Ayn Rand Knew What Caused Our Economic Crisis; Why Don’t We?
by Thomas Del BeccaroOur President blames the Bush Administration. Many on Wall Street are now blaming Obama. Democrats blame Republicans. Republicans blame Democrats. Who really is at fault for our economic troubles?
The answer is rather simple.
Government and those that proclaim it can solve so many of our problems – regardless of their party.
In 1959, in an interview with Mike Wallace, Ayn Rand posited that:
“A free economy will not break down. All depressions are caused by government interference and the cure that is always offered . . . is more of the same poisons that caused the disasters.”
Of course, Rand was speaking in the wake of the Great Depression. After the market crash, government sprung into action to save the day. The government raised the top tax rate from 25% to 63%, then to 79% and then to 94% and choked off capital formation – the lifeblood of CAPITALism – you see, it is right there in the name. The Government also allowed the money supply to shrink by 1/3rd and spread the Depression around the globe by cutting off trade. That turned a significant recession into the Great Depression.
Not so, according to FDR. Roosevelt thundered that ‘The rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence . . . Practices of the unscrupulous money-changers stand indicted . . . in the hearts and minds of men …’ So what was FDR’s answer? The same poison that caused the disaster – government action.
Today, the overall tax burden – what the average household pays – is close to the highest in our history. We are regulated at unprecedented levels. The government housing policies resulted in an inflated market and a market crash. The same Federal Reserve that allowed the money supply to shrink by 1/3 in the ‘30s recklessly raised interest rates this decade and set off housing deflation. If that was not enough, government has allowed the oil supply to be choked off and that too contributed to our crisis in the form of way over priced gasoline.
What is the Left’s prescription for what ails our economy? More of the same poisons.
Our government has grown from just over $120 billion budget in the mid 1960 to nearly $3.7 trillion today. We transfer well over $1 trillion dollars a year in redistributive policies to “fight poverty” – yet despite spending untold trillions – our poverty rate has remained nearly constant over those 40 years at 14%.
In other words, government never so much solves our problems as much as it institutionalizes them. In the case of poverty, it does so by providing nearly countless benefits to those without work and then keeps them on the dole by taking away their benefits if their private income rises. Faced with a choice of “free” benefits or earned income, government induces millions to remain dependant.
It is story hoary with age as Ayn Rand notes. In other words, the more things Change, the more they stay the same.
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[...] This post was mentioned on Twitter by freedom fighter mom and DRIP USA, AZ grassroots. AZ grassroots said: Ayn Rand Knew What Caused Our Economic Crisis; Why Don’t We? http://bit.ly/3r3U29 #dripusa #ocra #tcot [...]
And our President promises to end the cycles of "boom and bust" in the economy. He refuses to recognize that risk taking, innovation and growth occur during the swings in economic cycles.
Interesting article a few weeks ago from Charlie Gasparino about how Summers, Volker, and even Geithner were upset that they were all shut out from economic decisions. This administration simply will not let economic reality get in the way of its agenda. Statism is always the answer.
I think he is more interested in ending the cycles of boom, the bust got him elected and allows him to rule from a position of fear, he seems perfectly happy with the permanent bust part of the plan.
The leftist look at europe with it's pandemic unemployment and see no problem with any of it, after all they still live well so let the rest eat cake.
Obama knows that his so called "economic recovery plan" is a just all smoke and mirrors. Truth is he wants our economy to fail and capitalism to die a slow painful death. Then he and the rest of his socialist thugs can turn our great nation into a subservient member of thier "global community" and crown himself king of the world.
The tone-deaf in Washington will continue this line of "logic" as long as they possess the Sanction of the Victim
I wish Obama cared
When he talks about the soldiers being murdered in Texas he does so with the same distracted arrogance that he talks about 10% of our countrymen being out of work
A photo op, and chance to hear himself speak, but no passion or compassion. The man simply see's economic turmoil as an opportunity to enhance his own position, it's not that he wants people to suffer, he just doesnt care if it gets him what he wants.
His buddy Sorros is an amoral being, Podesta is a amoral being, all his CZars are amoral beings, of course rational people recognize them for what they are, narcicistic sociopaths, problem is the rationale people are not running the country.
Give it some time, the thing about americans is that we have a tendancy to forgive most things, but when pushed into a corner we take of the gloves and drop the rules, that day is coming and it wont be pretty.
Government myrmidons are so frightened at the thought of actually having to work. We must remember government is the job of parasite, or as we learned from Ayn, “producers, looters, moochers.” It is that way now, and always will be, as long as “We the People” allow it. Kick’em all out in 2010, start over with the Founding Documents, 2010, 2010, 2010…
There's a light at the end of the tunnel. Unfortunately, it's the train bearing down on us, full speed and loaded with debt.
And a must read (read it all!):
http://www.aynrand.org/site/PageServer?pagename=a...
