Below is a letter I received on September 12, 2003 stating that “big” business is to blame for our economic troubles in America by purchasing and selling foreign products to American consumers.  (I’ve taken the name of the example business sited and given it the cover name of Wally World).  This letter is followed by my reply letter:

Kenny:

Was browsing thru your website and read some of your letters and one struck me.

I can tell you who sold out America....we did it collectively as a society, but it started with big business.

My best example: Wally World

Wally World saw its greatest growth with Sam Wally declaring that his stores carried only domestic made goods. After his departure from this earth, his cronies decided to widen profit margins by slipping in more and more products that were supplied from China and Taiwan.  Go to any Wally World today and view for yourself the high percentage of non domestic products. Retailers, wholesalers, and manufacturing companies buy both product and package from overseas to simply reduce their costs and widen their profit margins.  I see this with companies almost weekly.

Now we , as a society, feed this process by continuing to purchase products from these retailers, wholesalers, and manufacturers because we have been convinced that they have offered us lower prices thru better technology, purchasing power based on volume, etc. We as a society continue to fuel their profit margins by believing that "they really care about our inflation woes". The sick part is that the guy who just got laid off from his job due to lack of business(and the customer lost was Wally World) goes to Wally World and spends what little money he has and re-feeds the problem.

Another base of contention I have is simple: Why are we trading with Communist countries? How traitorous can our country and people get? It is the same, in my opinion, as the spending of billions of dollars in economic aid to foreign countries when the real need lies within the boundaries of the United States. Oh, yes, we have to maintain a politically friendly relationship with some of these countries and help them since they cannot help themselves. But it always seems that we give and don't receive in return in equal value. The sad commentary is that this is all financed by hard working middle class Americans.

Not only is product and package purchases overseas adding to the failure of our economy, it sends a clear message to retailers, wholesalers, and manufacturing that service and quality is of less value. If I send a container of product to you from China and it is defective, you either use it or reorder it(with three months lead time) and fail to make your product or shipments during the wait. That does not seem to have value to those industries that "buy for price and profit" overseas.

The bottom line.....we as a middle class society have demanded more for less and our country's business fathers have responded by cutting the tail off the dog.... The stockholders of these companies are the only winners in this sordid mess and I believe that most have no conscious or loyalty to this Great Country!

Dear sir,

Glad you stopped by and read some of what is printed on my website.  I showed your letter to a work associate and he said he read something similar this week in our local newspaper (I’ll have to dig it out as I missed it) written by Morton Marcus saying pretty much the same thing, but he added that people making overpaid labor union wages also buy the products at places like Wally World that sell many foreign goods.  (After reading the article later, I will note that Morton Marcus was much more subtle in his mention of labor unions and labor union workers, but I believe he was making the point that I have expressed here about union workers buying at Wally World).

He also said “you people are all to blame” (my words—not Morton’s).  But it sounds like he was including the labor union workers for being overpaid and asking others to buy inflated priced products made and sold by their companies.  This line of reasoning would definitely increase the complexity of the problem to include more than cheap labor foreign goods and international businesses profiting in gross amounts from selling them to Americans.

If Sam Wally began selling only American made goods at prices cheaper than all his competitors, then he surely was not able to sell union made goods only!  Unless he learned the fine art of the vice grips, forcing companies to sell to him without making any profit margin themselves.  So was he selling only non-union domestic products or could he outsell his competition solely because he employed non-union labor and that is where he made his money?

The real sad part is that the person who does not go to Wally World (or one of their like competitors) with the little money he has left due to being laid off, finds his dollars do not hardly go far enough to care for his family’s essential needs, let alone luxuries; when he buys UNION MADE domestic goods.  But he may feel better knowing that someone making $20 an hour on the union line putting nuts on bolts (or some similar complicated procedure) is doing well for himself and his family.

You are absolutely right that we should not be trading with Communist countries, because an easy case can be made by all but the politically blind that those goods are literally created by slave labor (non-voluntary—unless the laborers wishing to eat is the only criteria for voluntarism!).  And foreign aid is financed for the most part by the same middle class that is struggling in this country to make their own ends meet.  We are both puzzled why this goes on?  Unless what I draw out as the populists’ argument is closer to reality than even I give it in one of my letters "Many Americans Identify Themselves as Populists".  But when I wrote my “What...Or Better...Who Causes Unemployment?—The Analogy of An Artist”, I could not see how this reasoning was flawed in any way.  I still don’t!!!!

The free market economists whom I admire:  Frederic Bastiat ("Let Us Now Try Liberty"), Richard Cobden (the English Bastiat), Ludwig von Mises, Eugen von Bohm-Bawerk and others like Thomas Sowell from the so-called Austrian school or influenced by it make the case that “if goods do not cross borders, then armies will”  To wit, that free trade between nations keeps them at peace with one another.  A sharing of their varied abilities, technologies and resources.

