Bleeding Heart Capitalism (Part 1 of 2)

You’ve heard it millions of times, and you’ll hear it throughout the Democratic National Convention:

There are the ‘haves’ and the ‘have nots.’ Those who have are duty-bound to give to those who do not have, based on the supposedly moral imperative of redistribution. Those who ‘struggle at the bottom’ are entitled to the help (always in the form of government) from those closer to the ‘top.’

In order to figure out why these arguments never die, let’s start with a psychological theory. Politicians and intellectuals who make this argument engage in psychological projection.

Psychological projection means assuming an emotional reaction in another which really refers to your own emotional reaction or behavior. For example, a husband who’s cheating on his wife may be quick to fear that his own wife is cheating on him, even if she’s only a few minutes late returning from the grocery store. He’s projecting his own motives and behaviors onto his wife.

Leftists, including Obama, are doing the same thing. They’re assuming that, for example, the poor immigrant woman working as a cleaning lady is miserable at her job. Of course, any individual can be miserable at his or her job for a variety of reasons.

Why assume that all people who work in lower level jobs are unhappy, without any evidence to back it up? Because the leftist, Barack Obama or whoever else, can’t imagine doing such work himself. ‘If I would be unhappy doing it, then this poor woman must be unhappy as well.’

This is the classic psychology behind leftist guilt. Leftist, ‘redistribute-the-wealth’ types are generally guilt-ridden people who feel they don’t deserve (and, therefore, you and I don’t deserve) to live better than others.

What such leftists fail to consider is the fact that, for many people doing lower level jobs, their life status represents a huge step forward. I used to know a restaurant owner, for example, who hired as kitchen help individuals who immigrated from third- and fourth-world countries. Some of these people grew up in African nations, where the dictatorial rulers had murdered their families or otherwise initiated a reign of terror. Needless to say, there was little or no economic development in their home countries. They were delighted to be working as kitchen help in the United States rather than being hunted down in the streets or terrorized at night because they came from a politically incorrect family. Who knows—maybe if the United States stopped providing foreign aid to some of these dictatorial countries, the leaders would fall and capitalism and rationality (the two things which create wealth and stability) might enjoy half a chance.

Leftist, socialistic types learned absolutely nothing from the fall of socialistic Communism. This media and academic culture consists of the people who write the news stories, the editorials, and the television commentaries which in turn influence our legislators, judges and presidents in government. It consists of: MSNBC, CNN, CBS News, The Washington Post, The New York Times, The Today Show, Good Morning America, ABC News, and so forth.

‘How can you justify a tax cut for the rich when so many are suffering in low-level jobs and can’t get beyond them?’ Of course, people who ask such questions have no remote grasp of how the economy works. The capacity of anyone to move beyond low-level jobs depends on two basic factors: (1) their own determination and hard work; and (2) a healthy and vibrant enough economy whereby determination and hard work actually matter and you can, therefore, get somewhere.

Leftists, intellectuals and media types, of course, disregard the fact that there is even such a thing as determination and hard work. In an age where the majority are supposed to have clinical depression or so-called attention deficit disorder, and where post-partum emotions are thought to turn normal mothers into vicious, calculated killers (for an hour, anyway), you have to be pretty daring to suggest that maybe—just maybe—one’s level of determination, conscious choice and deliberate effort have anything to do with success. Nevertheless, they do; and better Americans (those outside of the media, political and intellectual establishment) generally understand this fact, though much less so than used to be the case.

As for the economy, the problem is this: we have a mixed economy. We have many socialistic attributes such as high taxation, hyper-regulation, and income transfer programs like Social Security and Medicare (to name the most well known). At the same time, there are many tax loopholes, and there has been some moderate tax relief over the last thirty years: for example, the Reagan tax cut of 1981, the Clinton-Gingrich capital gains tax cut of the mid-1990s, and the Bush tax cuts (soon to expire) from the early 2000s. However, there have also been significant tax increases (Bush, Sr. in 1990; Clinton in 1993; huge, across-the-board tax increases set to go into effect in January 2013).

A mixed trend likewise prevails in other areas of the economy, such as regulation. The fact that our economy is so mixed creates some confusion. We’re on a contradictory path, back and forth between more socialism on the one side and more capitalism on the other. It’s as if we are both capitalistic and socialistic at the same time. It’s hard to know what to blame, and what to praise.

Since Obama, we have been on a decisively socialist path and if uncorrected, we’ll be a socialist state before long. Romney proposes taking us not toward capitalism, but back to the mixed economy.

Consequently, guilty liberals can look at our mixed economy and say, in effect, that it’s not socialistic enough and we, therefore, need more redistribution of wealth. They call it ‘investment,’ but it still boils down to plain old socialism.

What they don’t ask us to consider is how much better the economy might be—including for those at the bottom— if we put more of the ‘capital’ back in capitalism and radically reduced our government controls, taxes, and all the rest.

Think for a moment about the woman scrubbing the floor of your office building. Or the man cleaning up behind you at the local McDonald’s. They obviously need and want these jobs—otherwise they would not be doing them.

Where would these people be without the individuals in business who risked and invested the capital needed to build the office building? Or to start up the McDonald’s franchise? If these investors and capitalists disappeared tomorrow, the floor scrubbers and sweepers would struggle horribly and likely die.

This is because the scrubbers and sweepers depend upon the choices and opportunities generated by the semi-capitalist system of profit, incentive, and personal responsibility. Also, in a thriving American economy (one where capital is not encumbered by regulation, taxation and redistribution) there’s every reason to expect that most of these low level workers will rise economically, if they so desire.

Concluded in tomorrow’s column.


Be sure to “friend” Dr. Hurd on Facebook. Search under “Michael Hurd” (Rehoboth Beach DE). Get up-to-the-minute postings, recommended articles and links, and engage in back-and-forth discussion with Dr. Hurd on topics of interest.