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Why do billionaires support Obama?

By Ben Cerruti
web posted April 25, 2011

Barack Obama has kicked off his campaign for re-election in 2012 looking to raise close to an estimated one billion dollars towards that end. Now ask yourself, why would extremely wealthy people want to contribute funds to someone who wants to take more of their income by increasing taxes on it? 

One could reasonably visualize the possibility that these billionaires would consider their contributions, including the increase in their taxes on income as an investment. The return on this investment being what they would derive in an increase in their overall wealth along with the benefits that would accrue with being in a de-facto relationship with the government.

It must be understood that income and wealth are not the same. Wealth can be created by accumulated income over time or by increased value of assets such as security holdings and real estate. Income, of course, can also be derived from wealth by way of its investments. Barack Obama disingenuously states his desire to redistribute wealth when he really means income.

Of course, the corruptive practice of quid-pro-quo is not exclusive to any particular political party or politician. However, when the politician is the President and his ideology appears to be markedly socialistic, one's fears arise that we Americans are being led down a path to State Capitalism. Wherein the wealthy, including major shareholders and executives of large Corporations find a greater degree of benefit and security being under the control of government. By way of their financial contributions to government administrators they are able to influence the laws and regulations that affect them.

This was so well evidenced by Jeffrey Immelt, President of GE and Obama's jobs czar, in a letter to his stockholders "We are in a recession and, at times like these, it is difficult to predict how bad and for how long. We are running GE to 'weather the cycle'. However, I believe we are going through more than a cycle. The global economy, and capitalism, will be reset in several important ways. The interaction between government and business will change forever. In a reset economy, the government will be a regulator; and also an industry policy champion, a financier, and a key partner."

It should be obvious that there are others who are following Immelt's lead in joining the rush towards state capitalism. There are those who may not immediately fear this movement and question the affect it would have on them. As long as it doesn't affect their present and visual future way of life why be bothered by this movement. However, if we rationally consider what state capitalism will bring it becomes apparent that it will have a dire affect on the greater majority of the people.

If the government finances, creates and regulates industry it is more than a partner, it becomes the de-facto owner of it. It does this by controlling the banking system, regulating industry and awarding government controlled business to favored corporations if not, in essence, owning them. The path of least resistance for private industry is to succumb to the temptation of a secured favored future. The incentive for entrepreneurs of new ventures to bootstrap their enterprises to wealth becomes continuously diminished and high productivity and efficiency cannot survive for long in this environment

Perhaps the greatest effect that will be felt by all individuals in our society will be the diminishment of individual freedom. It is already on its way. Some examples are the recent banning of incandescent light bulbs, attempts to outlaw plastic grocery bags, attempts to control the type of foods we eat and agricultural subsidies. Also having an effect is the ethanol subsidy to corn growers and regulations restricting domestic drilling for oil that increase costs of both food and fuel. 

State capitalism creates a two-class system. One class being the government and its employees partnered with those who control large corporations and people of great wealth. While the other class being rest of us in the private sector. In our traditional economic system the private sector has been the source of funding for the public sector. One must consider that increasing the size of the governing public sector that will include large corporations will accordingly shrink the size of the private sector and its ability to contribute to that funding.

So the choice should be apparent for those who believe in individual freedom and the tenets imbued in the Constitution and the Bill of Rights. There is no place for state capitalism and a two class system that insure that those with great wealth and in high position in government have de-facto control of all of the rest of the people. Barrack Obama and all of his ilk must be removed from government and the financial bond to the wealthy completely and permanently cut. His rhetoric that he is acting for the benefit of the poor and less fortunate is pure demagoguery since his actions decry it.

It is apparent that this will eventually require the repeal of the 16th Amendment and return of the power of the purse to the individual states, along with the repeal of the 17th Amendment returning the power of senatorial appointments to the state legislatures. The Federal Reserve System will either have to be replaced by a computer as recommended by noted economist Milton Friedman or abolished completely with the banking system returned to the individual states as envisioned by noted economist Fredrich Hayek. The return to state's rights and limited central government must prevail for our union to endure as a nation of freedom loving people. ESR

Now a senior citizen, Ben Cerruti has been involved in espousing his views in writing for the last 20 plus years. He has been published numerous times in various San Francisco bay area newspapers and has been actively involved in taking positions on ballot measures to the point of writing the arguments and rebuttals and appearing on television to state his position. He has been involved in ongoing extensive correspondence with Milton Friedman, noted nobel laureate in economics, and is presently preparing to present this series on his website http://www.arationaladvocate.com.

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