Why Does The American Economy Work So Well?
America is an amazing place. I will never understand why countries all over the world don’t copy our system of capitalism and free markets. I mean the jury is in folks. What are they waiting for?
In just over 200 years America went from an empty land to the dominant force in the world. We are the reserve currency of the world, we are the leaders of the world economy and, like it or not, we are also the world’s policeman. How did America accomplish so much so fast? The answer is — a market driven economy.
What Makes The America Economy So Different?
- We can own property. In many parts of the world that’s not possible. As long as you pay your property taxes and obey your homeowner’s association “Gestapo” rules you can live and own property virtually anywhere you can afford it.
- We have a lot of freedom. We can live and work where we want, we can buy things, produce things, and sell things for profit with minimal interference.
- Most important of all, our own goals, interests and desires drive us. We can sell our experience, expertise and skills to the highest bidder. The sky is the limit. Buyers try to get the best deal; sellers work to be more profitable. It’s win-win for both sides.
- Monopolies are illegal. American competition has the full protection of the US Constitution and the courts. We can open a competitive business right across the street and let the chips fall where they may.
- No price controls. Nixon tried it in the 70s but it just doesn’t work. Prices in America are allowed to fluctuate. To ebb and flow depending on location and demographics. We can have a sale if we want to. Supply and demand.
- Last, but not least, our federal government is supposed to protect our free access to our various markets. While there is no question that markets are sometimes manipulated, it’s the governments job to regulate, within reason, those engaged in our free enterprise system. Our entire economic system is built on fairness to everyone.
Some Final Thoughts
Fairness to everyone? Do we really believe that? Is spite of all our freedoms do we really have a “fair” market system? I guess if you are a regular viewer of the six o’clock news you’d probably say no.
Banks getting slap on the wrist fines for bilking depositors out of millions? Hardly seems fair. But, with great freedom comes great responsibility. And the real power lies squarely in the hands of the American consumer.
I have the freedom to close my account in that bailed out bank and take my business elsewhere. If, in my opinion, my employer is not fairly compensating me I have the freedom to tell him or her to “kiss off” and sell my abilities elsewhere.
Or, in sweet poetic justice, open a competitive business right across the street. I don’t know about you but I’m feeling much freer now.