Alan Jewell is a grain farmer in Southwest Wisconsin. He has been honored four times as having one of the best-managed farms in the United States. Alan works with producers and processors, specializing in marketing and hedging their production. He is a featured speaker at many events involving the Agriculture community. He can be reached at 608.935.2596 and [email protected] This e-mail address is being protected from spambots. You need JavaScript enabled to view it . Past articles can be found at http://www.farmandlivestockdirectory.com/columns.html
“The problem of socialism is socialism. The trouble with capitalism is capitalists,” which is the approximate quote of the ex-communist editor of The Freeman, Willi Schlamm. Mr. Schlamm, after overcoming the naïveté of his youth, later helped launch William F. Buckley’s National Review. The National Review’s launch in 1955 was an attempt to bring an intellectually conservative perspective to the prevailing liberal political discourse of that day.
Schlamm and Buckley are no longer with us, but the core of Schlamm’s observation still rings a clear truth today. Over the last 20 years or so, we have seen the hard socialistic societies of Soviet Russia and Red China allow much of their underground economies to emerge and lead their transitional hybrid economies forward. It is the capitalistic economic engine within those societies that is bringing a new and larger middle class to those countries where previously only the elite of the governing class enjoyed the rewards from the working man.
There are a few very basic human expressions that are hard wired into every person and society that have walked the face of the earth. Most everyone cares more about themselves and their immediate family more than the guy over the far hill. Most of us care more about the profit we are able to keep rather than worrying about our neighbor’s ability to keep a profit. Most of us know we can manage our own lives, our dreams, and our opportunities much better than some faceless bureaucrat issuing questionable commandments from afar.
That is the core of capitalism. It is not some remote theory that some long whiskered philosopher devised in a lost bygone era, but it is simply the acknowledgement that we can live life to our fullest by following some commonsense rules. These rules live inside most every person since the beginning of time.
Most people want to get ahead and most people want their children to have a better life than what they or their parents had. In every society people will try to game the system, if they can, so that they and their children, can live a better life. In a capitalistic system people work harder at their jobs to achieve those goals, while in a socialistic society, black markets run just underground or alongside to allow goods and services to come to normal working people that would not be otherwise available.
In societies ruled by bureaucrats or kings, corruption is the main method of getting your kids into the best schools, or gives your family the best house, or gets you the best car. In a capitalistic society, producing a needed product will provide you with those same opportunities. In a capitalistic society we create opportunity, in a socialistic society we create a cancerous fatty growth that layers on an extra burden of unfairness and inefficiency to carry forward by an advancing society.
That is not to say that all is well in a capitalistic society that is marbled with the fat of socialism within its economic muscle. That is why in President Obama’s health bill, leftists and labor unions required they would get preferential treatments paid for by the common man or why Warren Buffett, a very successful left-leaning businessman is currently lobbying congress to exempt him from the greater regulatory rules that apply to the rest of us. That is why liberals come to congress asking for higher taxes but do not donate their money directly to the United States Treasury.
The problem with socialism is the system itself. That is the main flaw with socialism. When people try to game a socialistic system, they are following the personal dictates of natural law that governs the behavior of all of us. Ironically, the socialist system works against the common man of whom the system is supposed to protect. The socialist wants the same rewards as any man, but the socialist wants someone else to pay the bills. The socialist wants someone else to do the hard work. The socialist wants the better life, without the effort. In a socialist democracy, the socialist votes for the politician that can ‘give’ him his due reward, while requiring someone else to pay the bill. That is why in the United States today, over one-half of the people do not pay any federal income taxes, but about half still vote for a socialist platform and their numbers are growing. It makes perfect sense. It goes with basic human nature. And, it will ultimately fail.
But, the problem with capitalism is the capitalist. We find them on Wall Street, in the big banks, in the insurance industry, and in the auto executive enclaves. There are plenty of folks looking to abuse the system here. The really smart people game the system by devising financial instruments that are unsustainable and undecipherable in the real world, as witnessed by the failure of many of the sold derivatives by Wall Street and guaranteed by the giant insurance companies. In retrospect, the circular sales game in the real estate market was promulgated by Washington, repackaged by Wall Street, and supposedly insured by the insurance companies, failed for a myriad of reasons.
The core reason this whole real estate fiasco tumbled into chaos was that not one of the players had skin in the game. If there was failure, did the politician lose any of his money? Did the Wall Street executive lose his golden parachute if the deal went south? Did the insurance executive lose his Midas sized and taxpayer funded bonus at the end of the year? Did the guy with no hope of repaying the housing loans ever repay the money borrowed? Nope, nope, nope, and double nope.
