Wednesday, September 10, 2008

Bob Cook: Trust in Our Free Enterprise System

In response to the boys of a family friend, who have cited a NY Times article on the Economy as "proof" of why they're supporting Obama, Bob Cook provides this retort:


A competitive free enterprise system is constantly enduring hurdles and setbacks, but the basic system is the best and most successful ever employed by mankind. To site one problem in one sector (Housing) that happened at the same time we have experienced a substantial pricing increase in oil (which affects us all) and then leap to a statement “IN FUNDAMENTAL WAYS, THE AMERICAN ECONOMY HAS STOPPED WORKING” is not based on fact. What it does is lay the groundwork for government to play a larger role in commerce.

Yes, belt tightening is absolutely inevitable if we are going to compete in the global marketplace. We have lived in a world of growth, new inventions and products, property values escalating, etc. but in a true free enterprise capitalistic system, there are NO GUARANTEES that will always consistently occur. Every time government tinkers with one area of the economy to prop something up, another area suffers.

Consumer debt unquestionably is too high and out of control. Discipline, Education, and Leadership must correct this problem, not throwing the “system” out or changing it dramatically! There are no guarantees in life. Services as well as products come and go as demand shifts. Businesses must change or die. Employees (and UNIONS) must understand change and the effects of supply and demand as well as the nature of a competitive environment. Without the understanding and mutual cooperation, businesses will fail or move to a more acceptable environment.

The subject of this country’s health care absolutely needs to be addressed. Problems abound with blame for all involved. Because we have the finest of medical care, caution must be exerted to make certain we do not sacrifice quality and expertise. Too much testing and too much running to hospitals with the most minor of problems are two of the many areas of concern.

Hospitals are settling law suits into the millions for every adverse reaction or mistake or even implied lack of skilled care. Something must be done to curtail or cap such huge outlays of capital. Some payment should be required from those wanting an abundance of attention.

Federal tax credits should be available for individuals providing their own health insurance. With life spans longer and health better, age 65 is no longer a realistic age to be triggering Social Security. A trust fund was established for this program, however, it was eliminated by LBJ and a Democrat controlled House and Senate and put in the General Fund. We must reestablish the Trust Fund and the new Clinton tax on receiving these funds should be diverted solely to this Trust Fund. More federal dollars must be moved from foreign aid and maintaining U.S. troops everywhere in the world, and spent wisely on America’s roads, bridges, and worker retraining as Bob Reich suggested long ago. Oil drilling (passed but vetoed by Bill Clinton) should finally be unleashed fully with vast job creation as a result. Why would there be vast quantities of oil in South America, Mexico and Canada, but little in the U.S.A.? That is very hard to buy!

Fiscal discipline by our government is absolutely essential. To say we must “fix global warming” is pure folly. We are not capable of such, and besides, it has not been warming in a decade! The idea of “emissions permits” issued by the government would be more government red tape leading to outlandish corruption. Obama would undoubtedly do the bidding of LABOR UNION BOSSES, often to the detriment of hardworking non-union workers. What do unions want: (1) Elimination of the secret ballot for unionization, (2) Elimination of NAFTA, (3) Establishment of trade barriers, (4) Federal penalties for businesses wishing to move to another country, (5) More government employees carrying a union card, and the list goes on. None of this would help our economy. Government involvement in more of private enterprise will spell disaster. Constant condemnation of PROFIT is dangerous and counterproductive. Certain industries should not be singled out as being too successful. That is not the attitude that made this country great. Education absolutely needs improvement, and the sooner bad teachers and administrators are dismissed, the better. Good, creative teaching should be singled out and rewarded. Those ideas are not acceptable to the mass leveling aura of unionism. Unions should not be running our schools. Competition works wonders at all other areas of life, and it should with education as well. All parents should be free to send their children to the school of their choice. If that means “Vouchers,” so be it as we are all taxed throughout or lives for the public school system whether we use it or not.

Capitalism is blamed for not delivering income equality and permitting budget deficits. The magic of CAPITALISM can do wonders, but not when hampered by unrealistic taxes, unreasonable regulations, and constant criticisms by the government. By raising personal federal taxes, Obama will hit thousands of job creating small businesses filing personally as “Subchapter-S” Corporations. What a dramatic blow to our economy this would be. This is one of the many important negatives of the OBAMA ECONOMIC AGENDA. Part of this agenda is a “windfall-profits tax” on oil companies. I could expect this in Cuba and Venezuela, but America? Both parties could use a lesson in staying out of private enterprise! Who would be next? This is not a government prerogative.

Ronald Reagan’s and George Bush’s tax plans worked, as most tax reductions do. To scrap this existing, successful plan would do great harm to the economy. Obama says that will be one of his first priorities. Obama’s $250,000 “family” tax increase will have a severe, long term, devastating effect. To penalize success, and continuously reduce the carrot at the end of the stick is to ignore and belittle the very thing that made this country great. Why must the liberal mind-set continuously penalize hardworking, accomplished people? What is wrong with “PROFIT”? Where do those profit dollars go? They go right back into the ECONOMY to keep the wheels turning. They are the fuel for a robust economy. They are not buried in the backyard! Sadly, Obama has made no exception for the vital “Sub-S” Corporations in his tax increase scheme. I say again, this will be very hurtful to the small business community.

The “HOPE CREDIT” for college would not be nearly as devastating and would probably work smoothly, helping those in need. With Medicaid going into big financial trouble, cutting payroll taxes does not seem to make any sense at all. Benefits are going to have to be cut, along with a higher age qualification, if this program has any chance of long term survival. The “FAIR TAX” should seriously be considered, but will not be in an OBAMA administration. Using the income tax to transfer money through government to low income earners is certainly not the roll of the federal government. Lowering taxes and even eliminating taxes is within the understandable realm of what Congress can reasonably do, but paying people who report low incomes is ridiculous and will lead to still more cheating and corruption regarding income tax reporting. A national sales tax (with proper exemptions) would eliminate all “underground” tax cheating. This is now referred to as the FAIR TAX.

When corporations are compelled to pay more tax, where do they go to obtain the funding? That’s right you and I, Mr. & Mrs. John Q. Public! Not only the stock holders hit, but eventually the users of every product or service provided by those corporations. There are so many pieces to an increased, robust economy as there are to a downturn and slow economy, and these changes occur slowly. To suggest that President Clinton’s tax hikes brought us prosperity is ridiculous. Forces were well underway toward such before his arrival, but look what had occurred at the end of his eight years, a serious recession.

President Bush did the right thing to cut taxes as he brought us out of the worsening recession. The deficit that occurred was not from that, but from excessive congressional spending on everything in sight. Government spending has got to be permanently brought under control. Eliminating “ear marks” and using line item vetoes (as well as complete vetoes) can help do this. The President absolutely must have such line item power which he does not have at present.

The thought of income redistribution patterned after such an effort in other countries makes no sense as it is not successfully working in those countries. Obama bemoans the fact that his party has failed to tell its story and the Republicans have done a good job of telling theirs. Could it be the Republicans have a sound common sense and reasoned format and the Democrats do not? Once again, deficits are referred to in this article as being a direct result of tax cuts. I believe these cuts dramatically stimulated the economy bringing more tax revenue, which in turn triggered greater government spending. This exacerbated and undisciplined spending is the root cause of the deficit. Both parties seek prosperity. A return to some measure of manufacturing will go a long way toward that end. Government can assist in that effort, but must work with and not against our wonderful competitive free enterprise system. Wouldn’t it be nice if we all pulled in the same direction?

Bob Cook

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