Bear clearly in mind the meaning of the concept of “rights” when you read the list which the platform offers:
“1. The right to a useful and remunerative job in the industries or shops or farms or mines of the nation.
“2. The right to earn enough to provide adequate food and clothing and recreation.
“3. The right of every farmer to raise and sell his products at a return which will give him and his family a decent living.
“4. The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home and abroad.
“5. The right of every family to a decent home.
“6. The right to adequate medical care and the opportunity to achieve and enjoy good health.
“7. The right to adequate protection from the economic fears of old age, sickness, accidents and unemployment.
“8. The right to a good education.”
A single question added to each of the above eight clauses would make the issue clear: At whose expense?
Jobs, food, clothing, recreation(!), homes, medical care, education, etc., do not grow in nature. These are man-made values—goods and services produced by men. Who is to provide them?
If some men are entitled by right to the products of the work of others, it means that those others are deprived of rights and condemned to slave labor.
Any alleged “right” of one man, which necessitates the violation of the rights of another, is not and cannot be a right.
"Statism—in fact and in principle—is nothing more than gang rule. A dictatorship is a gang devoted to looting the effort of the productive citizens of its own country. When a statist ruler exhausts his own country’s economy, he attacks his neighbors. It is his only means of postponing internal collapse and prolonging his rule. A country that violates the rights of its own citizens, will not respect the rights of its neighbors. Those who do not recognize individual rights, will not recognize the rights of nations: a nation is only a number of individuals.
Statism needs war; a free country does not. Statism survives by looting; a free country survives by production."
“The Roots of War,”
Capitalism: The Unknown Ideal, 37.
But he won't come out and say it. I think he is milking the bust for all it's worth, and refusing to acknowledge the destructive policies which caused it. In fact, he uses those to grow the dependency class, which he believes will keep his party in power. He will try to rig some growth in time for mid-term elections, then comes another round of social engineering.
I think you're right on the European outlook though. As long as he has enough welfare for the unemployed, he doesn't care about the unemployment rate. No surprise how he is so worried about how the "world" views us. He wants us to be like them.
You are exactly right Thinking.Man, he is all about himself and jumps at every chance to get his face on camera. No sincerity in his words. It's all about the "show" with him, that's why he can't even speak a complete sentence without a teleprompter near.
Don't worry Thomas, the modern KKK (Keynes, Kerry and Krugman) has got it all under control.
Seriously, how could they possibly rationalize repeating nearly every policy from the 30s in the U.S. and the 90s in Japan? A case in point is the healthcare legislation due to be voted on this weekend. It seems momentum is against us and Ayn Rand for now. But as with the Medicare Catastrophic Coverage Act of 1988 (H.R. 2470), it may not be too soon to start a repeal campaign. For a great article on that government created catastrophe go here:
http://www.heritage.org/Research/HealthCare/bg996...
http://thanksforthelaughs.wordpress.com/2009/05/0...
"I pledge by my life and my love of it, that I will never live for the sake of another man, nor ask another man to live for mine". John Galt, Atlas Shrugged Needs of tax-eaters (ACORN clients) suck the wealth out of our economy. The rules are no longer known because they are based on political expediency and ideology rather than law. This chaos is created, and so far, might be averted.
In the 1970's, when I would argue with leftists who spoke dreamily about how under a socialist system, there wouldn't be any depressions or boom/ bust cycles, I always asked- "so where and when has this ever been tested, and found to work?"
They never had an answer- of course, true socialism has never been tried, you see, and there have always been mitigating factors, understand…..
So now here we are, being treated to the same dreamy prescriptions for eternal prosperity and utopia, this time from those who worship capitalism as a religion, free from empirical evidence, the perfect answer to everything.
So where has pure capitalism been tried, and found to work? Is it a place we can visit, and study? Can we witness its blessings of never ending prosperity and freedom in person?
You are talking about natural rights. They are derived from our humanity. Our Founders understood them. That's why they provided for their protection in the Constitution. Life, Liberty, Property (i.e. the pursuit of happiness) Notice in the Constitution the way these types of statements are phrased "THE right to life, liberty, and the pursuit of happiness.", "THE right to free speech", "THE right to bear arms". The implication is that these rights are bestowed upon men by their creator and not by any government instituted among men. Therefore government cannot take them away. The only legitimate function of government is to preserve these natural rights. And that includes, as you said, not providing for one man at the expense of another's rights. The crux of the issue is that individuals have rights. Groups don't have rights.
