Sunday, April 19, 2009

The Collectivist Threat and Capitalist Promise

The following is a terrific piece from an Objectivist who spoke at the Chicago Tea Party on April 15 and who is a regular contributor on Fox News:

The Collectivist Threat and Capitalist Promise
By Jonathan Hoenig

Delivered at Chicago's Tax Day Tea Party Protest , April 15, 2009
Federal Plaza, Chicago IL

What an honor to be with you today! I'm the finance guy here, so let me clue you in on some truly frightening numbers. The US Government has pledged, promised or spent an unfathomable amount of your money over the last year. The total amount, as calculated by Bloomberg, is over $12.8 trillion dollars, which amounts to $42,105 for every man, woman and child living in America today.

It is 14 times the total amount of currency in circulation and approaches the entire GDP for 2008. It's enough to pay off every home mortgage in the country and still have two trillion to spare. To put it in perspective, twelve trillion is the number twelve followed by twelve zeros. To those who solely blame President Obama, remember that it was the Bush administration that expanded the federal budget by $1 trillion, passed the disastrous Sarbanes Oxley regulation and the Medicare Prescription Drug Program. Bush added more than $4 trillion to the national debt, a 70% increase.

It was Bush's administration who got the entire bailout orgy started. You might recall him telling CNN that "I've abandoned free-market principles to save the free-market system". If that's not doublespeak, I don't know what is.

But today's protests, being held in over 500 cities nationwide, aren't simply about taxes, rather the philosophy behind those taxes.

It has been described as socialism, fascism or communism. In various contexts, all are true, but let's refine it. From loans to the automakers to the bailouts for the banks, the taxation, spending and control, the primary philosophy that's powering the country now is collectivism.
Collectivism holds that the individual has no rights. Your life and the product of your labor now belongs to the group. If the group wants a bailout, heath care, green cars, low mortgage rates, a job, an education - anything at all, it now becomes your responsibility to provide it, whether you want to or not. You see it in taxes that take money from people who've earned it and give it to those who have not. You see it in the language itself. Phrases like "we're all in it together", "I am my brother's keeper" and "shared sacrifice" all speak to the same idea: you are here to serve. And unlike charity of volunteerism, the "will of the people" is implemented by force, not by voluntary trade.

This is a profoundly un-American ideal. From the original Boston Tea Party came the Declaration of Independence which put forth the morality of individual rights. In this country, you are born free, not with a duty to serve the King but with a moral right to live your own life. "Life, liberty and the pursuit of happiness" refers to your life, your liberty and your happiness. You do not owe society a thing.

For socialists, collectivists, and others who support a high tax, high spending, government controlled economy, sacrifice is an absolute. You're expected to sacrifice for your neighbor, your government, for AIG or Citigroup, or deadbeat homeowners or poorly run municipalities, whomever the geniuses in Washington decide deserves your money.

This is wrong. The Founding Father's view of government was that its scope was limited and clearly defined.

Is the purpose of government to own and run a car company? An insurance firm? A bank? A mortgage company? Of course not. We've become one of the state-owned basket case European economies we used to make fun of in this country.

This country was the once land of "rugged individualism."

"Individualism" is a term you might hear a lot. Fundamentally, what it means is that the individual, not the group, is what is important and valuable. Individuals have rights, groups do not, because groups after all, are only collections of individuals.

You want to help a needy deserving homeowner? Fine. Write them a check. Charity is a perfectly legitimate thing -- but government doesn't own you, nor does your neighbor, the needy, the children or anybody else. In America, there are no masters, there are no slaves.

In recent decades, and certainly over the past year, we've moved away from rugged individualism and toward a collectivist society that forces everyone to sacrifice for the group.

In a political context, individual rights means free market capitalism. AIG never cost me a dime until Tim Geithner put my hard earned savings into it. The financial crisis can be directly traced not from capitalism, but from a collectivist, interventionist government. The Federal Reserve, Freddie Mac, Fannie Mae, the Community Reinvestment Act, Sarbanes-Oxley, not to mention the $12 trillion bailout and stimulus efforts are not mechanisms of the free market.

Tax Day Tea Party Protests are rallies against taxes, yes, but even more so against collectivism, that immoral notion your life, your energy, your wealth are Washington's property.

Look around at this incredible city. It wasn't a bailout that created the most prosperous country in the history of human civilization, but a society that limited the role of government and protected the individual rights of each citizen to live his own life.

A return to that philosophy is our only hope.

Jonathan Hoenig is managing member at Capitalistpig Hedge Fund LLC

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