Monday, October 5, 2009

Power-Lusters and their Serfdom-tool: Regulations - October 30, 2008

I cherish the principle of equal inherent inalienable rights because it adheres to my personal philosophy: I want to be happy, but never at the expense of anyone. I earn my own happiness. I don’t want anyone to sacrifice or to be regulated for me. I greatly appreciate acts of benevolence, and I am forever grateful to innovators who carry me along to a better existence where their brilliant minds take them.

It is in my own self-interest that active minds flourish. They can flourish only in freedom.

The response of power-lusters to great achievement is not admiration, but a desire to destroy or control. They succeed because many citizens evade that regulation is a form of slavery, and that their approval or silence is an endorsement of serfdom.

Regulations are used by politicians, their protégés, and constituents to lord it over wealth creators. As President George Washington would say, such tyranny and these tyrants are abhorrent.

Neither Senator Barack Obama nor Senator John McCain is an advocate of freedom. It is logical that they are both anti-capitalism. Senator Obama plans to spread the wealth around while Senator McCain’s hero is President Theodore Roosevelt, a dedicated antitrust enforcer who, by endorsing income tax and an inheritance tax in 1908, became the first President of the United States to openly propose that the political power of government be used to redistribute wealth.

Alan Greenspan says in his essay entitled Antitrust:
"No one will ever know what new products, processes, machines, and cost-saving mergers failed to come into existence, killed by the Sherman Act before they were born. No one can ever compute the price that all of us have paid for that Act which, by inducing less effective use of capital, has kept our standard of living lower than would otherwise have been possible."
The following is from Mike Milken, a brilliant innovator who created millions of jobs, and consequently, tyrannized by power-lusters:

“In 1993, a new government health-plan proposal would have led to sweeping changes in the pharmaceutical industry, including what some feared would be regulation of rates of return on investments. This would have had a major impact on an industry in which it can take 14 years to bring a new drug to market. The ten largest companies in the industry lost a staggering $70 billion in market capitalization in only 14 months because of the mere possibility of regulated rates of return. Tragically, but logically, pharmaceutical companies responded by cutting research-and-development budgets in a necessary realignment of risk and return. While we'll never be able to measure what medical breakthroughs may have been lost or delayed, one thing is certain: corporate managements can never afford to ignore regulatory developments.

In the late 1980s, Congress passed the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA), which typified a brief period of over-regulation that targeted insurance companies, bondholders, banks and other lenders. Well-meaning but ill-advised, FIRREA banned investments by savings and loan institutions in non-investment-grade companies and forced the S&Ls to sell existing loans that had been made to these enterprises — the very companies that create all the new jobs in America. (Over the last 30 years, more than 100 percent of jobs created in the U.S. have come from small and medium-sized companies that don't qualify for an "investment-grade" credit rating. During the same period, the 800 or so investment-grade companies have actually shed a net four million workers while smaller companies created 62 million jobs.) At the time, there was only a handful of investment-grade companies headed or controlled by African Americans, Hispanics, women or unions.

Thus, as recently as the late 20th century, the Congress of the United States effectively, albeit unknowingly, said it was illegal to provide capital to businesses headed by minorities and women or to any company that would create jobs. It was OK to make a mortgage loan that would build a building; but you couldn't finance the company that provided jobs for the people inside the building. That's why I called FIRREA and similar regulatory acts "neutron legislation" - like a neutron bomb, they left buildings standing but eliminated the people, or at least their jobs. Because only a handful of our 50 states have more than a few dozen "investment-grade" companies (some states have no such companies), Congress effectively redlined most regions of the country, reducing asset values and employment.”
Serfdom has bipartisan support in Congress, and we will soon have a president of like mind.

I hope citizens of mettle will rise to defend freedom -- that the nation conceived in Liberty shall not perish from the Earth.

1 comment:

Ilyn Ross said...

It is the proper function of government to prosecute fraud and rights-infringement, and to prevent them without infringing rights.

Presumption of innocence is a hallmark of justice. George Washington said, ‘It will be found an unjust and unwise jealousy to deprive a man of his natural liberty upon the supposition he may abuse it.’