You misread the point. People who favor capitalism do not believe in "eternal prosperity" or "utopia". Utopia is acutally Greek for "No Place", because the point is, it doesn't exist. Belief in such a non-existant place would betray a lack of critical thinking ability. We do not think that if government were shrunk, problems would cease to exist. In a finite world, with finite resources, some will always possess more than others. That is merely accepting reality. HOWEVER, you, as an individual, would be more free to make your own success possible in a world with less government intrusion. You are correct in one small point: capitalism has NEVER been tried anywhere. Which is why arguments that the current economic situation "proves capitalism wrong" are such a silly exercise in cognitive dissonance. The benefits of individual freedom are logical, and quite easy to follow… Unless you are of the belief that government needs to hold your hand…
Thank you so much for this article. People who blame our financial troubles on capitalism and freedom are deluding themselves. I would argue that we haven't had capitalism in this country for almost 100 years since the founding of the Fed. How can you have CAPITALism when you have a central bank controlling the interest rates. The interest rate is the price of money. In a truly capitalist system the interest rate would represent the amount of savings, i.e. CAPITAL, in the system that is available for investment. The Fed control of the interest rates is a nothing more than a price control, which is socialism and we've had it for almost 100 years.
The way things should work is: produce -> consume -> save what's left -> invest. Instead we basically have: print money -> produce -> consume -> print more -> produce more -> consume more. This cycle breeds debt and unsustainable prices (bubbles). There has to be some savings somewhere and we don't have enough for capital formation. The Fed discourages savings through monetary policy because they think spending drives the economy. We need a more production driven economy, not to mention a sound monetary unit.
You are right on the money! He is using Cloward and Piven's strategy. The American Thinker has a great article on this strategy, link below:
http://www.americanthinker.com/2009/02/the_clowar...
It is all becoming so very clear of late, just hope it isn't to late to fix it.
It just occurred to me that I didn't clearly say I agree that your list are not rights. I was just trying to expand on the last statement of the violation of rights of others.
Perhaps my post should have been clearer and if you go to the source you will see what I mean. The words were Rands not mine and she was commenting on the Democratic party platform of 1963 which is where the list comes from.
Sorry for being confusing
Oh you are right there are only degrees. Here is a pretty good map of where we find the most capitalism.
http://apod.nasa.gov/apod/image/0011/earthlights2...
Many of us do understand what has caused the crisis. We have joined in Tea Party Protests, spoken out at Town Halls, called and written our Congressman. In return, we have been called Unpatriotic and Racist. Tuesday is hopefully the tipping point which will cause those who do understand to kick the bums out of office in 2010.
Interesting how it matches up well with this map:
http://www.heritage.org/Index/images/Index09_map….
Thanks Harry …. Spot on!
Oh yes, gee, what a freaking co-incidence that is!
/sheesh
His Correct position will be the "KING OF THE UNDERWORLD"
From Thousands of years of Human Civilazation; IF YOU DON'T WORK, YOU DON'T F****NG EAT !!!!!!!!!!!!!!!
I don't think I've seen it said better.
And the theoretical compliment offered by the statist is…MONEY GROWS ON TREES!
Agreed.
The Libs are all counting on us playing along in the "Sanction of the Victim" routine. It's incomprehensible to Nancy Pelosi and her ilk that we're not just bending over and taking it and are, in fact, fighting back from the moral high ground on which we stand. They count on us playing along in their game of half-said, tacitly understood, euphamistic language.
I won't do it. I refuse to play. It's far more satisfying that anything I've ever experienced.
I picked cotton and chopped maize when I was a kid. I'm forming a victims' group to claim an entitlement before the money runs out or goes par with Zimbabwe. Need a name…
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The difference between Ayn Rand and the current children in the Administration is, Rand had a brain, an intellect. Obama is a moron, an empty suit. You've heard of sleepless in Seattle? He is clueless in DC.
Why is it that once elected the political elite can't see the simple truth! Its because they don't want to see it and they didn't gewt elected to not get rich from having done so! We the peole need to get the government out of the way of our lives. Vote them all out and replace them with citizen statesman as our forefathers intended. Those who had served should be stripped of all the benefits they voted for themselves because they've done a lousy job and should have been fired long ago. No golden reirements, ss only. what they didn't pay in? Too bad! nothing for them then. Invetsigate them all and if anyone is found to have even slightly stretched the rules, jail! They all took an oath to defend this ocuntry from all enemies foriegn and domestic and they all have become the enemy! Wake Up America! March on Washington! Stop this madness before it destroies America!
"Why don't we?"
Cause we don't wanna know!
At this point it would take a dictator with the concentrated power of Mao to straighten out this sewer of a country we live in.
Any elected prez who even honestly addressed 1/3rd of our problems would be taken out and lynched.
We have the gubmint we deserve. The 'Greatest Generation' sold us down the river and 'we' have spent our lives having a good time on credit.
There IS a way out however. WW III. Tear up all the paper debt and start over. This is your future. Prepare yourselves.
also …
F! China! Thanks for our money back that you stole from us with your slave labor tactics and warlike monetary policy. Thanks for all the cheap crap.
