Friday, May 08, 2009

America Needs An "Ethical Revolution"

Nick Provenzo at The Center for the Advancement of Capitalism writes about the crisis we're in and the solution (it's not government intervention and meddling).

So unlike the claims of some, the current crisis is not so much a battle between Wall Street and Main Street. The problem we face today rests on every street; it rests in our nation's unchallenged enshrinement of need as a virtue and its willingness to use government power to assuage that need. Instead of leaving people free to work toward improving their lives though their own efforts, we have created a system of perverse incentives; a system that has now collapsed as a system so-designed must.

What then is the answer to this panic? I hold that we simply ought to let the businesses that failed fail, expedite the liquidation of their assets at their current market value under streamlined bankruptcy laws, and once and for all remove our government from the business of creating perverse economic incentives.

Notice however that such a plan is not a serious proposal being debated within the halls of Congress. Instead we are told that we require more regulation of banking through "Financial Stability Oversight Boards," smaller CEO salaries, stricter business accounting rules, massive taxpayer-funded bailouts of banking, subsidies to borrowers, and perhaps most rich, we are told that we should expect our government to make money from it all as it essentially nationalizes the commercial banking sector. I'm sure the folks at Amtrak think that they are going to make money one day too, but institutions that respond to political wishes rather than the reality of the marketplace do not make money; they lose it and in our age they lose it to the tune of billions upon billions of dollars.

So for the market to be restored, we must first demand an ethical revolution, one that says that people have a right to their life, liberty and the freedom to pursue their own happiness, but not a right to claim the unearned or a right to have our government provide it for them. Our nation needs to learn a new mantra: Give us liberty, and death to government controls. (Read here at Center for the Advancement of Capitalism).

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