Mere Money Cannot Save You

Crushing small business with regulations leads to a nasty world.

Last week the D.C. area was hit by a fast-moving storm that dumped a large amount of wet, heavy Global Warming in a very short time - right in the middle of evening rush hour.

Complete gridlock ensued.  Illegal immigrant cleaners and $500-an-hour lawyers; private office drones and high-powered bureaucrats; all were stuck alike in the drifts, forced to abandon their cars and take refuge in tollbooths and gas stations.

Even the most powerful man on Earth, President Barack Hussein Obama Jr, was snarled in the global-warming morass:

The wintry weather grounded Marine One, the helicopter that typically transports Obama to and from the military base where Air Force One lands. Instead, a motorcade met Obama at the base, and the line of vehicles spent an hour weaving through rush hour traffic already slowed by the storm.  It normally takes the president's motorcade about 20 minutes to travel between the base and the White House.

Almost as big a snow job as the SOTU.

Our elites like to think that they are above the petty problems that preoccupy us peasants down here on the ground, and for the most part they are.  The Washington DC area was recently "honored," if that's the word, as having the worst traffic in the nation as far as time wasted in jams.

We've written about why that is: basically, local government abdicated its responsibility to build local roads that connect, leaving all road-building to developers who quite naturally cared only about their own individual development and nothing whatsoever about the traffic grid, and lack thereof, as a whole.

Does Mr. Obama care?  Not a whit: normally he flies right over it on Marine One at our expense.  Lesser lights receive convoys of police escorts which whisk them past the impotently idling proletariat.

Let things get sufficiently bad, though, and no amount of money or power can save one from the consequences.  As a nation, we are on the path of teaching ourselves this lesson in far more serious matters than traffic.

Where Inequality Matters

For some while now, the Left has bleated about rising inequality - that is, the rich getting richer than everybody else.  Generally speaking, conservatives don't find inequality to be a problem because new technology increases inequality while at the same time making everyone better off.  As Reagan liked to say, "A rising tide lifts all boats."

Give the government too much power, though, and the rising tide stops lifting all boats and starts putting them under instead.  That is where we are today - government policies are designed to shrink the economy rather than letting it expand.

In last week's State of the Union (SOTU) speech or, in a more descriptive acronym, "S(tuff) Obama Tells Us," Mr. Obama celebrated:

Two years after the worst recession most of us have ever known, the stock market has come roaring back. Corporate profits are up. The economy is growing again.

Unlike his previous speeches, this is perfectly true, but you wouldn't know it from the unemployment numbers which remain as breathtakingly awful as ever, nor from a stroll through the supermarket where rising prices shriek at you from every shelf.  Mr. Obama's Democrats would like to blame our economic problems on greedy rich people who need to be taxed, but everyone is greedy (not least themselves) - it's part of human nature.

The reason the stockmarket is going gangbusters while job growth remains anemic is because government interference has become so monstrous that only the very richest and most powerful corporations can handle it.

Consider the onerous and job-killing requirements of Obamacare - the Secretary of Health and Human Services has the power to issue waivers to companies and unions to let them give their employees health care plans that don't meet the Obamacare specifications.  HHS has churned out 729 waivers so far.

These 729 (and more every day) waivers are issued to privileged companies so that they do not have to follow the expensive standards which everyone else has to meet.  Waivers have been issued to such mammoth corporations as McDonalds, Darden Restaurants (Olive Garden and Red Lobster), Carlson Restaurants (TGI Friday's) and Aetna, to say nothing of dozens of politically-connected labor unions that don't want their members to enjoy Obamacare's "benefits" they fought so hard to impose on everyone else.

You know who's not on the waiver list?  Ma & Pa's Corner Grocery, Joe's Auto Repair, and Sally's Salon.  Is it any wonder that the rich get richer when they have the clout to wriggle out of destructive government requirements that bleed you, me, and their smaller competitors?  It's no surprise, it's inevitable.

Crush small business and you crush the middle class while boosting big-business' market share, stock prices, profits, and campaign contributions.  Crush the middle class and you crush the working class who mostly works for them.

Do too much of this and you wind up with a Third World country.  Is there no wealth in Third World countries?  There is most certainly great wealth, but it's all concentrated in the hands of a tiny elite who do whatever they please and lord it over the impoverished masses.

Lord of the Flies, and the Feudalism of Monopolies

Lording it over the masses is loads of fun for a while.  Eventually it catches up with you.

Brazil, not the richest of countries, has the largest number of private helicopters per capita in the world.  The Washington Post tells us why:

As homicide and kidnapping rates have soared to record levels, civilian helicopter traffic here has become what industry executives describe as the busiest on Earth... Already 63 kidnappings have been reported this year in Sao Paulo, up from only 15 during the same period last year, according to police statistics. The surge in abductions has produced a cottage industry of plastic surgeons who specialize in treating wealthy victims who return from their ordeals with sliced ears, severed fingers and other missing body parts that were sent to family members as threats for ransom payment.

