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Government Does Not Create Wealth

Guest post by: Michael Hume

Article Overview: In the United States, we're a week away from some big changes... and the midterm congressional elections are only a part of what's coming.

Government Does Not Create Wealth

As Reagan Said, It Only Consumes It In the United States, we're a week away from some big changes... and the midterm congressional elections are only a part of what's coming.

It's deja-vu all over again as the Democrat party, consumed by the ambitions of its most liberal elements, has overreached toward socialism in a way not seen since the first two years of the Clinton administration. The "Republican Revolution" of 1994 was the result back then, when the GOP won a modern-record 52 seats and took control of the House of Representatives. To save his political life, Clinton famously "pivoted" toward the center-right policies favored by the nation's majority, and worked with the new Republican congress to accomplish enough (most notably, welfare reform) to win re-election in 1996.

President Obama has lurched the country so far to the left he's made Clinton look like a Republican. Experts now say a GOP takeover of the House similar to that of the '94 "revolution," fueled by the tea-party stirrings of the electorate, is likely. But this time, Obama promises nothing like Clinton's pivot move. If anything, Obama seems poised to "double down" on the sort of far-left initiatives that angered the populace and gave rise to the tea-party movement more than a year ago.

I'm worried about the damage that can be done by the outgoing Democratic congress during its "lame duck" session between next week's election and their departure in January. Don't be shocked to see them try to ram through a cap-and-tax "energy bill" for Obama's hasty signature, not unlike the way the unpopular Obamacare health bill was forced on a disapproving nation. The new legislators will be able to try repealing any damage done (and many candidates are leading their races, at least in part, because they've vowed to help roll back Obamacare). But with the sort of small majority the GOP is likely to enjoy (and which will not likely include a majority in the Senate), Obama will be able to easily veto their new efforts with no threat of a congressional override.

So "cap-and-tax" might be our reality, at least for a couple of years. If the socialists currently in power are able to add the government takeover of the energy industry to their takeovers of health care, manufacturing (such as automobiles), and finance, it could be difficult or impossible to reverse America's transformation from a free-market republic to "state capitalism" - which is the current politically-correct term for socialism.

And don't count on any extension of the "Bush tax cuts" of 2001 and 2003. That means that, as a parting gift to the voters who'll have dismissed them, the liberal Democrats will essentially be able to leave us with the biggest tax increase in the history of our nation. That will further cripple the private sector (which is undoubtedly the intent of the liberals) and make a return to a free market (and the commensurate free society) even more of an uphill climb.

That all sounds bad enough, to be sure. But on the heels of Tuesday's historic election, which is sure to anger the government ruling-class elite, the Federal Reserve is set to announce the degree to which it will be applying "quantitative easing." QE is another politically-correct term, this one a substitute for "money printing." In other words, the Fed is set to buy massive amounts of its own debt with "funny money" it creates out of thin air. This is probably the biggest danger of all. "Quantitative easing" could give rise to the sort of hyperinflation not seen since the days just before World War II in Germany.

Have you heard the stories of the hyper-inflation of the German mark back then? The most famous one is that of a woman who loads up a wheelbarrow with nearly-worthless paper money to go into town and buy bread. She goes into the store to make her selection from among the billion-mark loaves, and when she comes out, she finds she's been robbed. Oh, her billion deutschmarks were still there, piled on the sidewalk. The wheelbarrow - which was worth more than the money it carried - had been swiped.

So by contrast, next week's government moves could make the Halloween they follow look about as scary as the most fluffy-bunny Easter.

What can you do about it?

As a voter, you're doing everything you can if you cast your vote the way experts say most will next week - to throw out the socialist bums, and give conservative legislators a chance. If they're determined, our new representatives might do much good... but what's to keep them from drinking the Washington kool-aid that's poisoned generations of lawmakers before them? Things look promising in that regard, but I wouldn't wait around to find out. Start a business, so you have an income stream you can rely upon when layoffs start going around at your day job. Watch your personal health - don't trust your vitality to the new government health care, which will likely put high-quality medical care into the history books. And get smart NOW about what to do to protect and grow your wealth. These scary changes are likely to create something like a worldwide depression, during which most will be ruined but a few will become rich.

I believe strongly that it's still possible to protect yourself against the coming storm... but the time to prepare is now.

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Article Tags: government takeover, health wealth and happiness, inspirational leadership, personal responsibility



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