Sunday, May 8, 2016

A New P.R.I.M.E. Directive: Eliminate the Bureaucracy that Impoverishes the Poor

Many poor persons seek to escape their confinement through the off ramp of entrepreneurial pursuit.  They don't lack from ideas.  They have spent years, in relatively threatening neighborhoods, toiling over laws and mathematics to garner a degree in a field of study.  They have taken the risks of public transportation, even leaving the care and education of their children in the hands of progressive captors, to gain the skills essential to building a modest enterprise.  Through the collective of sincere and loving capitalist investors--yes, family and friends, these future Wall Street tycoons have yielded their minds, bodies and souls to the perils of discovery and small free market engines that will spur economic growth and employment.  Yet, these angels of prosperity face a stranglehold that is greater than the application for a commercial loan.  It is an enemy that seeks to wage continual warfare on the profits of their ideas and the investments of the ones that they love.  Their enemy is so emboldened that it will even use their sometimes skill lacking employees against them to spur economic surrender.  It seems the great dishonor amongst these wizards of overcoming lack with providential resolve and stubborn will is that they did it without a government program.  For this, they will pay handsomely.  Beyond tax and fee liberalism, the stranglehold on those seeking to escape poverty through entrepreneurial pursuit is bureaucracy.  Relief of the poor will not come from a monthly subsidy but capital investment, hard work and profit.  We must overcome poverty by eliminating the bureaucracy that sustains it.  Those with People Reinvesting In Marriage and Economics (P.R.I.M.E.) interests must consider this our next Directive. 

Former Anti-Integration Democrat South Carolina Governor James F. Byrnes once quipped, "The nearest approach to immortality on earth is a government bureau."  It was an observation well understood by a man who surrendered his post as Associate Justice of the Supreme Court to become Head of the Office of Economic Stabilization for President Franklin Delano Roosevelt (FDR).  It was created under the Stabilization Act of 1942 to regulate taxes and control prices, wages and salary increases.  He understood the access, power and influence of operating a Congressionally approved bureau.  Nine months after slowing the economic growth of the American economy by over-regulating private enterprise, FDR made Byrnes Head of the Office of War Mobilization, an independent agency created by Presidential Executive Order 9347.  Its purpose?  It was created to oversee all government agencies involved in the war effort including managing the construction of all new factories, the utilization of all raw materials, hiring civilian and military personnel and the transportation of military personnel.  The REAL POWER that he possessed is revealed in the McNair Papers: 

"...to formulate ,and develop a comprehensive national economic policy relating to the control of civilian purchasing power, prices, rents, wages, salaries, profits, rationing subsidies, and all related matters--all for the purpose of preventing avoidable increases in the cost of living, cooperating in minimizing the unnecessary migration from one business, industry or region to another, and facilitating the prosecution of the war. To give effect to this comprehensive national economic policy the Director shall have power to issue directives on policy to the Federal departments and agencies concerned.

The Bureaucrat Byrnes would become known as "The Assistant President".  His agencies would be disbanded by executive orders under later presidencies.  However, the FDR initiatives of price controls and rent controls lives eternally in modern government bureaus like the Department of Treasury and the Department of Housing.  

With the extensive power to regulate public and civilian life, one must ask, "Did the New Deal work?"  Let us hear the words of an expert observer:

"We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong … somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. … I say after eight years of this Administration we have just as much unemployment as when we started. … And an enormous debt to boot."

So Ken, who was that?  Ronald Reagan?  Thomas Sowell?  Dr. Brooks Robinson?  No.  No.  No.  The US Treasury Secretary Henry Morgenthau, Jr. who was uniquely responsible for funding the unfulfilled promises of FDR's New Deal.  How effectual were they?  The effect so measurable that there seemed only one option: Raise Taxes!  

We have never begun to tax the people in this country the way they should be..... I don't pay what I should. People in my class don't. People who have it should pay.