Is a world of kidnapping, mutilation, and armed assault really the world the rich want to live in?  It might be great to fly in a private helicopter from your "fortess-like office" to your mansion in "a walled city where the privileged live behind electrified fences patrolled by a private army of 1,100" while passing over "a cluster of inner-city prisons" as the article describes - but what if something goes wrong and your copter is forced down into the combat-zone below?  As Brazil's plastic surgeons know, sooner or later Murphy always wins in the end.  Mexico is going down the same road.

The giant corporations of the Third World run by plutocratic billionaires became rich not because they improve people's lives or sell a service better than the competition's, but because of crony capitalism and political corruption.

Consider the world's richest man, Carlos Slim of Mexico.  Though he owns many companies now, his fortune was founded on ownership of Telmex, the Mexican telephone monopoly.  If there's only one company allowed by the government to sell phone service and you own it, of course you're going to become filthy rich.  Even Homer Simpson couldn't screw up that sweet a gig.

Exploiting the people through monopolies granted by government power harks back to feudal practices during the Middle Ages.  Once upon a time, very little industrial activity was allowed without a special charter from the king, who only granted them to his noble friends.  The peasants and townspeople had, by law, to get their grain ground at the lord's mill at whatever price he deigned to charge.

Feudal legal monopolies kept the peasants poor and the lords rich, just as they do today in the Third World.  Because of the government-created monopoly, phone service costs far more for Mexicans than it ought to.

Every small business must waste money on overpriced phone bills instead of hiring more people or expanding their own business.  Mexico has created one rich, famous guy - at the expense of countless thousands or millions of smaller entrepreneurs and workers who you'll never hear of, and of businesses which won't ever exist because they can't afford to.

Why would a Mexican with enough initiative and appetite for risk spend thousands of dollars to be "escorted" across the US border instead of starting a business in Mexico?  Because there are so many oppressive regulations and so many corrupt politicians that it's effectively illegal to start a small business in Mexico.

America was built on small businesses.  America was built by individuals who took risks and invested their own money hoping for a return that didn't always come.  As with Mexicans who risk their lives to cross the US border, profits came often enough, and for enough people, to create the wealthiest society the world has ever known.

Today's elites may think that they are wealthy enough that problems down on the ground don't matter to them.  Instead of working hard to earn their customers' dollars, they spend their time schmoozing with government to use the power of the state to force people to give them money, like Obamacare does with health insurance, ethanol rules do with adulterated gasoline, most states do with car insurance, most towns do with home inspections and a myriad of occupations for which you must be formally trained and registered by government fiat.

In short, instead of a nation where success is gained by building a better mousetrap, we're fast becoming a place where the only way to get ahead is by using political connections to squeeze out unearned economic rent.

Obama and the Left have realized that something's badly wrong with the economy.  Instead of fixing the cause, they're working to make it worse, just as environmentalists fret about polluting traffic jams but try to "fix" them by pushing people onto bicycles instead.

And the supposedly Communist Chinese?

Clever business entrepreneurs have come up with the ultimate lemons/lemonade agenda, and it is working to assuage tempers in the massive gridlock across the car-crazy land known as China.

The way it works is that anyone of China’s 1.3 billion car owners can now escape the encroaching horror of the traffic jam by calling for a substitute driver to take their cars to their destinations. Once the transfer is complete, the drivers are whisked away on the backs of motorcycles.

Now there's something worth a try here.  Anyone want to invest?  Oh wait - here in the U.S., it's illegal to dodge jams by going between lanes on a motorcycle.


Petrarch is a contributing editor for Scragged.  Read other articles by Petrarch or other articles on Business.
Reader Comments

You wrote about this a while ago>> so why is it Pres Obama's problem that the DC locals buy houses w/o exit strategies?
Sounds more like a cause for Republicans... expel the foreigners~!
Criminalize the country/independent city (in Virginia) directors~!
then your essay makes a leap into the topic ...
if you don't like DC with its torpid/turgid climate, leave...

February 3, 2011 9:03 PM

If you didn't sound so angry . . . so irrationally angry at other people who you have literally no personal connection with . . . I might have been able to finish this essay. You have a point - maybe even a rational, good point. But it's couched in blame and petty name-calling. You make yourself sound ignorant and childish. Stop being so negative and you might even persuade somebody one day. You may very well be right, but no one is ever going to take you seriously with that bad attitude.

You know who you sound like? One of those whiny liberals who bitches about not being able to take the helicopter that he can't fly, even with his elitist education, because the bourgeoisie neighbors of his can't afford the Prius, and global climate change just dropped a blizzard on his ass... which happens to be in a city with a population density of more than 13,000 people per square mile.

But no, I'm sure it's ME who's being unreasonable.

February 3, 2011 9:41 PM

Happening again today.

January 21, 2016 1:49 PM
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