|Jonas Max Ferris|
And while we’re at it, let’s kill all the lawyers (or at least limit their power). These professional shakedown artists are targeting one great American industry after another and slowly destroying the American way of life — one trial at a time.
The list of clear drags on our economy goes on and on — High taxes, environmental regulations, minimum wages and other worker’s rights. It’s no wonder jobs are leaving our country at a fast clip. What a terrible place to do business!
How we ever became the world’s biggest economy with more billionaires and more of the world’s greatest businesses even though nearly every other country had a big, big head start, is amazing. Or is it?
Maybe what the free market drum beaters don’t realize is that a totally free economy works about as well as a totally un-free, centrally planned (Soviet Union, Cuba, etc.) economy does — which is to say, it don’t.
Let’s not forget we had a near-utopian capitalist society as recently as the 1920s. Taxes were largely nonexistent, rivers made for nice free disposal chutes for nasty byproducts of industry, organized labor could be beaten until it was disorganized, the federal government was smaller than some state governments today, and the motto of the president was, “the business of America is business."
And what happened to it all? Did rules, regulations, and taxes appear on the scene and destroy everything, like some sort of serpent dolling out apples to Adam and Eve?
The system imploded. Rampant speculation and outright fraud led to a stock market crash of proportions we hopefully will never see again. Unemployment rocketed to Soviet Russia levels and economic output plummeted for years.
How could it be? You couldn’t sue anyone, at least not for ridiculous sums and for questionable reasons. There was no minimum wage, no social security payroll taxes, no burdensome environmental policy, no securities and exchange commission, no Elliot Spitzer, no restrictive taxes, no OSHA.
Maybe we can’t handle a land of the totally free. When things cave in, the down cycle is so ugly the system grinds to a halt — people lose confidence in investing in the stock market — even putting money in the bank.
The way free marketers talk you’d think the Great Depression happened after the rules and regulations kicked in, not before. They had their utopian society and it died (just like the central planners had with the Soviet Union).
Virtually every rule, regulation, or other burdensome un-free market system today exists because somebody pulled something so absurd that there was a national outcry of, “there outta be a law." In other words, we earned our bureaucracy one fraud or collapse at a time. Certainly banking would be less onerous today if banks didn’t lose the faith of the entire population by their own behavior.
Maybe America works partially because these “drags” make the country better. Are foreigners racing to buy up property in the countries we export jobs to? Who in the world doesn’t want to live in California, home of many of the most valuable neighborhoods in the world and the very epicenter of regulatory insanity?
This is not to say the pendulum hasn’t swung too far in the direction away from pre-depression freedoms (as is often the case). Would there ever have been a Soviet Union (or even socialist European countries) if not for blatantly unfair kingdoms that lead to revolutions?
Because our country was largely formed in the aftermath of a free market bonanza gone awry, we have to be careful not to overdo it in the other direction. Too much regulation is as bad as too little. The biggest risk of too much government is not just economic brakes, but a resulting desire to move too fast in the other direction — back to no rules, and on a path to destruction of another sort.
It’s a vicious cycle we’ve largely avoided (so far), that Russia still can’t shake. They went from having royalty in charge, to communism, and then to an overly free, Wild Wild West structure in the 1990s, and now back to central planning and unrestricted central powers.
Free market zealots have selective memories. This country became great because of (not in spite of) taxes and some regulations, even (gulp) lawyers. Would we have won any wars without taxes?
America also became great because the federal government didn’t have absolute power to decree its brand of economic freedoms and individual rights. Sometimes states should decide what lawyers can do, what you can smoke, what speed you can drive, who can pull the plug on life, and what can go in the air.
It’s not regulations and lawyers that have dragged Russia down — it was and is power grabs. Governments that take power away from people fail. Regulations and lawyers give people power.
This weekend our Business Block has more on how government regulation affects YOUR investments. Tune in Saturday 10am — noon ET.