Capitalists vs. Highwaymen

“The financial crisis is not the crisis of capitalism," according to Mr. Sarkozy. “It is the crisis of a system that has distanced itself from the most fundamental values of capitalism, which betrayed the spirit of capitalism.”

Capitalism has not led the world into “crisis”. Today’s troubles are a symptom of the perversion of capitalism through government policy.

Imagine a motorist driving along a highway. He is traveling at the time of his choosing toward a desired destination. The motorist is in process of satisfying his wants, to get somewhere for some purpose. The driver is lawfully engaged in improving his life.

The motorist has paid the appropriate amounts for license and fuel tax. The highway operator has a duty to spend these revenues to create a smooth, safe route and offer information to help all motorists coordinate their travel for maximum efficiency. The highway operator makes the road and the rules of the road.

Now imagine the highway operator placing advertising and other sign clutter which make it difficult for the motorist to spot essential safety markings. And the highway operator allows some subsets of motorists to violate rules about speed, spacing and merging because those travelers are deemed “more needful”. Each subset is granted different exemptions. Any indication of which drivers are using which rule sets is prohibited. The highwayman prefers to maintain an appearance of equality upon the road.

Under such conditions, should a driver distracted by sign clutter spin off a curve, or be run off the road by a screaming needmobile, or slam into an unmarked abutment, is it in any way fair, proper or just to blame the motorist? No. The wreckage is the result of poor design and bad management by the highwayman.

Government provides and maintains the financial highway upon which capitalists seek their destination. True, sometimes capitalists move too fast, or break well-thought rules. Those who do are criminals, which law and government punish. The victims of reckless capitalists can find insurance against their loss. (But they must choose to buy it, and insurance, too, is another route subject to the risk of government oversight.)

The problem is not within capitalism. The current carnage is not a failure of markets. Our “crisis” is a government failure. There is greed, but it roosts on Capitol Hill, not Wall Street. Legislators expanding power and doling out favors have evolved a system which can no longer handle the traffic.

Properly seeing the matter as a government failure is the route to the best response. The solution is not more rules, adding more drag and more opportunity for corruption. The way forward for all is upon a highway with clear and simple rules which treat all travelers equally.

It is time to pay deference to the real economic heroes of capitalism: the self-made entrepreneurs who have the courage to start a business from scratch, the fidelity to pay their taxes, and the dedication to provide real goods and services to their fellow man.

Let’s clean up the road and get out of the way!