October 26th, 2016 // 6:40 am @ Oliver DeMille
And the Real Need in the 2016 Election
Vital Point #1
While the mainstream media focuses on the presidential election, the real battle will be for Congress. Even some members of Congress argue that winning the White House for their party will make all the difference—but that’s only true if the next Congress remains weakly afraid to take on the Oval Office and use the power of the purse to put our economy back on track. The American framers set up the Constitution with exactly this in mind: a strong Congress that keeps the president in check.
Many people consider this election one of the most important of our generation. And it is, but not because of the presidential contest. Put simply:
Regardless of who wins the White House this year, the real issue will be whether we have a weak Congress who lets the executive branch keep increasing spending and decreasing freedoms—or a strong Congress that understands what the Framers intended and uses their Constitutional powers to get our economy back to true free enterprise.
The voters need to understand this, and keep their eye on the ball. This is extremely important.
The two things the next president will do that are near this level of importance are 1) to appoint new members of the Supreme Court, and, 2) heaven forbid, to deal with a major national security problem. So, obviously, the executive election matters as well. But without the right Congress, we’re in for major decline in the coming years—no matter who occupies the Oval Office.
Vital Point #2
The real battle isn’t what most people think. It is being waged in both subtle and open ways, but academia and media seldom mention it directly. Yet this battle will determine our future.
Many think the great battle of our times is one of the following:
- Socialism vs. Capitalism
- International Interventionism vs. America First
- China vs. the United States
- Conservatives vs. Liberals
- Globalism vs. Nationalism
None of these is even close to our biggest challenge. Today’s great war for our future is much larger, significantly deeper, and more impactful than any of these. The great battle of our times is:
Elitism vs. Enterprise
More specifically: Top-Down Elitism vs. Grassroots Free Enterprise. Note that elitism thrives when a few super-rich at the top dominate finance, politics, media, and culture in our society. Enterprise flourishes where the regular people—the masses—have great economic opportunity and as a group determine our economy, government, and social customs/values.
Elitism rules from a few top banks, governmental institutions, exclusive universities, elite media firms, and dominant corporations. Enterprise drives society from the basis of strong families, communities, churches, voluntary service organizations, and small businesses.
But there’s more: Elitism today dominates the top organizations promoting both socialism and capitalism, and it makes up the Establishment of both major political parties. Elitist banks and corporate leaders control the management of those seeking both globalism and national strength. The leading media and academic hawks and doves are nearly all elitists. Elites win by controlling both sides of things—wherever they can.
Elitist investment rules the corporate world, top media providers, and the most powerful special interest groups. Elitist philanthropy controls higher education, the most influential think tanks, and many of the most powerful foundations (most of which operate quietly behind the scenes).
In America, the word Enterprise is frequently coupled with its partner, freedom, in the phrase “Free Enterprise”; but “Free Elitism” is an oxymoron. If it’s truly free, it isn’t elitist.
Indeed, it is elitist influence in Congress and the media that circumvents the Constitution by convincing the House not to utilize its power of the purse to check the White House, the Court, or the Senate. So, yes, the real need in this election is to elect the right Congress—men and women who will use the Constitution as intended.
But the real war runs much deeper: Getting regular people to choose enterprise over elitism, in their votes for Congress and in their everyday education, career and cultural choices as well. This war—to awaken the people to the reality of top-down ruling elitism vs. grassroots free enterprise, and get them to take a stand for free enterprise—is the great battle of our times.
This starts with the most basic principles of learning and livelihood. On an educational level: If you’re not regularly reading the great books, great classics, and great ideas, you’re part of the problem. Concerning career: If you’re not engaging or strongly supporting entrepreneurial ventures, or (at the very barest minimum), encouraging entrepreneurialism among the youth, you’re part of the problem.
If you’re swayed by the education/career conveyor belt, or pushing your children and grandchildren into it, you’re part of the problem. If you’re swayed by the elitist Establishment that dominates both political parties, or their media partners, you’re part of the problem. And if you’re caught in the socialist vs. capitalist or national versus globalist debates (all of which are ultimately led by elitists), you’re part of the problem.
