North Santa Rosa

Misallocation of Capital by The Gunny

Misallocation of Capital (part 1)
​This Nation got a head start on the free allocation of capital while colonies because at our inception, “the capital” was almost entirely “sweat equity”, which is allocated entirely by the laborer, while our “sparse population” meant very little central control of anything at the start. We had at the very beginning, the lesson against socialism and communal property in the utter failure of the Massachusetts Bay Colony, losing half its population in its first years, and only by choosing to reverse course and discard the underlying principle and replace it, did that colony survive, and ultimately become thriving.
​Throughout history, government has been primarily established by force, and while many such governments have chosen to be less imposing than possible, in almost every case, imposition has been the primary way of ruling The People who are under it. Capital has been invested by the dictates of government, and wise governors have kept their nations going many generations, by ensuring education was a hallmark, and those which didn’t, fell shortly after wisdom fell.
​Our nation was established out of an unusual set of circumstances and they allowed the colonies to grow even while having a bare minimum of government, something extremely rare for Empires but based on the populating by our “mother country”, rather than the norm, with few rulers, controlling a large native population.
​We became an economic force with far more freedom and liberty in choice than perhaps any set of colonies before us, and we came to our success with this experience as something we would cherish as “uniquely American”. We had ceased to be British Subjects, even without noticing, and came to consider ourselves “Americans” even as we kept our loyalty to England and The King.
​When we established our independent Nation, we did so on a notion, untried since God established Israel, of having the very least of government, constrained to its exact and explicit duties and purposes, leaving everything else in the hands of those who would both plant the seed and reap the harvest, both physically and metaphorically, as the same principle of self-benefit applies in the studied allocation of capital off the farm as well.
​It was no accident the constitution left the whole of the economy outside any government control and only gave government one job, economically; the coining of money, and the establishing of relative value of foreign coin. The founders precisely kept the sole source of government revenue as “excise tax”, because that tax alone controls the economics of import, and ensures competition in the marketplace. Without a thriving economy, government has no revenue, so it is incumbent for congress to set such “excise taxes” to keep domestic business fully competitive with foreign imports.
​Adam Smith in his treatise “On the Wealth of Nations”, demonstrated selfish self interest is the only way capital is invested at its best most effective place and time, because only the individual, sowing and reaping, has all the factors affecting profit, exactly and directly in hand. While States and the federal government kept to principle established, the colonies were profitable as few Nations had ever been, and our own Nation established a new paradigm.
​Every tiniest bit of government beyond constitutional limits must misallocate any revenue, simply because it cannot be at the point where the decisions are logical and rationally clear. The full understanding of this fundamental Principle is why the Constitution is a constricting document exclusively.
​Having allowed government to assume an ever expanding role in our economy, to the point it consumes substantially more than half of all economic assets, and by this fact, must by Nature, misallocate it, inherently unable to have the facts at hand to do otherwise, we must revert to first principle if we would have our Nation as our own.
​Our elected representatives argue over how to allocate government consumption between established programs which are the essence of waste, fraud and corruption while ignoring the elephant. There is no discussion of whether government should have any of this, but only how to mis-spend.
​We can never restore our economy and revert to being a Free and Independent Nation, while government controls both the whole of the economy, by controlling half, and while doing so, it spends not only half our GNP, but also two thirds again of that part, borrowed, with no way to ever pay back. We can’t be a Free and Independent Nation while government controls our every move and thought.

Posted by on Mar 7 2013. Filed under Local, The Gunny. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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