In a representative democracy you get what you vote for, or supposedly so. It's a fundamental tenet of democracy. Throw the switch; punch the paper; and your voting voice has been heard. You get what you, or rather, what the majority wants. But with bailouts and stimulus programs, that isn't the case.
When a company that supplies the buying public with the products and/or services that the public wants suddenly finds itself struggling for profitability, it, in essence, has received the votes of the majority. And in a free market, that company has only two options. Either it can change, and begin to provide the products that the majority wants; or it can be liquidated. Liquidation is simply the sale of the company, or parts of it, to other companies that have remained competitive. And if the company doesn't change enough, it will eventually go bankrupt, which is the same as a longer, slower, more painful liquidation.
But bailouts, “stimulus” programs, toxic asset reallocation programs, and all of their politically correct sounding cousins, are actually failures of the democratic process as it is applied to our economy. Our politicians, actually all of us, believe that the will of the people deserves to be heard through the power of the voting booth. Democracy is its own reward, because every single person of voting age in the country has a say in what direction they want the country to take. But for some reason, many of us conveniently overlook our hard earned dollars – our day-to-day livelihood – our wallets.
When you make a purchase, you are essentially “voting” for a particular product and/or service. When you go to the grocery store, you do this probably two or three hundred times – possibly a thousand times. You make one very specific selection for a product, not all by itself or with one or two other products, but in comparison to and over a number of others. And you do this for every selection you make. This same process goes on and on in every aspect of your life. The clothing store; the gas station; the hobby shop; the hardware store, etc. Thousands upon thousands of conscious and semi-conscious decisions are made with our hard earned dollars and what we desire most for ourselves. And all of our countrymen do the same.
So, arguably, which has the greater effect? Your day-to-day purchases, using your own money, which you have rightfully earned, or your once per four years chad production process? Voting for a politician, or group of politicians, gives the country a general direction. But when you vote, every day, with your own dollars, you give the entire economy a specific destination. You're telling not just the manufacturer of the product you purchase to “make more of this,” but you are also sending every other manufacturer the same signal – “do this.” The overall effect of our purchases gives us a far more concrete understanding of the desires of the people than the hopes we parlay from our votes for particular candidates. Best of all, we get to make such votes every day.
We tell certain auto manufacturers “make less of this,” and certain financial services suppliers “don't do that.” And as I mentioned, it's with our hard earned money. It's our most telling desire for a specific destination. People don't speak with their mouths; they speak with their wallets.
Interestingly, however, our general directioners often disagree with us. Despite having told myriad U.S. companies that we don't want what they have to offer, every day, our elected officials have chosen to bail them out with... the money we earn and have intentionally kept from them. This is akin to economic anti free will. It's the very antithesis of a free market, and the opposite of our stated desires for a specific destination in our economy.
The most pressing issue, though, is this: your dollar votes count more than your, or their, policy votes. First, because you have earned your money through your own time, energy and sweat. Your life. And second, because the American public plays a much greater role in the day-to-day activities of the economy than the government. They are not making the actual purchases. You are. In short, the economy doesn't belong to them; it belongs to you. They simply don't have the right to overrule your every day votes, no matter how many jobs they say they will "create" or "save."
If a laissez-faire economic system can be compared to our democratic political system, on the one hand our leadership would tell us they need to “control, control, control” the economy. But in our political system, the same leadership would tell us, all votes need to be counted. Why the disconnect? And which system gives us the more concrete ideas about what the people want?
So bailouts and stimulus programs, though they might make us feel a bit better and more secure, are the opposite of the principles our country was founded upon. They are undemocratic. And they deny what the people have stated they want as a specific economic destination for the country.
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