Elitism wins as long as the masses play the elitist’s game. Indeed, many people are actually supporting elitism, either by giving up on their dreams and simply settling for whatever job pays the bills, or by trying to climb the elite ladder and become part of the elite themselves (and/or guiding their children toward the same).
The solution is enterprise. What is your mini-factory, your enterprising project (or projects) that fuels your passion and have the potential to greatly improve the world? If you don’t have such a mini-factory—or find yourself seldom working on it—you aren’t fighting the great battle of our time. And our side is losing.
This battle is real. Current. Dramatic.
It is happening right now.
We need to win it for freedom, for our children and grandchildren, for the future of families and morality and goodness. Which means this: We need your involvement.
(To learn more about creating your own personal mini-factory, and how this will win the battle of our times, read The Coming Aristocracy by Oliver DeMille. Available at the Leadership Education Store)
June 8th, 2016 // 12:08 am @ Oliver DeMille
Washington’s “Grin and Bear It” Message About an Economy that’s Still Struggling
The Need/Desire Question
In a 1927 issue of Harvard Business Review Paul Mazur of Lehman Brothers wrote the following prescription for the nation: “We must shift America from a needs to a desires culture.” How? “People must be trained to desire, to want new things, even before the old have been entirely consumed. We must shape a new mentality in America. Man’s desires must overshadow his needs.” (Cited in The Happiness Equation by Neil Pasricha, p. 78.)
What a thing to say! And it has happened, just as Mazur recommended. But in the process, something else happened as well. Not only were people convinced to want more and newer things, but government got caught up in the same quest. And people began desiring many more and new things from government as well. This changed our entire culture.
More recently, President Obama has assured the nation that a slow growth economy is the new normal. But is this good news? Or very bad news masked by a smile? Truth: it’s certainly not good news. (See the new report: “The World is Flat: Surviving Slow Growth” in the March/April issue of Foreign Affairs)
But before we address this, let’s take a little quiz. Just for fun.
Messages and Meanings
The following quote is about what nation?
(1) “_____________ will not be able to grow its economy…without…privatizing state-owned companies, [and] loosening regulations…”
Or consider this:
(2) “It may have…an undervalued currency, a debt-to-GDP ratio of 250 percent, and an average annual GDP growth rate over the last decade of less than 1 percent…. [but] Life expectancy is among the highest in the world; crime rates are among the lowest. The…people enjoy excellent health care and education.”
(3) “Middle-class wages stopped rising more than 30 years ago, but…low interest rates…and easy credit obscured the problem, allowing people to bridge the gap between their stagnant incomes and their spending.” How? By going into massive debt.
What is most interesting to me about all three of these quotes is how applicable they are to the United States today. Just re-read item 1 above. It could be a very realistic (and important) “To Do” list for Washington in 2016. Yet it was written about today’s Russia under Putin. (Foreign Affairs, May/June 2016, p. 20)
Still, Washington does need to heed its message:
- privatize state-owned companies that are a drain on taxpayers and gum up the free market
- loosen regulations that are killing small business and sending investment capital to other nations
Item 2 above could also seem to be about the United States, but in fact it describes today’s Japan: “It may have…an undervalued currency, a debt-to-GDP ratio of 250 percent, and an average annual GDP growth rate over the last decade of less than 1 percent…. [but] Life expectancy is among the highest in the world; crime rates are among the lowest. The…people enjoy excellent health care and education.” (Foreign Affairs, March/April 2016, p. 50)
The intended message here is clear: “If the people have good health care, education, and a stable economy, everything is good. A growth economy isn’t necessary.”
Starts and Stops
In fact, in the United States, “Middle-class wages stopped rising more than 30 years ago, but…low interest rates…and easy credit obscured the problem, allowing people to bridge the gap between their stagnant incomes and their spending.” (Ibid., pp. 50-51)
But how have Americans masked falling wages? The answer is illuminating:
- By going into massive mortgage debt (eventually leading to the housing bubble crash and the Great Recession).