Frederic Bastiat

Ludwig von Mises

Thomas Sowell

In your explanation of who sold out America, you did not include government (with their socialist policies of taxation and regulation ad infinitum) or labor unions (protected by government to collectively strike with government force backing them up—stopping a company from replacing their jobs with other workers) with any degree of share in the blame as possible culprits with “big” business or business “big or small” in general.

One way to make sure a few stockholders of these companies are not the only winners is for all Americans to become stockholders.  But then that would require that all Americans put off some consuming and invest in the capitalization of the economy.  Many are simply classified solely as consumers.  How else does one classify someone who consumes without doing any work?  Shouldn’t such policies as these (paying people not to work) be factored into explaining the whole picture of what is wrong with America?

There is a political party that obtains its power by making more folks dependent on government (or government force to extract value from their neighbors) for their daily bread than being interdependent with their fellow citizens through value for value trade; and then convincing them that only a vote for their party members will keep the free fountain flowing.  Oh, it can certainly be argued that the “other” party has caught onto this ploy and is trying to play “me too” with these same people; rather than politically incorrectly stating what is going on here.

Patrick J. Buchanan, Pat Choate, and many others, who do not classify themselves as modern conservatives, but rather, as Pat calls himself “a conservative of the heart”, actually hold to mostly populist positions favoring protectionism (again I refer to my writing "Many Americans Identify Themselves as Populists" for a profile).

The way I would explain our present fix in some sort of an analogy or whatever it would be called is to say that a machine that had a bad mechanic adjust one thing and threw it out of kilter, and then another mechanic adjusted something else to try and offset the original problem, because it was “politically incorrect” to fix the original problem; then another and another; until the machine was all out of whack.

The Wally World problem example you shined your light on may be one of the attempts of one of the secondary mechanics to adjust the original problem or an attempt to adjust one of the incompetent attempts to adjust the original problem.  I believe the original problem was one thrust on us which stated “YOU PRODUCE, I DO NOT, WE ARE COMRADES, LET US SHARE.  YOU HAVE SOMETHING, I HAVE NOTHING, WE ARE BROTHERS, LET US SHARE.” (A quote attributed to French economist Frederic Bastiat explaining “This is brotherhood . . .”)  Or in the words of Karl Marx in his Communist Manifesto “FROM EACH ACCORDING TO HIS ABILITY, TO EACH ACCORDING TO HIS NEED.”  What made this attitude so true and unchallenged in American society?  When that can be answered, then one gets to the root of the original problem with our economy.  Find the ones who still argue that that is a beautiful philosophy and you found the ones who are stopping us from solving our economic and social problems.  Find the ones who are afraid to say that that is an ugly and evil philosophy and you found the ones who are the silent accomplices.

All profit is interest.  Read the Ludwig von Mises review of “Capital and Interest”  "EUGEN VON BOHM-BAWERK AND THE DISCRIMINATING READER".  von Bom-Bawerk was one of the economists who tore down the works of Karl Marx, but the west admired Marx and most have never heard of Bohm-Bawerk.  Read Matthew 25:15-28 about the “talents”.  The one who invests in tooling (capital equipment) makes a profit, but the profit is merely a return on his investment.  Most people only know how to consume (some do not even produce), but wonder why they don't make any profit!  They choose not to take risks.  Successful risks cause interest, or profit, bad risks cause loss or negative interest.  Most people are afraid of negative interest.  Others are simply afraid of work!

Inflation is government taxation, unless it is the result of private counterfeiting.  Read "WHAT CAUSES INFLATION?".  The only way we can get the economy going with overpaying all the workers is to grant government to inflate the currency and credit to the degree that although we are all overpaid, our dollars buy less and those who invested in capital equipment, when their money had more value, watch some of its value stolen from them in government induced depreciation of value.

Is there a place for Christian love and caring in a society run on Free Enterprise without a mixture of socialism?  There better be, or else it will fall as it would deserve to fall.  But Christian charity must be a private thing that is not after political votes, else it will turn into a pure secular charity, which would have other motives behind it other than Christian love.  The leaders we have are trying to institute the counterfeit of Christianity on our society, rather than allow the people to exhibit it of their own caring concerns.  Communism (in reality “socialism”) is nothing more than a worldly counterfeit for true Christianity.  Here I would refer to my letter “Many Leery of GOP Takeover”.  I’m sick of people being lied to and becoming addicted to lies like a drug that has a hold on them.  (Bastiat said that you go to the trouble to prove that 2+2=4 and then people get bored and vote as though you never proved anything at all.)  If we don’t soon become a people hungry for the truth, then we will end up where we deserve to end up—in the trash heap of history.

Sorry for the length of this letter, but know that it will take you much less time to read it then it took for me to formulate it and get it out of my mind.  Have a nice day and STOP, THINK AND LOVE LIBERTY!

---Kenneth J. Wolf
September 12, 2003