Strangely, it’s not something politicians are keen on talking about during a recession. If someone outside of the U.S. were to observe the U.S. presidential race, they would understandably surmise that the most pressing issues in that country are birth control, abortion, and the religious views of individual politicians. These topics are hashed and rehashed amidst crippling uncertainty and even despair over economic conditions.
Millions of people cry out for the government to do something. Cut taxes! Raise taxes! Take money from the rich, give it to the poor! Raise the debt ceiling, expand social programs! Cut social programs, offer business tax incentives! Stop immigration! Increase immigration! Invade a resource-rich country!!! Wait. Really? Oh yes.
Where the hell do we even begin sorting this issue?
The first step: be wary of your government’s willingness and ability to fix these complex problems by itself. As we have established and as any observant person can see, politics has become about politicians and their cronies making themselves rich and powerful. Sure, they respond to the pleas of the people, but in obtuse and useless ways, ways that only serve to pacify any unrest--and that simply cannot last, which might be another matter.
This doesn’t mean that, ideally, governments would keep completely out of economics in some sort of capitalist free-for-all. There is a place for government intervention. Obviously, enterprising market-centered and power-centered businesspeople will go as far as possible to make more money, acquire more power and in their quest, create monopolies, treat employees unfairly, damage the environment, or any number of things that are detrimental to society.
However, it is important that, in our haste to create a fair and balanced society, we do not forget that, first and foremost, business, enterprise, entrepreneurship, consumption, and production are important and need to be free (within broad limits) to grow and thrive. The foremost economic role of government is to encourage that.
Government is not many things we think it should or would like it to be, but one thing it is, is power. When things get economically out of control, only a government has the clout to step into the path of other powerful entities like large corporations and do things like: enforce the honoring of contracts, break up monopolies, shut down Ponzi schemes, prosecute powerful and corrupt people and groups, and redistribute wealth.
Unfortunately, government so easily becomes intertwined with other powerful entities. Examples of this abound, from the regulated becoming the regulators to vested interests like weapons manufacturers or private prison companies influencing public policy in their own interest to politicians passing laws that allow them, and only them, to participate in ethically questionable investment practices.
When issues like this get out of hand, governments and societies will eventually consume themselves, production and consumption (the economy) slows, and things ultimately fall apart paving the way for a new stage in social development.
Besides the government, a certain type of person--cause centered--can play a valuable role in encouraging economic prosperity. Valuing hard work, enterprise, innovation, and creativity need to be encouraged, glorified, and even indoctrinated into any successful society. In the U.S., we lament the demise of “The American Way,” in favor of a widespread sense of entitlement. Promoters of this “American Way” would make it their cause to instill in a new generation how poisonous entitlement can be to society and how powerful self-reliance and hard work really are.
Think about it. It’s the only way. Work hard, learn, get an education. Nothing comes from waiting for success except more waiting. Luck helps those who help themselves. The Lord loves a workin’ man. I’ve got a thousand platitudes that apply to how individuals can interact for benefit in their economies. And the running theme is, it’s up to you.
See a continuation of this blog here.