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The Obama Files!
I was going to add these articles to my "Asshole Files", but this section deserves a special place all it's own. I think this section will grow about as fast as my anger with this Socialist who is tearing our country apart piece by piece. I once swore an oath to uphold and defend the constitution of the United States against all enemies, foreign... AND DOMESTIC. And I take that oath VERY seriously.
The Flawed Concept of
"Wealth Redistribution"
M40 - Thursday February 26th, 2009, 6:29pm
Anyone who believes in "wealth redistribution" shows a complete and utter
ignorance of how economics work. This applies at both the micro and
macroeconomic scale. The fact that our president is a firm believer in “wealth
redistribution” is a scary fact indeed. If you doubt this, listen to him talk
about it here:
http://www.youtube.com/watch?v=iivL4c_3pck
The premise of "wealth redistribution" is
that it is unfair when one person has more wealth than another. However, this
whole assessment of fairness is based on a faulty principle. That principle is
called "zero sum economics", and it is a flawed assumption. Zero sum economics
assumes that there is a fixed amount of wealth in the world, and that we all
have to share it. If someone takes more than their share, then someone else has
less as a result. If that were the case, then "wealth redistribution" might be a
means to remedy that inequity. However, nothing could be further from the truth.
There is NOT a fixed pile of "wealth" from which we all must share. Wealth is
created, not taken from others.
In the zero sum mindset, if I take an extra slice of pizza, then some unlucky
asshole is left to gnaw on the box. There is no consideration for the fact that
we can simply make another pizza, and have thus created "wealth". The pizza is
worth 10 times what the raw ingredients were worth, and thus wealth is created
from nothing. If you know someone who supports "wealth redistribution", ask them
the following. Should artists be forced to sell paintings for the exact sum of
the cost of the paint and canvas? The answer is (of course), no way! Well...
where did that extra cost come from? It came from the artist’s skill, time and
workmanship. The artist created a large amount of wealth from a couple dollars
worth of materials.
But some folks might argue that there's a fixed amount of dollars, pounds, (pick
any currency) out there and that is what we are forced to share. Again, a FLAWED
perception of reality, and an ignorance of how economics and currencies work.
What is a dollar worth? It's worth a dollar of course... but what the fuck does
that mean? Here's the secret... it means whatever you want it to mean.
The dollar is a piece of paper that is sometimes worth a lot, and at other times
isn't worth the paper it's printed on. The value of any currency is worth
whatever people perceive it to be worth at that exact moment. It is only a
"bearer instrument" used for trade and is based ENTIRELY on your trust in it’s
value. If I'm selling bread, I might decide that my bread is worth a dollar per
loaf. But the next day, I may decide it's worth two dollars a loaf. It's up to
me what I charge, but it's also up to the BUYERS. If people decide that my bread
tastes like ass, then suddenly my bread is worth precisely ZERO DOLLARS to me or
anyone else. Therefore, the value of ANYTHING is... exactly what people are
willing to spend on that thing!
If I have a Snickers bar and someone offers me a dollar for it… SOLD. However,
if I happen to be starving and the Snickers bar is the only food available, then
that Snickers bar may be worth a hundred dollars… it may be worth a thousand
dollars… or a million. The Snickers bar is the ‘wealth’, NOT the dollars. The
dollars are only instruments used for trade, and like any trade, you as a buyer
or seller need to weigh your perceived value of the item you’re trading and that
which you’re trading it for.
Paper money and coinage were invented to make trade easier for people. Let’s go
back a few thousand years in history… before money. The tribal toolmaker shows
up at the butcher’s place. He offers the butcher a nice stone knife for a choice
cut of mutton. Well, the butcher may already have all the stone knives he needs,
so… no deal. The toolmaker now needs to find out what the butcher needs, then
find a person who has that and is willing to trade for stone tools! Why? No
“currency” as a means of trade. But again, the currency is only valued based on
what people are willing to pay. If there was starvation among the tribe’s
people, then all the stone tools in the world aren’t worth a bite of mutton.
Likewise, if the tribe has 27 butchers, but only one toolmaker, then decent
stone blades are worth a LOT of meat.
Because there's a fixed amount of DOLLARS out there, the value of a dollar
therefore rises and falls based entirely on public perceptions. If we as a
nation are busy little bees and produce lots of goods and services that the
world actually wants, then the value of the dollar skyrockets. If we sit back
and get fat and lazy, the value of the dollar plummets like a stone.
So what if we simply make more dollars? Would we create wealth? HELL NO.
Again... dollars do not equal wealth, they are merely the instruments used to
trade wealth between people. Therefore, if Obama decides he'll print dollars
like crazy to pay off the incredible debt he's saddled us with, then all he's
doing is doubling the amount of dollars out there... but cutting their VALUE in
half… or worse. The actual amount of wealth hasn't changed just because he
directs the mint to make more trade instruments.
Because of this, when governments don't understand basic economics, they make
huge mistakes (like printing more money). Let's pretend you are a foolish little
imbecile, and have your life savings (let's say $50,000) sitting in the bank.
Obama decides tomorrow that it would be cool to simply print 10 trillion dollars
in new bills and pay off all our debts. Your life savings would still amount to
exactly $50,000. However, you might then need that $50,000 to buy a Big Mac
combo meal.
At about this point, you might think I'm exaggerating. However, history is rife
with economies that collapsed into rampant inflation because they were run by
idiots who knew nothing about economics. As soon as people begin to lose
confidence in a currency, that currency loses all it’s value. It may as well be
a pile of paper.
Only our confidence keeps the system going. It’s the confidence that if we trade
something for dollars, that we can then trade those dollars for something else
of value. As soon as we lose that confidence, we end up with $10,000 Snickers
bars.
RETURN TO THE OBAMA FILES INDEX