Saturday, April 04, 2009

Exporting Their Mistakes Worldwide

by Mark Steyn - April 3rd, 2009 - OC Register

Let it be said that in recent years in America, the United Kingdom and certain other countries the "financial sector" grew too big. In The Atlantic, Simon Johnson points out that, from 1973-85, it was responsible for about 16 percent of U.S. corporate profits. By this decade, it was up to 41 percent. That's higher than healthy, but it wouldn't have got anywhere near that high if government didn't annex so much of your wealth – through everything from income tax to small-business regulation – that it's become increasingly difficult to improve your lot by working hard, making stuff, selling it. Instead, in order to fund a more comfortable retirement and much else, large numbers of people became "investors" – albeit not as the term is traditionally understood: Instead, you work for some company, and it puts some money on your behalf in some sort of account that somebody on the 12th floor pools together with all the others and gives to somebody else in New York to disperse among various corporations hither and yon. You've no idea what you're "investing" in, but it keeps going up, so why do you care? That's not like a 19th century chappie saying he's starting a rubber plantation in Malaya and, since the faster shipping routes out of Singapore, it may be worth your while owning 25 percent of it. Or a guy in 1929 barking "Buy this!" and "Sell that!" at his broker every morning. Instead, an exaggerated return on mediocre assets became accepted as a permanent feature of life.

It's not, and it can never be.

Perhaps the embarrassment of Barack Obama bowing to the Saudi Prince (see it here) will be enough to start Obama's slobbering acolytes seeing what a loser agenda he is promoting. Of course his acceptance of the idea of global government is actually thought to be a positive move by many of his radical left wing supporters. But is it really all of them? I guess we are going to find out fairly quickly whether he really does have 52% of our nation committed to extremist socialist policies or whether a fair number of them were conned and will come to regret their gullibility.

An important point of Steyn's article though is that even the so-called "capitalists" of the Republican Party, as represented by Karl Rove and George W. Bush, have no idea what capitalism really means. The financial services sector, a supporting player in the world of free enterprise, is NOT capitalism. Wall Street cannot justify its huge share of national profits in a rational world. Anyone who believes in free enterprise has to recognize that we need to get back to free enterprise and that means we need to return Wall Street to a service selling securities and not allow them to manipulate markets based on the fraud of derivatives, credit default swaps, collateralized mortgage obligations, and every other complex and confusing scam some smart PhD in accounting can come up with.


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