Monday, March 30, 2009

I Want Capitalism Back

This article on the Obama Administration's follow-up to TARP is worth reading, particularly this:

But wait, it is now not just the recipients of Troubled Asset Relief Program (TARP) money and other taxpayer funds who are to be regulated. According to "sources," the White House is considering salary controls for "all financial institutions" and "publicly traded companies," not just those receiving "federal bailout money."
What's more, the feds intend to impose this by fiat, meaning regulations not legislation. When the government controls your salary, control over your financial compensation is not far behind.

Workers at GM think they're being treated worse under the Obama administration than they were under straightforward GM management.


I wrote this in response to a reader, but apparently it needs to be repeated. Those of you who hate the "power of big business" need to remember that said power, however financially impressive, is nothing compared to the power of the government. Businesses are nothing if they don't provide goods and services that customers want. On the flip side of this, government had more direct control over people because they control the laws, and those laws are enforced by regulations, police, courts, taxes, and when all else fails, the point of a gun. Businesses cannot do any of these things legally.

Occasionally I get retorts like, "Big business runs the government because they've got money and lobbyists and they 'own' senators." This requires re-explaining as well. Yes, businesses have lobbyists. Yes, those lobbyists make contributions to various members of Congress and Senators' campaign funds. But they cannot enforce their wishes. A member of Congress can accept a donation one day, and then turn around and vote for a bill that harms the donor's interests the next. And if the government really was so beholden to big businesses, then why are those businesses subject to the highest corporate taxes in the Western world? Why must they spend money for things like ADA, OSHA, EPA, FICA, benefits, etc.? All of those are huge expenses that interfere with profits. If businesses' lobbyists "control" the government, then they should be fired, because they're doing a poor job of it.

And then there's this angle: up until the 1930s, business lobbyists weren't really necessary because Washington didn't control that much of the economy. There was no need to have high-powered lawyers and professional persuaders in $1,000 suits walking the halls of Congress to protect their interests. Government power has since centralized in Washington, and that's why the lobbyists were necessary--as protection.

A liberal friend just posted on Facebook,

[X] thinks that firing Wagoner was just the start. In every revolution, heads gotta roll ...

To which I responded, "Revolutions are great until it's your ox being gored." Obviously I didn't vote for Obama. But I'm willing to bet that even people who voted him did not vote for a revolution, just a change in policies. And to follow on to my response, revolutions can consume their own. It's always cool to "get even" with whoever the revolutionaries think is the bad guy until suddenly YOU'RE the one labeled as the bad guy. For examples of this sort of behavior, see the history of the French Revolution and Russian Revolution.

No comments: