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Entrepreneurship

The Jefferson-Madison Debates: Are Today’s Education and Politics Entering the Age of Star Trek?

May 12th, 2018 // 9:02 am @

“A shoe, too, is no longer a finished product, but an endless process of reimagining our extended feet, perhaps with disposable covers, sandals that morph as you walk, treads that shift, or floors that act as shoes.” —Kevin Kelly 

“We have long argued that as the Web extends in usage…increased access to factual information would improve the quality of public discourse. However, the opposite seems to be occurring.” —Don and Alex Tapscott

Given how much technology has changed the world in the past twenty years, and how differently we now live, it’s easy to assume that the Internet Revolution has brought the big change—and this era of massive shifts will slowly relax back into some kind of normality. But the truth is that we are just at the very beginning stages of the Information Age. The changes have just begun.

Following are a few of the major developments still ahead, as described by the experts on current technologies. As you think about each of these, consider the ramifications of these trends as they relate to the future of education, career, the economy, and the type of education needed for the emerging economy:

1. Autonomous vehicles. Self-driving cars are a reality.[i] How long they will co-exist with human drivers before the laws require all cars to be driven electronically remains to be seen.[ii] Self-driving planes, boats, and trucks will also change our lives drastically. Flying vehicles are next. As drone technology improves, taking people as passengers may not be too far away.

2. 3D Printing (additive manufacturing).[iii] This will revolutionize transportation, shipping, and manufacturing. Things that can be printed out in our own homes don’t need to be built in factories, or shipped by truck, airplane, or even drone. 3D printing will also have significant impact in medicine by printing certain medical implants.[iv] In fact, 3D printers now print food, including candy—and some people think it even tastes good.[v] One taste tester wrote: “It tastes like an after-dinner mint mixed with a sugar cube.”[vi]

3. 4D Printing. The printers will print smartobjects that are self-learning, and self-altering in response to their environment.[vii]

4. New Smart Materials. As Klaus Schwab, Founder of the World Economic Forum, put it: Some are “self-healing, self-cleaning, metals with memory that revert to their original shapes, chemicals and crystals that turn pressure into energy, and so on…. Take advanced nanomaterials [nano means smaller than the human eye can see] such as graphene, which is about 200-times stronger than steel, a million times thinner than a human hair, and an efficient conductor of heat and electricity. When graphene becomes price competitive…it could significantly disrupt the manufacturing and infrastructure industries.”[viii]

5. iMoneyCenter. As Forbes put it: “Your cellphone will become a global bank. Mobile money accounts already outnumber traditional bank accounts in parts of the developing world, and new technology will turbocharge that trend, allowing payments to anyone, anywhere, in local currencies.”[ix]

6. RFID (Radio Frequency Identification). Tiny tags can be put on pretty much anything, or anyone, and track where it is at any time, all over the world.[x] This technology is cheap and easy to use. The tags can even contain sensors that keep track of how well the item is doing, and what it is doing.[xi]

New Normal

Kevin Kelly said of the various kinds of small digital devices that are being created: “A few are shrinking to the size of the period following this sentence. These macroscopic measurers can be inserted into watches, clothes, spectacles, or phones, or inexpensively dispersed in rooms, cars, offices, and public spaces.[xii] Sensors can be built to watch and listen.” He also wrote: “Massive tracking and total surveillance are here to stay.”[xiii]

The machines are becoming ubiquitous.[xiv] Moreover, a lot of people like it this way. One report summarized the trend as “Our Love-Hate Affair With AI.”[xv]

The ramifications of the new era of machines for freedom and relationships of all kinds are immense.[xvi]

7. Gene Mapping and Synthetic Biology. This is popularly called the creation of “Designer Babies.” “It will provide us with the ability to customize organisms by writing DNA.”[xvii] “Today, a genome can be sequenced in a few hours for less than a thousand dollars.”[xviii] And at some point scientists foresee artificial memory implanting into peoples’ brains.[xix] Just download what you want to know—facts, dates, formulas, etc. Gene Mapping will impact agriculture and the energy sector (by producing biofuels) as well as medicine and education.[xx]

8. Personalized Medications. Medicine, from those used to treat advanced diseases to simple aspirin, will be personalized for each individual—“tailored to your DNA.”[xxi] These will likely be very expensive at first, further widening the gap between the upper and other classes.

9. Non-Communicative Relationships. A number of popular magazines each month present articles that tell men and women they need to turn off their electronic gadgets and talk to their spouse or significant other. The articles are detailed and specific, with advice like “look your spouse in the eye while you talk to her,” and “actually listen to the words he says and try to connect with his logic and feelings,” etc.

The volume of such articles suggests that this is a serious problem. Relationships are often victims of addiction to electronic devices, texts, messages, and other incoming communication that is more highly valued than interaction with the live person in the same room.

Relationships and Roboticships

Moreover, emerging technology will very likely throw a serious monkey-wrench into many relationships. VR (Virtual Reality[xxii]) is incredibly advanced now, and will soon be on the market in extensive ways. A person can slip on a VR helmet or glasses and be transported mentally to a whole new world. Some VR research and development is focused on porn, although the tech world prefers the term “alternative relationships.” How will this impact marriage, family, education, and stable relationships?

Robotics have reached the point that lifelike “partner dolls,” sometimes called “sex dolls”, that talk and interact are already available.[xxiii] Soon, experts say, they’ll be easily accessible online and sold in our corner neighborhood stores.[xxiv] It’s a potential revolution in lifestyles, and the impact on relationships will certainly be real.[xxv] It is unclear how this will influence marriage and family, but the prospects seem quite negative.

A number of apps try to fulfill the same need—for relationships in an electronic format.[xxvi] If we find it difficult now to put down our phones or take off our headphones to engage in meaningful conversation and relationships, imagine how difficult it will be to turn off the robots, apps, and VR glasses.[xxvii] VR, and lifelike personal relationship robots, can be programmed (or told by the user) to never argue, nag, disagree, shout, or storm away.[xxviii] Again, such devices won’t take the place of quality, mature relationships, but they could very well hurt or make such relationships more difficult.[xxix]

10. The Rise of the Algorithms. Online technology now employs numerous advanced algorithms and AI technologies that are learning to do everything from sensing where our eyes are gazing (in order to know our interests and sell to us)[xxx] to what our politics are (as mentioned above, this could be to allow providers like Facebook and Google, or others, to determine what news feeds to send us—to promote their own political goals), to how empty the milk carton in our fridge is (in order to order a fresh one).

Schwab said: “Amazon and Netflix already possess algorithms that predict which films and books we may wish to watch and read. Dating and job placement sites suggest partners and jobs—in our neighborhood or anywhere in the world—that their systems [algorithms] figure might suit us best.

The Man AI in Charge

“What do we do? Trust the advice provided by an algorithm or that offered by family, friends, or colleagues? Would we consult an AI-driven robot doctor with a near perfect diagnosis success rate—or stick with the human physician with the assuring bedside manner we have known for years?”[xxxi]

AI is tasked with watching us and learning from us, and as AIs become smarter, some of them will be incredibly effective forecasters. Companies may even be valued based on their AI. For example, Kelly wrote: “Amazon’s greatest asset is not its Prime delivery service but the many millions of reader reviews it has accumulated over the decades.”[xxxii] These reviews, and the AI that runs them, learns from them, and uses them to help predict what books each user is likely to enjoy, is a huge asset.

The concept of establishing corporate boards of directors made up entirely of Artificial Intelligence is discussed openly and seriously.[xxxiii] Do we want algorithms in charge of everything?

In education, the possibilities are seemingly endless—and just as alarming. Kelly wrote: “The tiny camera eyes that now stare back at us from any screen can be trained with additional skills…researchers at MIT have taught the eyes in our machines to detect human emotions. As we watch the screen, the screen is watching us, where we look, and how we react.

“Since this perception is in real time, the smart software [algorithms] can adapt what I’m viewing. Say I am reading a book and my frown shows I’ve stumbled on a certain word; the text could expand a definition.”[xxxiv]

This means that the text of the book is changing before you read it, based on what you have read so far and how you reacted. In other words, the computer is in effect censoring what you read before you even read it.

What about the author’s intent? Well, that depends. The AI, or the people who commission and oversee the AI, may decide to carefully protect the original text, or they may not. They may edit, censor, distract, etc.—whatever they think best achieves their goals.

Remember that thing called Thinking?

They may even have different ways of dealing with different people—like Google gaming the search system so that people who look up a certain Republican candidate get the most negative articles about him on the first page, while those who search for his Democratic opponent get the most flattering articles (or vice versa).

Or they might simply guide your searches to the companies who paid them the most to do so. If these guides are personalized and targeted to each individual user (like in the movie Minority Report), different readers will literally be getting a very different education. One student will read very different things than a second student, while the third reads yet another thing—all determined by AI and/or those who program and control the AI.

Kelly continued: “Or, if it realizes I am reading the same passage, it could supply an annotation for that passage. Similarly, if it knows I am bored by a scene in a video, it could jump ahead or speed up the action.”[xxxv] If we choose such functions on a menu, that’s one thing. But what happens if the big businesses or the cyber-governmental-industrial-complex just decides that this kind of censorship is best for the people? Or for a certain group or type of people, such as those from a certain religion or political party?

On purely educational grounds, having the computer supply definitions, commentaries and links is bad for thinking. It teaches rote dependence on experts, even if the expert is an AI. If we don’t have to question, ponder, or debate the books we read, we’ll be thinking a lot less. The words censorship and brainwashing aren’t farfetched in this context.

What about politics? The media and party-media machines already spread a lot of false information. What will happen when algorithms take over the media spin? It will personalize to each reader, each person using the Internet (or whatever kind of Supernet or Skynet takes its place). As such, the AI will learn how to confuse each person the most effectively. Again, this isn’t far from the personalized billboards and ads in the movie Minority Report.

(Un)Locked Doors

On an even larger scale, if an algorithm claims to predict which of various candidates would make the best president, prime minister, judge or senator, do we just give up voting altogether? After all, the voters seldom put in leaders who truly deliver what they promised. Or will the experts try to convince us that an algorithm-based AI should be our president and Congress and Court and make our top government decisions—getting rid of human error altogether?

And in all this, let’s not forget that someone can access the algorithms. All computers can be hacked—so far. As author Marc Goodman put it: “There’s never been a computer system that’s proven unhackable.”[xxxvi] Bigger technologies mean bigger hacks, with more drastic impact on people.

And won’t the growth of the Internet just funnel more and more power to a few elites who control the algorithms? The answer is “Yes. Emphatically yes!”

In fact, is there any way to stop this from happening?

11. “Reshoring.” This means that when high tech processes like 3D printing, gene mapping, and RFID tagging become mainstream around the world, many industrial jobs will be lost—but a lot of high-tech jobs will move back to the most advanced nations in search of highly-trained workers with expertise in areas conducive to high tech.[xxxvii] Whether this will happen or not remains to be seen. It may not happen at all. “…many workers [may]…end up permanently unemployed, like horses unable to adjust to the invention of the tractors.”[xxxviii]

12. Portfolio Careers. These occur where a person’s career includes doing several different jobs for different employers in the same day.[xxxix] For example, one person might be a teacher during the school day, a restaurant manager during the evenings, and an eBay seller in his spare time—all to make ends meet. Portfolio careers may become very widespread in the new economy. A lot of people probably won’t like such a development, leading to increased class divisions and conflicts.[xl]

13. Even Greater Class Divide. As Schwab wrote: “…half of all assets around the world are now controlled by the richest 1% of the global population, while the lower half” of the population control less than 1% of world assets.[xli] Or as the Tapscotts put it: “…the global 1 percent owns half of the world’s wealth while 3.5 billion people earn fewer than 2 dollars a day.”[xlii]

To be continued next week …

NOTES

[i] Schwab, 15, 147-148; see also Kevin Kelly, The Inevitable, 2016, 50-51; Brynjolfsson, 14-20; See Sam Smith, “The Truth About the Future of Cars,” Esquire, April 2016, 69-74; Erin Griffith, “Disconnected,” Fortune, August 1, 2016, 44.

[ii] See Smith, 69-74.

[iii] Scwhab, 15; see also Brynjolfsson, 36-37; Kelly, 53.

[iv] Schwab, 15, 22, 161-167.

[v] Andrea Smith, “Print Your Candy and Eat it Too,” Popular Science, January 2015, 24.

[vi] Ibid.

[vii] Schwab, 16.

[viii] Ibid., 17.

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One Great Challenge Facing America Today

August 26th, 2017 // 4:51 am @

The Coming Fall

Only 15 percent of Americans are on target to fund 1 year or more of their retirement. One single year. Yet many will live twenty to thirty years after retiring. This one fact alone is a major blow against conservatism.

It may in fact kill conservative principles and ideals in the next two decades, and it could deeply hurt the American economy and our freedoms in the process. This is not an exaggeration. Put simply:

How can conservatives expect to win elections or, even if they are victorious at the ballot box, actually pass conservative laws and policies when more than 85 percent of the American people are going to be fully dependent on someone else’s money for housing, food and clothing, health care, and other expenses during retirement?

With the massive Baby Boom generation moving into retirement, many analysts ask: how can the United States implement anything short of collectivist socialism in the next thirty years?

To cut away the safety net, or to default on the promised Social Security and healthcare benefits workers paid into for decades, would be immoral and create widespread poverty for many of our most vulnerable. To buck up and pay for these obligations, and supplement them with what will be needed for millions of retirees to just get by, will require levels of taxation and regulation that will truly be nothing short of…well, socialism.

Bottom Dollar

Few people want to admit this reality—Republican politicians least of all. But over sixty years of government promises, spending money that should have been saved, inflating the currency, and putting numerous regulatory hurdles in the path of entrepreneurialism, innovation, and economic growth have taken their toll. A national debt north of $20 trillion dollars (more than $100 trillion when all the obligations and liabilities are met, and a lot more as these obligations and interest on the debt increase every month) leave us little wiggle room.

There are two realistic responses. First, we can go after major economic growth. This will require a systemic change in our economy—meaning mass deregulation and getting the government almost entirely out of the marketplace. Tax rates must come down drastically, and foreign-held corporate money must be encouraged to repatriate without penalty. Foreign direct investment must also be recruited (another reason tax rates must be significantly reduced).

The second option is to keep on the current path until we default, then allow an IMF bailout of the U.S. and the replacement of the dollar as the world reserve currency with International Monetary Fund SDR currency or some other (probably electronic) legal tender. This will result in a major reduction of the standard of living for most Americans and an explosion of additional government handouts. Most retirement and other savings that do exist will be wiped out, and nearly all Americans will go on the dole, with a few elites at the top, and both socialism and globalism will dominate.

The amazing thing, to me at least, is that many of our nation’s leaders right now—in both parties—actually prefer the second option. Moreover, a lot of them believe that this is the best course for our future. They deeply believe in globalism, collectivist economics, and the end of America’s attachment to free enterprise, gun rights, family values, and religion. They believe that government is the greatest power on earth, and deserves our universal allegiance and support. Even, ultimately, reverence. Anyone who disagrees, they believe, is small-minded or caught in the past—or both.

New or Old

Not only do many Democratic leaders hold this view, but a surprising number of Republican officials believe it as well, or at least they vote like they believe it (which brings the same results). This is a real battle, and the globalist elites are winning. The media, most of academia, and a majority of politicians are on their side. In their view, the future of the world is at stake—either a bright future of globalism (with elites in charge) or a return to dark-age tribalism, as they see it (where the regular people rule through small-minded, unenlightened democratic influence), will ensue. They are determined to ensure the globalist outcome.

They literally consider it a war–and one that is worth winning, whatever the cost. If academia, media, Hollywood and the lobbyist/D.C. bureaucracy/political party-apparatus can force the Trump administration to back down from anti-globalist policies and behaviors, so be it. That’s what the hubbub is about on the nightly news, investigations, etc.

But if not, they’ll take more drastic measures. A currency default might do it, causing bank holidays and massive layoffs. Or a serious shakeup in the White House—brought on by the Special Counsel, indictment of the President, or something else that circumvents the will of the voters and instead chases the goals of the elite. Something unexpected, of the same magnitude, could trigger a return of White House alignment to globalist goals. Today’s elites in government, media, finance, etc. can hardly remember a time when globalism wasn’t the clear agenda. Most of them are outraged at the very thought.

The rest of America has a serious problem. Remember the 85 percent of Americans who don’t (or won’t) have enough retirement savings to last more than a year? How are conservatives going to effectively promote smaller government and a return to genuine free enterprise in a nation strapped with the $20 trillion-plus national debt, $13 trillion in consumer debt, over $100 trillion owed in debt plus unfunded liabilities, and many millions (and growing) of retirees who will desperately need financial support?

The Next Step

I’m an optimist, because I believe the best days of America and the world are yet to come. Usually I infuse my writings with optimistic ideas on how we can really improve things in the days ahead. But right now I have to admit that I’m concerned. I’m not sure how we get past the economic hole we’ve dug for ourselves—not just politicians, but the regular people as well. We are culturally, if not actually, dependent on government spending and government growth.

Yes, a lot of people want the government to cut back, but they can’t agree on what to cut. Almost all Americans want the government to keep spending for things that benefit them directly. The ones that support cuts mostly only support cutting other people’s government benefits. Thus Congress doesn’t actually fix much.

Unless this changes, Democrats will continue to be the party of bigger government and increased socialism while Republicans will talk about smaller government, limits, and Constitutional boundaries—but when the votes come to the Senate, truly conservative changes won’t have enough Republican support to pass, and when cases make their way to the Supreme Court, free enterprising systemic changes to the government-corporate-K Street nexus won’t have enough Justices behind them. Too many officials simply aren’t willing to do what needs to be done. It’s too hard, and too unpopular.

I’m not sure what can change this.

Of one thing I am certain, however. History is absolutely clear on this point. As goes entrepreneurship, so goes our nation. Ultimately, a major increase in effective entrepreneurship, innovation, and business ownership is going to make or break us. It will create growth if it happens, and that changes everything. Also, the future of entrepreneurship is something each of us can influence. Our next three decades will either bring massive economic growth or the rise of rampant socialism to America. To choose the path of growth, our government can help (by deregulation and choosing to be smaller)—but a lot more people engaging effective entrepreneurship is the indispensible. Period.

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“The Coming Tide”

July 25th, 2017 // 7:22 am @

A Prediction

For decades the Democrats proudly saw themselves as the party of the little guy and the working poor. Republicans were considered the party of Wall Street, white collar professionals, and big business. But these alignments have changed during the opening years of the 21st Century. The Democrats are now, as The Atlantic put it, “a coalition of Millennials, minorities, and white professionals.” The Republicans consist of whatever is left over, which amounts to a majority of people in the large majority of states.

Perhaps the most striking thing about this new political arrangement is that so many white-collar professionals are now Democrats. Moreover, a large number of them are genuinely liberal, even progressive. This is a major departure from historical trends.

The most obvious reason for this shift is something members of the professional class have in common: years of participation in and graduation from the modern American university system. To find success in today’s campus environment often corresponds with embracing academe’s general values, processes, and views. When such views emphasize diversity of thought and vigorous debate of different ideas, the result is a certain kind of learning—and a certain kind of graduate. This approach helped make American universities the best in the world.

But when such views and values include rejection of diverse ideas, religious values, and pressure to adopt one overarching political and cultural perspective (pervasively advanced by the Left), a different result is natural. A different kind of typical graduate is also inevitable. This is where we find ourselves today. As the American campus has moved increasingly Left, the culture experienced and accepted by a large number of its participants has followed suit.

College Flight

This leaves many conservative or religious families, and others who aren’t particularly conservative or religious but don’t want their college youth to be ridiculed for their views or indoctrinated with blatant liberalism, with a difficult choice. College, long considered a required rite of passage into adulthood by many families, is becoming less attractive to a lot of people. The rebuttal is that the financial rewards of a college degree make it unavoidable. This boils down to two widely accepted but currently weakening views:

  1. College leads to financial success
  2. Financial success requires college

Perception is never quite as accurate as reality. Belief #1 (college leads to financial success) is a partial truth. It turns out to be true for some people, not true for others. In the 2010s, it is false for more than half of college graduates. Belief #2 (financial success requires college), on the other hand, is patently false. There are many people with financial success and means who dropped out of college or never enrolled at all. Indeed, many business owners who never finished college find their company bombarded with resumes and applications of those who did.

Certainly college is an effective path to career for many people. However, a downside for parents who aren’t committed liberal ideologues is the worry that many of today’s universities will turn their children into exactly that. And the biggest losers in the current system—even in the few schools where religious or conservative values are acceptable—are students whose focus on career prep distracts them from getting a truly great education. Sadly, this describes a significant majority.

II.

To be clear, all of this is part of a much larger national context. The bigger trend is that Americans are increasingly rejecting the 1960s promise of a society of experts who wisely and efficiently fix everything. The golden era of the American university was an outgrowth of this post-World War II zeitgeist: that everyone could participate in a society of experts, and that expertise and institutions held the solutions to all our national, world, community, material, and even personal problems.

