Posts Tagged ‘lobbyists’

Big Guy Versus the Little Guy

Thursday, April 13th, 2017

Dear Friends,

It seems to me, the role of government has always been, and continues to be, to keep the little guy down, while protecting the big guys from the little guys. The founding of the US ushered in a new paradigm but the elite, over the course of a century managed to evolve even that virtuous national ethos back to the traditional one. Today there is not a nation on the planet that allows the little people to compete on a level playing field with the big guys. With an eye to calculation, the elite use the power of propaganda to convince the little guy that they work for him, against the little guy’s interests. This is done in a myriad of ways. Usually they offer up a piece of legislation that sounds good, a hike in minimum wage for example, but actually works against the interests of the little guy. We have shown such a propensity for falling for the trick, the elite know they have nothing to fear from us, because we will fall for it over and over again.

Income taxes are the ideal example. At the beginning of Obama’s Presidency, the billionaire Warren Buffett told a crowd of drooling reporters that he was incensed, his secretary paid a higher tax rate than he did. This was reported all across the media landscape as proof Buffett is a human hearted man. So the elite in government dutifully raised his secretary’s taxes, cut Buffett’s and gave him a monopoly for his choo choo trains to carry crude oil from Canada to Texas refineries. Of course transporting oil on trains is exponentially more dangerous then in a pipeline, as Lac Magantic proves, a few dozen little people burning to death is a small price for them to pay however, for the wonderful philanthropist Buffett’s monopoly profits. The entire affair was nothing but a propaganda exercise that worked perfectly.

People who work for a living pay a much higher tax rate than people who derive their income from investments. The already rich derive their income from investments and can pay accountants to protect their income from the tax man, those of us who labor for our daily bread however, have little left to pay an accountant and tax lawyer to protect ours, so we pay through the nose. The false meme that people earning over 200k should be taxed to death, only serves to keep the rest of us down, and protects the uber wealthy from having to compete with us. This is because the guy earning over 200k is not rich yet, she is trying to get rich, and the elite cannot tolerate that, so we are plied with propaganda based on jealousy and envy. The little guy is again tricked into damaging our own interests and protecting those of the elite.

Regulations are all about keeping us down. The role of regulations, despite what the elite tell you they are, is to protect a politically favored group or industry. Let’s say someone starts a business and manages to get rich despite the array of government regulations, taxes, cronyism and corruption. The first thing he will do is turn around and close the door behind him. This is done with regulations. He will use some of his wealth to lobby government to pass regulations making his industry “more safe.” Of course more safe always means a higher bar to entry. That higher bar, one that the already rich didn’t have to leap, protects the elite from having to compete with the hungry entrepreneur. The old saying, Shirtsleeves to shirtsleeves in three generations is one of the primary motivating factors here.

The children of the uber rich never grow up. They don’t have to. So they are ill prepared to compete with people who have grown up in the school of hard knocks. That is why in a traditional capitalist economy this saying holds true. Today however the elite have put in place a whole plethora of ways to protect their half witted grandchildren. Trust funds, regulations preventing competition, taxes to keep the working woman down and cronyism that only allows certain people to do certain things. In South America they haven’t had a free market… ever. I have a friend from Guatemala Brolio. One day we were talking and I mentioned to him that land in Guatemala must be pretty cheap, and the forest products industry pays handsomely for the lumber from that part of the world. I went on to say that if him and I went in together to buy some land and used good silvicultural practices we could make a mint. He laughed and laughed at the very thought. Shocked, I asked why? He replied that only certain people in Guatemala can own land.

The next time you have to cut a check to the government for some arcane regulation you ran afoul of, to pay a tax you weren’t aware of, to get permission from the government to engage in economic activity or buy equipment that you have no use for, to satisfy some government rule, you are experiencing this in action. You are being actively held down so the elite don’t have to compete with you. Next time you get fined by some self important bureaucrat, you’re economic future is being crushed by government, to save the fortune of a half wit. This has been the role of government from time immemorial. Oh yes, there have been a few times, short periods where this wasn’t the case, and those times have been immortalized as golden ages. Ancient Greek democracy, Roman republic, the founding of the US and the early years of free enterprise also known as the Enlightenment, are the few examples. Notice however, that those periods were short, singular and most importantly, the nations and societies involved have never risen again. This is why there is and always will be a huge disparity of wealth in the world.

