The rallying cry of the Democrats has always been “unfair.” Today is the same; the economy, the education system, the healthcare system, the justice system, the (fill in the blank) system is unjust and unfair.
Anytime you claim something is unfair, you are pitting one group against another and use the politics of division to accomplish your agenda.
Examine the economic argument they provide…
The left continually rails against the 1%, the evil capitalists, the rich, the successful. They eagerly pit the working class against the rich and claim that they have the answer to social equality for all.
The Democrat’s solution is more regulations and taxes, which they claim will generate extra money to be redistributed to those that have been treated unfairly by the system.
How are their policies self-fulfilling prophecies?
Let’s take a look and understand that history provides us with glaring examples of where their policies will lead.
The policies of the left are always about taxes and regulations. It truly does not matter the subject; every answer the left offers consists of only these two “solutions.”
If the left sees a problem with a government agency, the answer is to tax more and throw more money at it. If the left perceives a problem in the private sector the answer is solely, exclusively, and always regulation.
Taxes: The more you tax a person or a business you remove economic freedom, you also increase the cost of that product or service.
This once again limits the number of people that can afford the good or service, in turn, you are restricting access to that good or service.
Now you have effectively created even more of a “have and have not” issue that you can politicize and claim the 1% is just getting richer and it is just not fair.
Regulations: The other tool of the left, not only adds to the cost of a good or service, but it also increases the economic cost of entry into a market for a person wanting to start a business that offers a good or service.
Now, let’s look at a hypothetical for a minute to see the actual costs of taxes and regulations to the consumer and how this is a self-fulfilling prophecy for the left.
Say you want to hire a painter for your house. In a free market you, as the consumer of that service, should be paying for labor and materials.
→ The cost of the paint is $300, and the cost of labor and consumables is $500, and the painting company owner makes $200 for his profit.
→ You, as the homeowner and consumer of this service, have an invoice of $1,000 to have your house painted.
→ The government decides that a 25% tax must be collected for this service.
→ For the painter to make what he was making before the tax, he must now charge you $1,250.
→ The government passes a law (regulation) that says the plastic bucket the paint comes in must be taken to a certified recycling facility. The recycling center charges $5 per bucket recycling fee and your painter has six buckets.
That’s an additional $30 fee plus the one hour of time it takes to take the buckets, the fuel in the vehicle, and the wear and tear on the vehicle.
→ These new regulation would add an extra $100 to your painting bill. We are now at $1,350.
→ So let us say you were paying a market wage of $10 per hour per person to paint, you had 3 people ($30 per hour) and this job took 10 hours or $300 in labor not including the owner.
→ Democrats increase the minimum wage to $15 (regulation). The labor costs increase to $450. Your $1,000 paint job is now $1,500.
→ But wait, Democrats now wants to regulate painters. The painter must only buy newly designed and safer ladders. Those new ladders are $800 each and you need 6 ladders to be effective. That is a direct cost of entry of $4,800. Prior to this new Democrat regulation, he standard ladders had cost $200.00 each.
→ Now, you the homeowner will be assessed a “cost” for these ladders in your bid of about $250 for capital ladder expense recovery rate. Now, your total for the paint job is $1,750. Keep in mind, the owner of the painting company is still only making $200 off the job.
So what has happened in this hypothetical?
A $1,000.00 paint job is now $1,750 so fewer homeowners can afford to have their house painted.
The economic cost of an entrepreneur wanting to start a painting business has been increased from $1,200 to $4,800 just in ladders so fewer people can afford to become painters.
Fewer painters result in the price increasing for house painting over time. So you have a contracting or shrinking market due to government interference and the cost of every aspect has become more expensive.
A shrinking painting market means fewer houses being painted at a higher cost. Fewer houses being painted means fewer employees in the painting industry, which equals higher unemployment.
Higher unemployment means people become frustrated and “BEGGING” for more government help. More government “help” just exacerbates the problem.
What does history tell us? It tells us the policies of the left are a self-fulling prophecy. Look at Castro in Cuba, the Bolsheviks in Russia, the rise of Hitler, Maduro in Venezuela just to name a few.
They all had a population that was discontent due to inaccessible access to goods and services because of the cost of those goods and services and high unemployment.
These dictators and movements pitted one group against another, they stated the system was rigged against the average person and the resolution was for the government to intercede to bring the “unjust” system back into balance.
How did they do it? By raising taxes and consolidating power. History shows us how that worked out.
Democrats are creating the circumstances that consolidate wealth into the hands of the few, procreates a system that prevents entrepreneurship, and is taking us down a path to have a population “BEGGING” for socialism.
This path, to succeed, requires the left to destroy one thing in America: the middle class. A strong middle class makes their plan unachievable.
So how has the left destroyed the middle class and how does their plan continue to this day?
Beginning with NAFTA, Democrats set the United States on a path of exporting our middle class.
The manufacturing base has always been one of the bastions of the middle class and moving those jobs to Mexico and then to the other “cheap labor” nation-states, like China (the TPP “trade deal” was the death knell of the US economy) effectively removed a large chunk of the middle class.
The effect of this was moving these Americans from the middle class to the poor, forcing proud hard-working Americans to the lines of the unemployed, making them reliant on government programs and believing capitalism had failed.
The opposite is true, the government failed them, not capitalism.
Take at the last large bastion of the middle class, the self-employed. Democrats have consistently waged war on this group as they are the last of the middle class in America.
They are the plumbers, the electricians, the gym owners, the salon owners, the restaurant owners, and those who have spent their life savings and a lifetime to build a business.
The left has opened our borders and removed some businesses from the grasp of American citizens due to cheap labor.
Look no further than landscaping, various construction trades and other business verticals that require a low economic cost of entry. The left has, by removing these low-cost businesses, prevented hundreds of thousands of Americans from being able to compete.
These are more Americans that are now in the same boat as those from the manufacturing industries…locked out from enjoying the American dream because of the Democrats!
In New Jersey, they are now passing a law to allow illegal immigrants to hold professional licenses. I predict this is just the beginning, other blue states will pass similar laws, further destroying the middle class.
So now what? In walks Covid-19. State governments are CRUSHING the rest of the middle class.
How is it safer to stand in a long line at Walmart to buy a pair of shoes but unsafe to go to a small locally owned shoe store that has fewer people per day in the store and shorter lines?
Examine the consolidation of wealth during this event, who has gotten the most wealth from this? Large corporations: Walmart, Target, Amazon, and the like.
Who is crushed? The last of the middle class, those that have built a business. The salon owners, the gym owners, the restaurant owners, etc.
These are people that secured their leases with their personal guarantee, signed second mortgages to finance their dream. If lost, many will never recover. They will follow those from the manufacturing sector, needing government assistance, and believing capitalism failed them.
Then the Democrats can claim the richest 1% are growing even richer, the middle class is gone, the system is rigged, the system is systemically unfair, etc.
They will then proclaim, “WE MUST RISE UP and FIX THIS, give us the power and we will make it fair.” The SAME message of every revolution in modern history. What they will not tell you is they are the reason for all of these problems.
Look at Democrat-controlled cities to see the republic’s future if the left has its way and its hands on the levers of power.
With the last large segment of the middle class under attack, our republic is truly in jeopardy. The systematic destruction of the American middle class seems more like a plan straight from the Socialist playbook than a coincidence to me, a self-fulfilling prophecy if you will.
Listen to this episode of the Conservative Business Journal Podcast with host and founder John Di Lemme unleashing the truth about the power of Capitalism in America and the deadly effects of Socialism…