Increased medical expertise and technology would make us truly healthy; better law schools and lawyers would ensure true justice to everyone; advanced technology and training in journalism would bring a golden age of media full of light and truth; business advances and expertise would eradicate poverty and bring prosperity to all. And so on….

The promise of what experts would bring the world was exciting, even intoxicating. True political experts, we were assured, would bring lasting peace, end conflicts, and spread happiness to every city and town. The Fed would ensure a stable and growing economy at all times, using modern expertise and financial algorithms to save us from major financial challenges. The promises were endless.

Over fifty years later, none of these expectations have been realized. Not even one of them. The entire “experts will fix everything” project is a bust. Just look at the current state of our politics, from the Clinton era to the Bush years, from Obama to Trump. Problems are far from solved. Many of our great national institutions, both public and private, have declined or lost their way. The citizenry’s trust of our government, and of experts in general, is lower and lower each decade.

In truth, the era of the expert is insolvent. It’s well past bankrupt, to be precise. We’re still training more experts, but they still haven’t solved the problems that caused us to want more of them in the first place. A lot of things have gotten worse. In short, something else is needed…

And soon.

What’s Next?

While national debts continue to skyrocket (more than doubling in the past 8 years), markets show increased volatility, and governmental credit ratings are downgraded, many of the experts assure us that things are getting better. But all they’ve shown is that they don’t really know what they’re doing. They know how to keep themselves well paid and in power, but beyond that, they haven’t fulfilled their purpose.

For example, imagine what would happen if we faced an economic depression like those the U.S. suffered in the 1930s, 1860s, or 1780s. When the Great Depression came, most Americans trusted the government, our leaders, and our national institutions. Today most citizens have very little trust in any of these; indeed, over sixty percent of Americas don’t trust the government to do the right thing most of the time. If crisis comes in this atmosphere of mistrust, few solutions from Washington will find enough traction to be successful.

This is a dominant characteristic of our times: We can’t seem to solve our national problems, big or small. We are mired in political squabbles, both between parties and within parties, and Washington accomplishes very little that actually helps the American people. It often causes harm, in fact.

As a people, we have largely lost trust not only in governmental officials and institutions but also in the media, Wall Street, Hollywood, the schools, big business…the list is long. Whom do we really trust as a people? Whom can we turn to in crisis—with real confidence they’ll fix things? In short, which experts do we really believe have our backs anymore?

If the promise of “experts will save us, and all our youth should become experts” doesn’t ring true anymore, what does? What is the answer? From the founding era through westward migration and the Industrial Revolution, the overarching goal of most Americans was to build a business and raise a family. This was our drive, our agenda. It was our national project, carried out by myriad individuals and families.

Then after World War II we turned our gaze in another direction: the career, a profession, education as job training, and daily life spent meeting the needs of the corporation or whatever organization employed us. In short, experts ruled and most people wanted to be experts. If they couldn’t swing it themselves, they at least tried to make it a reality for their children. Even family goals were expected to bend or give way to the interests of employers. Schools, likewise, were reorganized to separate, grade, sort, and point young people in the direction most likely to meet corporate needs. Experts oversaw the entire process, literally from cradle to grave and almost everything in between.

As the evidence of expert limitations grows, and as our national faith in the power of experts to solve our problems erodes and crumbles, what is left? Where will we turn? A whole generation of Millennials grapple with this situation in their work life, and more decide to opt out of the system than join it. Where are we headed?

III.

So far, nobody can definitively answer these questions. Time will tell, but in the meantime we must do our best to understand and prepare for the economy and world that is emerging in the post-faith-in-experts era. My opinion is that the most likely path forward is to reconnect with our American roots and turn our sights once again toward entrepreneurship. Business ownership is, in fact, the historical American pastime. The fact that many people abandoned it for half a century only worked because a few business owners did things on a big enough scale to employ the many.

But eventually, like any system where the many depend on the few for survival and progress, the few began taking more and more of the profits and power for themselves. In history this was called aristocracy, in more recent times it has been called socialism, and in our day it often gets away with calling itself capitalism. But whatever we call it, such a model is a far cry from the free enterprise system that turned America into a world leader—based firmly on freedom and the goal of most people to be independent owners and build their own businesses.

If and when this goal once again permeates our national mindset and our people’s choices, we’ll see the rise of a nation of problem-solvers. At that point, we won’t be dependent on politicians to fix things, and as a result, things will actually get fixed. In the process, we’ll naturally see a decreasing attachment to political parties and the rise of a non-political majority of business owners and family raisers.

There was once a name for just such goals: “The American Dream.” It’s time to bring it back.

To put it succinctly: Experts won’t save us. Politicians won’t fix what ails our nation. The solution will come, if at all, from a cultural change that marks the resurgence of a certain kind of person. At one point in history, people around the world had a word for such independent-thinking mavericks who took risks and then worked incredibly hard to make their businesses flourish and grow. They called them “Americans.” What qualified one for such a title? A burning drive to build and lead one’s own business, and to raise a family and community of young people with the same goal.

I think we’ll witness the rebirth of this same “tide in human affairs” very soon. In fact, I believe it’s already begun. But it faces strong headwinds blowing in the other direction, so we need to do better if we want the American Dream to succeed again. This is our key to the kind of future we want to pass down to our children and grandchildren.

Families, schools, communities and parents can either raise a nation of “independents” or a society of “dependents.” One will bring freedom and opportunity, the other won’t.

It’s our choice, and the decision won’t be made in Washington — or even at the ballot box.

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Understanding Trump’s Election, Part Two

March 23rd, 2017 // 11:35 am @

Why Did the American People Give Donald Trump the Presidency?

(If you haven’t read Part One of this article, do so here. This installment is a continuation of that article.)

The Big Question

Now that you’ve read Part One of this article, let’s dig deeper into why the American people elected Donald Trump, and what they expect of him in office. Michael Polanyi brings us to bedrock with another key question: What is freedom for? In other words, what is the true purpose of freedom? We can only understand the differences between the masses and elites (or translate between them) if we know how the two groups answer this profound query.

Is freedom for prosperity of the masses? Or the wealth of a few? Is the purpose of freedom to give power to the few? Or power to the masses?  Is freedom for the protection of the people from every challenge or difficulty that might arise? Or for protecting the inalienable rights of all? What is freedom for?

Is its purpose the improvement of the world? Answer: Yes. But how?

This is a deep question. One of our most pressing modern challenges is that elites and the masses answer it very differently. In other words, they see the purpose of freedom very differently. The American founding fathers knew this, and they gave the masses the voting power specifically to ensure that the masses won this conflict. They believed—based on history—that if elites ever won the tug-of-war between the elites and masses, freedom would drastically decline.

Differing Goals

Elites naturally view the world in one of two ways:

(1) the superiority of the upper classes; or

(2) the superiority of the upper classes combined with the concept of noblesse oblige.

In the first of these, elites see themselves as better than the masses—in other words, they believe that as the more educated, wealthy, and sophisticated group, they know what is best for the rest of the nation. Some elites add to this the view of noblesse oblige, meaning that they feel they have a responsibility to take care of, protect, guide, and help provide for the rest of the people—those they consider their inferiors in this world.

