The Market Economy and Spiritual Qualities
In a market economy, productivity leading to wealth entails spiritual qualities of life.
The materialists' fallacy game has ended. They have lost. But either they don't yet acknowledge the facts or they perversely deny their loss.
It is the mantra of the deluded, held by the old Materialists, European Socialists and, more recently, Maoists in China -- by Trudeauists in Canada and Progressivists in America, capped by Barack Obama's egocentric, progressivist willfulness and manipulated crises. That tons of resources and stimulus cash poured into the economy from an invented, mythical supply of money (the national debt) is the right path to economic prosperity has been shown for what it is: an illusion. "Fair" redistribution by taxing the rich has left the underclass worse off.
Barack Obama's original intention has not changed. He wants, and has always wanted, to transform America not in the image of our Constitution and heritage, but in his own image -- namely, how best to get money from others. Sadly, he does not know how wealth is created. He has never earned any himself by his own creative production of any goods or services, a process which includes the challenge of profit and loss.
But those physical resources and that money have now run out. America is finally coming to terms with the meaning of debt and the devastation it has brought upon what once was a great, productive society.
The path of exponentially increasing national debt leads inevitably to national ruin. America's social capital and economic capital are depleted because Americans are spiritually enervated and are being misled as to the proper role of government in the lives of the nation's citizens. Barack Obama sees the role and apparatus of government from the standpoint of the ruler, not from the standpoint of the citizens. He espouses the view, like Thomas Hobbes in Leviathan, that the sovereign has the right of decision-making, even in situations entailing life or death, as Obama did in supporting the Illinois law to allow living aborted fetuses to die.
Let us learn from our past. Consider, for example, that within three years, during World War II, America created the vast network of the Manhattan Project, at a cost of over three billion dollars, which became larger than the entire American auto industry -- the many research facilities, businesses, and industries; the nuclear facilities in Oakridge, Tennessee; Los Alamos in New Mexico; and Hanford, Washington; and sundry labs and factories, led by brilliant theorists, many of them in their twenties and thirties. They produced the unthinkable, the atom bomb, and thereby ended World War II triumphantly.
The cost of this today would entail a multiplication factor of at least 13 -- an unimaginable cost to present thinking. But they did it -- not by merely transferring money from one column to the next, but by imagination, creativity, and very hard work.
And if the rejoinder is that this was wholly a "government project," let it be acknowledged that often throughout the intense struggle to succeed, government bureaucrats had to be pushed out of the way to make it work.
Hewlett-Packard began by two men, Bill Hewlett and Dave Packard, tinkering in a one-car garage. Bill Hewlett gave Steve Jobs a summer job. Jobs went on to create Apple, one of the largest, most successful, and wealthiest corporations in the world. Both Hewlett-Packard and Apple were developed on the thesis of dependable innovation: to create products that make a business both efficient and profitable in ways not even imagined before.
Supply-side is the only way to go. It is the only game in town that will enable Americans to recover their economic strength and sense of national purpose. Spiritual capital -- the intangibles, not merely injections of mythical money -- is the name of the game.
Supply-side economics focuses on metaphysical issues. What undergirds them -- not Obama's obsession with "things," not material resources -- are the elements that are limitless, truly infinite: creativity, inspiration, imagination, the human will, and human determination. While this cannot be demonstrated on the charts of Keynesian economists, it works, and it works for very good reasons. It is the only game worth playing. Within a free society, these metaphysical realities are inexhaustible. They are the characteristics of those who, often with limited resources but with intellectual brilliance and unflagging determination, create products and services for humanity that humans hadn't even imagined they needed or might need. Herein lies the genius and altruism of the capitalist supply-side vision.
Some of the most prosperous countries in the world, whether Venice in the past or Hong Kong and Singapore in our own times, had limited natural resources; nevertheless, by creativity and ceaseless endeavor, they developed prosperous societies. How false to say, as Barack Obama says, that "you didn't build that ... someone else did[.]" It is theirs, by right of intelligence, creativity, and diligence, not to be purloined by an avaricious bureaucracy. Barack Obama's form of socialism skews, rather than guarantees, the value of everything in the economy and undermines the rights of ownership.
Government's job is not to control or become the major player in the economy, but to create a positive environment for creativity, innovation, and investment. This involves the courage to say no to many wasteful spending proposals from many sides of the political spectrum, and to carefully and systematically scrutinize how the public's tax dollars are spent.
This entails a budget, which the White House failed to submit in February as required by law, and which the Senate has not proposed in years (though the members of that body now say they will propose one within the next few days).
Amity Schlaes' recent book Coolidge is instructive: within hours of President Harding's death in 1923, Vice President Coolidge, suddenly vaulted into the presidency, met with his budget director to go on the offense against unnecessary spending. His opponents were the Progressives, the ideological ancestors of Barack Obama and Hilary Clinton. Coolidge cut taxes four times and produced a budget surplus in each year of his presidency. It was a prosperous era. He and his finance team created the "Two Percent Club" to honor departments that cut budgets by that amount, then the "One Percent Club" for those who cut by more. Coolidge met with leaders of the Congress frequently and with his budget director dozens of times in each of the years beginning in late 1923, when he became president, to 1927. While he recognized even then, as Arthur Laffer famously has said more recently, that lower tax rates increase rather than decrease tax revenues, Coolidge did not lower tax rates for that reason. Rather, he lowered them to reduce bureaucratic intervention in the lives of people and the business community and thus to enhance the prospects of economic growth.
Contrast this with Barack Obama, as reported by Vali Nasr, a university professor who was special assistant to Richard Holbrooke during the latter's brief tenure as envoy to Afghanistan and Pakistan. He says that Obama created a "Berlin Wall" of domestic political operatives around himself, and that he is a "dithering, controlling[,] risk-averse" United States president. For Barack Obama, friendship is based on what is for him favorable exchange of political services and loyalties. He is personally detached from most members of both parties in Congress, unless for purposes of public image he invites members in for an audience with himself. Last weekend, Paul Ryan, chairman of the House Budget Committee, said that his discussion with Barack Obama that week over lunch was the first in Obama's more than four years as president.
The growing number of those who are now permanent wards of the state await yet more "stuff." They have become clients of the political class. Will these become the decisive factor in future elections, deluded into thinking that fairness preordains that "those out there, the rich, owe us the entitlements we demand"? From whence, and for how long, can such expanding largesse continue and dependency be multiplied?
The anxious unemployed who truly want work, especially many middle-aged of the middle class, wonder whether jobs such as they once had will ever again be theirs. Leaders of both small and large businesses spend much of their time struggling with burgeoning regulatory impediments. Their cry is "Turn us loose; get out of the way."
Without individual creativity, innovation, diligence, and the inevitable risks associated with the displacement of existing products, ineffective leadership, and bureaucratic mindsets, long-term growth and sustained prosperity are not possible. Is our national recourse for the next three years simply to forestall further major debilitating White House initiatives, and grimly wait it out?
Samuel J. Mikolaski is a retired theological professor. His website is www.drsamstheology.com.