Take action before helplessness sets in
The recent dramatic and sudden intervention actions of our government to “rescue” the economy come with terrible consequences. The severity of the state of our country cannot be stressed enough: the freedom of the people of the United States of America is rapidly diminishing. America has quickly moved from operating with the efficiency of the free market to relying on the government to control many aspects of the economy. This can otherwise be defined as socialism; the exact opposite of the foundation of the United States.
America was based on notoriously non-socialistic ways, especially in the economic realm, which is what sets the United States apart from others and gives us such a great economic advantage. Unfortunately, as a result of the current financial crisis, the government has steadily increased its involvement in financial markets. For instance, in most recent news, the government has constructed a plan to buy equity stakes in the nation’s top financial institutions. It was stated that “some of the big banks were unhappy about the government taking equity stakes, but acquiesced under pressure from Mr. Paulson.” This forceful intertwining of the banking sector with the federal government is a perfect example of how socialism is quickly creeping up on the American people. Now is the time to step up and take a stand and not overlook the severity of the new socialistic state our country is in.
This new socialism, or collective ownership (i.e. equity in the major banks, etc.) the government now has in financial markets, is undoubtedly going to lead to a halt in the motivation of the American people to thrive and produce. Motivation is a very simple concept and can very easily be disrupted if freedom and choice are dramatically reduced.
Motivation can be defined as an internal state that arouses, directs, and maintains behavior. The key component is that motivation “maintains behavior.” The free market easily maintains passionate behavior for the people to produce because there are endless possibilities. When a need arises, people have a great desire to succeed at fulfilling that need; simple supply and demand. Further more, this healthy and strong motivation creates competition among others, which ultimately leads to impeccable quality and numerous choices. With the free market, the peoples’ incentive to expand the economy is ever-present and quality is at its highest.
Socialism, on the other hand, dramatically minimizes the motivation of the people because they are restricted by the government’s control. The government is an entity in and of itself, leaving little power for the people. The impulsive broad power the government has taken in our financial markets will without a doubt result in limited competition, poor quality of products, and most importantly, minimal drive of the people to efficiently increase productivity.
As a part of a naturally tendency, when people are restricted and convinced there is no escape, they are left with a feeling of helplessness. This can be described as a concept called learned helplessness. Learned helplessness takes place when we experience repeated exposure to aversive events that are out of our control. Many Americans are most likely currently experiencing this uncomfortable feeling because of the great amount of uncertainty and lack of control.
The scary aspect is that it can lead to the American people surrendering to the government. At first, the vulnerable feeling strikes up fear and panic, but soon after, if people realize their behavior has little effect on the environment, they easily give up. This act of conceding to the government is detrimental. When people feel that have little chance to freely engage in the financial markets without restrictions, it can quickly leads to permanent reduced effort and success.
Do not be fooled that the strong government intervention in our financial markets is needed. Do not quit. Do not give up. Socialism is being pushed upon us and it must not be taken lightly. Before learned helplessness sets in all of us, action needs to take place. Now is the time to stand up and be a voice of reason. It is imperative that the lack of control we are all experiencing is not taken over by the powerful learned behavior of “giving up.” Instead of backing down to the government out of fear, the people of the United States of America must realize the challenge which has arose and persevere for the sake of our freedom.
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Ms Adrian,
As for motivation; you’re absolutely correct. I believe that the large financial institutions always believed in the back of their minds that since they are so instrumental in distributing capital in America to get construction projects off the ground, that the government wouldn’t ever allow them to fail. This motivation to be corrupt and fail was seen during the S&L crisis of the late 80s, and we’re seeing it today. Although I think that with the government now wanting to take ownership that there MAY be less corruption. Just a gut feeling though.
Let me get this straight, Tyler. You state that because large financial institutions believed that they were “too big to fail” and the government would bail them out that they acted irresponsibly and were “corrupt”. Then you move on to say that because the government is taking equity that they will be less corrupt? The government has essentially stated that it will bailout anybody and everybody, small or large. Best case scenario a company takes huge risks and makes tons of money. Worst case scenario they lose tons of money and are able to give up a portion of the equity of the business to avoid outright bankruptcy. Seems to me that these government bailouts would actually cause much more corporate corruption, even if the government does take equity. So, now we have even more corrupt companies and a socialist government. Wonderful.
The whole idea that “Greed and corruption” in this imaginary entity called Wall Street brought down the U.S. economy boggles my mind. Who owns Wall Street? Well, over two thirds of Americans own some form of stock…. so assuming that stock implies ownership (which in light of recent government seizures may not hold true), than it would seem an awful lot like Americans and “Main Street” own “Wall Street”. Obviously, it’s technicalities how you label the two entities, but the point is, Wall Street wouldn’t exist without Main Street. Wall Street has always worked for Main Street. When the investors bought shares of all these financial institutions in the open market they voiced not only their approval of the large bank’s management, but also acceptance of risk. It wasn’t a secret that a large part of these banks were investing in asset backed securities. Yet, when it all collapsed, it was these very same people who were yelling for more regulation and oversight.
To me, this whole thing is a natural contraction that resulted from the most common 4 causes of any crisis: 1. High levels of inflation, 2. Speculative booms, 3. Easy access to money, and 4. Over-priced assets. And we seem to be planting the seeds for the next economic crisis in our response to this one. On a side note, I clearly went off on a tangent that has very little in relation to the previous comments, but the argument I was trying to make is that the essence of publicly owned corporations is that they are PUBLICLY owned. This means that it isn’t just Dick Fuld or John Mack making the decisions for the entire company and are the only ones responsible. Public ownership goes two ways – you take the gains in good times but you take the responsibility and losses during bad. You can’t take the gains and look to the government during bad. On another side note, wouldn’t it be fitting if Capitol Hill was renamed Capital Hill?
HAHAHAHAH!!! I love the last line, Donald.
At Mises Institute there is an article called “Inclined to Liberty” worth ones reading.
In that article they show a survey done in 2000-5 of 128 countries. The survey shows that there are five quintiles with almost identical percentages in all the countries. So weather you live in a free society or facism the quintiles do not change. In other words there is no advancement or change in class of people through socialism. What they did find was the freer the society the higher scale of income for all.
I guess that means it just takes more ditch diggers then WallStreeters to operate capitalism no matter what government structure you live under.
Socio-economics tells us that depression leads to socialism. Just what we need now, more socialism.
I understand governments motive as an investment for government to pay its bankrupt debts. But it is these type of things that open doors we wished we never went to. I think we will see far more radical things happen in the near future. I hate hearing them talk about Social Security. Next thing you know, poof’h your retirement IRA, 401′k are in the government hands as Social Security.
Americas broke and government needs cash.