Robert's Random Ravings

The Politics of Greed

With all of the economic disaster of the last year or so, it is painfully obvious that there is something very wrong with our system. We have a system that is geared to making the rich richer. Sure we offer up the hope for the “average Joe” to “hit it big,” but an old adage rings true most of the time: “You have to have money to make money.”

So is this the right way to do things? Is it fair that people like Bernie Madoff, who swindled (“allegedly”) upwards of $50 billion gets to live at home in his Manhattan penthouse while awaiting whatever “justice” will be handed to him? Would a poor person be given the same treatment?

Or how about all of these Cabinet appointees of President Obama that have not paid their taxes? They get a slap on the wrist, pay their fine, and continue on as if nothing happened. What do you think would happen to the average American if the IRS discovered that they had failed to pay $120,000 in taxes? Remember that tax evasion was how Al Capone was caught.

Capitalism is a fairly simple principle – leave the free market to sort things out. It’s a nice theory, but put into play, it does not work. It is classic strong vs. weak (good vs. evil???) bullying. The ones that are on top try to bully the ones below them, push them out of business, or just buy them out of competition.

That is why we have all of these laws regarding monopolies and other economic situations – to try to level out the playing field a little. Obviously, we have seen that it does not work. When unregulated industries cheat and defraud the American public of literally trillions of dollars, it proves that pure capitalism does not work.

When the idea of derivative securities began to get traction (i.e. packaging a group of mortgages and selling them off to spread the risk), some people saw a great opportunity. And there probably were some good parts to this. But the end effect was to allow loaning far beyond the traditional amount sustainable. When this process got de-regulated, it was like putting the bull in the china shop. When the money is pouring in, the last thing people are worried about is scaling back. So the schemes got bigger and bigger while their foundation got stretched farther and farther. This is obviously a simplification of the process, but hopefully you get the idea.

Many people like to throw out the word “socialism” as if it is a dirty word. Well, the truth is that we are partly socialist. The government takes responsibility away from the free market (such as with Social Security) for some basic necessities. In a true market economy, there would be no government “interference” at all. This is what President Bush was proposing when he wanted to privatize Social Security and allow people to make their own investments. Imagine of that had actually happened? With the fall of the stock market, I have heard figures thrown around of nearly $3 trillion of retirement funds being wiped out. This happened in a relatively short time too. Within a year or so, people saw their portfolios disintegrate. Suddenly, retirement is not a viable option for a lot of people. Unfortunately, the same bad news was hitting businesses and Americans started getting laid off by the thousands, and then the hundreds of thousands. So retirement savings get wiped out and at the same time jobs get wiped out. Where do you turn?

In my opinion, all of this started with basic greed. We all want to make a better life for ourselves and our children. But what is the cost of this ideology? We have become a nation of entitlement. We “deserve” the best, and therefore will acquire goods, whether we can afford it or not. We also reward our biggest crooks, thereby perpetuating the cycle of greed and indifference.

I think we need to take a step back and stop worrying so much about riches and start thinking about each other. We need to remember that we are a community – not a business opportunity.

I believe that things will improve, but each of us has to do our part. We need to live within our means. We need to become active in our government and the policing of our government. We need to not let greed be our main motivation.


02/17/2009 - Posted by | Politics | , , , , , , , , , , , , , , , , , , , ,

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