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Economic Freedom or Socialist Intervention?<br>by Ron Paul

Written by Subject: Economy - Economics USA
by Ron Paul
The freedom to fail is an essential part of freedom.  Government- provided financial security necessitates relinquishing the very essence of freedom.  Last week, the big 3 American automakers came back to Capitol Hill with their hands out to the government.  Congress spent this past week debating how much money to give them and what strings should be attached.  Though the bailout plan for the auto industry has suffered what I would call a temporary setback in the Senate, other avenues for public funding are being explored through the Federal Reserve and the Treasury Department.  I am afraid the American auto industry will soon learn that having billions rain down from Washington will not be the blessing one might expect.

The government, after it subsidizes an industry, tends to become a very demanding benefactor.  Politicians may not have any real idea about how to build a car, run a bank, educate a child, heal the sick or build a road, but they are quite adept at using carrots and sticks to manipulate and threaten those who do.  Most of the federal control over education, roads, healthcare, and now banking and soon auto manufacturing, is done through money, mandates and conditions.  The bailout proposal we were considering would force automobile manufacturers to submit their business plans for the approval of a new federal "car czar."  This bureaucrat would have the authority to approve the automakers’ restructuring plan, monitor implementation of the plan, and even stop certain transactions he determines are inconsistent with the companies’ long-term viability. 

One could argue that if billions of taxpayer dollars are going to flow into a failing industry, then representatives of those taxpayers have "bought" a say in how that industry is run – which is precisely why bailouts are such a bad idea for both the industry and the taxpayers.  The federal government has neither the competence nor the Constitutional authority to tell private companies, such as automakers, how to run their businesses.  I would have thought that failed experiments with central planning and government control of business that caused so much harm in the last century would have taught my colleagues the folly of making businesses obey politicians and bureaucrats instead of heeding the wishes of consumers, employees, and stockholders.  But the auto industry is in danger of learning for themselves one of the oldest lessons in politics: he who pays the fiddler calls the tune. 

It is not the job of government to sustain business.  The government should get out of the way, and instead examine excessive regulations, tax policy and red tape that have been hostile to manufacturing in this country.  We should get back on a sustainable economic course in this country, or we are doomed to collapse, as the Soviets did, under the crushing burden of big government and a strangled economy that can no longer pay for it.

1 Comments in Response to

Comment by Edwin Sumcad
Entered on:
The argument defeats itself.

In essence, it argues that if there is order, control or government there is no freedom, and yet if there is no order or control there will be no freedom as we enjoy it today.

If anyone is free to do to you whatever he/she pleases even though you end up with a bloody nose for doing nothing, there must be a law or order – control – to have my freedom to be left alone without a bloody nose. In the same way, control or government intrudes into business when running a business needs order. Even the postman cannot do his business of delivering mails if the owner of a fierce Doberman unleashes a killer in the neighborhood because of his freedom without control, to do so. The mailman needs a law – control – to defend his freedom to do business that he too like the dog owner, may live. It goes beyond socialism.

I think even imbeciles understand this: Life left the cave when we realized that we will not survive without some form of order or authority that intrudes into this human freedom of the wild. We developed a sophisticated and more advance form of control and order, and that**Q**s when government was invented. This editorial abhors government intrusion in the freedom of the wild when businesses went wild, to introduce some form of order and control, and yet wants businesses to do whatever they please. Cut the nose to spite the face. The argument defeats itself.

It is like hate of wearing clothes when one wants his freedom to be just naked free. Yet embarrassed without any body covering while arguing the freedom to be naked free!

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