Thus Elite Group 1 believes that the purpose of freedom is to allow the fittest to thrive, the richest to get richer, the more powerful to exert their will on the world. In contrast, Elite Group 2 sees the purpose of freedom as the powerful and wealthy taking care of the rest of us, making sure we treat each other well, ensuring that the poor are financially supported by the middle class. Group 1 could hardly care less what the masses do, they are instead focused on getting more power and wealth for themselves. Group 2 are the opposite: like helicopter parents, they want to exert power in every aspect of our lives, using the authority of government to ensure that they are taking good care of us in ways they “know” we need—ways they believe we are too ignorant or confused to take care of ourselves.

The masses are also split into two major groups: (A) the Bernie Sanders and Elizabeth Warren wing of the masses, who are against Elite Group 1 but seek the support and leadership of Elite Group 2. (B) The other wing of the masses, most of whom supported Donald Trump in the last election, are adamantly against both Elite Groups.

This is the biggest divide in modern American politics and society. Note that the mainstream media is overwhelmingly in support of Elite Group 2. They sincerely believe they know what is best for the masses, and they consider any other view unenlightened, lacking, even dangerous.

The irony purported by such elites is palpable. For example, as recently pointed out by various commentators, on the one hand they decry a wall on the southern border as “racist,” “non-inclusive,” and “uncaring”, while on the other hand many of these same people live in restricted, elite, gated communities. They aren’t against walls per se. Indeed they surround themselves with walls—to keep out the unwanted from their homes and yards.

Likewise, many of those who adamantly call for increased gun control and restrictions on firearms are personally surrounded by well-armed bodyguards, and their estates and homes have the latest security measures and teams of gun-wielding security teams.

Another example: some rail on anyone who supports school choice or wants regular people to be able to send their kids to private schools, as if public school is the only good choice, and then they send their own children to prestigious private schools or hire expensive personal tutors. Apparently private school is great for them, but not for regular Americans. There are many other examples of such hypocrisy in Elite Group 2.

Keys and Locks

In all this, many elites seem to sincerely believe that while they, with all their “superiority” and “entitlement”, deserve such protection (walls, private school, and guns galore), the regular people are racist and intolerant to seek the same thing. Do they actually believe that because of their wealth and status they deserve the special tax breaks and tax shelters they use each year, while the regular people are required to just ante up and pay their full share? Really? This is precisely the attitude and aristocratic smugness the framers wanted to avoid when they refused to let elites choose our elected officials.

Again, the specific reason the American Framers gave the voting power to the masses is to give them power over the elites. This is exactly what elites find most objectionable about the Constitution, the main reason they want to use Supreme Court decisions and treaties (both of which thrive on the kind of fine print that most of the masses never read) and any other means they can discover to change and circumvent the Constitution.

Note also that in modern times large majority of experts—in various fields—have joined the elite classes, both in term of attitudes and values. More national mainstream media experts have become elites than perhaps any other field.

What They Want

But back to the key question: What is freedom for? To elites, the purpose of freedom is almost universally to increase their station. For the masses, in contrast, it is to pursue their happiness—in whatever ways they choose. Once again, these two groups are opposed. To increase their station, elites need the masses to remain below them on the socio-economic scale. To pursue happiness, the masses need the freedom to reach whatever status they seek. Some care about status, others don’t, but the freedom to pursue it, and whatever else they want (as long as they don’t violate the inalienable rights of others) is closely governed by elites in our world. To this end elites have erected numerous systems (including the rules of education, career, promotion, investing, starting businesses, the courts, etc.) that make it easier for their own offspring to attain status, and more difficult for the masses and their children to do the same.

All of this has a direct influence on what the American people now expect of President Trump. The elite classes want him to tack back to the center, meaning they want him to moderate his attacks on things the elites cherish (such as the mainstream media, bigger and bigger government, and national reliance on experts in every walk of life), to talk and act more like elites (they call this “appropriate”, “decorum”, or “presidential”). They want him to get little done in actual policy, to blame Congress or K Street for not really accomplishing what he promised during the election. To be clear, the more the Trump Administration delivers what it promised, the more the power of elites is dismantled. Whether you personally like or dislike president Trump, know this: Elites don’t want to be diminished, so they’ll fight Trump at every turn—and in whatever ways they think might work.

Those who elected Trump—not just his adamant supporters but many others who voted for him, or anyone else besides Hillary Clinton, because they saw a Hillary presidency as true disaster—want him to take on our biggest current national problem: too much elite influence in our society. Elites now control most media, most of academia, most of our leading cultural institutions (e.g. Hollywood, television, pop music, etc.), most government agencies, and a lot of finance and business. The power of elites in the federal government has become stifling, and threatens our Constitutional way of life. Moreover, as we’ve already discussed, they use their power to rig the systems of education, career, investment, etc. in ways that benefit their own children and increase the difficulties of the masses and their children trying to live the American Dream. More and more people now realize, or at least suspect, that the system is rigged against them.

Using Skepticism

The voters want Trump to reduce elite power over government and give it back to the people. Or, failing this, to at the very least reduce elite power over government. To do something that effectively gets rid of the rigged system. If he does this, the elite media will become even more extreme and increasingly vicious in its attempts to stop him.

Note that the elite classes argue for something similar. They want to use American institutions to equalize the American masses with regular people all around the world. This would leave them—the elites—in charge, but put all the masses of the globe on the same footing.

Few Americans who understand this situation support this elite agenda. Trump at least says that he’s trying to put regular Americans on the same footing as elites, not put them on the same footing as the masses around the world—with the elites in charge of us all. This is the great battle.

The media, or course, as a key arm of elites, doesn’t clearly tell the American people that this is occurring. But it is, and it presents a clear and present danger to our society.

The elite classes, including mainstream media, operate using what Polanyi called “the chisel of skepticism driven by the hammer of social passion.” This is a powerful way to see elite and media actions for what they really are. The social passion they cherish is that elites must take care of the rest of us, that they know better than the rest of us, that they—as our superiors—have the training, wisdom, status and wealth to do what we really need, and as their inferiors we should be happy to follow their lead and grateful that they care for us and are guiding us along.

Anyone who sees this kind of smug arrogance for what it really is (…smug arrogance…) is immediately branded “angry” and “ignorant”. Those who persist on this path can expect to be called bigoted, racist, narrow-minded, and eventually evil. This is the social passion of today’s elites, including much of the elite media.

But note: The way elites implement this is to use as much skepticism as possible. Skepticism is often confused with objectivity or journalistic fairness, so even a mainstream media that has long since lost much of its objectivity is able to appear removed and analytical simply by remaining deeply skeptical. This is, in fact, how many in the media are trained. They ask tough questions, but with a skeptical tone, and respond to the answers with even more skepticism. To their audience, this frequently appears to be good journalism.

But those reporting the news get to choose what questions to ask anyone they interview, and as long as they retain a skeptical tone, many listeners don’t realize that people who agree with the reporters are asked easier questions while those with a differing view are asked questions designed to entrap or frustrate. A nod or frown allows media members to sway the audience, yet media skepticism convinces many listeners that the media is treating everyone the same. The same skeptical tone frequently masks the art of spin, even deception. Note also that even media anger sells well as long as it comes in the tone of skepticism.

