From Bill Buckler, author of The Privateer [2]
Getting Nothing For Something
One of the great ironies of the way that politics and economics is conducted in our “modern” societies is that the great majority of those who are lured into going along with the game by the promise of “something for nothing” end up in a situation where their payoff is “nothing for something”.
A truism of the retail trade is that you get what you pay for. This means that REAL quality costs more than the run of the mill. It has to. It takes longer to make. It uses superior raw materials. It requires a higher level of skill from those making it. It lasts longer. And it does what it is supposed to do better. There are many people who cannot afford or do not want real quality. But there are also many others who stridently maintain that there is no such thing as “quality” and that the widget that they paid $50 for is “just as good” as the one in the shop across the street that cost you $100.
There is great wisdom in the old adage that you should buy the best you can afford. If the item is vital to your well being or your livelihood, stretch what you can afford as far as it will go. But the operative word here is “afford”. Nowadays, people don’t look at the price tag, they look at the limit on their credit card(s). If they are buying a house, they don’t look at the cost of the house - and the mortgage - they look at the required down payment. They don’t look at what is left over after they have made the purchase. They think about “owning” the item. They don’t think about paying for it.
The old “buy now - pay later” - attitude leads to a lot of woe when the ability to pay dries up for whatever reason. Bad as that can often be, there is something much worse. That is the acceptance of the claim that government-run economies and welfare states hide behind - the claim that it is possible to get “something for nothing”. Everybody knows that this just ain’t so. But they see what appears to be people getting something for nothing all around them so they decide that it must “work” - somehow.
What the last five years has begun to teach an ever greater number of people is that those who succumb to the siren song of “something for nothing” end up with “nothing for something”. It’s a mugs game.
The Defamation Of Independence
Mr Bernanke and his colleagues all over the central banking world are well aware of their fundamental problem. If there is one “entity” in all modern societies where the very concept of “savings” is seen as a deadly danger it is government. The act of saving (and access to something WORTH saving) makes for a nation of independent and increasingly prosperous individuals. Such individuals do not look for something for nothing. An individual who can sustain his or her life by their own effort has little need of being “governed” and will not be “ruled”. That makes the job of governance very easy, but the “job” of ruling prohibitively difficult. Since a government does not produce, it cannot “save” in the real meaning of the term. All it can do is to minimise its demand on those who DO save, those who consume LESS than they produce. That is anathema to a government intent on gaining the power necessary to “run” an economy.
The purpose of a “welfare state” is to convince a majority of the people that savings are not necessary. Once a welfare state has been put into operation - as it has been all over the developed world for a century or so - those in power go further. Their new task is to convince their subjects that the act of saving is not only unnecessary, it is dangerous to their “prosperity”. This would seem at first glance to be both a ridiculous and a formidably difficult task. It is. It has taken our “powers that be” a long time to succeed.
But succeed they have. The majority of the subjects of government all over the world have swapped independence for “entitlements”. That act, all by itself, has impoverished every nation in terms of REAL wealth. The higher the pile of IOUs pile up - the greater the impoverishment becomes.