And F! Saudi Arabia! Thanks for the oil we taught you to get out of the ground and even gave you the equipment and tech to do so that you nationalized while we stood by and did nothing. Go ahead …. TRY and cut us off. Just try you dress wearing freaks.
I have a better idea. Since apparently we conservatives are a minority, we should demand hate-crimes legislation, so we can then lock up all this liberals that insult us under hate speech legislation.
I'd love to see the look on Pelosi's face when she reads *that* bill on her desk !
Please don't make Ayn Rand a panacea for the survivability of capitalism. She was an atheist, her characters in her books were despicable people who had no moral compass. While her capitalistic persona in her books, and in real life, had some applicability to today's problems, her solutions were not fair to all those who work for a living. Her depiction of governmental influence for the "unionized worker" on manufacturing being the cause of economic downturn is partially correct, but corporate greed is also a problem that she lets happen without any negative result. Obama's governmental influence into private business is not yet happened, but it will have a foot-hold if and when the health care bill is passed.
I could not agree more. I am appalled that people are not seeing it. He is a dangerous, cold fish. He cares not one whit about us, the soldiers or this country. Another Chavez/Castro in the rough.
Life, Liberty and the pursuit of Happines are not in the Constitution, they are in the Declaration of Independence.
"Corporate Greed" can have no meaning in a free market. In a free market, by definition, all are price-takers, not prices-setters. Therefore, profit can only occur through innovating and lowering average production costs.
The only time Corporate Greed has any meaning is in a non-competitive market.
The same Federal Reserve that allowed the money supply to shrink by 1/3 in the ‘30s recklessly raised interest rates this decade and set off housing deflation.
I would love for you expound on this point a little. I'm not aware of any "reckless" raising of interest rates, or how that would correlate to housing deflation?
You are right. I'm sorry. I always think of them together. Brain fart.
Good point AlistZ: IMO greed implies "more than their fair share" and to some extent the notion implies a closed economic system where economies are not growing but a static system where this static wealth is distributed.
For Arkyump: Obama's Gov't influence into the private sector has already happened. Heard of GM? Maybe you meant the scope he envisions hasn't happened…you'd be correct there. I don't like to consider the "what if" scenarios if the health care bill is enacted, but it wold be more than a foothold. It would be a stranglehold.
Bomb Iran. That should stir the pot.
The federal reserve has now and again has sought to fight off the effects of higher oil prices by increasing interest rates. In the latest episode, the Fed was well aware of the number of mortgages vulnerable to interest rate increases, i.e adjustable rate mortgages. Even so, it sought to fight off higher oil prices by raising interest rates even though it threatened the stability of so many mortgages. Not only did it have no effect on oil prices – just as it didn't in the late 70s – it pushed rates too high and tipped the mortgage market and burst the housing bubble – a bubble gov't helped create. Gov't to the rescue! If you were aksing about the 30's, one point of the fed was to stablize the banking industry. Yet when the crisis of the 30's arose, the Fed actions did not stabilize banks, it presided over the failure of many and the oney supple shrunk by one third.
Corporate Greed is an amalgamated term that defines excesses in managerial demands. Whether is it making the managerial ivory tower more pleasing; excessive pay allowances; optimal benefit packages that are not part of the workers portfolio; use of extended retreats; and many other perks. Stockholders equity also suffers when management take more than they need, e.g. ENRON. You can't tell me that those idiots are good Ayn Rand followers/
[...] This post was mentioned on Twitter by Jess , Jack Baer. Jack Baer said: Ayn Rand Knew What Caused Our Economic Crisis; Why Don’t We?: http://bit.ly/14TynU “A free economy will not break down." [...]
Thanks for replying. I agree with you regarding 30's. Regarding recent history, there is so much babble regarding what actually happened, that it's hard to get a handle of facts. I know Kudlow has said that long term rates were higher than short term rates for the year before the bubble burst. So, in that sense i guess he was arguing that long term rates were too high.
I have put more blame on the government mandate to change lending rules and allow zero-down home ownership than on Fed Policy. Even now, the government is offering tax-credits to home buyers. We are in a consistent era of both Republcian and Democratic Federal authorities believing that they have some imperative to manipulate mass behavior via tax codes. This is a fundamental distortion of the purpose of taxation, and an instrusion on human freedom, in my view.
[...] Any Rand Knew What Caused Our Economic Crisis, Why Don’t We? Ayn Rand [...]
I get it, abolish gov't. Oh wait, that is synonymous with the rule of law, so we abolish laws ?… right, wow, stupid people are just a dime a dozen, lets give them all blogs and twitter accounts to spread their ignorance. Ayn Rand deluded her self into believing she invented a new way of thinking, "its all about me" profound…
Why don't we teach about Ayn Rand in schools instead of Marx? In fact I wonder if Obama has even heard of Ayn Rand.
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