% of my income for retirement. Keep in mind that all this cash is flowing monthly into the stock market, continuously, like a river. Even now.

I can’t get to any of this - my - money right now. The Social Security System has no ‘fund’ so there’s nothing there to get. And my 401K isn’t available until I’m too old to use it. I can take it out but I pay a huge penalty, close to half. So it isn’t available to use in my productive life for things like, starting a business, paying for college, or stimulating the economy. So while you can’t use your money to grow your life, there are others who can use your money to grow their lives. This may seem like swindling, but this system was set up by laws.

Yes, you heard me right. While your income isn’t available to you, it is made available to other private citizens in a process protected by U.S. law. Consider the following argument.

Keeping your 401K in a ‘safe’ money market account produces virtually no growth so isn’t a viable retirement plan. So you move it into mutual funds. Mutual funds then make the money available to companies to use as investment capital through the purchase of stocks. These mutual funds are administered by investment banks and other institutions which, as we have all seen, almost without exception, pay their executives ridiculously huge bonuses even though they lost all the money you had been forced to put aside for retirement. So while the money your earned can’t do you any good, it supports a lavish lifestyle for others.

That’s bad enough, but there’s an even more chilling revelation hidden in this web of deceit. One of the strongest arguments against socialism is always the exorbitantly high taxes needed to pay for social services. On the order of forty to fifty percent in some countries. But we’re already paying upwards of 30% for retirement alone! Add income tax and that jumps to 45%. Health care comes out of our checks too, which easily pushes the rate to 50%. State and local taxes drive it north of 60%. In California it’s more like 70%.

Friends, we’re socialist already. But it gets worse. Far worse, because for most of us, there are no social services to be had! The hallmark of the socialist state – the safety net – is missing. While other socialist countries provide retirement and health care – even if it isn’t the best – the middle class in this country has neither. Social Security is insolvent and our 401K’s are worthless. Health care is only available while you’re working. So while we’re socialist, we’re not. We have the high taxes, but not the services. Where did the money go? I hear some Wall Street execs took home in excess of 2 billion dollars in compensation last year.

In fact, we’ve come full circle. We’re back to feudalism. Bad feudalism. In a good feudal relationship, the Lord expected work but provided protection. As long as he wasn’t a cruel, greedy bastard, the system worked surprisingly well. When he was a cruel, greedy bastard the Lord rolled in lavish excess, stopped providing protection, yet demanded the serfs continue to work. The serfs starved and complained but the Lords had lost the fundamental human element of compassion so simply shut the gates on their castles.

The question is, what are we going to do about it? America isn’t feudal Europe. In feudal Europe the people had no rights and the wealthy class had no accountability. We still have rights and there is still accountability. For now. But for how much longer? Those in power have already shown their disdain for good government and good business in favor of hoarding wealth and land. They passed laws which made your money available to them and not to you. They know they have swindled us and that we’ve done nothing about it. When people behave badly without consequence they grow only more bold. Why should they not feel that they are fundamentally entitled just because the masses are still restrained by the concepts of law and ethics? Concepts which they have found to be inconvenient or never had in the first place. Will they win in their latest ruse to increase their fortunes by asking us to buy things we don’t need, made in a country not ours, to ‘jumpstart’ the economy and get money they don’t need flowing back into their coffers?

I’m not a fan of socialism, but it is better than what we have now. And unless we the people take back not only our government, but our economy, we’ll wind up with even less. What is that going to take? There are those who say that the Tree of Liberty requires blood and sometimes they are right. But it hasn’t gone that far yet. Not even close. And in fact, the solution is much simpler, won’t cost a thing, and would actually save us money.

All that in between lifting the razor to my face and pulling it down my cheek. I guess you can have a thought in the shower.

-Futbol Guru, http://mises.org/community/blogs/not-a-lemming

I'm Not One of Those

FutbolGuru — Fri, 02 Jan 2009 03:17:00 GMT

It has become unfashionable in some circles to speak out against the rich. Of course it is a hobby on the left, and it is not at all uncommon for a wealthy congressman or actor to rail against excess, such as former South Carolina Senator Ernest Hollings’, famous statement that, “There’s too much consumin’ goin’ on.” Whether he’s right or wrong, his statement smacks of pandering, and for the most part middle-class Americans have been conditioned against openly criticizing the rich. We are free in this country and part of being free is the freedom to make tons of money and live the way we want. Who’s business is it to question how much money another person makes, even if it rises into the billions betting against our own economy and helping raise oil prices? In fact, speaking out against the rich is generally considered a sign of envy or jealousy and the speaker is often cast as less ambitious/intelligent/or otherwise lucky as the one he’s attacking. Across a large segment of society it has become un-American to speak out against wealth. It is even labeled as communist or socialist.