- By using credit cards, car loans, student loans and building up major consumer debt. The average U.S. household has over 97 thousand dollars of debt and growing. (The Motley Fool, January 2015)
- By more than doubling the amount of work they do, with both parents typically now in the full-time workforce, instead of just one breadwinner.
- By working longer hours. The average workweek in the United States is now 46.7 hours, not the 1950s model of 40 hours and a crisp 9-5 workday. (USA Today: Modern Woman, Fall/Winter 2015) Over the course of a month, that’s an extra 29 hours—almost an extra workday every week compared to American workers of the 1950s.
- By depending on increasing amounts of government support, including “free” public school education, “free” health care for those who qualify, and a number of even more direct government programs and assistance.
In all this, according to Gallup, less than 20 percent of U.S. workers love their job. Around 80 percent are in jobs they hate, dislike, or feel less than passionate about. Moreover, most Americans don’t believe that their current job will ever get them ahead financially. They’re just barely paying the bills—if that.
Still, the current message from Washington and labor experts is that things are fine, that the economy has improved under president Obama’s leadership, and that we should be grateful. Most people won’t see financial increases anytime soon, “but don’t sweat it.” Like people in Japan, we are assured that we should just be happy for general stability and get used to a stagnant economy.
Fewer jobs, more college-grads who are unemployed or (underemployed) and living with their parents, more three-generation households, falling home values, rising costs of food and necessities—these are the new normal. “And it’s okay,” Washington assures us. “If things get really bad, there are more government programs than ever to help you make ends meet.”
Don’t worry, be happy.
Regulations or Solutions
“Don’t desire so much anymore,” we’re told. “Make do with less. Except when it comes to big government. We’ll give you more of that!”
But how does this message from today’s Washington jive with the reality? Truth: “An economy that grows at one percent doubles its average income approximately every 70 years, whereas an economy that grows at three percent doubles its average income about every 23 years—which, over time, makes a big difference in people’s lives.” (Foreign Affairs, March/April 2016, p. 42)
Factor inflation into these numbers—on the basics like food, housing, education, and transportation—and one percent growth means the average household falls further behind each and every month. At three to four percent growth, in contrast, like the overall average from 1945-2005 in the United States, families can improve their standard of living over time—and even help their kids do better than themselves.
Right now this level of growth is found mostly in Asia, certainly not in North America or Europe. Thus the increasing American realization that our children and grandchildren are likely to be worse off than we are, while their Chinese counterparts will probably experience upgraded lifestyles and standards of living in the decades ahead.
But this isn’t a static reality. It is based on the current policies and agendas of Washington. These can be changed. For starters, just adopt the suggestions Westerners often give to Russia, as outlined above:
- reduce/remove numerous government regulations that are killing small businesses and driving investment capital and high-growth corporations—and jobs—to other nations
- stop federal overspending in so many government agencies by simply cutting their budgets—significantly—to spark increased investment and business growth
Just these two changes would significantly reboot the U.S. economy.
Americans can become a more frugal and a resilient people once again, no doubt. But they would rather be a more innovative and entrepreneurial people—and they have proven that they are incredibly good at it—if government will just cut away the red tape and let free enterprise thrive again.
May 25th, 2016 // 6:12 am @ Oliver DeMille
Parties, Issues, and Funds
Mitt Romney was right about a number of things. One of the most important, even though it got him trouble with some voters, is that a solid 47% of the nation is against the Republican candidate for president (whoever he or she is), simply because a large group depends on government programs to financially make ends meet. In fact, the number appears to be increasing.
According to one report, “Nearly half of Americans would have trouble finding $400 to pay for an emergency.” The same article notes that “47 percent…would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all.” (“My Secret Shame,” The Atlantic, May 2016)
Indeed, in 2014 only 38 percent of Americans thought they could come up with the money for a $500 car repair. (Ibid.) In other words, the number 47 percent (who needed government help to survive in 2012) may now be closer to 62 percent.