Where was the unbiased judge that oversaw the run-up of the housing bubble, or the collapse of the auto industry, or the non-bankruptcies of the insurance industry? The answer, of course, was that no judge, court of law, or unbiased referee was used. Congress, having no experience in these things, stepped in and took the taxpayers money to save the powers that placed the congressional members in office. The legal system built on over 200 years of trial and error and refinement was sidestepped so that the elite could game the system at the taxpayers expense.
Where was the unbiased referee? Instead of suiting up in his traditional zebra shirt and black pants, congress took the side of the socialists and took to the playing field biased to one side holding the game skewed and the rulebook filled with changed regulations. What single prosecution have we seen, other than one Bernie Madoff? Not one auto executive, one Wall Street bigwig, one insurance ceo, or one union boss stood to spend any time in jail for malfeasance.
Now that banks, insurance companies, Wall Street, and the car companies are not allowed to fail, the executives there will now game the new system, as instituted by congress. The executives realize that the greatest threat their companies face will be led by the politicians in Washington. No longer will the capitalistic market system require that the executives place their decisions based on market facts, but the new congressional mandates will have the executives brown-nosing to their new masters. The decisions made under the new rules will not help grow our economy.
The last quarterly survey by the National Association of Business Economics says that about three quarters of its members felt the $787 billion Recovery Act did NOT affect, higher or lower, employment at their firms. The money spent was an exercise in failure. So while our sons and daughters are paying off the taxes our Washington elites have bestowed on our future, the money spent was only a boondoggle. The cost of which will not affect congress in anyway. They have their incumbency, they have their pensions, and they have no skin in the game.
The new system already owns a good percentage of the Detroit auto production; it has just taken over the health system of the United States amounting to over 10% of the GNP; it has received payment for and doled out winnings in the biggest Ponzi scheme ever attempted, the Social Security System; and the referee has dictated that the government will now be the judge and jury, not the marketplace, for all businesses deemed too big to fail.
Some socialist societies have built walls to keep their subjects constrained within their borders. The subjects or normal citizens could only imagine one solution to the unbearable rules and taxes forced upon them by their rulers or governments and that was to escape to greener pastures. We are not at that juncture, yet.
But, we must allow one monopolistic institution to fail and that is congress as it is presently situated. The reelection of the current members of congress, this fall, in their bid for another re-anointment to power must be stopped. We must elect representative to congress that will allow poorly run businesses to fail. We need representatives in Washington that will referee fairly instead of changing the rules mid-stream to favor one side.
We need representatives that will allow our friends and neighbors’ the opportunity for life, liberty, and the pursuit of happiness. It’s what got us this far and it will get us far in the future, if we will allow it.
“The problem of socialism is socialism. The trouble with capitalism is capitalists,” which is the approximate quote of the ex-communist editor of The Freeman, Willi Schlamm. Mr. Schlamm, after overcoming the naïveté of his youth, later helped launch William F. Buckley’s National Review. The National Review’s launch in 1955 was an attempt to bring an intellectually conservative perspective to the prevailing liberal political discourse of that day.
Schlamm and Buckley are no longer with us, but the core of Schlamm’s observation still rings a clear truth today. Over the last 20 years or so, we have seen the hard socialistic societies of Soviet Russia and Red China allow much of their underground economies to emerge and lead their transitional hybrid economies forward. It is the capitalistic economic engine within those societies that is bringing a new and larger middle class to those countries where previously only the elite of the governing class enjoyed the rewards from the working man.
There are a few very basic human expressions that are hard wired into every person and society that have walked the face of the earth. Most everyone cares more about themselves and their immediate family more than the guy over the far hill. Most of us care more about the profit we are able to keep rather than worrying about our neighbor’s ability to keep a profit. Most of us know we can manage our own lives, our dreams, and our opportunities much better than some faceless bureaucrat issuing questionable commandments from afar.
That is the core of capitalism. It is not some remote theory that some long whiskered philosopher devised in a lost bygone era, but it is simply the acknowledgement that we can live life to our fullest by following some commonsense rules. These rules live inside most every person since the beginning of time.
Most people want to get ahead and most people want their children to have a better life than what they or their parents had. In every society people will try to game the system, if they can, so that they and their children, can live a better life. In a capitalistic system people work harder at their jobs to achieve those goals, while in a socialistic society, black markets run just underground or alongside to allow goods and services to come to normal working people that would not be otherwise available.
In societies ruled by bureaucrats or kings, corruption is the main method of getting your kids into the best schools, or gives your family the best house, or gets you the best car. In a capitalistic society, producing a needed product will provide you with those same opportunities. In a capitalistic society we create opportunity, in a socialistic society we create a cancerous fatty growth that layers on an extra burden of unfairness and inefficiency to carry forward by an advancing society.
