Kindness is Not Good Economic Policy, Part Two

I just read quote by Mike Huckabee that was rather interesting.  To paraphrase, he said that the biggest threat to the Republican party is not liberalism, but libertarianism.  And though Huckabee’s a conservative Christian, he’s not the only one talking social libertarianism (decriminalizing drugs, legalizing prostitution, etc.), he’s also bewailing the economic approach of laissez-faire capitalism (or has he put it, those cold-hearted libertarians would strip health care from the elderly and kids).

Yes, I’m sure that’s exactly what libertarians want.  I’m sure they’re all out there waiting eagerly for the day they take power and can snatch prescription medication from the elderly.  Huckabee’s statement is the same attitude that is putrefying in Washington right now.  It’s the reasoning the politicians are using to justify the Wall Street bailout, their economic “stimulus” plans, and now this latest bailout of the auto industry.  They all say the same thing: “We don’t really think it’s fair to charge the American taxpayers to help out other American taxpayers, but we just have to do something or else people will lose their jobs, or not get health care, or not have a decent home, etc.”

Granted, Huckabee has been against the Wall Street bailout, but when he comes out with a statement like that, he’s definitely no presenting himself as a free-market capitalist.  The issue is not one of kindness or moral fortitude.  No one’s stating that some people don’t deserve health care because they can’t afford it.  Let’s use the word “deserve” correctly.  Everyone deserves to have health care, a decent home, and a college education for their kids.  But that doesn’t mean that a bloated government bureaucracy can give it to them effectively or efficiently, and it certainly doesn’t mean that government should give it to them by taking money that others have earned.

It’s not nice to allow thousands of people to lose their jobs.  When a libertarian says, “Good, if the business fails, it fails,” they’re not chortling with glee that people are losing their jobs.  If a business fails, more efficient ones will take its place.  Those out-of-work people can get better jobs, or start their own companies, or go back to school, or whatever.  Businesses fail all the time.  People lose all the time.  It’s called life.  It’s called reality.

What if Hooters gets in financial trouble?  Thousands of women with fake boobs and self-respect issues will be out of a job.  Would we see tears for them?  Or suppose the porn industry starts tanking.  We’re talking about a ten-billion-dollar a year industry here.  Tens of thousands of people left jobless.  Where would everyone be on this one?  Should we then give the porn industry a bailout to prevent all those sex workers from losing their jobs?

Kindness is Not a Good Economic Policy

This morning on the news I heard a guy arguing why General Motors should receive a multi-billion-dollar bailout from the government.  General Motors, as most people know, is tanking and probably going bankrupt unless the government steps in and helps.

I’m sure some people (including politicians) will make the case that if GM goes under, lots of people will be out of a job, so it’s imperative to prevent that from happening.  They’ll say great old companies like GM are the “backbone” of America’s manufacturing base, and if we lose that, we’ll really be in trouble.  They’ll give the same excuses they gave for that disgusting $700-billion Wall Street bailout:  It may smell dirty, but we must do it to help the economy from really going down.

Really?  If that was all they were concerned with, why did they tack on all the tax cuts and pork to the fucking thing?  McCain, Obama, Bush, and every single politician who signed that bill should be ashamed of themselves.

What’s funny to me now is that GM and everyone else is coming out of the woodwork asking for bailouts.  Why not?  It appears the government will hand out money to anyone who asks, anyone who can make a compelling case for why their particular business is necessary to keep the economy going.  And they all give the same excuse.  The guy from GM said it on TV: “They bailed out AIG, so why not us too?”  I hear people like Alan Colmes say similar things all the time: “The Republicans give bailouts and sign progressive tax bills – aren’t they guilty of socialism just like the Democrats?”

Disgusting.  They’re sniveling little weasels, all of them.  To quote Bill O’Reilly, you don’t justify bad behavior with more bad behavior.  Why can’t these people realize the fact that this bailout money is coming from the government?  Where do people think the government gets it money?  Do they think it runs a profitable little business on the side?  No, they get it from taxes.  They take the money from the American people.  If they use that money to “create” jobs, for more bureaucracy, or for bailouts, it’s a zero-sum game.  It comes from the people, and it goes back to other people.  This is not a stimulus for economic growth.

If GM goes out of business, a lot of people will lose their jobs.  Good. They’re better off not working for a shitty corporation that’s doing poorly.  Maybe they can go get a job at Toyota, Volkswagen, or Kia – corporations that are doing well.  This is America.  We don’t ask for handouts.  We don’t expect to be given anything but opportunity.  GM had its opportunity – decades and decades of it.  It got plenty of money from investors.  Now things have changed.  Oh well.

