March 22, 2011
Destroying Wall Street will not make poor people rich
I hate elitism. I really do. I have worked with people from all walks of life and the only people I cannot stand to be around are those who believe their personal opinion respresents the norm. No one individual can stand as a representative of the whole. Period. It is impossible.
Although I do not hate rich people, I do hate rich people who feel they are wholly entitled to their wealth because they are better bred, better raised, better educated, or whatever. A person who earns their wealth is always entitled to it, that does not make the person inherently more human than someone who is less successful. Capitalism is not a zero sum game. You can win, you can lose, or you can wind up anywhere between the two extremes. That is the power of a genuinely free market. True, some people enjoy insane wealth while others starve. The fringes are irrelevant. In a free market the vast majority wind up with enough food, enough resources, and enough small luxuries to genuinely enjoy their life, regardless of how their personal success compares to the extremes. There has been no other system throughout history that this can be demonstrated for. In every other economic system humanity has ever tried you still wind up with extremes, but now the extremes completely dominate the society and there is nothing in between!
So when I see something like this, I am completely flabbergasted:
If they succeed in destroying the minor, fragile recovery and inducing another economic collapse they will not win redistribution of the money and resources enjoyed by the most successful into the hands of the least successful. If you shut down Wall Street, you shut down the world.
There will be no money.
It will simply vanish.
The money is not real. The entire world uses fiat currencies loosely tied into the perceived value of the U.S. dollar, which is in and of itself a fiat currency. Collapsing the system (which is inevitable by the way) means the money disappears. Sooner or later the fiat currency-based, fractional reserve banking system that our world completely and wholly depends on will come crashing down around our ears. That is the weakness of the system. The goal is to find a better system to replace before it fails and then to transistion into the new system. So far, no one has come up with a better system for redistributing the world's wealth!
Redistribution is what the entire system is based on. The fiat currencies must circulate and must maintain a perception of value both on their own and in relation to the others. If you remove one without replacing it with another fiat currency (note the Euro) the entire house of cards comes crashing down, the world's resources get concentrated into a few hands, and the rest of us starve to death.
If you crash Wall Street there will be no money to pay oil workers, thus there will be no oil. If there is no oil, there is no transportation, no fertilizer, no research, no global communication system, no electricity, no heating oil, no food, no consumer goods, no lumber, no material goods, there is nothing. Each individual will be forced to survive on the basis of whatever immediately falls to hand. Communities like the Amish will thrive, cities like New York will be abandoned, billions of people will either starve to death or kill each other trying to steal food from the few who have it.
There are many problems with the current world system. Communism or any form of collectivist organization will only make those problems worse. The situation in Libya and throughout the Middle East, for example, is the direct result of collectivist thinking in conflict with individualist thinking. One group, the "people" feels cheated by their leaders, the very same leaders who have spent six decades designing their societies on the basis of what the "people" themselves have held to be true. People in local leadership in towns, villages, tribes, and neighborhoods throughout the Middle East have demanded their national leaders preserve ancient traditions and reject the encroachment of the modern world. Well, a new generation has arisen that no longer agrees. They are demanding the modern world be allowed to replace traditional society.
They are not demanding theocracies.
They are not demanding Marxist redistribution of national wealth.
They are not demanding greater centralized social control.
The danger is that one or all three of these might replace the traditional social structures they are demanding be removed. If that happens, then they will wind up worse off than they were before.
If the American progressive movement succeeds in both their coalition with unionized labor and their desire to link up with extreme elements of Islam, then the fiat currency based, fractional reserve banking system will implode because it cannot exist without some degree of freedom in the markets and some degree of faith that individualism is superior to collectivism. If individuals cannot keep the resources earned through honest work in a diverse range of occupations each based on meeting a real and existing need then the system fails. Period. No exceptions. An individual's ability to improve their access to resources through hard work and creativity is the single fundamental idea the entire house of cards stands on. If you shake the foundation hard enough you do not redistribute the resources more fairly. In fact, you accomplish just the opposite. Collapsing the system will result in concentration of available resources back into the hands of those who happen to be sitting on top of them when the collapse occurs and it will also completely remove the ability of those individuals to improve their lives by transporting those very same resources to people who need them.
The current level of redistribution of resources is completely and wholly dependent on the existence of fiat currencies. If you collapse Wall Street, the currencies vanish. Yes, the system is flawed and does need to be replaced. No, collapsing the system will not result in the natural creation of a better system. Instead, it will only result in a reversion to one of the failed systems that the current system replaced.
Now is the time for creative thinking not destructive thinking. We need to be looking for a better system before this one comes crashing down around our ears. Forcing that collapse will result in reversion, not advancement. A series of forced collapses is the historic pattern that brought us to this point in the first place. Creating another forced collapse will only repeat the pattern. It will not generate a better system.