Does President Obama Understand Capitalism?

Last week, in attacking Gov. Romney for his association with Bain Capital, President Obama said:  “My view of private equity is that it is set up to  maximize profits, and that’s a healthy part of the free market.  But that’s not always good for businesses or communities or workers.”

The President simply doesn’t understand.

When business people seek profits for themselves they strive to satisfy the demands and wants of the market.  Yes, those are selfish goals.  But that’s the genius of the free market.  When businesses succeed they hire more workers and contribute to the community by paying more in taxes, for instance. Without the prospect of profits, why go into or invest in business?  To put it in the vernacular:  “What’s in it for me?”

The motivation of the business person is irrelevant to the economy.  If he serves the market, everyone (except his competitors) benefits.  That is among the keen insights contained in Adam Smith’s Wealth of Nations written over two centuries ago.  Harness human nature for the common good by instituting a free enterprise system. 

A sad irony of history is that efforts to structure economic models to do “good” (think socialism) end up doing bad.  They ignore human nature.  To pursue equality at the expense of opportunity is to discourage productivity at the expense of all. 

These comments are not meant to endorse a pure laissez-faire system. Government-enforced rules to require that businesses play fair with one another (protect trade secrets) or ensure safe food (meat inspection, for instance) are reasonable restraints. But, generally, government should stay out of the way.  The less free the enterprise system, the less successful it will be. 

That perspective would strongly suggest that a pro-capitalist president would want to do all he could to encourage businesspeople to seek profit.  He wouldn’t favor higher taxes on their income [shouldn’t the Administration want to do all it can to give incentives to those who create the wealth?  Actually reducing their taxes – not raising them – would make sense.]

President Obama, however, has supported measures that have increased governmental involvement in our economy, most notoriously Obamacare, as well as less well known restrictions on the financial and energy industries.  Remember the Keystone Pipeline which would have created thousands of jobs?

If you were a businessperson, would this anti-business climate fostered by the Administration encourage you to invest and increase your economic activities?  Or would you sit on your money and hope for better days? 

Another irony is that the Administration’s reelection prospects would be greatly improved by a healthy economy and that would be far more likely to exist if the business community felt that the President was supportive.

Why then does Barack Obama pursue policies which are so contrary to his political self-interest?  Certainly the evidence so far is that he very much wants to be re-elected.  The President’s campaign indeed is already focused on scorched-earth tactics it believes will achieve the objective.  There is only one answer that makes sense.  The President’s leftist ideology has blinded him to reality.  He believes that his approach must be right because that’s what he believes.  So how could he be wrong? 

His self-imposed economic ignorance will likely lead to his defeat in November.

What’s Wrong with “Gay Marriage”?

For those promoting it, it’s a matter of equal rights – as if being able to call oneself “married” as opposed to something else is a question of equality.

There is certainly an argument that individuals of whatever sexual orientation who proclaim their desire to be committed to one another should be able to enjoy the same legal benefits available to traditional marriage partners.  Rights of inheritance and medical decision-making are examples. And, in fact, anyone can accomplish such tasks by agreement with another.

Until recent years, activists for homosexuals focused on obtaining recognition for civil unions intended to codify the benefits already statutorily available to married heterosexual couples.

But such activists now want something more:  the right to have the term “marriage” applied to same sex unions.  Considering that legal benefits can be achieved by other means, why is there a fixation on a label? 

I suggest the answer lies in the very understandable desire to have societal approval for how one chooses to live.  It is a psychological quest, not a matter of civil rights. 

As such, the matter might seem to be of little importance to those who are not homosexual.  But plainly, the fact that voters across the country have consistently endorsed the view that marriage is only between a man and a woman suggests that other factors are involved. 

A significant block of gay marriage opponents view the proposal from a religious perspective.  The Old Testament, after all, treats homosexual behavior as a sin (Leviticus 18:22). 

From an historical vantage point, a traditional marriage –for reasons of power, economic advantage or love -- has always been between a male and a female.

Given biological facts of life, marriage has long served as an essential element of social stability by providing children with a mother and father whose presence usually aids in their development. 