That is not to say that all is well in a capitalistic society that is marbled with the fat of socialism within its economic muscle. That is why in President Obama’s health bill, leftists and labor unions required they would get preferential treatments paid for by the common man or why Warren Buffett, a very successful left-leaning businessman is currently lobbying congress to exempt him from the greater regulatory rules that apply to the rest of us. That is why liberals come to congress asking for higher taxes but do not donate their money directly to the United States Treasury.
The problem with socialism is the system itself. That is the main flaw with socialism. When people try to game a socialistic system, they are following the personal dictates of natural law that governs the behavior of all of us. Ironically, the socialist system works against the common man of whom the system is supposed to protect. The socialist wants the same rewards as any man, but the socialist wants someone else to pay the bills. The socialist wants someone else to do the hard work. The socialist wants the better life, without the effort. In a socialist democracy, the socialist votes for the politician that can ‘give’ him his due reward, while requiring someone else to pay the bill. That is why in the United States today, over one-half of the people do not pay any federal income taxes, but about half still vote for a socialist platform and their numbers are growing. It makes perfect sense. It goes with basic human nature. And, it will ultimately fail.
But, the problem with capitalism is the capitalist. We find them on Wall Street, in the big banks, in the insurance industry, and in the auto executive enclaves. There are plenty of folks looking to abuse the system here. The really smart people game the system by devising financial instruments that are unsustainable and undecipherable in the real world, as witnessed by the failure of many of the sold derivatives by Wall Street and guaranteed by the giant insurance companies. In retrospect, the circular sales game in the real estate market was promulgated by Washington, repackaged by Wall Street, and supposedly insured by the insurance companies, failed for a myriad of reasons.
The core reason this whole real estate fiasco tumbled into chaos was that not one of the players had skin in the game. If there was failure, did the politician lose any of his money? Did the Wall Street executive lose his golden parachute if the deal went south? Did the insurance executive lose his Midas sized and taxpayer funded bonus at the end of the year? Did the guy with no hope of repaying the housing loans ever repay the money borrowed? Nope, nope, nope, and double nope.
Where was the unbiased judge that oversaw the run-up of the housing bubble, or the collapse of the auto industry, or the non-bankruptcies of the insurance industry? The answer, of course, was that no judge, court of law, or unbiased referee was used. Congress, having no experience in these things, stepped in and took the taxpayers money to save the powers that placed the congressional members in office. The legal system built on over 200 years of trial and error and refinement was sidestepped so that the elite could game the system at the taxpayers expense.
Where was the unbiased referee? Instead of suiting up in his traditional zebra shirt and black pants, congress took the side of the socialists and took to the playing field biased to one side holding the game skewed and the rulebook filled with changed regulations. What single prosecution have we seen, other than one Bernie Madoff? Not one auto executive, one Wall Street bigwig, one insurance ceo, or one union boss stood to spend any time in jail for malfeasance.
Now that banks, insurance companies, Wall Street, and the car companies are not allowed to fail, the executives there will now game the new system, as instituted by congress. The executives realize that the greatest threat their companies face will be led by the politicians in Washington. No longer will the capitalistic market system require that the executives place their decisions based on market facts, but the new congressional mandates will have the executives brown-nosing to their new masters. The decisions made under the new rules will not help grow our economy.
The last quarterly survey by the National Association of Business Economics says that about three quarters of its members felt the $787 billion Recovery Act did NOT affect, higher or lower, employment at their firms. The money spent was an exercise in failure. So while our sons and daughters are paying off the taxes our Washington elites have bestowed on our future, the money spent was only a boondoggle. The cost of which will not affect congress in anyway. They have their incumbency, they have their pensions, and they have no skin in the game.
The new system already owns a good percentage of the Detroit auto production; it has just taken over the health system of the United States amounting to over 10% of the GNP; it has received payment for and doled out winnings in the biggest Ponzi scheme ever attempted, the Social Security System; and the referee has dictated that the government will now be the judge and jury, not the marketplace, for all businesses deemed too big to fail.
Some socialist societies have built walls to keep their subjects constrained within their borders. The subjects or normal citizens could only imagine one solution to the unbearable rules and taxes forced upon them by their rulers or governments and that was to escape to greener pastures. We are not at that juncture, yet.
But, we must allow one monopolistic institution to fail and that is congress as it is presently situated. The reelection of the current members of congress, this fall, in their bid for another re-anointment to power must be stopped. We must elect representative to congress that will allow poorly run businesses to fail. We need representatives in Washington that will referee fairly instead of changing the rules mid-stream to favor one side.
We need representatives that will allow our friends and neighbors’ the opportunity for life, liberty, and the pursuit of happiness. It’s what got us this far and it will get us far in the future, if we will allow it.