Bill Hinder: In defense of capitalism
April 5, 2009
Steamboat Springs — Capitalism has proven to be the best economic system known to man. You can compare it to all other economic systems attempted or still being used – communism or socialism, for example – and it remains obvious that capitalism as an economic system is superior in allocating resources and creating efficiencies. No question.
However, capitalism, as recent and past events have shown, is not without its innate problems. It has no moral compass, no ethical barometer, and it lacks a conscience. The engine of capitalism is greed and, without regulation, that greed becomes unbridled. Witness the current CEOs who rationalize their unimaginable bonuses for terrible performances.
The system requires a moral compass that has been missing in recent years. It needs that ethical barometer, that conscience that is supposed to be possessed by the regulators of our financial system and the CEOs who are entrusted to invest the capital that our system runs on. The same men and women who rewarded themselves with hundreds of millions of dollars in bonuses and threw themselves parties that were lavish even by the standards of a Saudi prince, with taxpayer bailout money meant to help correct the mess they got us into. They ruined not only the U.S. economy, but also the global economy with an arrogance that can only be compared to Nero’s fiddling while Rome burned.
Yes, we must have regulation. Capitalism without it is a very ugly thing. Just look at recent events in the subprime mortgage industry. To think they allowed an entire industry to be based on loans that no good businessperson would ever make. Loans that from the start were very suspect as to ever getting paid back.
Regulations and the people who enforce them have to come in and start putting reason ahead of greed as a guiding principle. The Bush administration, and primarily Bush appointees, made no attempt to monitor the loans that made no sense economically, except for the temporary enrichment of the lenders and insurance companies who made and insured loans without researching them adequately. To say they let the fox in the hen house misses the point that they cared a lot more about the fox then the hens.
The democratic process has swung the pendulum the other way. Let’s hope it’s not too late and that the pendulum doesn’t swing too far because too much regulation can be just as destructive as not enough. To defend capitalism, we must regulate it.
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Bill Hinder was raised in Perryman, Md. He graduated from the University of Utah and worked as a CPA for 10 years. For the past 14 years, he and his wife have owned and operated the Elk River Guest Ranch in northern Routt County.
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