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The Battle: How the Fight between Free Enterprise and Big Government Will Shape America's Future
America faces a new culture war. It is not a war about guns, abortions, or gays—rather it is a war against the creeping changes to our entrepreneurial culture, the true bedrock of who we are as a people. The new culture war is a battle between free enterprise and social democracy. Many Americans have forgotten the evils of socialism and the predations of the American Great Society's welfare state programs. But, as American Enterprise Institute's president Arthur C. Brooks reveals in The Battle , the forces for social democracy have returned with a vengeance, expanding the power of the state to a breathtaking degree. The Battle offers a plan of action for the defense of free enterprise; it is at once a call to arms and a crucial redefinition of the political and moral gulf that divides Right and Left in America today. The battle is on, and nothing less than the soul of America is at stake.
174 pages, Hardcover
First published May 4, 2010
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Displaying 1 - 30 of 38 reviews
August 19, 2020
A little old but the information in here is important. Brooks, the former president of the American Enterprise Institute, gives libertarians and conservatives a blueprint on how to downsize the government and why it should be done. Brooks arms the reader to the teeth with facts and data for the reader to use when debating proponents of larger government. Quite good overall!
Edit: I decided to change the rating from 3 starts to 4 stars after careful consideration. I’ve been considering it for some time now.
Edit: I decided to change the rating from 3 starts to 4 stars after careful consideration. I’ve been considering it for some time now.
April 18, 2011
This book does a great job of describing the chioce we are facing as a country: free enterprise or big government. It also points out where many of the supposed benefits of big government have been shown to be cataclysmic failures. Mr. Brooks works from facts, analyzing trends and results. His conclusions are very interesting.
August 13, 2014
This book is an exploration of political philosophy using empirical methods. Brooks gives an excellent, succinct and accessible summary and analysis of the american political situation since the 2008 financial crisis. It is based heavily on poll data, history, and lucid financial analysis and it defines beautifully the practical and moral case for the American free enterprise system and culture.
March 5, 2020
I appreciated this quick, readable discussion of free enterprise by a thoughtful economist. The current battle between statism (including expanding bureaucracies, increasing income redistribution, and government-controlled corporations) and free enterprise is a new culture war we are facing. Brooks shows that the 2009 stimulus was not a success and was not a necessity. The majority of Americans do not think the government should penalize success by redistribution intended to “narrow the gap between rich and poor.” Brooks shows that redistribution does not solve poverty; rather, “only policies and approaches grounded in free enterprise succeed in lifting large groups out of poverty in the long run.” (p. 111) The goal (in poor villages) should be to stimulate prosperity, which is more productive than government aid; entrepreneurs lift up their whole communities around them, and innovation should be rewarded, not penalized. Brooks discusses how the federal intervention of the New Deal prolonged the Great Depression; FDR’s lavish spending bought him votes, started generations of Americans living on the dole, and weakened our culture of free enterprise (but did NOT fix our economy). Brooks presents his facts in a clear way with plenty of footnotes to verify them.
Definition: “Free enterprise is the system of values and laws that respects private property, encourages industry, celebrates liberty, limits government, and creates individual opportunity. Under free enterprise, people can pursue their own ends-- and they reap the rewards and consequences, positive and negative, of their own actions.” -p. 3
“America’s overwhelming support for free enterprise is not equivalent to blind support for corporations-- which makes perfect sense. Support for the institution of marriage does not equate with a belief that all husbands are trustworthy. Similarly, a healthy love of capitalism does not require a naive belief that all capitalists are good and honest.” -p. 10
“No amount of unearned money can ever heal the human heart: … the secret to human flourishing is not money but earned success in life… In a country like the United States where people are above the level of subsistence, a poor man who believes he has successfully created something of value will be much better off than a rich man who has not earned his success. The big problem is not that unhappy people have less money than others. It is that they have less earned success.” -pp. 71, 77
“But if YOU suddenly got richer, you’d be much happier, right? No, you wouldn’t -- not unless you truly earned it, and then it would be because of the success, not the money… Studies show that welfare recipients are far unhappier than equally poor people who do not get welfare checks.” -pp. 79,80
“We all want control over our lives. Free enterprise gives us this control; statism takes it away… the state prefers to exercise control on its citizens’ behalf, thereby diminishing for them an important avenue to personal fulfillment and happiness.” -p. 91
“Core principles… about the moral superiority of the free enterprise system over the forces of statism and redistribution…:
The purpose of free enterprise is human flourishing, not materialism.
