What makes the rich, rich? | Eastern North Carolina Now

    Publisher's Note: This article originally appeared in the Beaufort Observer.

    In a recent jaunt to eat out at a local restaurant, we observed at some point in the evening literally one half of the customers sitting in the dining room doing whatever it is that techies do with a Smart Phone. But when you understand what these gadgets can do it is little wonder the surrounding environment was not sufficient to compete with the little screen these folks held in their hand.

    At our table we were discussing the recent gaffe Barack Obama made when he insulted most entrepreneurs in the world when he suggested that they did not create their business. The table consensus was that the President's remarks revealed his ignorance, as well as his entanglement with collectivism, more than it did anything else.

    Unfortunately, our President's economic philosophy grossly missed the mark. He would have known better had he understood I, pencil:



    A recently released update of the classic I, pencil is call I, Smartphone



    What Barack Obama missed in all of this is what the "proximate cause" of the pencil and the smartphone was.

    His ignorance led him to conclude that the government (collective or commonwealth) was what created the smartphone. When he, and his handlers, tried to walk back his insult of entrepreneurs, they tried to claim he really was simply recognizing that in creating most innovations there are an infinite number of contributors to the effort. And that is indeed true. But it misses the point.

    The point is that someone, somewhere, had an idea and the determination to create something from that idea. Sure they took advantage of a vast array of resources, some material and some intangible, but what brought those resources together to form something with utility was the ingenuity and hard work of an entrepreneur.

    The obviousness of that simplicity cannot honestly be debated. But it misses the point if you leave it at that.

    What is important to understand, and indeed, what created the smartphone was the capitalistic system. And it is that system that our president does not understand nor does he appreciate. And he certainly does not govern in such a way as to encourage the maximum potential of that system. It is indeed that system that he has attacked. And the essence of that attack can be seen in his promotion of "tax the rich." He sees the wealth that entrepreneurship produces and so what is his response? He would confiscate a larger part of it, and thereby de-incentivizing the innovation that produces the wealth, rather than promote a system that encourages even more entrepreneurship. His philosophy is that of the fairy tale character who would kill the goose that lays the golden eggs.

    And that is why we are stuck in a recession.

    As a trained attorney, Barack Obama should understand the concept of "proximate cause." That is the legal doctrine that says: "but for this cause the event would not have happened." In law, it is the idea that while there may be many contributing factors in the commission of a crime or a tort, the proximate cause is the one(s) that had it not have happened the crime or wrong would not have been committed.

    Entrepreneurs understand proximate cause. They know what it takes to make something happen and they also know what happens if critical events do not happen. But when they are not sure about those events they usually choose to sit tight. It is not that they fear risk. It is that they avoid unknown risks if they can. It is for that reason that so many of them in recent years have chosen not to venture into new enterprises while Barack Obama is in charge.

    And that is why we are stuck in a recession.

    Worse than anything, what Barack Obama fails to understand is that it is the Spirit of Enterpreneurship that God put in so many of us that is what not only creates wealth but what improves the quality of life for so many people throughout the world. The Bible tells us that God gave Adam and Eve dominion over the Earth and all the creatures in Eden. In doing so God ordained entrepreneurship. Entrepreneurship was taught by Jesus in the parable of the talents.

    So why on earth would our government try to stifle that which but for it would make us all richer and in most cases better off?

    What Barack Obama does not understand is what millions of people in this nation and around the world know, and that is, had it not been for them that something very worthwhile would not exist, and they are not only deeply offended by his assertion that they "did not create that something," but they fully understand that, with his attitude and approach, they had best think twice about risking another venture until he is gone.

    Obama tried to explain his faux pas by arguing that "we are all in this together." And yes indeed we are. But some of us are producers and some of us are users. Some are assets to the commonwealth and some are liabilities. And even those who are overall more of a liability than an asset sometimes make a contribution. But those are not the people who are entrepreneurs. Entrepreneurs are the ones who can see a vacant lot and imagine a thriving retail business there. They not only can envision it, they have both the ability and determination to make it happen. Entrepreneurs are the ones who see a need and go about developing a way to meet that need. Entrepreneurs are the ones who take the risks. They often risk everything they own in a venture. They are the ones who pay themselves last. And they are the ones who expect to be rewarded when their enterprise succeeds.

    It is not that they resent paying taxes. But they believe they should not have to pay more than those who consume more than they produce. They believe they should decide how their wealth is shared with others, not have some politicians decide it for them.

    Socialists like Barack Obama and his minions believe it is the collective...the commonwealth...the government that should be the beneficiary of entrepreneurship. But beyond that, they believe that the government should make the decisions for the entrepreneurs. And Obama, when he talks about "roads and bridges...and the internet" believes because government made an incidental contribution that it should own the enterprise, never mind that it was the entrepreneurs who paid the taxes that allowed the roads and bridges to be built.

    And that is why we are in the recession we are in.