Skeptical tone allows the mainstream media to continually claim that their focus is truth and justice. Fairness and objectivity, they claim, are their driving purpose. But their definitions of fairness, objectivity, and justice are skewed. The old American Founding view of freedom (to do whatever you want as long as it doesn’t take away the inalienable rights of anyone else) is minimized by the ploy of skepticism. The new definition is to just quit thinking and instead follow the lead of our “betters”—the elite and their paid staffers (most of the experts).

Plans and Purposes

Despite all this, in the last election a majority of people in a majority of states saw through media spin and supported the candidate they considered most likely to oppose and decrease elite power—either Bernie or Trump. And here is the deep reality: if the Trump era boasts a major economic upturn, bringing more financial power to the masses, he will likely maintain such support. If not, it will dwindle or crash. The American masses want reduced power of elites, but they measure this largely in terms of increased economic power in their own personal lives.

These two things, above all, are what his supporters expect from a Trump presidency—or anyone they lift to office: (1) a reduction of elite power, and (2) increased economic well-being for the masses.

Two More

There is a third desire, and a fourth. As Polanyi put it: “The ideal of a free society is in the first place to be a good society.” Once again, elites and the masses define this very differently. Elites see good society as one that follows their ideas of what is good, including letting them (as superiors) rule, and letting them redistribute wealth as they see fit (meaning from the middle class to the lower classes, but leaving elite wealth largely—and conveniently—in the hands of themselves).

The masses, in contrast, see good society as one where they (the masses) rule, so they can keep elites from dominating, a society that benefits everyone and maintains freedom and true opportunity for all. Indeed, throughout history elites have used their rule to keep the masses from wealth and power. The masses see good society as one where people, communities, and groups voluntarily (not by forced government) take care of others and help those in need. The masses also believe that a good society gives them the opportunity to pursue improvement—personal or economic—as they will, as long they don’t violate the rights of others.

When the masses rule, through election that puts in leaders who do what they promised, and the people take care of others and love others voluntarily, and each individual has the freedom to pursue his or her goals without government or class hurdles, the masses see this as freedom. They also see it as good society.

If elites have too much power, the government intervenes in too many things, or the government or elites block our moral pursuit of improvement and advancement (using regulations and requirements, all of which are designed to benefit the elite classes), the masses see this as a loss of freedom and less-than-good society.  This, by the way, is where the majority of people in the majority of states see our nation today.

Finally, the masses want safety. They want national security to be effective and consistent. They don’t want to wonder about who our allies and enemies are, or feel confused about the gap between the White House’s words and its actions regarding national security.

Answers Through Asking

Note that on this topic, the flyover states (and back-road locales that have more electoral college votes than liberals want them to) have also provided more than their share of the military personnel for the nation. When soldiers serve and pay the ultimate price for our freedoms, these flyover parts of the nation and their families provide much of the giving and suffering.

Such people are willing to die, or let family members die, to keep our nation free. Again, the framers knew what they were doing when they established the electoral college—keeping these people relevant in electing the commander in chief.

Contrast this to what the elites seek: to maintain and increase elite power and wealth, and to patronizingly take care of the rest of us. The framers got it right. They gave the masses—not in sheer numbers, but a majority of people in the majority of states through the electoral college—the final election power. They did this on purpose. They did it to keep elites—any group of elites—from getting too much power. This is what elections are for! This is precisely what “democracy” requires. Any arrangement that doesn’t put the regular people in charge of elections is some brand of aristocracy or other elite rule.

The Real Question

What then, can be done between elections to give more power to the masses, less to elites? The answer to this question brings up difficult and disturbing realities. Let’s put this in very simple terms:

  • Are our most important institutions in society supporting the increase of elite power or the increase of power to the people?
  • Specifically: Are we teaching (schools), raising (families), inspiring (parents, churches, entertainment, media), and training the next generation to be independent and wise thinkers (power to the people), or rather to focus on the twin goals of (1) fitting into the system, and (2) getting ahead in the system (more power to elites)?
  • Are we teaching, raising, inspiring, and training them to question and improve the world (more power to the people), or simply to accept the world as it is and try to rise in status and promotion within it (more power to elites)?
  • Do we mostly pass on the values elites want the masses to hold: seeking status and prestige (as doled out by elites), the government as the answer to most problems, the main life goal of being an employee, risk avoidance, trying to impress our “superiors”, and “this is just the way the world is”?
  • Or do we effectively pass on the values of the American framers and modern freedom: service, independent thinking, moral purpose, “your mission in life is the key to your career”, entrepreneurialism, acquisitiveness, innovation, ingenuity, tenacity, and personal sacrifice for God, family and country?
  • Do we most vigorously promote institutions (power to the elites), or principles of truth (power to the people)?
  • Do we believe mostly in experts (power to elites) or the common sense of the people (power to the people)?
  • Do we trust the mainstream media (power to elites), or do we generally distrust the media—just like the American founders did (power to the people)?

This entire question can be summed up by how we educate:

  • Do we educate our young surrounded by the system established by elites for the education of the masses, focused on textbooks, reliance on experts, grades (designed to sort the masses based on their potential usefulness to elites), lectures, grade levels, pressure to fit in and conform both socially and intellectually, and controlled by bureaucracies?Is our educational emphasis mainly what Toffler called the real curriculum of most modern schools: rote memorization, training rather than education, obedience to superiors, and being on time to work?Let’s be clear. This is a system designed to increase the power of elites.  (However, ironically, almost none of the elite class educate their own children this way.)
  • Or do we choose the kind of education that has always created nations and generations of leaders, using great books, great ideas, original sources, focus on principles, individual mentors, personalized learning, and lots of discussion and depth? Is our goal to educate young adults who are deep thinking, independent minded, creative, innovative, entrepreneurial, and effective leaders in their chosen work and lives? This is what brings power to the people—those who get such an education.

Indeed, this is the very type of education the elite classes provide for their own children.

What Next?

What do we want for our future?

On the one hand:

Rote education for the masses, and at the same time quality Leadership education for the children of elites?

Or, on the other hand:

Leadership education for all?

This is the true dividing point.

This is our fork in the road for America today.

Which path will we choose? This choice is the deeper reality than what goes on in elections, or in Washington.

This is also the pivotal question of our individual power—are we using it to build the rule of elites, or the rule of the people? The reason elites have repeatedly won this battle throughout most of history is simple: they convinced many of the masses to join them, to focus not on making a better system for all, but rather to focus on trying to seek promotion and status in the education-career-governmental system set up of elites, by elites, and for elites.

Which side are you building and strengthening each day?

Regardless of how you feel about the last presidential election or the current administration, this is the great question of our time. It is vitally important right now, today, because how we answer this question will determine the future for our families and our nation.