We stand for equality of opportunity, not equality of income.
We seek to stimulate true prosperity, not treat poverty.
America can and should be a gift to the world.
What truly matters is principle, not political power.” -. 103
“Equality of income is not fair. It is distinctly unfair. If you work harder than a coworker but are paid the same, that is unfair. If you save your money but still retire with the same pension as your spendthrift neighbor, that is unfair… Fairness is a system that rewards hard work, merit, and excellence. It is a system that rewards the honest MAKERS in society… Real fairness does not mean bringing the top down… It means giving the bottom a fighting chance to rise.” -p. 110
“Redistributive government welfare programs rob the poor of their chance for earned success and their inalienable right to the pursuit of happiness. Prosperity-based solutions are the answer… the best thing policymakers can do is allow these entrepreneurs to keep more of the money they earn, invest in their businesses, and expand their operations.” -pp. 116-7
Definition: “Free enterprise is the system of values and laws that respects private property, encourages industry, celebrates liberty, limits government, and creates individual opportunity. Under free enterprise, people can pursue their own ends-- and they reap the rewards and consequences, positive and negative, of their own actions.” -p. 3
“America’s overwhelming support for free enterprise is not equivalent to blind support for corporations-- which makes perfect sense. Support for the institution of marriage does not equate with a belief that all husbands are trustworthy. Similarly, a healthy love of capitalism does not require a naive belief that all capitalists are good and honest.” -p. 10
“No amount of unearned money can ever heal the human heart: … the secret to human flourishing is not money but earned success in life… In a country like the United States where people are above the level of subsistence, a poor man who believes he has successfully created something of value will be much better off than a rich man who has not earned his success. The big problem is not that unhappy people have less money than others. It is that they have less earned success.” -pp. 71, 77
“But if YOU suddenly got richer, you’d be much happier, right? No, you wouldn’t -- not unless you truly earned it, and then it would be because of the success, not the money… Studies show that welfare recipients are far unhappier than equally poor people who do not get welfare checks.” -pp. 79,80
“We all want control over our lives. Free enterprise gives us this control; statism takes it away… the state prefers to exercise control on its citizens’ behalf, thereby diminishing for them an important avenue to personal fulfillment and happiness.” -p. 91
“Core principles… about the moral superiority of the free enterprise system over the forces of statism and redistribution…:
The purpose of free enterprise is human flourishing, not materialism.
We stand for equality of opportunity, not equality of income.
We seek to stimulate true prosperity, not treat poverty.
America can and should be a gift to the world.
What truly matters is principle, not political power.” -. 103
“Equality of income is not fair. It is distinctly unfair. If you work harder than a coworker but are paid the same, that is unfair. If you save your money but still retire with the same pension as your spendthrift neighbor, that is unfair… Fairness is a system that rewards hard work, merit, and excellence. It is a system that rewards the honest MAKERS in society… Real fairness does not mean bringing the top down… It means giving the bottom a fighting chance to rise.” -p. 110
“Redistributive government welfare programs rob the poor of their chance for earned success and their inalienable right to the pursuit of happiness. Prosperity-based solutions are the answer… the best thing policymakers can do is allow these entrepreneurs to keep more of the money they earn, invest in their businesses, and expand their operations.” -pp. 116-7
January 4, 2011
Brooks provides historical, economic, and political arguments for the application of policies that promote a free-market system and lauds America for its success because of its application of free markets in every-day life. Parts of the book become a little too politicized in a right vs. left mindset, but the overall message of his book is the strength of America is built upon free market values where everybody has the opportunity to work and make something of themselves; America is equal opportunity, but not equal outcome system. The results of a free market system will make some more successful than others and Brooks argues this is for the benefit of all because it is what enables America as a nation to exist and to succeed. The move toward an equal outcome for all with heavy welfare and high taxes will only stifle economic growth and lead to social and economic problems in line with many European countries.
January 1, 2020
The author presents and argues for the conservative views well. To some degree, the book explains the underlying reasons behind results of recent elections after the release of the book.
July 10, 2014
Oh dear. The big print is a dead giveaway. But once more academics are part of a left-wing conspiracy to make citizens ... ummmm ... think a bit more.
May 9, 2024
The Battle: How the Fight between Free Enterprise and Big Government will Shape America’s Future
Conservatives desperately need to read this and Arthur Brooks’ other books. Not only would it help conservatism, more importantly it would help our nation which critically needs it.
