Presidential Parenting
Is this election a defining moment in United States history? It certainly seems so. On one side we have Barack Obama. On the other we have Mitt Romney. What choice could be more disparate? Certainly Ron Paul would be more adamant about reducing the size of government and its influence in our lives, but this election is not about government per se; it is about the relationship the people have with government.
We, the people, are confronted with an ironic choice. For decades we have voted for representatives who offer us more and more subsidies and programs, while not taxing us for their full cost. The representatives’ purpose was simple: they were buying votes. The purpose of the voters was getting something for nothing. The result has been continually expanding government and debt. A continuation of the same policies will soon result in a government that is completely overpowering, along with debt that is unsustainable; thus the irony.
The voters and representatives now have the unhappy choice of choosing to restore the balance of expenditures and revenues or suffering an economic and political collapse. But even today there are many who deny we face this situation. Perhaps this is because it comes on us relatively slowly. Each day we get up, things seem the same, and so we think nothing has changed so very much. But it is a bankruptcy. “How did you go bankrupt?” the woman is asked. The answer is thought provoking: “Slowly for a while, then suddenly.” And that is how it happens.
Not everyone pays attention to the balance sheet and economics of the country, even though the Internet makes the finding very easy. Unfortunately, this election is about the US balance sheet and economics. Previous elections have been about incremental change. This one is about what we believe the United States should be. Do we believe in individual effort, the opportunity for personal success? Or do we want government to decide everything? The White House is making their position perfectly clear.
Mayor Cory Booker of Newark, NJ, made news being attacked by his own party, the Democrats, for defending Mitt Romney’s record in the private sector. Actually he said the campaigns shouldn’t be about attacking each other. But that was too much for the Obama campaign, so David Axelrod, one of Obama’s top advisors, attacks Mayor Booker for his mild statement. What do we learn from this? We learn Democrats may not defend private business, because Obama’s campaign for reelection includes attacking private business.
It is incredible that we have reached this point, yet a large part of the people support the president and so, if only by default, support the attack on private business. So for this election, more than most, the people, the voters, need to be reminded about the difference between government and private business.
To be sure the relationship between business and government is symbiotic. Indeed governments are instituted among men to secure certain rights (see Independence under Declaration) that directly and indirectly are supportive of an individual’s ability to start and run a business.
To be successful, anyone starting a business needs to know that a friendly, consistent government will provide a legal framework which is understandable, stable, slow to change and fair to all. This is commonly called the Rule of Law. It is then up to the individual to determine a product, a service that he can provide to others; something for which customers will pay enough so he can pay his bills, his employees and himself. These products will range from the legal services of lawyers to the manual labor of yard maintenance, to computer services, to shaved ice parlors, to the iPads of Apple.
After paying the direct costs of running the business, there must be enough excess to pay government for the services required of it. Let us be clear on this. Salaries and profits must both have enough excess to pay taxes to support government.
This is the crux of the issue. For government to exist, for the programs and subsidies that government provides to exist, there must be enough excess in private businesses and individual incomes to pay taxes to government and still leave enough to run the business. Where else does the money for government come, if not from there? Government has always been about taking from those who produce to give to those who govern. Kings and princes in a feudalistic society were the precursors to this process. The tax collector first comes to take from those who produce before the benefits can be given to the supporters of the king.
What is implied and must be understood is that the price of everything is higher because a certain percentage of the cost of the product must go to pay for government. The taxes on gasoline are a notable example. For every gallon purchased in North Carolina, 53 cents is tax. Payroll and income taxes are similar. For every dollar earned, a certain percentage is extracted to be given to government. If taxes weren’t taken from your earnings, one of two things could occur: you would make less on paper but have the same amount to spend, or you would get to keep everything which now goes to government in taxes.
As government has grown, the businesses and people who work outside of government have kept less of what they have earned while those in government take more. The result is that private business, in total, has become relatively smaller and weaker while government has grown larger and stronger. Unfortunately, even though government depends on the viability and profit of private business, there comes a point when there is no more to take. This is the simple result of taking too much, or of people no longer trying to start a business in the first place.
It is not the small-business startups which are referred to here, but the ones that require investment to build or renovate a manufacturing plant, to put the machines inside, to buy the initial raw materials and pay the employees as they work, long before anything is produced that can be sold. When those who might start such a business see government as a hindrance instead of a help or partner, they no longer make the effort; they refuse to take the risk, and so a business doesn’t come into being. Then new jobs don’t come into being and the unemployment lines stay longer than they should. Government doesn’t have as much to tax, but its appetite for taxing has not shrunk. What has shrunk is the private economy from which it takes.
Unfortunately many people don’t understand the relationship between government and its dependence upon the private economy for its existence. They think government just has money, that it is an amorphous entity which simply writes a check and no one has to do anything for the revenue to appear. That’s like the lady who said she couldn’t be out of money because she still had blank checks.
The fact is someone has to make something for government to have something to take. When President Obama attacks private business he is attacking that which has made this country and the people who live in it so well off. He is biting the hand that feeds him.
If those that support him don’t understand this, if they believe his speeches and refuse to understand the economic truth that more people must work for something than receive something for “free” from the government, then government debt will continue to increase, fewer businesses will be started and we, the people, will continue to have less and less. Seriously: Why should anyone work if they can get what they want for free from the government?
The analogy is simple: as long as you feed, clothe and house your children, requiring nothing of them in return, they’ll lay around the house, eating, playing video games and pretending to work, but generally wasting time and making a mess. What lesson does this teach the children?
Caring parents teach their children a work ethic and personal responsibility; to go out, get a job and make their own way. The choice we face with our relationship with government is much the same. Obama is about depending on your parents. Romney is about personal ambition and achievement.
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