(For more on this great current battle for freedom, and how to help the right side win, see The Coming Aristocracy by Oliver DeMille. You can purchase it HERE>>)

Category : Aristocracy &Blog &Citizenship &Community &Constitution &Culture &Current Events &Economics &Education &Entrepreneurship &Featured &Government &Leadership &Politics &Statesmanship

PART TWO: Free Enterprise is Better than Capitalism

December 27th, 2016 // 7:50 am @

Part II: The Central Issue of the Trump Era*

“The median [U.S.] family debt went from an average
of $25,000 per family in 1989 to over $70,000 in 2010.
It’s getting harder to make ends meet,
and harder to stay financially afloat.”
—The 5 S’s of Money (citing the Center for American Progress)

A missing piece of entrepreneurship-Free enterprise rewardsLET’S get straight to the point. The biggest battle in the Trump Era probably won’t be capitalism versus socialism. It will be free enterprise versus crony capitalism. For America’s future, free enterprise simply must win.

But crony capitalism is far ahead in this battle right now.

To understand this, we need to define some terms. There are two major types of economies: market economies and command economies. The first is based on freedom, the second on force.

Within these two branches there are a number of subtypes, including various kinds of command economies such as socialism, communism, fascism, collectivism and different applications of economic authoritarianism and totalitarianism.

The divisions of market-style economies are sometimes more confusing to people from free societies, because most of us have been trained to evaluate political and economic issues in binary mode where we narrow any debate down to only two sides—such as liberal vs. conservative, socialist vs. capitalist, democratic vs. totalitarian, good or evil, Allies or Axis, believers and atheists, idealists and realists, free or not free, and so on.

That said, we live in an era where the various types of market economics are now in conflict. During the Cold War the world was divided between two great camps, with market economies of all types firmly allied against the command economies–the NATO nations of the West versus the Soviet Bloc and world communism.

But after the Cold War (and especially in the post-9/11 world), this has dramatically changed. There are forces supporting each of the various types of market economies, and these are often pitted against each other in ways unthinkable before the fall of the Berlin Wall in 1989.

Capitalism Deconstructed

Differentiating between these sub-types is important for anyone who wants to accurately understand what is happening in today’s world. When people use the term “capitalism,” they may be referring to any of the following five types of market economies. And the truth is that each of these models has drastically different goals and processes:

  • Mercantilism: A system where the law allows market forces but gives preference and special benefits to the sector of the economy owned (or directly controlled) by the government. Also known as “state capitalism.” This system was historically used by the British Empire. As Parag Khanna put it in 2016: “…all countries practice some form of ‘state capitalism’ today, whether subsidizing strategic industries, restricting investments in key sectors, or mandating financial institutions to invest more at home.” (Khanna, 2016, Connectography, 33)
  • Corporatism: A system where the law encourages market forces and also gives preference and special benefits to the sector of the economy owned by big corporations within the nation, sometimes referred to often as “Big Business,” “The Military-Industrial Complex,” or simply “The Establishment.”
  • Keynesianism: A system where the law allows market forces but gives preference and special benefits to companies and institutions that are so big that they tend to care more about their public image for societal responsibility and promoting social justice than about profit(s), market share or stock value. According to Keynes himself, Keynesianism seeks the goals of socialism through market means.
  • Capitalism (crony capitalism): A system where the law encourages market forces and also gives preference and special benefits to the sector of the economy owned by big capital—including big corporations like in Corporatism, but also wealthy foreign and multinational corporations, and highly influential non-corporate institutions such as rich foundations, moneyed trusts, political parties, well-funded lobbies and special interest groups, affluent non-profit entities, wealthy families, moneyed foreign investors, and others with large amounts of capital. Under this system, the rich rule society, and they naturally influence government to maintain policies that benefit the rich more than others.
  • Free Enterprise: A system where the law encourages market forces and gives no special preferences; it protects equal rights for all individuals and entities and leaves initiative and enterprise to private individuals, groups, businesses and organizations that are all treated equally and with minimal legislation by the legal code.

All five of these sub-types are market-based, and sometimes called “free market” or simply “market economy” systems. But please carefully re-read the differences between these five economic models, because, again – while they are all market systems, they differ drastically in theory and practice.

For the last three generations, these five types of market economics have frequently been lumped together under the label of “capitalism.” While this is technically inaccurate—because capitalism is a sub-type rather than the whole of market economics—this is the way the word “capitalism” has been used and understood by most people.

Under this popular definition, capitalism is synonymous with “market economics” and is a label for the entire free-market model. But even when people use this broader definition, it is important to distinguish which of the five types is being discussed—because the future of freedom under capitalism, corporatism or mercantilism will be a very different reality than it would be under true free enterprise.

So, to summarize, we have five definitions of “capitalism” in the current usage, and another definition which uses “capitalism” to refer to all the five types together. Naturally, these definitions are frequently confused in our contemporary language. Note that even the broader definition of “capitalism” includes every market approach from corporatism and Keynesianism to mercantilism and crony capitalism. In all of this, free enterprise is often forgotten.

Even worse, in the realm of modern politics all five of these systems are frequently lumped together and referred to as “democracy” or simply “freedom.” While this is a partially accurate definition, it confuses the fact that these five kinds of systems behave very differently and offer different results to society.

Madison Weighs In

Understanding the details and nuances of how these words are used is extremely important to maintain freedom. The American founders dealt with several similar language challenges, such as when Madison felt the need to write Federalist Papers 10 and 14 explaining the important differences between democracies and republics.

He also used papers 18, 19 and 20 to clarify the differences between federations and confederations, as well as national and federal governments. Without such clarity, the Constitution would have been confusing to many Americans who were deciding whether or not to ratify it. The fact that today most Americans don’t understand these differences illustrates how far we have devolved from the level of education exemplified by the founding generation.

There are numerous similar examples, and part of being a free people is taking the time to understand the nuances of economic and political freedom and the language of liberty. No nation in history has long maintained freedom at a level deeper than that understood by the regular citizens in the society. And note that few things are more essential for free people than clearly understanding what type of economic system they want.

Based on the definitions above, consider the following three observations:

  1. All five types of market economies are better (meaning they have more freedom, opportunity and prosperity for more people) than all types of command economies.

Even the market approaches with the least freedom (Keynesianism and mercantilism) are significantly better than the command systems with the most freedom (collectivism and socialism).

  1. Still, when comparing the five subtypes of market economies, free enterprise is significantly better (with more freedom, opportunity and prosperity for more people) than mercantilism, corporatism, crony capitalism, and/or Keynesianism.
  1. The United States, Canada, Britain, France, Switzerland, Japan and other leading free nations of the world today have far too much mercantilism, corporatism, crony capitalism, and Keynesianism—and not enough free enterprise.

This is surprising to most citizens of America and the free world. For example, many conservatives in the United States argue that we are a “capitalist” nation or vote for the “capitalist” candidate and conclude that all is well, when in fact free enterprise is under attack from socialism but also just as strongly from mercantilists, corporatists, Keynesians and crony capitalists.

Voters and citizens must know what to look for when a policy or candidate claims to promote “capitalism.”

Real Life Differences

Some might argue that most of this is mere theory, and that the United States today is a free enterprise society rather than a crony capitalist system as outlined here. Such an assumption is incorrect. The U.S. commercial code has numerous laws which are written specifically to treat people differently based on their wealth—and extending special benefits to those with more capital.

For example, it is illegal for those with less than a certain amount of wealth to be offered many of the best investment opportunities. Only those with a high net worth (the amount is set by law) are able to invest in such offerings. This is capitalism, not free enterprise. Under free enterprise, the law would be the same for all people.