But it is exactly what I’ve been doing on Not-a-Lemming. Especially in my previous post. And I’m no communist or socialist. Most people who know me would call me a conservative. So how can I claim to be a conservative while at the same time bashing the rich in the land of rugged individualism? Can a conservative do that? And please don’t confuse the term ‘Conservative’ with the party ‘Republican’ or the orientation, ‘Right’. They are not now, nor have they ever been congruent even if their intersection is not the empty set. I can do it because I’m not bashing the rich. I am a staunch capitalist and am strongly in favor of innovation and the entrepreneurial spirit.

I got an iPod shuffle for Christmas. Actually I bought it for myself when I was shopping for my kids. It is one of the most amazing little devices I’ve ever seen. I’m no technophobe and have been aware of, and owned, iPods since their inception. But I remember a world before iPods. A world of transistor radios that rarely worked and clunky cassette and CD Walkmans that chewed through batteries like a teenage druggy burning through an inheritance. I now have a tiny device just a little larger than a postage stamp that can deliver hours of crystal clear music. That is innovation! That is legitimate wealth. Kudos to you Mr. Jobs. Live however you like. You’ve earned it, sir. And you’ve given back.

On the other hand, I live in a town supported primarily by government money. If our spigot ever dries up, this place with shrivel like lettuce in Palm Springs. A lot of people in this town start businesses, grow them, sell them, and get rich. Then they walk around with their heads in the air, literally, and puff about their innovation, sacrifice, and entrepreneurial skill. Except they built their businesses entirely on government money. Sure there were some long days writing proposals for government contracts, but for the most part their was no real personal investment, and the seed product of the business was almost always taken (some say stolen) from a competing company when the new business owner quit and took it with him. And these business owners invariably feel they earned it entirely through their own hard work and rarely give any of it back. Choosing rather to spend their windfall of fancy cars, second homes, and glitzy vacations.

Now Mr. Jobs has a pretty nice home, and I’ll wager that he’s got some nice cars too. And maybe even vacations from time to time, but there is a fundamental difference between what he does, and what these tax-suckers do. And now we’ve taken it to an entirely different level. A level which makes government contractors look like Mother Teresa. I’ll say it again as I’ve said it before, $750,000,000,000. And who acted like we were obligated to give it to them? Banks! Banks that took trillions (that’s $1e12 for you geeks out there) of investor money and evaporated it on bad loans in get-rich-quick schemes. They literally held the international monetary system hostage when they adopted an attitude that said, “Okay, don’t give it to us and see what happens.” How dare those bastards! And after losing our money!

This isn’t capitalism. It’s bad socialism. Perhaps even closer to Hitler’s fascism where the government propped up major industries to keep the war going. Yes, it is banks getting the money, but what about the executives that got them into that position? The failed executives. Did they give back their six-figure+ bonuses? Did they lose their mansions and second homes and personal bank accounts? Did their children have to drop out of the Ivy League schools they are attending? Will they be going on vacation this summer? Are their garages still filled with Mercedes and BMWs? Are their pension plans empty?

These people remained rich, and that is wrong. It is wrong because I’m NOT a communist. It is wrong because I’m NOT a socialist. In Soviet Russia party members became fabulously wealthy by diverting public rubles to their own accounts. All it required was a law. In socialist nations, the upper-class administrates public concerns which pay their salary out of the till. The same people who happen to run the government. And now that is America, too. I'm not saying they aren't entitled to it if they have worked for it. I'm just saying they aren't entitled to 14% of the GNP if they haven't worked for it. Especially after it was their poor management and lack of fiscal responsibility that got us into this mess in the first place.

Furthermore, I can think of no greater depressing effect on innovation and entrepreneurship than the bank bailout and the likely auto bailout. It has gazed straight into the eyes of the middle class and said, “fuck you.” I don’t apologize for the expletive. Expletives have their place, and this is it. This isn’t railing against the rich. This is railing against thievery. This is railing against communism and socialism at its worst. What incentive do I have to continue working night after night on actual products I hope to one day sell to actual people, when those who have figured out how to put their hand in the public till and pull out a dollar seem to have such a higher success rate? America was the land of innovation because innovation was rewarded. But how much longer will that be true in this climate? Especially when it is noted that those who actually earned money are far more willing to capitalize others than those who stole it. As the ratio of earners to thieves tips ever more in favor of the thieves, who for some reason feel they deserve their privileged lifestyle, actual seed money will become less, and less available. Innovators will leave for other places with fewer regulation and more favorable populations, and America’s monopoly on innovation will wither.

It is already happening. Europe, as it emerges from the effects of two world wars is gaining momentum. China, momentarily set back by the economic downturn, will regain her feet. And America, with capitol tied up in the hands of thieves, will seem increasingly less attractive to the talented and ambitious. It’s happened before.

So I reject any and all assertions that I am un-American, or communist, or socialist, or even jealous. I am a capitalist American who believes in fair play, equality of opportunity, and reward for innovation. You want to find a communist, go to an investment bank. He’ll be hiding in the closet under a pile of taxpayer money.

Next: Partners in Crime

-Futbol Guru, http://mises.org/Community/blogs/not-a-lemming