Wednesday, 16 December 2015 11:58

The Gifts of Capitalism

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Our Mission Is to Reawaken the Genuine American Spirit: of living in a good, great, and growing nation - as free individuals.

The Gifts of Capitalism

Barry MacDonald - Editorial

Problems with Piketty: The Flaws and Fallacies in "Capital in the Twenty-First Century," by Mark Hendrickson. The Center for vision & Values, Grove City College, 100 Campus Drive, PA, 16127, ISBN-13: 978-1503145214, ISBN-10; 1503145212, pp. 100.

In politics there is meanness and deception, dressed up, of course, in noble rhetoric. Too often politicians pose as saviors of the poor and middle class (the middle class is the cash cow) while the rich are the targets (there aren't enough to carry the load). Behind the curtain the same politicians who target the rich carefully cultivate wealthy cronies to share power with - it's all a cynical game.

Too many of today's experts - scientists, statisticians, economists - serve political roles. Too much writing on economics is laden with emotional impact, aimed not at increasing understanding but at motivating the angry into supporting a progressive agenda. The angry do not realize they are being used to cement politicians and cronies in a ruling class. The angry give away their liberties - the freedom to arrange their lives for themselves - in exchange for trifles and creature comforts.

The progressives seek to redistribute wealth. The progressives pretend that redistribution is done without harming individual freedoms, discouraging entrepreneurial productivity (why produce if the rewards will be stripped away?), and making the entire society poorer.

America is in danger of losing its freedoms - our freedoms - that have made it the wealthiest nation in history. America is in danger of becoming a bifurcated nation, with a repressive regime on top, and the ruled over beneath. The strengthening ruling class would be an exclusive grouping, and social mobility could be greatly impacted.

The progressive vanguard is drawing a veil over the American people, so that we lose sight of what has been vital and nurturing to us. It has taken a long time to inculcate the many myths perpetuating the progressive agenda. The myths are spun in our politics, media, schools, and entertainments. It is the duty of The St. Croix Review to reawaken Americans to the truth.

The truth is that America has been blessed to enjoy flourishing capitalism. Capitalism was with us from the beginning. The quest for freedom, to make one's own new life - which has much to do with capitalism - impelled the pioneers over the Atlantic in tiny ships. The thirst for economic freedom and property rights propelled the American Revolution; colonists resented unjust taxation, and so a critical number of motivated leaders took the painful steps towards independence from Britain. It took a War of Independence to secure our capitalistic impulses: Our nation was born with capitalism as a defining quality.

America would not be America without flourishing capitalism. Yet most Americans are blind to the blessings of capitalism. In fact, "capitalism," and "the profit motive" are currently dirty words.

Mark Hendrickson's book, Problems with Piketty: the Flaws and Fallacies in "Capital in the Twenty-First Century," is a concise refutation of a French, progressive/hero, economist. Thomas Piketty's book is Capital in the Twenty-First Century.

It was remarked in the British magazine, The Economist, that Thomas Piketty's book, in which he argues for a "global wealth tax" to lessen income inequality and reduce the concentration of capital "within and between countries," was "too moderate in tone," and "too tame" in policy to "enthuse Europe's zealous leftist intellectuals." Piketty writes that:

. . . there is no obvious reason to think that nearly all needs should b[e] paid for through taxes . . . [Generous, don't you think?]

And Piketty writes the "optimal [top income] tax rate in the developed countries is probably above 80 percent" (rather than 100 percent).

Imagine a world in which progressives had the power to control the distribution of income "between and within countries"! What kind of monstrous, supranational, busybody organization would be necessary? It would take a terrible ruling class - a foreign ruling class; and the American ethic would have to die.

Mark Hendrickson writes that Piketty became an "economic superstar" to American progressives, because of the timing of the publication (2014), and because his writing promotes an effective rhetorical weapon: "income inequality."

Income inequality has become a wedge issue for President Obama and the Democrats: they are able to point a finger overtly or subtly at the wealthy, and convince the poor that they are poor because the wealthy made them so. The rich have not earned their wealth, as President Obama infamously said: "You didn't build that! Somebody else made that happen!"

