by Gene Scarborough » Thu May 05, 2011 5:48 am
ET---
I join Keith in agreement with "too little competition / too much government interference." Right on!!!!
We have two kinds of economy: simple and small competition based / large and complex profit based.
I pefer the first because it is far more natural. The farmer who grew better crops in small farm days got the attention of others who asked him how he did it. My grandaddy was such a farmer who became the first County Agent for Pickens County, SC, as they promoted Soil Conservation with terasing of red clay hills / crop rotation / market knowledge as to what would bring good prices. If greed creeps into cotton farming, for example, too much is produced and the price drops. Some farmers had put back enough to see then through or had enough credit to keep on. Poor decisions / bad weather / bad prices all contribute to whether a farmer succeeds of fails.
The opposite is what we have going now, known as Agribusiness = large corporate farms. Foolishly, the subsidies meant to help the small farmer come out of the Depression are still in place. A man who can borrow $1-5M to start his year, hardly needs us taxpayers supporting him in hard times. All Industries getting so big / investors expecting profit EVERY year / bailouts to keep them afloat are no longer "fair competition." Yet, the very people who rage about "less government" are the ones who expect their Auto Giant to succeed no matter what! The difference between Agribusiness and Autos is that each farmer has only 1 investor = his bank. In turn, that bank has investors, but a Wall Street Banker knows nothing about farming. Anyone who expects and demands "progress without any failure" is a fool.
Price gouging is another phrase for "progress without any failure." The price of a successful drug should simply be it's efficacy to produce safe results. I fail to see why a modern new car should cost twice what I paid for my first house in 1970! With easy credit, anyone can buy one, but in recent years they have added the negative numbers of trading into the new loan and extended it now to 5-6 years. To smell new paint, fools no longer realize most cars will go 100-200K miles with no major repair issues. Insurance companies are now demanding lower prices on drugs and medical care because they are growing at 3-4 times the inflation rate.
The further you get away from simple forms of smaller oporations, the more the government interfers. The average person wants to earn big wages with no experience nor failure. We have gone from a Henry Ford or my Grandaddy Williams experimenting with new technology to Clemson University and white coat clad "scientists" developing elaborate chemicals to kill weeds. They get into the food chain and---with hormone raised animals---we have girls developing breasts at age 6 / people developing cancer of the lung who NEVER smoked!
This is a little rambling, but I'm trying to point out the value of KISS = Keep It Simple Stupid.
Gene Scarborough