I hear a lot of talk from the political left about the richest 1%, as if becoming wealthy in America is a bad thing, some kind of sin. It isn't. In fact, the opportunity to become rich in America is one of the things that makes this country great. What would be a sin is if we removed those opportunites from Americans. The Associated Press recently noted that 20% of Americans will be wealthy at some point in their lives. To me, that is fantastic. I want as many Americans as possible to be financially secure, but to the AP, it was a springboard for a discussion of income inequality, as if every person who becomes wealthy is somehow stealing money away from someone else. That belief is an economic myth, based on the false assumption that there is a fixed-sized economic pie, where one person's larger piece means others are getting a smaller piece. The problem with that assumption is, the economic pie is not fixed. It is dynamic, provided that opportunities are available to those who wish to grab them. While our free market capitalist system does create income inequality by definition (winners and losers), it is far preferable to a socialist government-controlled system that stifles opportunity and innovation, promotes mediocrity, and shares the economic pain equally across the population. I don't know how any American could believe otherwise, but many apparently do.
What baffles me even more about the political left is that after they decry income inequality and rail against the rich, they advocate for a bigger, more interventionist government, as if more government is going to solve the problem. Has it never occurred to the left that the government takes money and opportunity AWAY from American citizens, and that more government means more money and opportunity will be taken AWAY from American citizens ? Has it never occurred to the left that more centralized governmental power will make it harder for Americans to succeed ? And most importantly, has it never occurred to the left that the government serves the rich and powerful, because those are the people who are connected and can buy influence ? The government IS the rich and powerful, and like every other ruling class in the history of the world, it looks out for itself first.
Nobody on the political left is going to believe my previous paragraph, because they have all been told that only evil Republicans serve the rich, while Democrats are the good guys who are looking out for the common man. If that is true, then explain to me why, over the last forty-fifty years or so, at the same time our federal government has been growing by leaps and bounds far beyond what it ever was before, at the same time we've expanded welfare programs so much that it's difficult to even keep track of them all....why have wages stagnated ? Why has poverty risen ? Why has income inequality gotten worse ? If more government was the answer, then the way we've doubled federal spending every ten years or so should have made our lives a lot better. Instead, things have gotten worse (and please spare me the usual partisan dreck. Both parties have had power).
We've gotten the big government over the last half century, and the mountain of regulations that go along with it, but at the same time, the number of Americans who are self-employed has fallen to a record low as a share of the population. Self-employment has fallen steadily as government has grown over the years. This indicates to me that our opportunities are shrinking as government gets larger. Small businesses are being stifled. We are creeping from free enterprise to controlled enterprise. You can't even run a lemonade stand these days without getting permission from the government. We've run off the rails.
As bigger government (regardless of political party) serves the rich, powerful, and connected, and is in fact indistinguishable from the rich, powerful, and connected, because government IS the rich, powerful, and connected (how many poor people do you know who were elected to Congress ?), we the people suffer. Rules are established to insure the rich and powerful stay rich and powerful. Rules are established to restrict competition for the rich and powerful. Rules are established to make it harder for the little guy to grab the opportunity that is so key to his/her success. The little guy can't hire an army of lobbyists to peddle influence in Washington D.C., but the rich and powerful can. Guess who wins in that scenario ? Opportunity, the key to prosperity, is diminished, and the more power you take out of the hands of the people (your own hands) and put into the hands of the ruling class government, the more opportunity will be lost.
Here's but one example out of a million of the very phenomenon of which I'm speaking. I'm going to use the banking industry, because I have some familiarity with that industry, having worked in it. A few years ago, in the wake of the financial crisis, major new banking regulations were implemented, known as the Dodd-Frank Wall Street Reform And Consumer Protection Act. It was signed into law in 2010 by President Obama. We were told Dodd-Frank would insure that no bank would become "too big to fail" ever again. All those good Democrats were looking out for the little guy (or so they told us), but look what has happened since Dodd-Frank was passed...the top six megabanks (Goldman Sachs, Bank Of America, J.P. Morgan Chase, Citigroup, Wells Fargo, Morgan Stanley) control more of the banking market than ever before and have grown by 37% over the last five years, while the smaller banks, the community banks, have been dropping like flies. We have fewer banks now that we did in the middle of the Great Depression. Our number of banks is at a record low. Only one new bank has opened in the last three years,. We've lost about 11,000 banks since 1985. In '85, there were over 18,000 banks. Today, there are fewer than 7,000. Too big to fail has become too bigger to fail. Regulations have favored the megabuck big boys and forced others out, resulting in consolidation and less opportunity. The number of bank branches also continues to dwindle, with nearly 400 being closed in the third quarter of 2013 alone. Predictably, branches and banks are being predominantly closed in the poorest neighborhoods, leaving those underserved folks vulnerable to predatory checking-cashing joints.
On a side note - contrary to the opinion of many, banking was never "de-regulated" in the sense that bankers could do ANYTHING they wanted. Banking was and is one of the most highly regulated private industries, if not the most highly regulated industry, in existence. Regulation changes were made, but the government made them intentionally. The financial crisis didn't happen because the government wasn't paying attention. You really have to be naive to believe that. The financial crisis was a government scheme to increase home ownership that spun out of control. The government did everything it could to induce and/or force banks to grant those irresponsible mortgage loans, and the banks eventually went for it, because a silly ponzi scheme was concocted to "reduce risk", namely the secondary mortgage market on Wall Street (which was also created by the government, btw). The financial crisis was anything but accidental. Both political parties went along for the ride (this is what happens when Democrats and Republicans agree on things). If you don't believe me, ask yourself this question - Do you really think it's an accident that the megabanks most involved in and responsible for the financial crisis are now even bigger and more powerful than before ? Hardly. The government not only bailed them out, it rewarded them by putting rules in place to insure they grew even larger. Some punishment. Everything else is merely a sideshow, a distraction. There's practically a revolving door between the federal government and banks like Goldman Sachs, for chrissake. How much more obvious do they have to make it ? Like I said, the ruling class takes care of itself, and everyone else can eat cake. What I don't understand is why anyone would want to give more power to the ruling class, aka, the government. I want them to have less power and less control over all our lives. I want this to be a free country as opposed to a budding fascist or socialist state.
If we want a fascist or socialist country, let's keep going down the big government path we are on, to our detriment. Things will continue to get worse for the little guy. Or, we can restore the freedom, the opportunity, that Americans are supposed to enjoy. To my friends on the left, I say, we share common goals in desiring prosperity for the most Americans possible. It's just that your solutions are all wrong, and will leave us all as little more than peons begging for scraps at the table of the ruling class. No thanks. You can't create a dictator in the hopes that the dictator will be kind. That's a fool's errand.
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