Daily Wisdom

December 29, 2009

The True Progressives

I am a Progressive. This statement might come as a shock for those of you who know me. When you hear the word "Progressive", you normally think of a liberal or radical left-wing socialist or collectivist. As most of you know, I am none of the above. Nevertheless, I am a true Progressive. Why? Because those who call themselves "Progressive" have misappropriated the name, and should in fact be called "Regressives". Allow me to explain...

America is the greatest nation on earth. It is the only remaining "superpower". It has the highest standard of living in the world. It has invented more new technology than any other nation. It has the best medical care in the world. It has created more wealth than any other nation. It has the largest, most resilient economy on the planet. Being "poor" in America is far superior to being poor anywhere else on earth.

America did not become the greatest nation on earth by means of any left-wing agenda. It did not become a superpower through socialism. It did not become the envy of the world through collectivism. America became great through individual liberty, personal responsibility, property rights, entrepeneurial spirit, hard work, capitalism and the free market system.

Individual liberty or "freedom" allows people to go where they want, do what they want, and say what they want - within reasonable limits of course. Without the freedom to move, act or speak, a population becomes repressed and hesistant. Risk-taking becomes difficult and creativity is stifled.

Personal responsibility comes with individual liberty. Slaves are the property of their masters, hence the onus falls on slave-owners to provide for the needs of their slaves. Emancipation brings freedom. Along with personal freedom comes the responsibility to provide for one's own needs. Dependence means slavery. Freedom means responsibility.

Property rights allow individuals to retain the product of their labors. As people labor, they accumulate property or "wealth". Those who have wealth can buy the product of other people's labor. Thus, wealth for one creates wealth for others. When property rights are trampled upon, property can be forcibly seized or destroyed. This reduces wealth for some (directly), and wealth creation for others (indirectly).

The entrepeneurial spirit motivates an individual or individuals to use their creative talents to take risks in order to establish a new enterprise, venture or idea. The ambition that underlies the entrepeneur's risk-taking, envisions the opportunity for success and the promise of reward.

But risk-taking can result in failure as well as success. Failure will result in loss, but the loss is limited to the individual risk-takers. Success will result in gain, but the gain can benefit untold thousands or millions. Gain represents an increase in wealth, but it also represents "progress". The realization of new ideas, new products or new cures, not only creates new jobs and new wealth, but can improve the overall well being or "happiness" of a society.

Small businesses, typically established by entrepeneurs, employ approximately 80% of all Americans. Large companies were often started by entrepeneurs. For example, General Electric was started by Thomas Edison, and Microsoft was started by Bill Gates. Both were entrepeneurs of the first magnitude. And today, tens of thousands are employed due to their ambition and risk-taking.

Hard work is an essential element to success. Without hard work, entrepeneurs cannot successfully realize a new idea, product or venture. Hard work is required to achieve difficult goals and to complete important tasks. Hard work is a noble aspiration for any individual. Hard work creates wealth. Even when voluntary, hard work can improve the well-being of a society or individuals within a society. Idleness on the other hand, produces nothing.

Capitalism is an economic system in which private individuals or "corporations" of private individuals, are the primary owners and investors in the means of production, distribution, and the exchange of wealth. This is in direct contrast to socialism wherein the means of production, distribution, and the exchange of wealth are controlled by the state (ie, the government).

The free market system is an economy wherein sellers are allowed to "market" their products and buyers are allowed to choose which products they want to purchase, without economic interference or regulation by the government (except to regulate against force or fraud).

In an ideal free market, property rights are voluntarily exchanged at a price agreed upon solely by the mutual consent of the sellers and the buyers. By definition, buyers and sellers do not coerce or force each other to buy or sell. They obtain each other's property rights without the use of physical force, threat of physical force, or fraud. Neither are they coerced to buy or sell by a third party (such as the government).

In a free market system, prices are established based on supply and demand. When the supply of a particular product is low, but the demand is high, prices will rise. When the supply increases but demand is low, prices will fall. In that sense, the free market is self-regulating. Likewise, in a free market system, businesses are allowed to succeed or fail based on competitition within the market place, and not on the actions of any third party (such as the government).

Allow me to reiterate. America did not become the greatest nation on earth by means of any left-wing agenda. It did not become a superpower through socialism. It did not become the envy of the world through collectivism. America became great through individual liberty, personal responsibility, property rights, entrepeneurial spirit, hard work, capitalism and the free market system.

America's success has brought true "progress" to its own citizens and to others around the world. Consider what America has brought the world: the light bulb, the phonograph, the telephone, the transistor, the personal computer, and the internet, among countless others. Consider the improvements in medicine, health care, surgical procedures and pharmaceuticals. Consider the improvements in science, transportation, communications, energy, materials and electronics. All of these inventions and improvements are a sign of "progress".

In that sense, I am a true "Progressive". I want America's progress to continue unimpeded. I want America's standard of living to continually increase. I want Americans to live longer, live better and live healthier. I want Americans to take risks, work hard, realize their dreams and create wealth.