Why We Should be Proud of the Rich Getting Richer

Politicians (especially presidential nominees) are always promising to “make things fair for the working class Americans.”  Of course, rarely do things immediately and magically turn around after one of those politicians is elected.  Surprise, surprise.  Have working-class Americans ever noticed that they constitute most of America?  I mean, every politician has to appeal to them if they want votes.

Besides, I don’t mean to sound cold-hearted here, but is there something inherent in being a working-class American that requires help?  Are they at some sort of disadvantage?  Why?  Because the “rich are getting richer?”  So what?  Why do you care if the rich are getting richer?  If anything, shouldn’t you be proud that they’re investing and managing their money wisely?  Shouldn’t that inspire you?  Maybe you still don’t think it’s fair that some people have so much, but how does it help your position to complain about what someone else is doing?

I’m so tired of hearing people whine about America not being “fair,” and hearing politicians promise them that they’ll make it so.  Didn’t their parents ever tell them, when they were sniveling little children, that life isn’t fair?  That they’re going to have to work their asses off from adulthood on?  That sometimes they’re going to make bad choices and suffer the consequences?

Making things “fair” in American rings kind of hollow for me.  Don’t get me wrong – there should be fair opportunity for everyone, absolutely.  How about we start with tax cuts for everything?  Wouldn’t a flat tax be the very definition of “fair?”  How about we get rid of all government subsidies?  How about we let everyone compete in the free market equally?

But some Americans don’t want fair opportunity; they want their subjective idea of fairness enforced by legislature.  They think wealthy Americans should be taxed more heavily and have to follow different rules.  For some reason, they’ve decided that people should have the right to pursue success, wealth, and happiness – but only up to a certain arbitrary point chosen by them.  For some reason, they just don’t think it’s fair that others are earning a lot of money and they’re not.

I don’t think the definition of “fair” is to take other people’s money and redistribute it.  Furthermore, “fair” doesn’t seem like a very respectable goal to me.  Why settle for fair, when everyone can have the opportunity to go as far as they want?  These people have a rather defeatist view: Rather than attempt to elevate themselves, they want to lower others.

Why is it that people who complain about the wealth distribution in this country always think the solution is to steal from the prosperous, rather than urge everyone to become prosperous?  Do they have such low opinions of themselves and humanity in general?  Do they think these people they want to “help” are incapable of helping themselves?  How about none of us settle for being handed “fair” and instead strive to earn excellence?

How Obama Will Steal Your Money

Two things Obama has promised to do as president is rescind the Bush tax cuts and double the capital gains tax (from fifteen percent to around twenty-eight percent).  I am against both of these steps, so I’ve been informed that the Bush tax cuts and low capital gains tax are responsible for “decreasing revenue and the continuing plight of the poor.”

First of all, what “plight” are the poor in?  The poor in America are much better off than the poor in any other country on Earth.  The poor in America have a major problem with obesity.  The poor in America overwhelmingly have cable TV and cars.  Of course there are problems in America, but a host of starving, suffering poor is not one of them.  Free-market capitalism has lifted more people out of poverty than any method yet devised, and it is politicians like Obama (with their love of government intervention) who hinder this process.

Secondly, lower taxes for wealthy Americans are not causing the current economic troubles in this country.  The Bush tax cuts are not causing problems, but Bush spending certainly is.  I have no problem criticizing him for that.  Republicans are usually the same as Democrats when it comes to government spending (the Republicans just generally do it without raising taxes).  Even under Reagan, government spending skyrocketed.  Will we ever get a libertarian as president to save us?

Thirdly, raising capital gains taxes isn’t going to bring in more revenue.  You want evidence?  In 1986, the Tax Reform Act hiked the capital gains tax from 20% to 28%.  But surprise: Revenue from capital gains actually went down.  The year before the reform, the government collected $213 billion from capital gains taxes.  Five years later, it was down to $108 billion.  It sounds counterintuitive, but it’s true.  When capital gains taxes are raised, people simply avoid them by not earning capital gains.  Why does Obama think it will be any different now?

Fourthly, it’s an outright lie for people like Obama to claim that raising capital gains taxes only penalizes the rich Americans.  Not only does it affect the millions of middle-class Americans who invest in the stock market or sell their homes, it also reduces venture capital for small businesses.  Needless to say, this will not help the economy.  People are worried that Americans are investing in other counties instead of at home.  News flash, Senator Obama: If you raise capital gains taxes, you give investors an even greater reason to go overseas.  (And investing overseas isn’t necessarily evil anyway.)

