KILLING THE GOLDEN GOOSE
Apparently nobody learned anything from the economic outcomes of the twentieth century. Two large nations (The U.S. and Russia) somewhat similar in size and population embraced two diametrically opposed economic philosophies. The Russians adopted collectivism and progress in that country died. In the entire twentieth century, not a single new invention, product or innovation came from Russia. Nothing! Expropriate the capitalists was a popular communist slogan. They did and their economy died.
Meanwhile, the U.S. took an opposite tack. Limited government, low taxes, high savings and investment caused the greatest creative advancement in history. Make your own list; autos, airplanes, television, movies, computers, penicillin, air conditioning and shopping centers to name but a few. You could list a thousand such breakthroughs and not be close to complete. The contrast in the advancement in living standards in these two countries is profound and remarkable.
Nevertheless, we are discarding what worked for us and embracing a measure of the things that didn’t work for them. The root cause of this transition stems from the runaway social sympathy of the left. They are totally obsessed with spending money on the “disenfranchised.” (For a hundred years, a poor person in America was better off than most Russians.) Despite the outpouring of trillions to the “underclass” their conditions have worsened. There’s more of them and many have embraced a lifestyle of drugs, alcohol and dependency. Among them are a growing criminal class that threatens all of us with wrongdoing from misdemeanors to murders.
In order to fund this mayhem (along with economic stimulus and assorted other subsidies) our government must also “expropriate the capitalists.” They do it through higher taxes and the hidden tax of inflation (money printing). Soaking the rich and grabbing the profits of successful companies is the exact path utilized by the socialists and collectivists who have ruined the economies of many nations.
I started my company in 1973 with a small amount of capital. Soon my money was gone. I worked without pay for months. Finally, in 1979 I started to make a little money. Immediately, the state and federal government wanted half my small profit. It drove me nuts. I needed to have a cushion, a rainy day fund. I knew losses would ultimately come again. It crippled my growth and expansion. It caused me to buy a tax shelter that allowed me to keep more of my money, but subsequently caused me grief.
The left cherishes the idea that business success and profits are a matter of luck. They think entrepreneurs are a grubby lot who will nevertheless keep an inexhaustible fund of tax dollars flowing to pay for their social schemes. They are wrong. Most business start-ups fail. The few who succeed encounter difficulties and struggles. Nothing comes easy. Companies fail at every stage of development, big or small. How many major corporations have lasted 100 years, five maybe ten? Loading business with high taxes and social costs may fatten up welfare benefits but, as history proves conclusively, it kills the economy.