Sincerely,

John Pepin

Why there is so much money in politics

Monday, January 18th, 2016

Dear Friends,

It seems to me, the perennial question in politics is, what comes first the money in politics or the corruption? That question misses the point however, if the power of the state hadn’t grown to the magnitude and reach it has, there wouldn’t be much money in politics to begin with. People are always and everywhere self interested, in some places their self interest is tied up with tribal interests, other places self interest is bound with family, while in Western cultures self interest is about the self. No matter how self interest is defined by the culture, if it is more profitable to pay a government crony to get rich, rather than produce a product or service your fellow human beings need and want for profit, people will choose to bribe a public servant every time. There is a saying in modern business that a dollar spent on lobbying is worth ten on product development. What a damning thing to say about government’s corrupt influence on the economy. Yet there it is, it is more profitable to spend money on politics than to develop a product people want and can use.

In a market economy the path to riches is by producing something that improves the lives of others. That truism has two main outcomes, one is that the standard of living is constantly under improvement due to the introduction of labor saving and life enhancing products produced by entrepreneurs, and two, those who get rich do so by helping their fellows. This is why the market economy is so effective and efficient. When the self interested path to wealth is by improving the lot of Man, people who want to get rich will improve the lot of Man. What a simple concept to understand.

Most people who want to get rich however don’t want to go to such lengths, they would rather just steal the wealth through confiscation, government granted monopoly or outright corruption. Those in government see the wealth of the nation and in their hubris and greed they want an ever larger share of that wealth. Basically, sociopaths and psychopaths don’t want to help people, but want to get rich, so they turn to government. This is one of the reasons it is in the nature of government to grow. People who seek unearned wealth need to convince those they are stealing from, that it is in the best interests of the victims, so they connive and poison.

They connive to trick the mark into willingly giving up their sovereignty for “fairness,” “safety,” or shared sacrifice,” but it is only the people who sacrifice, the elite slop at the trough of government largess and the poor only get the slop that is tossed onto the ground, in the elite’s feeding frenzy. Politicians and lawyers poison the economy, to create the conditions where people are more and more desperate, because desperate people don’t think they act on emotion and emotional people are easily manipulated. So the power of government grows and grows, while the wealth of the nation shrinks and shrinks, and as the power of government to interfere with the economy, poison it if you will, it becomes ever more efficient to feed the leviathan than be fed to it.

As the power of government grows more money is fed into the machine. It becomes less and less profitable to produce a product or service that benefits people and more profitable to pay government to shut down your competition. Those in business can’t take the chance their competitors will pay government to shut them down through regulation, so they have to belly up to the bar, paying government not to close their doors. The corruption, power and influence of government grows and grows, in the arms race of businesses to keep ahead of their competition. In the meantime, money that would have gone into product development is spent instead on lobbying and political donations, therefore less products are available and demand for labor decreases, lowering wages and the labor participation rate.

So the question of, what comes first the money in politics or the corruption misses the point. It is the unchecked growth in government reach and influence that drives both. People will seek the easiest means to wealth available, and if that means is political power they will choose that route, especially sociopaths and psychopaths, that is why government is filled with them. Just because they are pathological doesn’t mean they are stupid, so they convince the people, or at least some of the people, they would benefit by more power in the hands of government. Once government has the power to destroy whole industries, create laws forcing people into markets and poison the economy, it is more efficient for business to pay government than to produce products and services. Once a nation gets there the economy can only rot away like moldy bread. The real problem is abandoning limited government for the nanny state, it always has been, and always will be.

Sincerely,

John Pepin