Of course taxes are required.  The free market couldn’t operate if the government didn’t tax us and use the money for infrastructure, law and order, national defense, and so on.  But we don’t need the government for much more than that.  We certainly don’t need higher taxes to pay for the socialist dreams and bankrupting promises of pandering politicians.

Let’s all say this together:  Obama wants to transform America into a European social welfare state.  That’s the “change” he keeps talking about.  And I hate to admit it, but he’s almost certainly going to win.  There’s no reasoning with the hordes of people who are going to vote for him.  Is it still too presumptive to say that capitalism is dying?

Why We Should Pay for Our Own Health Care, Part II

I’ve been told that if Obama’s universal health care plan is implemented, the only thing that will change is who pays the bill.  While this is bad enough (I’ll get to why I think so in a minute), it’s simply not true.  The medical institutions may still be privately owned, but they wouldn’t have to compete for the business of those receiving health care benefits.  There won’t be scrutinizing consumers to demand lower prices anymore, just a bloated bureaucracy answering every problem with more money.  I’m sorry, but quite a lot changes in this nightmare scenario.

This is like saying that if a nation made the switch from private education to public education, the only thing that would change is who pays the bill.  Take one look at the shambles of the public education system in America, and you’ll see what happens to an industry that’s bogged down by government handouts and regulation.  If the government stepped in and mandated health care for everyone who couldn’t afford it, we’d see a similar result.  We know this because we’ve seen it time and again.  History makes a compelling case.

The only thing that would change is who pays the bill.  Of course, the “who” in this case is the American people, the taxpayers.  My question is, why should we?  I don’t mean to be a heartless bastard here, but why should I have to pay for a stranger’s medical bills?  This is a two-way street: I certainly don’t want someone else to be taxed to pay mymedical bills.  According to Obama, he even wants us to pay the medical bills of illegal immigrants!

Maybe I am a heartless bastard.  Here’s something else to reinforce that: Consider the hundreds of thousands of Americans who require health care every year because they spend their whole lives eating junk food, smoking, drinking, an not exercising.  These problems are massive for the poor who can’t afford health care, but they are problems created by bad choices.  Should hardworking people be forced to pay the medical bills of people who willingly and knowingly smoke, drink, and gorge themselves into hospitals?

Next, how about we pay for nutrition counselors, and diet pills, and personal trainers, and stop-smoking programs, and self-esteem seminars?  Remember Big Brother’s solution in Orwell’s 1984 that required citizens to exercise in front of the TV/camera every day?  Should we expect something like that from the Obama administration too?

What You Earn is Whatever You Can Get

I got into a discussion with someone a while back who was very earnest about the wage gap in this country and the plight of middle-class Americans.  His point was that a blue-collar worker toils at physical labor all day long for his entire life.  He does it knowing he’ll never be rich or live comfortably.  He does it to support a family.  He works hard, much harder than many people who make a lot more money and don’t deserve it (like actors and rock stars, for example). 

It was a matter of proportion.  He was arguing that a blue-collar laborer should be making more since he’s busting his ass, providing a useful service, and probably doing it for a nobler purpose.  Conversely, the entertainer is a millionaire only because of the whim of some fans, and doesn’t really work hard comparatively.  It wasn’t fair, he said, that people make so much money for frivolous reasons.

I shocked him by disagreeing.  I told him that I think that rich actors and rock stars earn every penny of their money. (How they might squander it later on is a separate issue).  I told him that I don’t think a man’s sweat and physical toil are the measure of what he earns.

Predictably, of course, he accused me of being a “rich white kid.”  Though it’s irrelevant to the point, I had to dispel that assumption by telling him that I grew up in trailer parks and low-income housing with a single parent, eating hot dogs and Hamburger Helper.  When I turned fourteen and got a job, I was never given a single thing again; not even clothes or school supplies.

People who think like this guy are always certain that some should be “earning” more money, and some are “making” more money than they’re earning.  But they’re not talking about what is earned here – they’re talking about what they think these people deserve.  They’re basing their opinion about what a person earns on how much they need.  A blue-collar laborer has a family to feed and barely makes ends meet – he might not even be able to pay for his kids to go to college.  Therefore, he should be earning more.

I was called callous and heartless when I told him that “deserve” is not the same thing as “earn.”

What you “earn” is simply this: the amount of money people are willing to pay for your good or service.  That’s it.  That’s the only rational way to determine it.  How else can the amount someone has earned be measured objectively?  You may think a blue-collar laborer deserves more for his service (and maybe he does), but stop and think for one moment what it would mean to legislate it:  It means you would have to force someone else to pay more for that service than they are otherwise willing to pay.  How is that fair?

