“Greed” Is NOT the Problem


I remember testifying several years ago in front of the Health and Human Services Committee in support of then Representative Rich Cebra’s welfare reform bill. After my brief testimony, as I was returning to my seat, a Democratic legislator directed a remark toward me saying something about “Wall Street greed” and its deleterious effects upon civilization. His remark seemed out of context. It had nothing to do with the merits of the bill, or my remarks, but he simply couldn’t help himself.

The liberal insistence that the ills of society, indeed all human suffering, can be vanquished if, and only if, the modern incarnation of greed, commonly depicted as corporate wealth, can be tempered by the state and its army of regulators, is the central myth that fuels their sense of mission.

Here in Maine, a state that had been run by Democrats for the better part of the past 40 years, there is little to nothing to show for the progressive economic agenda in terms of a healthy economy. In fact, liberal policies have only resulted in chasing innovation and prosperity away from the state while nurturing a culture of dependence.

Ultimately, it is not corporate greed, but progressive government which is the root of society’s ills.  Look at Venezuela as a timely example. Just last week, after years of Chavez-inspired “paradise,” the state hurtled toward its inevitable collapse. But, instead of generating genuine introspection of the policies that produced such visibly atrocious outcomes, the Venezuelan president blamed American capitalism.  Meanwhile, millions flee from the socialist government of South America to the capitalist, prosperous United States each year.

Similarly, I don’t suspect economic enlightenment will descend upon Mayor Brennan or his fellow Maine liberals either.

What seems lost on modern progressives is the idea that private wealth creation has a force multiplier one hundred times greater than government. The state, which collects and distributes wealth without regard to return or risk is, in fact and by default, much more prone to be guilty of greed because of its inherent inability to self-police or self-regulate.  It continually throws good money after bad.

The state, not unlike corporations, is built on growth – more tax revenue equals more government. However, the corporation is required to determine and report risk, monitor and record investments, and ultimately deliver returns. The government labors under none of these quite acceptable restrictions.

Consider this method of private finance in contrast to the various economic models. The state habitually, continually lends without expectation of any return on investment, determination of a multiplier effect, or even a measure of risk and reward. Solyndra, anyone? I recall a few years back while on the campaign trail, some progressives were suggesting that food stamps, (yes, food stamps), had a 1.5X economic multiplier effect! Or, consider it in the context of Social Security. The argument against privatization of Social Security is the economic gyrations of Wall Street are too risky. Yet, the Social Security trust fund run by the government is on the verge of bankruptcy.

The news last week in Portland that several people with considerable wealth and assets are living in taxpayer funded shelters, which are intended as a last resort for the truly destitute and homeless, brings home this truth loud and clear.  Let’s not squander this teachable moment by pointing fingers and placing blame.  Instead, let’s examine and address the consequences of government greed.



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