Mark Hendrickson points to the truth: that rich people get rich by providing something of value to fellow Americans. The very rich have provided low-cost, high quality goods to very many Americans. The rich in America have earned their wealth, and all of us have benefited, as we have wonderful homes to live in, with wonderful furnishings, and beautiful cars to drive. We have the wealthiest poor people in the world: most of the poor have one or two cars, homes (with more living space than Europeans), cable or satellite T.V., internet access, refrigerators, cell phones, etc., all produced by the rich - even the poor share in the American dream, though they don't know it. They have been trained to be resentful.

Mark Hendrickson writes that before capitalism emerged in the 18th century humanity lived within rigid class systems. A blacksmith stayed a blacksmith all his life; and his son was a blacksmith too. The ruling elite rigged the economic system to their benefit; they kept the power and had no incentive to raise the standard of living for those outside their caste.

There was chronic poverty for most people. There was no middle class. There was no social mobility. There was no opportunity for entrepreneurial talent to emerge.

The American Founding Fathers were enlightened, and science was bursting with discovery, which allowed the creation of new wealth. The Founders created a governing system that protected free Americans from a possible elite that would re-impose the rigid class structures of Europe in America. Because we have individual rights (originating from our creator), property rights, economic contracts, we have economic freedom. Because we have economic freedom entrepreneurial genius flourished, and many thousands of businesses were born.

Because we have economic freedom we have social mobility; there are two sides to mobility - poor people can become rich through talent and hard work, but rich people can lose wealth through mismanagement.

In American history there have been very few true monopolies, according to Mark Hendrickson, because even the most established businesses are subject to market forces, and if they do not continue to provide high quality goods they remain vulnerable to competition. Pan Am Airways, Montgomery Ward, and Circuit City are examples of businesses that lost out. One of the true monopolies Mark cites is the Post Office, and it was founded and is preserved by government protection.

The American people determine which businesses succeed through their free choices. We choose high quality, low priced goods - goods that in a pre-capitalistic society were not possible.

It is tough for businesses to survive in free markets. Mark Hendrickson writes in "Capital, Capitalists and Capitalism (Part V)":

. . . a majority of U.S. business enterprises fail within four years, and . . . even the most successful corporations eventually die out.

We should be grateful for every business that honestly tries to serve the American public without government subsidies - these people have courage, intelligence, and drive. They provide us continuously with new products, often using cutting edge technology.

Only when government interferes with subsidies are inferior companies with shoddy products continued, and even then inferior products fail: note the floundering solar energy ventures.

If President Obama and other demagogic progressive politicians had their way, they would re-impose a rigid class structure, with themselves cemented on top. And they would foment and perpetuate class divisions as a means to blind Americans from seeing who is being put down, and who is appropriating the wealth: the progressives only really care about preserving their own elite status.

I enjoyed the company of a social group I belong to before Christmas. My friends are college educated, professional people. One woman said she disapproves of the "capitalism of Christmas" - I believe she dislikes the crass commercialism surrounding the holiday. A very intelligent friend, who holds a Ph.D. in the medical field, said "Christ fought capitalism!" - capitalism didn't exist during the time of Christ: The Roman Emperor rigged the system - if there are no property rights there can be no capitalism.

Obviously my good-hearted, intelligent friends don't understand what capitalism is - and therein is our problem. How may we preserve the underlying foundation that supports our freedoms, opportunities, and prosperity?

We must inform the American people of the gifts of capitalism. We must remind our fellows that it is a sin to resent the rich because they are rich.

The wealthy should be thanked, because without them there would be so much less prosperity: There would be no seed capital in the banks from which new businesses could be started. The more millionaires America produces, the more seed money becomes available - from which additional prosperity becomes possible - and thus wealth multiplies.

We must encourage our fellows to get busy and do something productive instead marching in a mindless mob.

We must not let our schools' curriculum fall under the control of the federal government, because however benevolent the curriculum seems today, it can be modified in the future and used as a vehicle for the progressives to disparage economic freedom, and propagate myths.

We must reintroduce the importance of character development into our schools. We must lead children to value courage, compassion, duty, hard work, and the need to have dreams to work toward.

And we must all learn to ignore the deceitful incitements of progressives, from whichever platform they propagate their myths, from whichever political party the deceit may come, until election time - then the progressives must be defeated.

In addition to his book on Thomas Piketty, Mark Hendrickson's six-part "Capital, Capitalists, and Capitalism" on would be helpful for anyone who wants to learn more about free enterprise. *

Read 3731 times Last modified on Wednesday, 16 December 2015 17:58
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