What do you think would happen if people were awarded money based on what they need, rather than what they earn?  It’s called communism, and it’s horrible not simply because it’s a bogeyman word, but because it doesn’t work.  No one would have any reason to produce any good, provide any service, or work at all.  Think about it:  The harder you work, the more that’s taken away from you and given to others.  You are punished for achieving, and rewarded when you do nothing.  Guess which one people choose.

How much a person needs is not an indicator of how much they’ve earned.  This does not in any way suggest that we should ignore those in need.   It does, however, suggest that we should not take from those who earn – even if it’s to give to those who need.

Why We Should Pay For Our Own Health Care

After John McCain showed up on The O’Reilly Factor and talked about his plan for health care (giving people vouchers so the companies will be forced to compete and lower their prices), I was drawn into a discussion with a few guys.  They liked Obama’s plan:  The government simply pays for everyone’s health care.  One guy even told me that it’s “not fair that rich people get to have better health care than poor people.”

I was incredulous.  Let me get this straight:  Wealthy Americans are just trying to get the best health care their money can afford, and somehow they’re doing something wrong?

Rich people can afford better health care, just as they can afford better lawyers.  Maybe you don’t think it’s fair, but what’s the alternative?  Should the government force rich people to purchase health care from less competent doctors?  Make a law that one can’t spend over a certain arbitrary amount on health care?

No, here is what the people want:  They want the government to force the best doctors and pharmaceutical companies in the field to lower their prices so that everyone can afford them.  It sounds great, right?  Maybe if you don’t think about it any further.  You don’t need a degree in economics to know that if you do that, those doctors and pharmaceutical companies won’t be the “best” anymore.  The “best” will disappear because they’ll have no incentive to do any better than meeting a government baseline.

This guy told me that countries like Canada, Sweden, and even Iraq gives every citizen free health care, so the United States should be able to do it, as well.  In return, I asked him where the richest people in the world go when they need an operation.  Where does the best medication come from?  Where are the best hospitals?  Where are the best advances being made in the medical field?

“America” is the answer to those questions.  If a billionaire Saudi prince needs a dangerous operation, does he go to Sweden, Iraq, or Canada to get the best care his money can afford?  Of course not; the very notion is laughable.  He comes to America.  The free market is what drives success.  If doctors and pharmaceutical companies are forced to compete to survive, they’re forced to get better and more efficient – and more affordable.

I don’t much like this country’s fascination with cosmetic surgery, but it’s a prime example of the power of the free market.  Cosmetic surgery is continuously getting better, safer, more cutting edge, and more affordable.    The reason is that health insurance doesn’t pay for it; the government won’t give you money to make your tits bigger.  Those in the industry are forced to compete for your business, and you can shop around for the best deal.  As a result, cosmetic surgery is advancing like Moore’s Law is chasing it.

Why is it that the Democrats’ solution to any problem in America is at the cost of someone else?  Besides rescinding the Bush tax cuts to pay for his health care handouts, Barack Obama also wants to raise the capital gains tax.  Are the millions of Americans who invest in the stock market doing something wrong?  If not, why does he want to punish them?  Should they earn less so that others can be given more?  Democrats always say we should work together, that we have a social responsibility . . . what about the social responsibility to not consume more than you earn?  What about the social responsibility to not take the money that other people earn at the point of a gun, Senator Obama?

Why Americans Should Come To Their Senses About Barack Obama

I’ve been saying for months that I think Obama is going to be our next president.  I wish it weren’t so, but I don’t see how McCain can compete with the record turnouts of Democratic voters and the energy of Obama’s speeches.

I don’t get it.  People talk about how Obama is going to bring change, pull people together, and achieve bipartisan solutions.  How?  On what position can Barack Obama – arguably the most liberal senator in America – come to bipartisan terms with Republicans?  Where can he meet them halfway?  On nationalized healthcare?  On raising the capital gains and estate taxes?  On rigid gun control?  On surrendering in Iraq?  On more social entitlements?  On immigration reform?  On environmental standards?

How is President Obama going to get Republicans to work with him on these issues, considering his rather leftist views?  Oh, I get it.  He won’t have to – he’ll have a Democratic Congress to hand him whatever he wants.

Let’s forget all those questionable connections Obama has, or the fact that he renounced his church and former friends twenty years too late – and only because it was politically expedient.  How does he get away with doubling the capital gains tax?  I just had a discussion with a friend of mine.  Her working-class family (like many others) is currently investing for retirement.  Why is Obama going to punish them?  Honestly, how is it not penalization to make it more difficult for working-class families who invest in the stock market?  I thought Obama was trying to help families?

Another thing my friend was concerned about was the estate tax.  In Obama’s book The Audacity of Hope, he said he wanted to raise the estate tax or else much of America’s wealth will “end up in the hands of those who didn’t earn it.”

