The Declining Level Of Trust Is Our Greatest Obstacle

Our concern over our financial leaders’ abilities to effectively manage our economy while they totally ignore the free market’s ability to solve our problems is at an all time high.

Our government is placed in a position where it must borrow 46 cents out of every dollar it spends, all the while increasing our national debt into the stratosphere.

Human Events Financial adds that this mistrust of our leaders is not just limited to the American citizens.  At the November 11^th and 12^th meetings last year of the G20, many financial leaders of other sovereign countries lobbied for an alternative World Reserve Currency to replace the dollar as the world’s reserve currency due to their concerns over the health of the United States dollar.

Historians point out that the British Sterling ruled as the world’s currency for over 200 years.  Its descent as the World Reserve Currency was the result of unsustainable national debt.  High government deficits always lead to the destruction of currency, dating back to Roman Times.  In the last 100 years, it has happened to Germany, Russia, Australia, Poland, Argentina and the Ukraine just to name a few countries that saw their currencies tumble.

Trust plays the key role in economic exchanges.  When trust disappears, market transactions break down.  Market psychologists Richard Peterson and Frank Murtha take the position that trust is the oil in the engine of Capitalism.  Without trust, the engine freezes up.

The public has repeatedly witnessed the government lying about the sub-prime banking situation, our national debt, inflation announcements and fraudulent spinning of all economic data to disguise the actual numbers.  Frederick Hayak once famously commented: “The curious task of economics is to demonstrate to men how little they really know about what he imagines they can change.”

Monty Pelerin, writing for the American Thinker, said the economic programs and policies currently in place are truly astounding.  I don’t think I have ever seen a more harmful economic environment for the county.  While some of these programs started with Bush, the Obama administration has advanced them to insane levels.

Logic, economics, common sense and history must be defied

to believe a recovery is possible in this environment.

The nation’s standard of living will be substantially lowered without prompt changes in policy.

Chris Dunn of the Huffinton Post states:  “According to the most recent data, 98% of all United States firms have less than 100 employees.  These firms are responsible for 98% of all new jobs in America and employ 50.2% of the private sector workforce.  American small businesses are responsible for over 97% of all exported goods and generate the majority of innovations that come from the United States.”

Not one dollar of the $2.3 trillion in economic stimulus funds will go to

the 27 million small businesses where most Americans work.

One hundred percent of the stimulus bill funds not destined for states will go to the top 1% of United States firms.  The firms in that top 1% have not created one new net job in America since 1977.

The American banks and the Federal government have pretended that all of the big banks are solvent.  As ABC News reported:  “The Treasury Department and the Federal Reserve lied to the American public when they said that the first nine banks to receive government bailout funds were healthy.  Most of that money will go to firms to dispose of their “toxic assets.”  Why are they toxic?  Because no one knows what they are worth, the balance sheets of the banks are not credible and therefore the entire market freezes up.  So, now the U.S. taxpayers own these “toxic assets.”

David Farr, the CEO of Emerson Electric, is typical of most large firms.  His company is large, a 41.7 billion firm, and he told Bloomberg News:  “Washington is doing everything in their manpower capability to destroy United States manufacturing, cap and trade, medical reform and labor rules.”  He says:  “I am not going to hire anybody in the United States, I’m moving.  They are doing everything possible to destroy jobs.”

Monty Pelerin concludes: “The reason Obamanomics will not and cannot work is because an economy cannot be managed from the top.  Critical incentives have been diminished or destroyed by recent economic policies.  Fear, uncertainty, threats, tax increases, penalties and violations of the rule of law are but some of the conditions anathema to entrepreneurs, small business and large business.  Businesses will not hire, invest or expand in a climate of disincentives.”

At the center of all of this is the growing distrust of government.

Until trust is restored, our economy cannot recover.  Each day brings a greater and greater concern over the confidence to move ahead with our lives. We are rudderless in a sea of uncertainty.  Trust is at an all time low judging from the approval ratings given our Congress and Administration by virtually every poll.

America deserves better.