Thatcher
"There is no week, nor day, nor hour, when tyranny may not enter upon this country, if the people lose their supreme confidence in themselves, and lose their roughness and spirit of defiance. Tyranny may always enter - there is no charm or bar against it." - 1984 - P.M. Margaret Thatcher
"I'm not pro-business. I'm pro-free enterprise." -- Representative Hensarling (Republican, Texas) - W.S.J.
By J.M. Hamilton 4-13-13
What ovaries! She was Tea Party before there was a Tea Party. Making most of her peers look like indecisive castrati, say what one will about her policies, P.M. Thatcher's will was indomitable. Mrs. Thatcher died this week, and her legacy is with us to this very day. This lady talked the talk, and walked the walk. And like many iconoclasts she thrived on adversity and bruising debate. There are few politicians who can achieve what P.M. Thatcher achieved, not even in war time let alone peace time, and that is bending a nation by shear force of will.
The best way to illustrate both Mrs. Thatcher's defiance of the established order, and her iron will, is to compare Mrs. Thatcher to her political peer and soul mate, President Reagan. Where Reagan and Thatcher both talked a great neo-classical economics game, our President often moderated, where she rigidly stayed the course. Deploying classic Keynesian economics (all rhetoric aside), the debt to GDP ratio soared under Reagan, who pushed both guns and butter in order to defeat the former Soviet Union. Whereas, the U.K.'s debt to GDP ratio went into dramatic decline, under P.M. Thatcher, dropping enviably to approximately 25% by 1990.
Mrs. Thatcher was austerity unchained.
Both leaders talked down government and the welfare state, but Reagan did not have the heart to cut entitlements, like social security. Mrs. Thatcher took out the axe on social spending and government owned enterprise, even cutting off milk to grade school children in need. Both leaders cut taxes, and yet, Mr. Reagan raised taxes no fewer than eleven times.
Reagan, like Thatcher, was capable of breaking unions, like PATCO; but as noted by the ultra-conservative institute, CATO, Reagan was actually one of the greatest protectionist Presidents of the 20th Century, saving countless American jobs (jobs that both Democrats and Republicans would rush to send offshore in the 90s and 2000s, via the doctrine Reagan had endorsed, free trade).
By comparison, Mrs. Thatcher dined on unions.
P.M. Thatcher deployed the foreign policy classic "wag the dog" strategy, before anyone knew what it was, when she reclaimed the Falkland Islands from an Argentinian invasion. Hence, the P.M. bucked up national pride, invoked patriotism, and the war provided a convenient distraction from England's domestic woes - all of which allowed her to secure a second term. Mr. Reagan would deploy P.M. Thatcher's same strategy a year and a few months later with the invasion of Grenada, to liberate a hand full of second-string American medical students from Cuba's communist invasion, which also helped to secure his second term.
Years from now what both leaders will be remembered for is: uniting their respective nation's will in crushing an evil empire, bashing their respective governments, and unleashing - what Lord Keynes referred to as - "animal spirits." A move towards laissez faire economics (LFE) may have been the right call for the early eighties, but some thirty odd years later, LFE has corrupted into the extreme - in the mistaken belief that whatever business wants it should have without question. In short, LFE has metastasized into crony capitalism; an overarching dependence upon the banking sector - and speculation - for jobs and GDP (and the deployment of trickle down economics and monetary policy); and monopoly and cartels. As we are all keenly aware, today, crony capitalism, the Wall Street and London banking cartel, and monopolies in various sectors of the economy, have all but eviscerated the middle class, from which both Mrs. Thatcher and Mr. Reagan came and both dedicated their professional careers attempting to protect. The most virulent form of LFE, Private Equity (which was just beginning to take off during the Thatcher/Reagan era), has been highly instrumental in gutting businesses for financial gain, responsible for a large number of bankruptcies, outsourcing jobs overseas, stripping the tax base, and engineering profits through financial chicanery and by making a perfidious hash out of the tax code.
Mrs. Thatcher, in the quote above, spoke of the evil tyranny of unions... today,
the Republican Party might be finally waking up to a similar tyranny imposed upon the economy and our country, by the international banking cartel, and the economic oppression imposed upon our citizens and the economy by monopolies and crony capitalism. The classic example being the tax imposed upon the citizenry, in the form of monopolistic profits, which are sanctioned, authorized, and encouraged by the federal government.
Large banks, in the name of capitalism, have been bailed out repeatedly at the expense of fiscal and monetary sanity, and the middle class. Government, politicians, regulators, and the tax code are often captured and owned by these risk management nightmares. And one could argue that the LFE takeover of the Republican Party was complete with Mr. Romney's nomination.
