This Lady Needs To Read American History

The Herald Mail Media reported yesterday that Representative Alexandria Ocasio-Cortez, speaking at the South by Southwest conference in Austin, Texas, stated the following:

“Capitalism is an ideology of capital — the most important thing is the concentration of capital and to seek and maximize profit,” Ocasio-Cortez said. And that comes at any cost to people and to the environment, she said, “so to me capitalism is irredeemable.”

Although she said she doesn’t think all parts of capitalism should be abandoned, “we’re reckoning with the consequences of putting profit above everything else in society. And what that means is people can’t afford to live. For me, it’s a question of priorities and right now I don’t think our model is sustainable.”

…While America is wealthier than ever, wealth is enjoyed “by fewer than ever,” she said.

“It doesn’t feel good to live in an unequal society,” she said, citing an increase in homelessness in New York City among veterans and the elderly while penthouses sit empty. “It doesn’t feel good to live in a society like that.”

Let’s look at those statements through the lens of American history. In November 2005, the Heritage Foundation published an article about communism in America.

The article included the following notes on American history:

Recalling the story of the Pilgrims is a Thanksgiving tradition, but do you know the real story behind their triumph over hunger and poverty at Plymouth Colony nearly four centuries ago? Their salvation stemmed not so much from the charitable gestures of local Indians, but from their courageous decision to embrace the free-market principle of private property ownership a century and a half before Adam Smith wrote The Wealth of Nations.

Writing in his diary of the dire economic straits and self-destructive behavior that consumed his fellow Puritans shortly after their arrival, Governor William Bradford painted a picture of destitute settlers selling their clothes and bed coverings for food while others “became servants to the Indians,” cutting wood and fetching water in exchange for “a capful of corn.” The most desperate among them starved, with Bradford recounting how one settler, in gathering shellfish along the shore, “was so weak … he stuck fast in the mud and was found dead in the place.”

The colony’s leaders identified the source of their problem as a particularly vile form of what Bradford called “communism.” Property in Plymouth Colony, he observed, was communally owned and cultivated. This system (“taking away of property and bringing [it] into a commonwealth”) bred “confusion and discontent” and “retarded much employment that would have been to [the settlers’] benefit and comfort.”

The most able and fit young men in Plymouth thought it an “injustice” that they were paid the same as those “not able to do a quarter the other could.” Women, meanwhile, viewed the communal chores they were required to perform for others as a form of “slavery.”

On the brink of extermination, the Colony’s leaders changed course and allotted a parcel of land to each settler, hoping the private ownership of farmland would encourage self-sufficiency and lead to the cultivation of more corn and other foodstuffs.

As Adam Smith would have predicted, this new system worked famously. “This had very good success,” Bradford reported, “for it made all hands very industrious.” In fact, “much more corn was planted than otherwise would have been” and productivity increased. “Women,” for example, “went willingly into the field, and took their little ones with them to set corn.”

The famine that nearly wiped out the Pilgrims in 1623 gave way to a period of agricultural abundance that enabled the Massachusetts settlers to set down permanent roots in the New World, prosper, and play an indispensable role in the ultimate success of the American experiment.

A profoundly religious man, Bradford saw the hand of God in the Pilgrims’ economic recovery. Their success, he observed, “may well evince the vanity of that conceit…that the taking away of property… would make [men] happy and flourishing; as if they were wiser than God.” Bradford surmised, “God in his wisdom saw another course fitter for them.”

There will always be inequities in wealth. A person who works 12-hour days will generally earn more than a person who works a 6-hour day. People who invent things or have new ideas generally do very well financially. Rewarding innovation provides an incentive for progress. Capitalism (or the free market economy) is not perfect, but it creates fewer problems than any other economic system. Those touting the wonders of socialism need only look at the economic history of Venezuela during the past ten years. Once the wealthiest country in South America, now a place of unspeakable poverty. That is the fruit of socialism or communism.

Representative Ocasio-Cortez, please learn your history.

The Consequences Of Not Understanding Economics

I am not an authority on economics. I am, however, a person who watches what goes on around me and sometimes learns lessons from what I see. Some economic principles are obvious enough to be learned that way.

In 2013, Forbes Magazine posted an article quoting a statement by then-President Obama on the subject of economic freedom. Economic freedom was not something President Obama believed in. President Obama acted on his belief that economic freedom was not a good thing, and the American economy suffered during his presidency.

The article quotes a speech President Obama gave in Kansas:

there is a certain crowd in Washington who, for the last few decades, have said, let’s respond to this economic challenge with the same old tune. “The market will take care of everything,” they tell us. If we just cut more regulations and cut more taxes–especially for the wealthy–our economy will grow stronger. Sure, they say, there will be winners and losers. But if the winners do really well, then jobs and prosperity will eventually trickle down to everybody else. And, they argue, even if prosperity doesn’t trickle down, well, that’s the price of liberty.