My friend was a little upset to hear a politician saying that her son didn’t deserve what she worked to give him.  Who wouldn’t be outraged at that?  Who the hell is Barack Obama to decide whether someone’s child deserves the money their parents want to leave them?  If our kids haven’t earned it, who has, Senator?  The poor?  What did they do to earn it, if we’re going to use your rationale?

I also remain unconvinced that pulling out of Iraq is the right thing to do, especially now that we appear to be making so much progress (the Sunni are fighting with us!).  A stable democracy in Iraq will keep America safe.  There’s a reason terrorist groups like Hamas would like to see Obama become president – they think he’d be softer on the war against Islamic terror.  Pulling out of Iraq can definitely qualify in that regard.  In January, I don’t want to wake up on Inauguration Day to the footage of thousands of Muslim fascists celebrating in the streets and shouting that they “defeated America.”

Saving face is not a trivial goal.  This isn’t about pride; it’s about practicality.  If you give in to an enemy who’s bent on destroying you, he doesn’t call it quits; he simply tries to go further next time.  They already think – perhaps even with a grain of truth – that while America’s military might is unparalleled, we don’t have the will to back it up for the long haul.  A show of strength saves lives and prevents more bloodshed.  Confrontations always involve a standoff to see who will back down first.  Barack Obama would have us back down first.  It’s foolhardy.

But hey, whatever.  Maybe I’m dead wrong.  Maybe pulling out of Iraq will somehow make the situation better with the Islamic fascists.  Maybe they’ll suddenly respect us.  Maybe raising taxes and taking away personal responsibility will make our economy stronger.  I want McCain to win, but since I don’t think he will, I’m rooting for Obama.  I genuinely hope he does well and things improve.  Wanting to see him fail is irrational; it’s like hoping that harm will befall America.

Robin Hood was a Thief – And a Democrat

I don’t understand why people continue to tell me that the wealthy should be taxed more than anyone else.  I got into a discussion the other day with a guy who thought I was literally crazy for suggesting that a baseball superstar making tens of millions a year should be taxed the same percentage as – yes, I know it’s practically blasphemy – a schoolteacher making under forty thousand a year.

In Barack Obama’s book The Audacity of Hope, he echoes Michael Moore and bewails the fact that CEOs of corporations make over two hundred times the salary of their employees.  Yeah, so what?  Why should you care?

In his book, Obama also points out dryly that the “wealthy in America have little to complain about” and goes on to give a laundry list of excessive luxury items on which they should not spend their money.  Maybe.  But Americans have a right to be as superficial and covetous as they want, Senator.  You don’t have to like people who buy gold-plated toilets, but that doesn’t give you – or Warren Buffet – the right to say that the government should require them to be any different.

How about this for a shocker:  The poor in America have little to complain about.  As we all know, “poor” in America means something quite different from “poor” in say, Ethiopia or Bangladesh.  In America, most people living below the poverty line still have homes to live in, cars to drive, and cable TV to watch.  The number-one health problem for poor Americans is obesity.  Obesity.  Think about that for a moment.

So many people have an emotional knee-jerk response to this issue.  “No fair!” they shriek.  “The average American works hard and tries to raise his or her family and they get shafted.”  Yes well, “average” Americans have the same opportunities as the richest men in America have.  Plenty of “average” Americans have made decisions that have led them to be highly successful.  Plenty of “average” Americans have become wealthy because of determination, innovation, entrepreneurship, and smart business and investing skills.  Maybe part of the problem is that so many people seem perfectly fine with labeling themselves “average.”

I’m not saying there aren’t problems in America, and I’m not saying that we should be heartless and unresponsive to these problems.  But why should the answer be to penalize people who are doing well?  Big corporations are making lots of money because they’re efficiently providing a good or service for people.  The CEOs of monster corporations are Americans, too; they have a right to run their business the way they want.  Why should they be forced to pay more of their money than anyone else?  Because they’re rich and therefore have an “obligation”?

Why?  They don’t owe you anything.  They didn’t wrong you or steal from you.  They had to make their money following the same rules that you follow.  The rich are getting richer?  So what?  Why do you care what other people do?  Stop whining.  Earn your own money instead of demanding that others give you theirs.

A big corporation just ran you out of business?  Tough.  Stop whining.  What, are you saying that big corporation didn’t have the right to try to do better than its competitors?  Isn’t that exactly what your business was trying to do?  This is what happens in competition.  You don’t have to be happy about it.  The world is a tough place.  But you didn’t get shafted; you simply lost.  Get over it and do better next time.