Some Economic Thoughts

It has been a long time since I've run anything about economics and since the weather is pretty calm right now, it is a good time. 

Unfortunately, the U.S. is a long way from capitalism as it should be practiced. These days we have a lousy version some call "crony capitalism." The well-connected prosper. In order for capitalism (I prefer the term "free enterprise") to work properly, a society needs a strong moral foundation -- which we have frittered away the past 50 years. 

When I was in college, we used to argue whether it was excessive for the President of a company's salary to be more than 15 times that of the lowest paid, full-time worker. Unfortunately, today, it sometimes 4,000+ times -- terribly excessive*.

Regardless, what we have now is better than socialism or, especially, communism which do nothing but breed misery and poverty for the average person. 

At the end of the above cycle, a nation looks something like this. 

Remember with this year's elections. Venezuela was a highly successful and wealthy nation with a prosperous middle class before they "voted in" socialism. Of course, when it didn't work, the socialists didn't allow the people to vote the socialists out. Within a quarter-century, the nation went from wealthy to poverty-stricken. 

*Example: Using today's dollars, let's say the lowest full-time worker at Disney makes $35,000/year. Then the most Walt, if he were still with us, should make in salary should be $525,000/year. However, since Walt was the founder, if he became a billionaire via stock appreciation, etc, that is fine with me. Walt (and his brother, Roy) took all of the risk -- and didn't pay themselves when things went bad, as they did several times -- they deserve the outsized reward for their success.