I recently had a conversation with a friend of mine regarding the seemingly suicidal push the politicians of the USA have towards tax cuts – some how they believe that cutting taxes will help the deficit. The premise is simple, albeit flawed: Less taxes means that companies and citizens will spend more money, thus expanding the economy that will lead to growth which will lead to more taxes! To date that has never worked and there are many macro-economists that will tell you that it cannot. So why then would politicians go for that route? Their goal.

The Goal for a politician, as directed by the public, is to help the nation. The Goal of the politician, as directed by the politician, is to get reelected. Now consider for a moment how those two perspectives differ and how they actually collide. If it is in the best interest of the country to bring down the deficit, and thus not lower taxes, regardless of what citizens think of the action, then that is what should be done. However if you are a politician and you know that lowering taxes will most likely lead to people liking you, and thus voting for you during the elections that are going on this year, then that is the route you take to get reelected. This is not conjecture. This is not conspiracy theory. This is what occurs on a common basis; politicians have even admitted to voting for something they opposed because of politics – meaning they will set aside their beliefs for personal or party gain. This is dangerous.

Now consider the present day problems we face. The economy was trashed due to poor regulation of banks and real estate practices. Our environment is trashed because of bad and ignored regulations over big oil and other big businesses which have caused major catastrophe. We can debate the global warming thing, but I assure you it is very real, yes naturally cyclical, but humans are speeding up the process. The American Car companies all took a dive – more economic woes. Banks failed – same thing. Banks found guilty of faulty business practices, in some instances outright fraud. What has been done to fix this?

1. Tax dollars were granted to failing companies. This is not capitalism. In a capitalistic society those failing, mishandled companies would have died. Americans were told that would lead to a Great Depression. That is conjecture. Those same failing companies showed record revenues this last year. Failing? Really?
2. The government purchased toxic assets from big banks and businesses with American Tax Dollars. These toxic assets were supposed to help those companies float, and in most instances did, but what did that solve? The government admittedly and purposefully purchased failing assets, a loss on the books, for what? To help Americans? With TOXIC assets? Please.
3. New financial regulations are in place. GREAT! A small percentage of what was planned. Why? Lobbyists. Priorities. Donations.
4. New regulations are being put in place to help govern the big oil companies. GREAT! Oil companies have answered with “This will drive up the cost of oil.” Stop buying from them. Lock a price. Do something that stops the gouging. How can an oil company complain of issues and report the third strait revenue record in THE HISTORY OF ALL COMPANIES EVER MADE ON THE EARTH? Please.
5. The government refuses to even consider making a real American Central Bank that can give out loans. Why? Because according to private bank lobbyists that is Socialism. No what it really is is competition, and they don’t want it.

The first step to solving a problem is identifying it. The problem here is that as a country, as a people, we now fail in dramatic style at identifying actual problems, instead opting to focus on symptoms and side effects. What is the actual problem? GREED. If people are greedy, and in a capitalistic society they are, then they will find anyway to make money. Granted. However when they mess up the problem is theirs, nobody else’s. Fishy business practices to get ahead, then when you fail then YOU fail, not me. The problem, the real problem we have in the USA is obvious – big business has become more important that solving actual societal issues. In capitalism the successful company keeps its revenues and record gains beyond taxation, they should also then in turn  stomach their losses.

I am looking directly at Goldman Sachs, Freddy Max, Fanny Mae, and GM when I say this. There will be a void, and someone will fill it.