Conservatives desperately need to read this and Arthur Brooks’ other books. Not only would it help conservatism, more importantly it would help our nation which critically needs it.
January 19, 2011
Short review: I do not recommend this book (go ahead and read if you want, as I believe in freedom of choice, but don't say I didn't warn you). This book takes some interesting data from recent scientific studies, and then wraps/twists it in ideological name-calling nonsense. I would go as far to describe it similar as a modern-day social Darwinism argument.
Long review: So before Christmas, I was driving home from work one Friday night, turned on the radio (happened to be on NPR since I listen to Prairie Home Companion and Car Talk) and caught part of what sounded like a very interesting talk on how "Money does not buy Happiness". In that talk he argues that in general, government redistribution of wealth is an ineffective means of increasing the happiness of its citizen and that the government should only provide limited monetary assistance (i.e. don't let anyone starve from lack of food, don't let anyone freeze due to lack of shelter, and don't let anyone die due to lack of medical care - but not much more than that).
First, he points to a study that shows Americans today are no happier than Americans in 1970... even though economically we are much "richer" than we were four decades ago (we can buy significantly more food, clothing, cars, and electronics and in general have a much larger percentage of our income free to spend on non-essential/luxury goods). However, we don't see this as us being "rich", just as the products being "cheap."
He also shows that while in general, citizen of richer countries are happier, after a certain level of wealth, the relationship disappears... so you can have people from poorer countries actually being happier than people from richer countries.
Then he shows that people who are explicitly given money do not on average turn out to be much happier. Here he cites data from lottery winners, people with unexpected inheritances, and of course people who have been giving explicit money by the government (welfare, food stamps, etc).
At the end, he proposes a few things that data has shown to improve happiness. The first is a sense of community (noting that all the countries that were poor, but happy... general had a strong cultural identity and community). The second is a sense of relative wealth (i.e. people are happier to be earning 50k when everyone else is earning 25k than earning 100k and having everyone else earn 125k). And the final thing is this thing called "earned worth" meaning that people really like seeing that their jobs actually have a tangible effect on the world. It could be the teacher who sees his students learn and thrive in the future. It could be a skilled craftsman that "sees" his finished products go out the door (this is different from assembly line factory worker are given a half-finished product, add something small to it, and then see a still-incomplete product move along out of their site unfinished). I found his point well argued and seemly well-supported and so just before I boarded my plane to visit my parents I bought the book on my new Kindle using some free credits I got (was the first book I bought on the Kindle).
So about a week later, while sick at my parents house due to a bought of stomach flu, I began reading it in earnest... only to discover the foreword was written by Newt Gingrich who said that this would be "one of the pivotal books around which American history turned."
After double-checking that I had gotten the right book, I shrugged my shoulders and kept reading... to discover that America is divided into two groups... there is the "free enterprise, work ethic, opportunity oriented majority (the 70% majority)" and the... "socialist, redistributionist minority (the 30% coalition)"... and it kind of went downhill from there... although there were a "few" middle chapters that rehashed the details from NPR talk I heard, it concludes by encouraging people to "take back America" from the "kulturekampf" (in italics) whose "socialist, redistributionist, social experiment ways" (throw in some more negative sounding buzzwords) is destroying the soul of America...
Well... the experience was educational. In hindsight, I should have looked up the book description on Amazon... but in my defense, it was my first book on the Kindle - I bought it quickly without reading the book description (also this would prove to be a very useful lesson as I read the book cover description of "Battle Hymn of the Tiger Mom" before commenting about that book sight unread). I did give about $6 to Arthur C. Brooks... but that amount of money doesn't help him that much and on the flip side I had the opportunity to learn and do some critical thinking against viewpoints that were not my own. I see it as the equivalent of watching a movie at the theatres (oh no... I just exposed my elitist true colors by my spelling of "theater") where you don't know if you are going to like it or not.
Long review: So before Christmas, I was driving home from work one Friday night, turned on the radio (happened to be on NPR since I listen to Prairie Home Companion and Car Talk) and caught part of what sounded like a very interesting talk on how "Money does not buy Happiness". In that talk he argues that in general, government redistribution of wealth is an ineffective means of increasing the happiness of its citizen and that the government should only provide limited monetary assistance (i.e. don't let anyone starve from lack of food, don't let anyone freeze due to lack of shelter, and don't let anyone die due to lack of medical care - but not much more than that).