And not at the expense of others around the world. I want everyone in the world to have what we have here in America. I want them to share our high standard of living, good health and increased longevity. I hope they would take our example and provide their citizens with the same individual liberties, property rights, capitalist economy and free market system that we have. I hope that they would encourage the same entrepeneurial spirit and ethic of hard work that we honor here in the United States.

The so-called "Progressives" on the other hand, seem to disagree. Instead of being proud of America's success, they are embarrassed by it. Instead of wanting everyone in the world to have what America enjoys, they want to strip America of its wealth and reduce it to third world status. Rather than lifting the world up, they want to tear America down. That is not "progressive"... that is "regressive".

Consider for example the global warming movement. What the "Regressives" are proposing to do is to emasculate the American economy by imposing a cap on carbon emissions that would, in effect, return America to the pre-industrial era. Businesses that fail to meet the carbon cap (effectively ALL businesses), would be forced to pay fines and penalties. These fines and penalties would then be transferred to other nations so that said nations could theoretically "catch-up" with the United States.

The problem with this scenario of course, is that there are no incentives for said countries to "catch up" with the United States. There are no guidelines for use of the funds, no milestones or progress requirements, no deadlines, and no oversight against fraud or abuse. Besides that, if and when such country were to actually "catch up" with the United States, then all funding would cease. Their incentive then, is to delay improvements in order to keep the money flowing. But I digress.

The "Regressive" solution to all problems is essentially the same. Instead of raising up those who are in need of help, the Regressives tear down those most able to help. Instead of allowing those who create wealth to flourish, the Regressives penalize wealth with punitive taxation. Instead of creating an environment of liberty and freedom, the Regressives impose stifling and restrictive regulations. Instead of allowing buyers and sellers to create markets and determine prices, the Regressives seek to manipulate markets and control prices. When American energy sources are available for American progress, Regressives prevent them from being used.

When the government should be regulating only to prevent force and fraud, the Regressives impose force and encourage fraud. Instead of promoting risk-taking, Regressives stifle creativity and frighten markets into quiescence. Instead of allowing consumers to spend their own money wisely, Regressives seize it from the consumer and spend it on "pork barrel" projects and "white elephants" that no investor would dare consider. Instead of allowing banks to determine risk for themselves, Regressives direct banks to make loans regardless of risk (with the obvious consequences). Regressives regulate where no regulation is required, and fail to regulate where it IS required.

And that is why they are "Regressive" and not "Progressive". America made great progress over many years without the help of these so-called "Progressives". Whenever the Regressives implement a new program, it merely serves to slow American progress. Instead of a "progressive" income tax, it should be called a "regressive" income tax. The Regressives destroy wealth, inhibit weatlth creation, penalize success, reward failure, make bad investments, punish creativity, foster mediocrity, create bureaucracy, slow down growth when times are good, slow down recovery when times are bad, and in short... they slow down American progress.

It is we... the capitalists, the free-marketeers, the lovers of individual liberty, and the advocates of personal responsibility who are the true "Progressives".

December 26, 2009

What The Polls Say

The following charts are from Pollster.com

December 18, 2009

Copenhagen's Communists

This came from Americans For Prosperity...

December 13, 2009

Obama: Year 1

Try to keep up. This moves pretty fast.

There's a larger version at YouTube HERE. Even better, click on the HD button.

Or, you can download a high quality MP4 file HERE (requires QuickTime or other MP4 player).

December 04, 2009

Stimulus Spending And Job Growth: Update 6

Well, here we are again. The new jobless numbers are out, so it's time to update my predictions. In June I wrote an article called "Stimulus Spending And Job Growth". In the article, I pointed out that Barack Obama said his stimulus package would create approximately 4 million "new jobs" over two years. He also said the unemployment rate would not exceed 8%. In order to create 4 million jobs in 24 months, the Obama administration would have had to create approximately 166,667 jobs per month to reach this target, assuming linear job growth. That scenario is shown as violet in the following graph.

As of June, when I wrote the article, the trend in job growth was actually negative. So I developed a curve showing what I thought might be a more "Likely" scenario -- plotted as light blue in the following graph. As you can see from the graph, the actual trend of job losses is somewhat worse than I had predicted -- plotted as yellow and red -- and the unemployment rate is now at 10%. However, the jobless rate is generally following the trajectory I had envisioned.

I have revised the September and October job losses according to the latest published figures. The number of jobs lost for the month of November was 11,000.

President Obama has already blown his promise to keep unemployment under 8%. And it looks like his ability to create 4 million new jobs in 24 months is also in jeopardy. Instead of having to create 166,667 new jobs per month, which he originally needed to reach his target, he now needs to create 445,400 jobs per month -- in order to make up for the nearly 2.7 million jobs that have been lost since the stimulus bill was signed.

Hey Obama, how's that "stimulus" thing workin' out for ya?