High and Low
This is a challenging dilemma. On the one hand, those with a sense of needing more government support and programs to make ends meet are a lot more likely to vote for Hillary Clinton or even Bernie Sanders than for any Republican. As the electorate becomes more financially strapped, it tends to swing to candidates promising more government help.
On the other hand, it is the liberal (Bill Clinton/Barack Obama) and moderate (Bush I/Bush II) policies—growth of government intrusion in the economy and poorly-constructed education, health care, banking and other programs—that have brought our economy to this point. As more people vote for bigger government, the government naturally grows and the economy further stalls. It’s a self-fulfilling negative cycle.
In a truly free enterprise economy, entrepreneurship would create a lot more jobs and prosperity. It brings approximately 80% of new jobs in the United States—but the sheer mountain of red tape a business start-up now faces (based mostly on the policies of the four presidents just mentioned, and more from Obama than the others), has significantly gummed up the economy. Obamacare is making it even worse, with the most damaging (job-killing) parts of the Affordable Health Care Act still slated to go into effect in 2017.
Between 2003 and 2013 the median net worth of Americans dropped an amazing 38%. (Ibid.) And it’s still going down.
In short: Big government isn’t helping—it’s adding to the problem.
Beginnings or Endings
Remember the 2012 presidential debates where Romney suggested that Russia is a major strategic threat to the United States and Obama scoffed and lectured Mitt about not knowing what he was talking about? Three years later, guess what? Russia a major strategic threat. (See Foreign Affairs, May/June 2016: “Putin Returns to the Historical Pattern,” “The Revival of the Russian Military,” “The Quest to Restore Russia’s Rightful Place,” “Why Putin Took Crimea.”)
The same is true in economics. Bigger government, thousands of additional business- and job-stifling regulations on the books, and more red tape, don’t help the economy. They hurt it.
And a majority of Americans are now feeling the effects. Fifty-five percent of households don’t have enough savings to make it for even one month. (Op Cit., The Atlantic) If the middle twenty percent of households, the true middle class in America, lost their income right now, they could, on average, continue their current lifestyle for just six days. (Ibid.) That’s six days!
The sudden 2016 “defaults on subprime auto loans indicate that the American willingness to just keep buying…can’t lift us out of this [economic] pickle…. The general default rate for all subprime auto loans jumped from 11.3 to 12.3 percent in just a month—exactly the kind of ‘can’t pay my bills’ phenomenon that triggered the  housing collapse.” (“The Portfolio,” Esquire, May 2016)
Recently announced: Sports Authority is filing chapter 11 bankruptcy, Staples is closing 50 stores, Fairway is near default, American Apparel filed for bankruptcy, and even Walmart is closing 154 stores. (Ibid.) The list of other companies on the brink or downsizing and cutting jobs is long.
The economy is sputtering.
All this in the midst of a presidential election year. I don’t know what Donald Trump will or won’t do in the Oval Office (whether he’ll be just another politician or really lead out and reboot the economy). But one thing is very clear: If Senator Clinton is our next president, the number of Americans who require government support to make ends meet by the year 2020 probably won’t be 47 percent, or even 62 percent, anymore.
It will be a lot higher.
May 19th, 2016 // 8:19 am @ Oliver DeMille
We need to start.
First, it is clear to almost everyone that the Drone Revolution has drastically changed the world—probably in ways that we can’t really undo. Whatever other functions they’ll eventually fulfill, drones are the ultimate war machine. They can be programmed to do things unimagined in earlier wars, like search out specific people from certain races, religions, viewpoints, business or educational backgrounds, etc.
They can be programmed to target a specific person. And all his/her friends. Everyone he/she loves. Those who agree with him/her on political issues. Governments can use drones on their own people, as well as in battle.
