Tuesday, June 1, 2010

The Economy

Let me preface this by stating that I am no expert in economics. But, I feel, based on the current economic situation, that being an expert may be part of the problem.

America is a land of ingenuity and advancement. The entrepreneurial spirit is more alive in American than anywhere else in the world. This spirit is the foundation of what we refer to as the "American Dream" and the reason why so many people from all over the world seek out our shores.

Our economy is founded on the principles of capitalism, which essentially means that the people control the economy by how they choose to spend their money. Businesses thrive because they are better able to provide a service or a good to the people with money. Businesses that are unable to generate customers fail. Hence the need for ingenuity and creativity when starting a business. And Americans have done very well. America is the birthplace of electricity, light bulbs, television, computers, automobiles, airplanes, the internet, etc. American companies are recognized the world over - Wal-Mart, McDonald's, Coca-Cola, Ford, Chevy, etc. And family owned and operated businesses build a strong backbone within our market. I worked in a family owned small business all through my childhood and it helped to teach me the value of work, money, and creativity.

The driving force behind capitalism being a success is that the government does not control the market. When government controls the market or even over regulates a market we move away from capitalism and into socialism. Some would argue that this might be a good thing, especially in the light of the dishonest actions within the housing and lending markets that have led to our current troubles. I would say that you should ask Russia how it turned out for them having a government run market. And yet, this is exactly the route we are taking. The government is reaching its greedy hands into the market, taking over businesses in the financial sector and even the auto industry. In my opinion, the government, behind a sneaky liberal agenda, is trying to expand ever further to slowly swallow our economy to pay off our enormous debts. It won't work because the more the government interferes or controls the market the less entrepreneurial spirit we will see.

Businesses come and go. It is the way of free trade. When a business is no longer relevant someone will replace it with something better. With the government stepping in to bailout hundreds of businesses over the last couple of years we have seen our debts rise and our economy crash. The Fed interfered with the natural flow of capitalism and we are seeing the devastating consequences that cannot be escaped so long as politicians continue to meddle in affairs that they understand less than I do. What should be happening in stead is the American people should be changing their spending habits. We were all hurt by immoral lenders over inflating home values and home builders feeding into the climate it created. These businesses deserved to fail. These businesses would have failed and been replaced with smarter, better solutions if not for our leaders. It is corruption preserving corruption, and when that happens we all lose.

Our economy can recover. Our economy should recover. But whether or not our economy actually does recover will depend on the people regaining control of the market. There are many factors at play within our capitalist foundation and none of them can be ignored. Education is one key component. Without highly educated and skilled people many businesses will never get off of the ground. Work, hard and honest work, is also necessary. More and more people are neglecting work and looking for the next government handout to sustain them. Life, Liberty, and the Pursuit of Happiness will never be handed out in a welfare line. These things are earned with blood, sweat, and tears. When we combine education and hard work we can become productive. And productivity is exactly what we need right now.