In America, however, there are signs that the GOP maybe changing and pulling away from the excesses conducted in the names of Thatcher and Reagan, and most importantly, may be coming to realize that government has a role to play in the economy. Senate Republicans recently passed a non-binding resolution decrying too big to fail banks.... can a break up of the cartel be too far behind? And Representative Hensarling (R.), the new head of the Financial Services Committee, has correctly drawn a line between monopoly, and free enterprise. Seems that not all Republicans pander to the cartel or will Mr. Hensarling cave?
This blog has said it before and it bears repeating, the moral imperative of capitalism is to provide quality goods and services at a competitive price, offer opportunity and employment, and provide a tax base so that essential government services can provide a back stop and support for a capitalist economy. And clearly there is nothing wrong with profit taking in a competitive market. Adam Smith, of course, pointed out that capitalism’s natural tendency is towards the elimination of competition and monopoly. Therefore, in order to protect the moral imperative and the middle class, both political parties must say "no" to business when warranted (particularly M&A activity that leads to market domination and is anti-consumer and anti-free market), break up monopolies and cartels, and guarantee competition throughout the economy, or heavily regulate, cap, and contain the profits of those sectors that are dominated by monopoly.
This is what government should do: establish the rules of the road of capitalism, protect the economy and the middle class from the plutocracy's excess, and repeat, as necessary. Ultimately, our government should be just as vigilant in protecting the market, and the consumer, as it historically, proclaimed to be in protecting freedom and democracy.
As the GOP does not want to fade into oblivion some senate and house members, like Messrs. Paul and Hensarling, have taken on a renewed interest in the middle-class. That's something both Mrs. Thatcher, and Mr. Reagan would applaud and support. The future of the GOP is libertarian on social issues, anti-theocracy, fiscally prudent, and pro- free market and anti-cartel. This is the path back to the White House; and this is what will appeal to the youth vote. Mr.Santorum need not apply.
"There is no week, nor day, nor hour, when tyranny may not enter upon this country, if the people lose their supreme confidence in themselves, and lose their roughness and spirit of defiance. Tyranny may always enter - there is no charm or bar against it." - 1984 - P.M. Margaret Thatcher
"I'm not pro-business. I'm pro-free enterprise." -- Representative Hensarling (Republican, Texas) - W.S.J.
By J.M. Hamilton 4-13-13
What ovaries! She was Tea Party before there was a Tea Party. Making most of her peers look like indecisive castrati, say what one will about her policies, P.M. Thatcher's will was indomitable. Mrs. Thatcher died this week, and her legacy is with us to this very day. This lady talked the talk, and walked the walk. And like many iconoclasts she thrived on adversity and bruising debate. There are few politicians who can achieve what P.M. Thatcher achieved, not even in war time let alone peace time, and that is bending a nation by shear force of will.
The best way to illustrate both Mrs. Thatcher's defiance of the established order, and her iron will, is to compare Mrs. Thatcher to her political peer and soul mate, President Reagan. Where Reagan and Thatcher both talked a great neo-classical economics game, our President often moderated, where she rigidly stayed the course. Deploying classic Keynesian economics (all rhetoric aside), the debt to GDP ratio soared under Reagan, who pushed both guns and butter in order to defeat the former Soviet Union. Whereas, the U.K.'s debt to GDP ratio went into dramatic decline, under P.M. Thatcher, dropping enviably to approximately 25% by 1990.
Mrs. Thatcher was austerity unchained.
Both leaders talked down government and the welfare state, but Reagan did not have the heart to cut entitlements, like social security. Mrs. Thatcher took out the axe on social spending and government owned enterprise, even cutting off milk to grade school children in need. Both leaders cut taxes, and yet, Mr. Reagan raised taxes no fewer than eleven times.
Reagan, like Thatcher, was capable of breaking unions, like PATCO; but as noted by the ultra-conservative institute, CATO, Reagan was actually one of the greatest protectionist Presidents of the 20th Century, saving countless American jobs (jobs that both Democrats and Republicans would rush to send offshore in the 90s and 2000s, via the doctrine Reagan had endorsed, free trade).
By comparison, Mrs. Thatcher dined on unions.
P.M. Thatcher deployed the foreign policy classic "wag the dog" strategy, before anyone knew what it was, when she reclaimed the Falkland Islands from an Argentinian invasion. Hence, the P.M. bucked up national pride, invoked patriotism, and the war provided a convenient distraction from England's domestic woes - all of which allowed her to secure a second term. Mr. Reagan would deploy P.M. Thatcher's same strategy a year and a few months later with the invasion of Grenada, to liberate a hand full of second-string American medical students from Cuba's communist invasion, which also helped to secure his second term.
