Friday, October 2, 2009

On Plumbing in The Two Americas

Increasingly there are two Americas: the first is comprised of investment bankers, commercial bankers, mortgage bankers, professors, real estate developers, judges, and others on government out-patient support. The second is of productive, value-creating Americans on Main Street in the private sector who lose because of government. Increasingly, the values that guide the two Americas are incompatible. The first America believes that they have the right to dispose of the value that the second America creates. The second America works hard and pays. The first America consumes the first America's wealth and boasts of its morality in compelling the second to pay.

Let us suppose the two Americas separate. The first America will see a surplus of theories about why judges create efficiency; why people who do not work deserve ten thousand dollars in health insurance; and why critics of the president are violent racists who deserve jail time. The first America will see a shortage of plumbers and rising prices as each attempts to do as little work as possible and each steals from each. The first America will have plumbing that remains unfixed.

The second America will see a surplus of plumbers. Repair and house prices will fall. But there will be a shortage of academics, judges and investment bankers. Productive people will produce wealth relative to the amount of money in circulation. Innovation will be rampant.

The first America will learn to live with broken plumbing and lots of theories about how to redistribute wealth, none of which work and all of which offer de facto guarantees of funding for investment banks, universities and judges. The first America will print money and hand it to the most powerful, claiming that they are selfless and charitable in doing so. They will become gradually poorer as investment bankers, lawyers, professors, and journalists consume ever larger shares of wealth. The second America will become richer, as America did until 1970, through hard work and innovation.

In which America would you prefer to live?

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