Now, it’s a simple theory. And we have to admit, it’s one that speaks to our rugged individualism and our healthy skepticism of too much government. That’s in America’s DNA. And that theory fits well on a bumper sticker. (Laughter.) But here’s the problem: It doesn’t work. It has never worked. (Applause.) It didn’t work when it was tried in the decade before the Great Depression. It’s not what led to the incredible postwar booms of the ’50s and ’60s. And it didn’t work when we tried it during the last decade. (Applause.) I mean, understand, it’s not as if we haven’t tried this theory.

Well, have we tried this theory? A little history is in order here.

The article reminds us:

I pick 100 years deliberately, because it was exactly 100 years ago that a gigantic anti-capitalist measure was put into effect: the Federal Reserve System. For 100 years, government, not the free market, has controlled money and banking. How’s that worked out? How’s the value of the dollar held up since 1913? Is it worth one-fiftieth of its value then or only one one-hundredth? You be the judge. How did the dollar hold up over the 100 years before this government take-over of money and banking? It actually gained slightly in value.

Laissez-faire hasn’t existed since the Sherman Antitrust Act of 1890. That was the first of a plethora of government crimes against the free market.

…Obama absurdly suggests that timid, half-hearted, compromisers, like George W. Bush, installed laissez-faire capitalism–on the grounds that they tinkered with one or two regulations (Glass-Steagall) and marginal tax rates–while blanking out the fact that under the Bush administration, government spending ballooned, growing much faster than under Clinton, and 50,000 new regulations were added to the Federal Register.

The philosophy of individualism and the politics of laissez-faire would mean government spending of about one-tenth its present level. It would also mean an end to all regulatory agencies: no SEC, FDA, NLRB, FAA, OSHA, EPA, FTC, ATF, CFTC, FHA, FCC–to name just some of the better known of the 430 agencies listed in the federal register.

Even you, dear reader, are probably wondering how on earth anyone could challenge things like Social Security, government schools, and the FDA. But that’s not the point. The point is: these statist, anti-capitalist programs exist and have existed for about a century. The point is: Obama is pretending that the Progressive Era, the New Deal, and the Great Society were repealed, so that he can blame the financial crisis on capitalism. He’s pretending that George Bush was George Washington.

Please follow the link to read the entire article. It accidentally explains the reasons the economy has prospered under President Trump. I also strongly recommend reading The Creature From Jekyll Island by G. Edward Griffin for the story behind the creation of the Federal Reserve System.

 

 

The Economic System That Works

We have all heard the expression, “The proof is in the pudding.” In other words, you can judge the value of something by how well it works. Sounds like common sense, but somehow common sense occasionally takes a vacation from our political dialog. Recently, the left wing of the Democrat party has come out in support of socialism. Tom Steyer and George Soros have invested millions of dollars into Democrat candidates who support socialism while many Democrats are trying to play down the fact that the party is flirting with socialist ideas. Capitalism has dropped in approval among the public while socialism is popular in many circles. Yet when you compare the results of the two economic systems, capitalism helps many more people than socialism.

Yesterday Investor’s Business Daily posted an editorial titled, “The Coming Global Middle-Class Majority: Thank Capitalism, Not Socialism, For The Boom.”

Here are some highlights from the editorial:

…capitalism in the last few decades has had the most revolutionary impact on improving human lives in history.

And yes, that’s a fact, one reaffirmed in a new study by the liberal-leaning Brookings Institution think tank.

The study validates what some have known now for years: Capitalism makes everyone wealthier, even the poor. But it also magically turns hundreds of millions of poor people into the middle class. It’s the greatest economic transformation ever.

The Brookings study, by Homi Kharas, asserts that in just two years — 2020 — the majority of the world’s estimated 7.5 billion people will be “middle class.” Kharas defines middle class as anyone who can pay for food, shelter and clothing, with enough left to supply some luxuries, including TV, a motorbike or car, higher education, home improvements and better food.

The editorial notes the difference between perception and reality:

Put another way, thanks to the free-market revolution that is still reshaping the world, per person global output increased more in the 15 years after the fall of communism than it had in the previous 10,000 years of human civilization.

To say this is an underrecognized, underreported phenomenon is an understatement. Today, in our colleges and universities, our best students learn that the world is bifurcated sharply into haves and have-nots, a result of capitalism run amok. And that capitalism leaves a small handful of people richer but the rest of us poorer.

Simply not true. Indeed, most of the world is getting richer, largely due to free trade, more open investment, and the recognition by many countries that not all regulations are good. And among those who have benefited the most are those who are the poorest.

Socialism didn’t achieve these things. Capitalism, now a dirty word, did. Yet, as we’ve mentioned before, a recent Gallup Poll shows that among those aged 18 to 29, 51% have a positive view of socialism while just 45% have a positive view of capitalism. They’re sadly mistaken.

As left-leaning economist Robert Heilbroner so eloquently wrote in the pages of the New Yorker all the way back in 1989, “Less than 75 years after it officially began, the contest between capitalism and socialism is over: capitalism has won … Capitalism organizes the material affairs of humankind more satisfactorily than socialism.”

The editorial concludes:

Yes, growth cycles go up, and they go down. But there is no question that the free market policies put in place in the early 1980s under U.S. President Ronald Reagan and British Prime Minister Margaret Thatcher have had an enormous effect around the world. The ideas they fostered and that other governments picked up made the world a much wealthier place. They helped pull literally hundreds of millions out of poverty and misery.