Rather than cutting budgets, spending and taxes, FDR sought to regulate, tax and spend more.  

FDR sought a 100% Tax, by executive order, on persons earning more than $25,000 net income.  Adjusted for inflation, 1942's net income of $25,000 in 2015 dollars is $358,446 net income.  Let's put this in perspective.  According to Sokanu.com, the Average Entrepreneur Hourly Wage in the United States is $82.50 and median salary of $171,610 per year.  Today's entrepreneur earning the FDR hated $358,446 net income would pay nearly $96,000 in federal income taxes.  We are not talking state taxes, insurance and other benefit costs.  Imagine 100%!  This is negative to the individuals' desires to make wealth from their ambitions and ideas.  Moreso, when the entrepreneur is stymied by government, the business is stymied to grow jobs in the free market.  According to the Kaufman Foundation, "New businesses account for nearly all net new job creation and almost 20 percent of gross job creation, whereas small businesses do not have a significant impact on job growth.  Companies less than one year old have created an average of 1.5 million jobs per year over the past three decades."  So who losses?  Most new businesses take greater risks on less skilled employees to produce the profit necessary to expand the business, grow revenue, increase salaries and hiring more labor.  The less skilled, less educated worker is the loser.  

These three shifts—from an industrial economy to an information one, from a producer society to a consumer one, and from a participatory culture to a spectator one—have come together in an extreme way to politically immobilize the very group that is the poorest in the United States—African-Americans. Relatively well-employed in manufacturing industries, they have little employment in information companies. Consequently, the majority of young African-American males are now found either among the unemployed, within the underground economy, or in prison. They are certainly not found in social movements, including the long-moribund civil-rights movement. This does not prevent them, however, from being totally absorbed with conspicuous consumption and with spectator sports. Ironically, there had been more involvement by young African-American males in social and political activities back in the bad old days of segregation.

The greater the government intervention, the less likely "the least, the last and the lost" are, not apply but, actually find an employer for the lower skills.  The groups the suffer the most: Hispanics and Blacks, especially the young in each.  A government program does not replace the modern skill sets lost from the absence of participating in the free market.   Bureaucracy that seeks to morally justify regulations, taxation and spending actually must falsely explain why "white people" or "capitalism" has deprived them of their well being.  In addition, they offer a solution.  Vote for the representatives that persist in promoting the New Deal philosophies that keep "the least, the last and the lost" broke, busted and disgusted.

Ludwig von Mises is the acknowledged leader of the Austrian School of economic thought--grounded in verbal logic which provides a relief from the technical mumbo jumbo of mainstream economics.  His frame of references was Nazi Germany during its origination in the 1930's.  In "Bureaucracy", Mises asserts, "THE main issue in present-day social and political conflicts is whether or not man should give away freedom, private initiative, and individual responsibility and surrender to the guardianship of a gigantic apparatus of compulsion and coercion, the socialist state."  He advised that the government that depended on a well-educated, powerful bureaucracy to instigate financial growth rather than depending on free market capitalists doom their economy and their state.  

The New Deal Workings extended a depression, originated in 1929 under Republican Herbert Hoover's Presidency, from 1933 to it's end about 1948.  The poor did not escape the throes of poverty and the rich were not denied their skill to make wealth.  However, in exchange for security that utterly leaves men and women dependent on the State and impoverished, these subjects have been given the assurance that if ever poverty becomes too tough then, someone will be there to care.  Probably a Democrat will offer the care of more government dependency because Republicans only care for the rich.  Whether you weave hair in Anacostia, seek an urgent care center in Barry Farms or train individuals on Microsoft technology in Northeast DC, it is important for you to fight against any and all bureaucracy or red tape that will distort your God-given ability to make wealth and to create the vessel that most assures the well being of your community: employment.  We must overcome poverty by eliminating the bureaucracy that sustains it.  Those with People Reinvesting In Marriage and Economics (P.R.I.M.E.) interests must consider this our next Directive.