Recently the Wall Street Journal reported that Federal Reserve Board Chairman Jerome Powell says the “Fed could start scaling back stimulus this year.” It’s important to understand that the Federal Reserve sets Monetary Policy, using rather blunt tools like short-term interest rates, the supply of money in the economy and now QE (Quantitative Easing). QE or printing US dollars is a new twist that subverts debt limits and allows the Department of the Treasury to spend money on new government programs, such as Green Energy and the Infrastructure Deal.
Congress sets Fiscal Policy: taxes, regulation, and controls over private industry. Each has its place and its time. However, when the Left gains control of either or both entities, the overriding philosophy is more control by government. With the current crop of democrats, more government intervention is assured. Sadly, it’s a 50/50 proposition when Republicans have control.
The issue is not more or smarter government control, the issue is more private sector freedom. The issue is more control of the government through the Rule of Law and less control by the government
In the wrong hands, monetary and fiscal policy work to subvert, alter or even harm the private economy. It is the private economy that creates every sustainable job, every long-lasting profit, every opportunity to acquire personal wealth by providing a product or service that others want. Its’ foundational principle is freedom.
Granted, government manipulation can create enormous wealth for an elite few, but at the expense of everyone else. It’s a zero-sum game. The private enterprise creates good for everyone who participates.
The point is that the private sector creates opportunity and success through freedom, not oppression. In Capitalism, the consumer makes his/her own decision free of coercion. This same freedom to choose is the foundation of our entire Constitutional Republic form of government.
The study of economics is the study of human nature. Capitalism is “Enlightened Self-interest.” It is self-interest because that is what motivates everyone. This is as basic and natural as our need to drink water. Capitalism recognizes this basic fact. Capitalism is Enlightened in that one can sacrifice immediate gain for long-term wealth. Enlightened in that one can forego an immediate gain that coerces another, to take the honorable path and enhance one’s good reputation through high quality and fair pricing. Private enterprise earns the right to prosper through freedom of choice.
It is curious that the Left says they are for the little people. The Left segregates the wealthy and successful (creators of jobs) and makes them punching bags. Yet every recommendation, policy or spending idea the Left proposes, requires that someone else makes the payment, not them. In the same vein, a freedom loving individual says if you don’t like guns, for instance, don’t buy one. Or if you like masks, wear one. The problem is that the Left, the government-centric, edicts that if they don’t like guns, they don’t want you to buy one. Or if I like masks, you have to wear one. The fundamental difference is that the Left uses the power of government to limit the individual’s ability to choose. The Left coerces.
Left unchecked, the government employees who implement Monetary and Fiscal Policy will attempt to overpower the private economy – through taxation, regulation and national debt. The principled objective should be free enterprise through controls on government interference via the Rule of Law, our Constitution. Let every rule, law, tax, regulation or ordinance be governed by the concept of the sanctity of the individual. The same freedom that accrues to the individual in our Constitutional Republic is perfectly reflected in economic capitalism.