Accordingly, if we accept the idea that traditional marriage is important to a healthy society, the question must be whether “same sex marriage” serves, detracts, or has no effect upon that objective?

That is a very important query in light of the dismal state of marriage in modern America.  Approximately 50% of marriages end in divorce, and the number of unmarried heterosexuals cohabiting has increased twelvefold in the last fifty years, for example.  As discouraging as those statistics are, it is hardly desirable to embark on policies which may further weaken marriages as a preferred status for living together and raising children. 

Yes, “married” is a term.  But labels do matter.  We choose to apply – or wish to apply – those which put us in a positive light. And so gays want to be able to use the label, too.   

Will allowing homosexual couples to “marry” further dampen the appeal of marriage for heterosexuals?

I don’t know. But as a society we ought to ponder the question.  From a conservative perspective, we shouldn’t rush pell-mell into expanding the definition of marriage without first seeking the answer.

Tradition deserves respect -- even when it no longer makes sense to some.  Traditions may exist for reasons critics don’t comprehend.  In this case, there may be unintended consequences down the road.  I don’t know.  But I do know one thing.  Unless the reasons for overturning a centuries old tradition are clear, don’t. 

Why Do We Act as though the Rest of the World is Like Us?

We Americans are a generous people.  And we think that the national creed embodied in the Declaration of Independence

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain inalienable rights, that among these are life, liberty and the pursuit of happiness

should be shared with others.

Consider Afghanistan.  The US is engaged in what is optimistically termed nation-building.  As a part of that effort, American troops are pursuing a policy of counter-insurgency.  The assumption is that if the population can be protected from the Taliban and its oppressive, radical Muslim creed, democracy and freedom will flourish.

But that’s foolishness.  With or without the Taliban, Afghanistan has never been a part of the world that values self-government and individual rights.  Rather, the country is a geographical area composed of many different tribes that, over the centuries, frequently war with one another and outsiders.

A tribe is not a democracy.  The chief rules.  The subjects obey or they die.  Unity of action is paramount to survival.  Otherwise they will be vulnerable to their enemies.

Of course, that’s not the American way.  But members of a tribe aren’t conditioned to think as we do.  The concepts of individual rights or religious freedom hold no cultural meaning.   They are foreign ideas and are inhospitably received.

Is it any wonder that our efforts at nation-building are floundering in the Middle East?  Yet, we are upset – and chagrined – when Afghans (of whatever tribe) kill Americans and riot in the streets because of perceived offenses (the inadvertent burning of Korans, for instance, that had already been defaced by Taliban prisoners).

Don’t they appreciate the thousands of American lives expended and billions of dollars spent defending them?  No.  Oh yes, they’ll take our money, but that won’t buy converts (to the democratic way of life).  And why should they be grateful?  They don’t share our values.  They’ll take, but not change their ways, because they don’t want to. 

The Wrong War, a recent book on Afghanistan, makes the point vividly.  The author, Bing West, is a fellow Vietnam veteran who knows a great deal about counter-insurgency efforts in Afghanistan, having traveled extensively through the front lines.

After surveying the experiences of the soldiers and Marines charged with implementing the policy, he succinctly noted of the Afghans:  they’re not buying what we’re selling.

If our policy makers (President George W. Bush and his administration included) had paid more attention to human nature, that verdict would not come as a surprise.

A Conservative’s Reading List – Oldies but Goodies

The Conscience of a Conservative by Barry Goldwater

Although authorship is officially the late Arizona Senator’s, it was actually penned by his speechwriter.  The book’s publication catapulted Sen. Goldwater onto the political scene in a big way, leading to his selection as the 1964 GOP presidential nominee.  The text is a primer on commonly-held views on the right and is an easy and educational read.

Economics in One Lesson, by Henry Hazlitt

This slim volume is a recitation of common sense free market principles (example:  “there’s no free lunch”) that lengthier and more sophisticated economic texts often avoid because they are not politically palatable.  

God and Man at Yale, by William F. Buckley, Jr.

This is a memoir of Bill Buckley’s student years as a religious conservative at an academic bastion of liberal secularism.  Apart from the verve with which the future founder of National Review writes, this book contains many cogent observations from the Right.