Very few people are taking this very seriously. On the one hand, it’s so potentially monstrous that we don’t like to think about it. Imagine drone technology in the hands of a Stalin, a Hitler, a Nero, Caligula or Mao, Saddam Hussein or an ISIS sympathizer in your neighborhood. If history has taught us anything, it’s that bad guys do sometimes rise to great power.
It will happen again, and drone tech combined with computing power is a recipe for disaster.
On the other hand, if we did want to stop it, what would we do? Most people believe it’s a fait accompli. No chance of turning it around. They’re probably right.
Second, the Crowdsourcing Revolution isn’t over—it’s just beginning. It has largely put the newspaper industry on the ropes, and the book industry is also now under the gun as Amazon grows. In fact, many brick and mortar malls are increasingly empty as Internet sales on many types of products and services soar. Education at all levels is facing serious competition from free online learning sources, and big swaths of the health care sector are being crowdsourced as well.
The good side of crowdsourcing makes a lot of things less expensive, easier to find, and quicker to obtain (or learn). The downside is that the large companies that control the data have algorithms that can influence us in ways we never imagined. For example, a man texts his wife to find out where a certain kind of cereal is in the pantry, and within minutes his smartphone chimes and offers him a coupon for the same cereal—from the supermarket closest to his home. Or if he texted from the office, it lists the grocery store nearest to his work.
This kind of data-mine-marketing is becoming a commonplace experience for those who use certain apps, and while it might feel a bit creepy at first, over time people get used to it—and even grow to expect it. Very Minority Report. How much governments and private organizations are using this kind of tech is unclear, but it’s growing. Add personal location tracking technology to the mix, and we really are living in a surveillance state.
Third, there’s a new buzzword floating around in economic circles: “Crowd-Based Capitalism.” The idea is that in the emerging 21st Century economy we’re evolving a whole new economic model. Not socialism. Not capitalism. Certainly not free enterprise. A new approach. As one book from MIT put it, we’re moving into a “Sharing Economy,” where “the end of employment” is being replaced with “the rise of crowd-based capitalism.”
The idea that employment as we’ve known it for the last six decades is increasingly outdated. For example, in the May 2016 issue of The Atlantic an article showed how one couple used up their entire life and retirement savings—and the entire life savings of the husband’s elderly parents—to put their two daughters through college. The idea of college training being essential is now being taken to incredible levels: The savings of two couples wiped out, just so their offspring could graduate with a degree—in an economy that doesn’t value degrees like it used to. (See “My Secret Shame,” The Atlantic, May 2016)
A truly new economy is emerging, but most people haven’t realized it yet. They’re still caught in the old—and paying for it in tragic ways.
Another example: When 2016 presidential candidate Ted Cruz said the following, “The less government, the more freedom. The fewer bureaucrats, the more prosperity. And there are bureaucrats in Washington right now who are killing jobs…”, the response was immediate. Two professors, one from Yale and the other from Berkeley, replied that the opposite is true: The bigger the government, the more freedom, and the bigger the bureaucracy, the more prosperity. (“Making America Great Again,” Foreign Affairs, May/June 2016)
A lot of people actually believe them.
But reality is still reality. Crowd-based capitalism means more government, and this isn’t the path to a great economy. The thing that is actually rising to replace the 1945-2008 era of employment it is a reboot of entrepreneurship and small business ventures.
The new economy can go in one of two directions:
- Government reduces the amount of anti-business and job-stifling regulations, and spurs a major entrepreneurial boom. This will create a lot more jobs, opportunities, and incentives for increased global investment in the U.S. economy.
- Government keeps increasing business-stifling regulations and takes the profits from businesses (big and small) to create a “sharing economy.” This will create a much higher rate of dependency on government welfare and state programs, reduce the number of people fully employed (making enough to live in the middle or upper class), and drive investment to other nations.
How the so-called “sharing economy” differs from socialism is actually academic. Yes, on paper it has a somewhat different structure than Marxian socialism. But for the regular people it’s going to feel pretty much the same. A few wealthy and powerful elites at the top, a small middle class of managers and professionals who work mostly for the elites, and a burgeoning underclass living largely off government programs.