Remember that the next time you hear Sen. Bernie Sanders, Sen. Elizabeth Warren or congresswoman wannabe Alexandria Ocasio-Cortez extol the wonders of socialism. Capitalism creates wealth. Socialism creates poverty. And the explosion in the global middle class proves it.

I guess those who support candidates espousing socialism need to study recent economics and history.

Who Does This Man Represent?

America is a Representative Republic. Americans vote for people to go to Washington, D.C., to represent them. Lately it seems as if we might not be doing a really good job of that. Generally speaking, I am not sure who most of the people in Washington represent. However, a recent speech by President Obama really makes me wonder.

Paul Mirengoff posted an article at Power Line today about President Obama’s speech in Argentina to a Young Leaders of the Americas Initiative meeting.  During the speech, President Obama explained the choice between communism and capitalism.

The article reports:

Obama instructed his young listeners that the question isn’t this system vs. that system, but rather “what works.” In Cuba, he claimed (falsely), communism is working great when it comes to health care. On the other hand, he acknowledged, the country looks like it’s stuck in the 1950s.

The lesson, said Obama, is that markets tend to generate wealth. Thus, they meet his “does it work” test, though they must be heavily regulated. Such is the wisdom imparted by this (once-thought-by many-to-be) towering intellect.

Scandalously, the only argument Obama was willing to make in favor of freedom is its tendency to generate wealth. If communism produced just as much, apparently it would be just as good or better, given the more even distribution of the wealth it purports to produce.

To argue in favor of freedom as a good in itself would, in Obama’s thinking, mean succumbing to ideology. He is much too cool for that.

I infer that during the heyday of the Soviet Union, Obama might well have been a communist. Then it was thought, based on successful propaganda of the kind some now accept when it comes to health care in Cuba, that communism was working fine.

I also infer that Obama may well be a fan of the current Chinese regime. Until recently, many thought it was working quite well.

Below is the video of the speech, as posted on YouTube:

The article at Power Line points out:

Obama’s entire speech is below. His remarks regarding capitalism vs. communism begin at around the 41:00 minute mark.

The difference between communism and capitalism is important to America. We need a President who understands that.

The Response To The State of the Union Address

For those of you who are not in shock by the fact that Marco Rubio actually took a drink of water, here is the video and some highlights from his speech Tuesday night.

The speech and video are posted at the Daily Beast. The video is also on YouTube. Here is the video:

A few highlights from the speech:

But America is exceptional because we believe that every life, at every stage, is precious, and that everyone everywhere has a God-given right to go as far as their talents and hard work will take them.

…This opportunity – to make it to the middle class or beyond no matter where you start out in life – it isn’t bestowed on us from Washington. It comes from a vibrant free economy where people can risk their own money to open a business. And when they succeed, they hire more people, who in turn invest or spend the money they make, helping others start a business and create jobs.

Presidents in both parties – from John F. Kennedy to Ronald Reagan – have known that our free enterprise economy is the source of our middle class prosperity.

…This idea – that our problems were caused by a government that was too small – it’s just not true. In fact, a major cause of our recent downturn was a housing crisis created by reckless government policies.

And the idea that more taxes and more government spending is the best way to help hardworking middle class taxpayers – that’s an old idea that’s failed every time it’s been tried.

More government isn’t going to help you get ahead. It’s going to hold you back.

More government isn’t going to create more opportunities. It’s going to limit them.

…And tonight, he even criticized us for refusing to raise taxes to delay military cuts – cuts that were his idea in the first place.

But his favorite attack of all is that those who don’t agree with him – they only care about rich people.

Mr. President, I still live in the same working class neighborhood I grew up in. My neighbors aren’t millionaires. They’re retirees who depend on Social Security and Medicare. They’re workers who have to get up early tomorrow morning and go to work to pay the bills. They’re immigrants, who came here because they were stuck in poverty in countries where the government dominated the economy.

The tax increases and the deficit spending you propose will hurt middle class families. It will cost them their raises. It will cost them their benefits. It may even cost some of them their jobs.

And it will hurt seniors because it does nothing to save Medicare and Social Security.

So Mr. President, I don’t oppose your plans because I want to protect the rich. I oppose your plans because I want to protect my neighbors.

Senator Rubio concludes:

This dream – of a better life for their children – it’s the hope of parents everywhere. Politicians here and throughout the world have long promised that more government can make those dreams come true.

But we Americans have always known better. From our earliest days, we embraced economic liberty instead. And because we did, America remains one of the few places on earth where dreams like these even have a chance.

Each time our nation has faced great challenges, what has kept us together was our shared hope for a better life.

Now, let that hope bring us together again. To solve the challenges of our time and write the next chapter in the amazing story of the greatest nation man has ever known.

Thank you for listening. May God bless all of you. May God bless our President. And may God continue to bless the United States of America.

The reason that a lot of the media has focused on Senator Rubio’s drink of water is that they don’t want you to hear the wisdom in the speech.

 

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