Capitalism Promotes the Common Good

Jerry Springer once hosted the trash-TV show The Jerry Springer Show. That program was notorious for its gutter content (fights, insults, profanity, adultery etc.). Springer is a far-left Democrat who once was mayor of Cincinnati, Ohio and he is a big Obama supporter.

During an interview on a radio show Springer recently suggested that the point of capitalism is to hire as few people at the lowest wages possible in order to make the most profit for the business owner. He also said that Obama inherited the economic crisis.

He was wrong on both counts and egregiously so. First, let’s look at Springer’s critique that capitalism exploits people. So in contrast what was Springer’s big contribution to our economy and our culture?

It was his TV show and it was pure, destructive garbage. Because it is the relentless tearing down of our good society by media pigs like Springer that is one of the main causes of our economic woes. Tens of millions of people have lost any sense of decency and propriety watching mindless productions like Springer’s show. And once people are degraded and distracted they can lose everything quickly without even understanding why or caring why. Then they go running shamelessly to the government to bail them out because liberals like Springer say it is OK to do so.

On the other hand we conservatives criticize productions like Springer’s; we maintain our personal integrity; we start businesses; we create jobs; we work hard; we advise people to behave well in order to improve themselves; we serve in the military; we go to church and worship a good God; we study the Constitution; and we conserve our hard-earned wealth and use it wisely. In short we do positive things.

And while Springer claims that capitalism is unfair it is important to remember that socialistic Europe has had twice the official unemployment rate of the United States for decades. How could this happen if socialism is so wonderful and wants everyone employed as Springer implied?

Answer: It is because highly-taxed socialistic economies historically have produced low economic growth and few jobs while low-tax, capitalistic economies have historically provided the most growth and jobs and the best opportunity for people to improve their lot in life. Global populations always have migrated toward capitalism and away from socialism and communism.

But you will never think about these facts if you listen to the Liberal Media and people like Springer. Meanwhile this Springer mantra that Obama inherited the bad economy from Bush is phony. After all the 2008 economic collapse was caused by the long-range policies advocated by Obama and the Democrat party. That collapse was caused by two things – the ‘subprime crisis’ that coincided with the bursting of the ‘housing bubble’. So let’s look at each:

The ‘subprime crisis’ meant that banks were forced to make trillions of dollars in loans to poor people who then largely defaulted on the loans, which then lost their value. And since these loans had been guaranteed by government-run Fannie Mae and Freddie Mac (by the taxpayer) and securitized and sold into the economy as investments, the subprime crisis was borne by the whole economy and by the taxpayer, and not by the poor people who had defaulted on their loans. Because part of the Democrat deal was that poor people would get the loans without any downpayment required. So the poor people didn’t bother to fight to stay in their homes to protect their investment. Because they had no investment.

Historically bankers required a big downpayment in exchange for a home loan specifically because it made a loan harder to get and it also gave the borrower a stake in the loan. This was rational policy because you really had to work and save and be disciplined to get a loan, to show that you are ready for the rigors of home ownership.

But Democrats complained for decades about downpayment requirements. That’s why they forced banks to not only make the loans to poor people but even loans without a downpayment. Eventually banks were forced to make the notorious NINJA loans – loans to people with No Income, No Job or Assets. In other words, you could walk in off the street and get a $300,000 home loan just by writing down your name and address and claiming that you were a victim of past discrimination.

Republicans saw the ‘subprime crisis’ coming for decades. They opposed the Community Reinvestment Act of 1977 that started the whole ball rolling by forcing banks to make these easy-money loans, even in bad neighborhoods. Then for years Republicans and conservatives demanded reform at Fannie Mae and Freddie Mac while Democrats and people like Obama opposed reform at every turn. Democrat congressman Barney Frank, when he was chairman of the House banking committee, even publicly said as late as July 2008 that Fannie and Freddie were in fine shape while they both collapsed in September 2008.

Then in 2011, after the smoke had cleared, Obama himself said that the ‘subprime crisis’ showed that poor people indeed “might be better off renting” which is what we conservatives said all along.

We conservatives believe that poor people generally do not have the discipline to own their own homes and should be renters, but that those who truly want to advance themselves through home ownership certainly should have the chance, but on legitimate terms and under strict guidelines like everyone else.

The second part of the 2008 collapse was the bursting of the ‘housing bubble’ which happened concurrently with the ‘subprime crisis’. Democrats and the Liberal Media all conveniently claimed that the ‘bubble’ was the capitalist system run amok. This is the opposite of the truth. It occurred for two reasons:

*because one person in the government, Federal Reserve chairman Alan Greenspan, set interest rates too low after 9/11. There is universal agreement on this. And we capitalists and conservatives always have argued that business must be regulated but that government should never, ever set wages or prices. Even George Washington said this. But with Greenspan we had one single person in the government artificially and wrongly setting interest rates for home loans (the “price” of loan money) too low. This is why the housing market went crazy – because of easy money – and then collapsed.

In fact easy credit is much worse for the economy that hard-to-get credit. Because easy credit encourages recklessness. That is why capitalism says that you should earn your wealth and keep what you earn, and not be given your wealth or have your wealth given away to others who may spend it recklessly.

*the ‘housing bubble’ also occurred because millions of people in our banking system today are college-educated liberals who think that banks should be institutions of social engineering. So they have incrementally lowered the standards at banks, which they were taught to do in our left-wing universities.

By the way Jerry Springer claimed that Obama “inherited” the bad economy, which is false. But then it is important to remember that Obama also “inherited” gasoline at $1.85 a gallon and today it is $3.50.

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