President Barack Obama and his cronies in Washington are doing everything possible to destroy our free enterprise system in America and overhaul it. They want to create a government-planned socialist economy where the government determines the factors of production. They're already doing that right now by taking over General Motors for example. The government owns 60% of GM. They're instructing GM what types of automobiles they must produce. Our Congress is trying to pass a carbon cap and trade legislation in which the government will tell various industries how much greenhouse gasses can be emitted into the atmosphere. It will eventually come full circle. However, the road to a planned economy wasn't started by Obama. Former President George W. Bush placed us on this road by signing an energy bill at the end of 2007 which would eventually phase out the current incandescent light bulb as well as the bailout of the mortgage industry last year.
Our country has been a free enterprise system since its inception. We've heard people right before the election of Barack Obama say America is a free market system. The truth of the matter is, we don't have a true free market. That was even before Obama's election as president. The last several years we've had a manipulated market. Why? It's due to the absence of competition. Competition comprises a free market. When competition is eliminated through unscrupulous business practices, you have nothing but monopolies and oligopolies. We heard arguments last September if the federal government didn't use taxpayer money to bailout the troubled banks, our economy would collapse. Why would the collapse of AIG or Fannie Mae or Freddie Mac have such an impact on our market? For no other reason because they're a monopoly. If there were other banks in competition with these giant ones, then a bank failure wouldn't as likely have such a negative impact on our economy.
I'm very pro-business, but whenever government and huge corporations are aligned together, then it's dangerous for our country. Take a look at Goldman Sachs. Reuters has reported that they had a 33% increase in 2nd quarter profit due to a blowout. However, it's not due to competition or natural forces in the market. It was due to manipulation and government helping them out. Henry Paulson, Bush's former treasury secretary, was the former CEO of Goldman Sachs. Goldman Sachs played a part in eliminating Bear Stearns and Lehman Bros., some of their former rivals. Paulson used the government treasury to help Goldman Sachs be where they are today. There were some unscrupulous practices taking place on Wall Street which benefitted Goldman Sachs. They're not under control by the SEC (Securities and Exchange Commission). The SEC chairman is to keep a watch of those kind of companies on Wall Street so unfair business practices don't take place.
You hear many people complain about the high cost of living. Why? That's due to very little competition. When there's no competitors, these huge firms don't have any reason to keep prices under control. When there's competition, it forces businesses to keep their costs under control so customers will patronize them. Take a look at Wal-Mart. Wal-Mart has been known in the past to having the cheapest retail prices in the country. Now since Wal-Mart has become a huge business, they're raising their prices. Why? Because they've outsold their competition and there's no incentive for them to keep their prices lower.
The government has the power to use anti-trust laws to break up these huge monopolies such as the oil companies and banks, for example. Anti-trust laws need to be used to break up these powerful monopolies. There's been some famous cases where monopolies have been broken up. One of the cases was Standard Oil in 1901. Another one was Alcoa Aluminum in 1945 and the other one was AT&T. It's not in the best interests of our country for there to be no competition. It hurts businesses and consumers. It will cause prices to be higher when there's no competition. The free market system works best when there's competition. Competition will give businesses incentives to be innovative and be the very best they can be. It gives the customer more choices to choose from.
Back in the early 20th century, presidents Theodore Roosevelt and William Howard Taft were known for breaking up trusts. Roosevelt was dubbed the name "Trustbuster". When you view the situation where our gasoline prices are shooting up the ceiling, it's due to the fact the petroleum industry is a monopoly. That's partially what's helped put this economy in the present recession. The oil companies and all these other huge corporations contribute heavily to the elected elite, that's why they don't do anything about the situation. We need to turn those kinds of politicians out of office. The government once again needs to revert back to the policy of breaking up trusts.
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