Years from now what both leaders will be remembered for is: uniting their respective nation's will in crushing an evil empire, bashing their respective governments, and unleashing - what Lord Keynes referred to as - "animal spirits." A move towards laissez faire economics (LFE) may have been the right call for the early eighties, but some thirty odd years later, LFE has corrupted into the extreme - in the mistaken belief that whatever business wants it should have without question. In short, LFE has metastasized into crony capitalism; an overarching dependence upon the banking sector - and speculation - for jobs and GDP (and the deployment of trickle down economics and monetary policy); and monopoly and cartels. As we are all keenly aware, today, crony capitalism, the Wall Street and London banking cartel, and monopolies in various sectors of the economy, have all but eviscerated the middle class, from which both Mrs. Thatcher and Mr. Reagan came and both dedicated their professional careers attempting to protect. The most virulent form of LFE, Private Equity (which was just beginning to take off during the Thatcher/Reagan era), has been highly instrumental in gutting businesses for financial gain, responsible for a large number of bankruptcies, outsourcing jobs overseas, stripping the tax base, and engineering profits through financial chicanery and by making a perfidious hash out of the tax code.
Mrs. Thatcher, in the quote above, spoke of the evil tyranny of unions... today,
the Republican Party might be finally waking up to a similar tyranny imposed upon the economy and our country, by the international banking cartel, and the economic oppression imposed upon our citizens and the economy by monopolies and crony capitalism. The classic example being the tax imposed upon the citizenry, in the form of monopolistic profits, which are sanctioned, authorized, and encouraged by the federal government.
Large banks, in the name of capitalism, have been bailed out repeatedly at the expense of fiscal and monetary sanity, and the middle class. Government, politicians, regulators, and the tax code are often captured and owned by these risk management nightmares. And one could argue that the LFE takeover of the Republican Party was complete with Mr. Romney's nomination.
In America, however, there are signs that the GOP maybe changing and pulling away from the excesses conducted in the names of Thatcher and Reagan, and most importantly, may be coming to realize that government has a role to play in the economy. Senate Republicans recently passed a non-binding resolution decrying too big to fail banks.... can a break up of the cartel be too far behind? And Representative Hensarling (R.), the new head of the Financial Services Committee, has correctly drawn a line between monopoly, and free enterprise. Seems that not all Republicans pander to the cartel or will Mr. Hensarling cave?
This blog has said it before and it bears repeating, the moral imperative of capitalism is to provide quality goods and services at a competitive price, offer opportunity and employment, and provide a tax base so that essential government services can provide a back stop and support for a capitalist economy. And clearly there is nothing wrong with profit taking in a competitive market. Adam Smith, of course, pointed out that capitalism’s natural tendency is towards the elimination of competition and monopoly. Therefore, in order to protect the moral imperative and the middle class, both political parties must say "no" to business when warranted (particularly M&A activity that leads to market domination and is anti-consumer and anti-free market), break up monopolies and cartels, and guarantee competition throughout the economy, or heavily regulate, cap, and contain the profits of those sectors that are dominated by monopoly.
This is what government should do: establish the rules of the road of capitalism, protect the economy and the middle class from the plutocracy's excess, and repeat, as necessary. Ultimately, our government should be just as vigilant in protecting the market, and the consumer, as it historically, proclaimed to be in protecting freedom and democracy.
As the GOP does not want to fade into oblivion some senate and house members, like Messrs. Paul and Hensarling, have taken on a renewed interest in the middle-class. That's something both Mrs. Thatcher, and Mr. Reagan would applaud and support. The future of the GOP is libertarian on social issues, anti-theocracy, fiscally prudent, and pro- free market and anti-cartel. This is the path back to the White House; and this is what will appeal to the youth vote. Mr.Santorum need not apply.
Just as it took an iron lady to stand up to both unions and the Soviet Union, it will take an iron will to stand up to crony capitalist and monopolist, who would ruin our nation for their personal enrichment.
A renewed commitment to the middle class, with the preeminent goal of maximum employment, by both political parties - and the Federal Reserve - would do a great deal to revive the country and the economy; and fear not, the rich will still make money. In my mind, one simple measure/mandate is called for today by our government: if you sell in America, you hire American labor in direct proportion, whether your company is foreign or domestic based. How painfully simple!
Ironically, if Mrs. Thatcher and Mr. Reagan were to run for the top job in America today, based upon their respective records, it is Mrs. Thatcher who would triumph over Mr. Reagan for the Republican nomination, such was her unshakable will --- no matter how misguided some of her policies. We often forget that Mr. Reagan was a democrat before he became a republican, which might explain why his heart was slightly bigger than his will.
P.S.
On a final note, Mrs. Thatcher eschewed the precursors to the European Union or Monetary Federation, and the Euro. Given the state of the E.U., it would appear that she led wisely.
Copyright JM Hamilton
Publishing 2013
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