Two books* on this topic are: (1) The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism by Arun Sundrarajan, and (2) Saving Capitalism: For the Many, Not the Few by Robert Reich.
For the other side of the argument—why freedom and free enterprise are the real answer—see my latest book, entitled Freedom Matters.
Middle America is still experiencing a serious economic struggle. Things are getting worse, not better. As one report on the heartland put it: “On every sign, in every window, read the vague and anxious urgings…Remember the Unborn; …Don’t Text; Don’t Litter; Buy My Tomatoes (Local!); Let Us Filter Your Water; We Can Help With Your Bankruptcy. Then bigger gas stations sprawled on crossroad corners, unoccupied storefronts…another consignment store.” (“The Country Will Bring Us No Peace,” Esquire, May 2016)
As an ad for Shinola products reminds us: “There’s a funny thing that happens when you build factories in this country. It’s called jobs.” We haven’t seen very many factories built here for a long time. Crowd-based capitalism isn’t a solution.
Together, these three changes in our world are a very big deal:
- The Drone Revolution
- The Crowd-Sourcing Revolution
- The Post-Employment Economy
If you have more ideas on these important developments, share them. If not, learn more about them.
The future can be determined by a few elites who think about such things, or by all of us. The more regular people engage such important topics, the more influence we’re likely to have.
The truth is, we’ve forgotten Watergate and Kent State. (See “The Cold Open,” Esquire, May 2016) We’ve forgotten Nixon and that the 2000 presidential election was decided by the intervention of the Supreme Court. (Ibid.) We’ve forgotten a lot of things.
As one report put it: “We’ve forgotten how easily we can be lied to.” (Ibid.) If we let them, Washington and the media will just tell us what the elites want us to know—and think.
July 30th, 2015 // 1:04 pm @ Oliver DeMille
Lines and Questions
I was in a long line at WalMart, and I started talking with the man standing next to me. We spoke about a number of topics, including politics, and in passing I mentioned that except for military and law enforcement, private enterprises are always better than government programs. He took issue with this, arguing that the government does most things better than private entities.
When I pressed him on this, he said that of course Washington does things better than people or businesses, because the government can keep spending as much as it wants until it gets things right.
I just stared at him.
“Seriously? It can just keep spending as much as it wants until it gets things right? That’s your big argument for the effectiveness of government?”
“Of course,” he replied. Then seeing the look of amazement and incredulity on my face, he asked, “Why? What’s wrong with that?”
“You realize that your model wastes a lot of our money, right?”
“Sure, but so what? I don’t make much, so I don’t pay much in taxes. Other people pay for government programs, so why should I care?”
I shook my head. Then I asked, “Okay, but tell me: what programs has the government got right?”
Over and Under
He cocked his head and tried to think of some.
After a bit he laughed. “Well, that’s why we’ll just have to keep trying.”
My amazement grew.
I told him the following statistics I had just seen on a news broadcast of Special Report:
Between 2008 and 2013 the Social Security Administration overpaid people in the amount of $128.3 million. That’s quite a chunk of taxpayer money. To right this wrong, the government went after these overpayments and managed to recover $109.4 million.
That’s pretty good, right? Not totally efficient, but not bad.
Then the rest of the information came out. The cost of recovering this money was $323 million, making the total loss for the taxpayers a huge amount: $213.6 million plus $18.9 million in overpayments.
Go back and look over these numbers again. It’s just plain amazing!
I could see that even the man in line thought this was ridiculous. He shook his head and sighed. “Well, we’ve got a long way to go…”
It was his turn to check out, so we left it at that.
I wonder if he votes? Or serves on juries?
Education of our citizens matters.
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Black Belt in Freedom On-Site Seminar
Saturday, September 26, 2015
RESERVE YOUR PLACE TODAY
9-10:30am: Session I
10:45am-12noon: Session II
12-1:30pm: Lunch Break
1:30-3:00pm: Session III
3:15-5pm: Session IV