You know the amazing thing is that liberals today and many misguided conservatives think that we have to reinvent the wheel every time somebody or some business has a problem, financial or otherwise. They think these type of situations never occurred in the past.
Very, very wise white men (not Latina women) created the Constitution of the United States. It is an incredible document that allowed the United States to produce over 30% of the world's GDP with only 5% of the world's population in less than 200 years after the country was founded. Even today we still are producing over 20% of the world's GDP.
Why? Because the Constitution established a rule of law, property rights, and freedom that allowed men to create wealth through their labors and not have it confiscated by lawless dictators. When people are allowed to freely trade and become wealthy through their ingenuity and hard work they work hard and create ingenious inventions that benefit everyone.
Just consider the cases of North Korea vs. South Korea.... East Germany vs. West Germany.. the Soviet Union vs. the United States.... there is no comparison in economic output. Why? Freedom, property rights, and contract law vs. authoritarian dictators and government officials making all the rules and decisions for the people, it's as simple as that.
The solution to most all of our problems today is to simply follow the Constitution, but we are gettting further and further away from it and Obama is trying to trash it completely. Take our national debt for example. If the federal government would follow the Constitution we would not have this debt because they would realize the powers of the Federal government were narrowly defined in the Constitution and that most everything they are doing, except for national defense and interstate commerce, is power that resides with the states.
Therefore, if they were actually following the Constitution the federal government would not be
able to throw money at every cause they think is worthwhile and that includes education
and health care. Nowhere in the Constitution does is allow the federal government to be involved
in these areas of our economy, but those are the primary things our idiot politicians running
for a federal office wants to talk about. I guess they think the people in the states are
just to stupid to be able to handle the education of their kids and their health care needs.
This was addressed by James Madison, considered by most to be the father of the Constitution, in the Federalist papers (45 I think). He stated that the "general welfare" clause
did not give the federal government the right to do anything beyond what was specifically
outlined for them to do in the Constitution and again stated that those powers for the federal
government were very narrowly defined.
The Constitution outlined a process called bankruptcy.
The founders knew that sometimes in life things go south financially for people and for businesses.
Bankruptcy law is well established and is the proper mechanism for handling situations like the banks,
GM, and Chrysler found themselves in during the last few months.
This means real bankruptcy through actual bankruptcy courts where contract law that has been established for over 100 years is what determines how the assets will be divided... and the bondholders are first in line, not last in line like the Obama thugs decided just because the new King wanted to pay off his supporters, namely the UAW.
Would all these jobs have been lost if GM and Chrysler went belly up? No.
The other carmakers, including Ford and Toyota which have plants here in the US, would have sold more cars and
hired more workers if the market needed more auto production. So in reality we taxpayers
were soaked $70 billion to date ($50 billion for GM and $20 billion for Chrysler) and in reality
we saved few if any jobs when you subtract the additional workforce that would have been
hired at the surviving car companies.
Low tax rates, reasonable regulations, and free markets are always the answers to more prosperity for more people.
Don't believe it? When the automobile was invented people started losing jobs in the horse and buggy industry. Would it have made sense for taxpayers to subsidize these companies in order to save jobs? No.
Let the strong survive and let the weak fail. This clears the way for capital and labor to move into something new and more prosperous based on market demands when companies are allowed to fail based on market conditions.
Through this process we will all be better off. It's the "invisible hand" at work which Adam
Smith talked about in his Wealth of Nations book written many years ago.
"But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by aninvisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it."
J. Cogburn
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