Also, in many cities employees of the wealthy are allowed special legal benefits—such as carrying firearms (personally or through body guards), operating under false names, or traveling with different security measures—that are withheld from the regular citizens. However a person feels about gun laws or financial policies, such laws specifically treat the rich and powerful differently than the rest. Crony capitalism gives them special benefits.

This bears repeating: The laws of the United States stipulate that if you have more money you can invest in business opportunities that people with less money cannot (to study this in more depth, see the terms “sophisticated investor,” “accredited investor,” and SEC regulations on private investment offerings). The specific amounts and details are changed by law over time, but we are absolutely a crony capitalist nation where the laws give higher benefits to the rich.

In fact, many of these laws, including all the examples above, specifically benefit the wealthy to the detriment of wage earners. Regular working people are excluded by law from the best investments and various other perks and benefits. This system is called capitalism, and it is a bad system—better than socialism or communism, to be sure, but not nearly as good as free enterprise.

With all this said, the amazing thing is that this reality is basically ignored by almost everyone, mainly because those who point out the flaws of capitalism tend to be promoting socialistic solutions rather than free enterprise.

As a result, people are accustomed to attacks on the rich by those who want bigger government. But almost nobody has experienced those who want more free enterprise and much smaller government pointing out that the rich have terribly unfair legal advantages in our society—and that this is a bad system.

In fact, this is so deeply ingrained in most people that when they hear anyone criticizing the unfair benefits enjoyed by the rich, they seldom believe that the speaker is making a case for smaller, limited government and less socialism. We are so conditioned, that this possibility just does not compute.

Some may say that I am overstating this point. “Of course the rich and powerful are treated differently than the rest. After all, they are rich and powerful!” While this may be true, such a view is itself a symptom of aristocratic society with preferential class divisions. And in nations where the laws and government treat the rich and powerful differently, freedom is always in decline.

In free enterprise systems, the law allows all people to take part in any investments. If there are laws about bodyguards, firearms, using false names, or anything else, they are the same for every single citizen in the nation. This is what free enterprise means, because such a system gives everyone truly equal opportunities. In a system where Congress creates one set of laws for some, and different laws for those with wealth, status, or position, free enterprise isn’t allowed to give people the full benefit it should.

Indeed, in our system, Congress goes so far as to exempt its own members from certain laws and guidelines; this is especially harmful when members of Congress are allowed special financial opportunities that other people are not. Thus it isn’t surprising to see people elected to Congress and within a few terms become extremely wealthy, even though their actual salary could never generate such prosperity. They are allowed (by their own votes in Congress) to make deals that are illegal for regular people. This is crony capitalism, not free enterprise.

The Local Test

Another way to test the level of free enterprise in your society it to start a business in your local area. In fact, start two. Let the local zoning commissions, city council and other regulating agencies know that you are starting a business, that it will employ you and two additional employees, and then keep track of what fees you must pay and how many hoops you must jump through to gain the needed approvals.

At the same time, have your agent announce to the same government officials that a separate company, a big corporation, is bringing in a large enterprise that will employ 4,000 people—all of whom will pay taxes to the local area and bring growth and prestige. (Don’t really announce this—because if it’s untrue you might be breaking the law, unlike big corporations that are allowed to routinely float such trial balloons.)

Then simply sit back and watch how the two businesses are treated. In most towns, counties and cities in the United States, the small business will face an amazing amount of red tape, meetings, filings and obstacles—the big business will likely be courted and given waivers, benefits and government-funded publicity.

Add up the cost to government of both of your proposed businesses, and two things will likely surprise you: 1) how much you will have to do to set up a small business, and 2) how much the government will be willing to spend to recruit the large business.

This is the natural model in a crony capitalist system. Capital gets special benefits and a different level of treatment by the government. The result in such a system is that the rich get richer, the poor get poorer, entrepreneurialism is discouraged, and many jobs, innovation, investments and growth move to other nations.

In contrast, under free enterprise, everyone is treated the same by the law. Free enterprise is a better system than capitalism—it provides more freedom, opportunity and prosperity to many more people.

Bait and Switch

All of this is more than a mere philosophical or semantic argument about which word we should use. The truth is that many people, probably most people, who feel positively about capitalism actually mean free enterprise when they say “capitalism.” The things they admire about “capitalism” aren’t special benefits to the rich and different laws for the rich versus the poor or middle class, but rather a true free market where everyone is treated equally by the law and where each person has true and equal freedom of opportunity.

The problem is that this definition of capitalism seldom makes its way into official government policies or the law. People support free enterprise, which they call “capitalism,” and the government implements public policy that is certainly capitalism (because it favors those with more capital) but violates the principles of free enterprise. This “bait and switch” is one of the main problems with using the term capitalism.

If by capitalism we mean true economic freedom and laws that treat everyone the same, regardless of their level of wealth, and if this thing we call capitalism made it into our laws and became our operational policies, I would ardently support it. In fact, I would support such a system whether we called it free enterprise, capitalism, or even zebra- or giraffe-ism. The system, not the label, is the important thing.

The problem occurs when people support a thing called “capitalism” because they believe it is free economics for all, and then those in power take this popular support and use it to enforce something very different. This is the current reality, and it is hurting the middle and lower classes by decreasing their opportunities and abilities to prosper. Again, most people don’t even realize this is happening to them.

Freedom for All

In short, call it what you will, but we need a system of truly free economics with laws that treat everyone the same. Words mean things, and the word “capitalism” emphasizes special benefits to the wealthy with capital just as naturally as the phrase free enterprise promotes freedom and enterprise for all. Still, it is the actual system that matters, and all of us would do well to carefully observe political and economic details and nuances—regardless of how things are labeled.

When the laws are altered at all levels so that government entities treat all businesses and individuals the same, regardless of how much capital they have (or don’t have) in the bank or as assets, the natural result is the spread of more business, innovation, entrepreneurialism, jobs and economic growth. Free enterprise, not government favoritism of any sort, is the most effective economic model.

If we want to call the future of our society by the name capitalism, fine. But we must find ways to effectively change the current model to a system where the law treats everyone the same by maintaining true freedom and opportunity for everyone—without special government benefits for a few elites.

It is important to recognize that this is about more than quibbling over what word to use. As long as our society gives special legal and financial benefits to elites, while withholding them from the rest of the people, freedom will continue to decrease and the gap between the 1 percent, and even the .01 percent, and the rest will keep expanding. For the typical family, this means they will have to work longer and harder in increasingly scarce jobs in order to earn less and less. This is a bad economic model—bad economically, and bad for freedom and society.

Today’s Major Challenge

To put this all in perspective, the Trump Era is on target to emphasize mercantilism, corporatism, Keynesianism, and especially crony capitalism.

This needs to change. We need to focus on free enterprise.

But first, people need to realize that this is even an issue. The truth is, the battle between free enterprise and other types of capitalism isn’t just an issue right now—it is the central issue of the Trump Era.

We need to start acting like it.

*(Note to Reader: This post is part of an upcoming new book by Oliver DeMille, entitled Free Enterprise versus Capitalism: Battle for the Future of Freedom.)

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