First, he points to a study that shows Americans today are no happier than Americans in 1970... even though economically we are much "richer" than we were four decades ago (we can buy significantly more food, clothing, cars, and electronics and in general have a much larger percentage of our income free to spend on non-essential/luxury goods). However, we don't see this as us being "rich", just as the products being "cheap."
He also shows that while in general, citizen of richer countries are happier, after a certain level of wealth, the relationship disappears... so you can have people from poorer countries actually being happier than people from richer countries.
Then he shows that people who are explicitly given money do not on average turn out to be much happier. Here he cites data from lottery winners, people with unexpected inheritances, and of course people who have been giving explicit money by the government (welfare, food stamps, etc).
At the end, he proposes a few things that data has shown to improve happiness. The first is a sense of community (noting that all the countries that were poor, but happy... general had a strong cultural identity and community). The second is a sense of relative wealth (i.e. people are happier to be earning 50k when everyone else is earning 25k than earning 100k and having everyone else earn 125k). And the final thing is this thing called "earned worth" meaning that people really like seeing that their jobs actually have a tangible effect on the world. It could be the teacher who sees his students learn and thrive in the future. It could be a skilled craftsman that "sees" his finished products go out the door (this is different from assembly line factory worker are given a half-finished product, add something small to it, and then see a still-incomplete product move along out of their site unfinished). I found his point well argued and seemly well-supported and so just before I boarded my plane to visit my parents I bought the book on my new Kindle using some free credits I got (was the first book I bought on the Kindle).
So about a week later, while sick at my parents house due to a bought of stomach flu, I began reading it in earnest... only to discover the foreword was written by Newt Gingrich who said that this would be "one of the pivotal books around which American history turned."
After double-checking that I had gotten the right book, I shrugged my shoulders and kept reading... to discover that America is divided into two groups... there is the "free enterprise, work ethic, opportunity oriented majority (the 70% majority)" and the... "socialist, redistributionist minority (the 30% coalition)"... and it kind of went downhill from there... although there were a "few" middle chapters that rehashed the details from NPR talk I heard, it concludes by encouraging people to "take back America" from the "kulturekampf" (in italics) whose "socialist, redistributionist, social experiment ways" (throw in some more negative sounding buzzwords) is destroying the soul of America...
Well... the experience was educational. In hindsight, I should have looked up the book description on Amazon... but in my defense, it was my first book on the Kindle - I bought it quickly without reading the book description (also this would prove to be a very useful lesson as I read the book cover description of "Battle Hymn of the Tiger Mom" before commenting about that book sight unread). I did give about $6 to Arthur C. Brooks... but that amount of money doesn't help him that much and on the flip side I had the opportunity to learn and do some critical thinking against viewpoints that were not my own. I see it as the equivalent of watching a movie at the theatres (oh no... I just exposed my elitist true colors by my spelling of "theater") where you don't know if you are going to like it or not.
October 5, 2010
I agree with author Arthur C. Brooks that “America faces a new culture war!” His book states this battle will define the values of this nation for years to come and it up to us to choose a side in this battle. I am part of what Mr. Brooks calls the “70 percent majority” not the “30 percent coalition.” The 70% is a group of people that believes in Free Enterprise and the Freedom of Opportunity not big government and socialist type entitlements. Regardless of which side you are on, the book does ask some interesting questions and points out some of the problems that have plagued presidential administrations for the last 20 years. The book is an easy read and should be read by everyone, because sooner or later it will be time to choose sides!
November 8, 2010
I didn't enjoy the first chapter at all...mainly because it reminded me of everything that's going wrong in the government right now, specifically in how it relates to the economy. But after that, it got better. For me, the author related what it means to be an American, the idealist American...you know, that hard-working, build-your-own-success-story kind of American. And I found that I was feeling patriotism for my country again...(too bad it's not lasting...).
And it gave some practical advice on how to get that America back. I have to say I really agreed with the author's statements, especially about free enterprise.
And it gave some practical advice on how to get that America back. I have to say I really agreed with the author's statements, especially about free enterprise.
May 28, 2010
It's nice to read something short after months of Atlas Shrugged.
I guess it's silly to be surprised by the tone of a book titled The Battle, but sometimes (most of the time) the tone was too much for me to bear. If you can get past that, and don't mind reading the phrase "30 percent coalition" five times per page, there's a lot of good stuff on free enterprise and happiness here. Instead of the book, I'd probably recommend just reading the Washington Post article version of the book: http://www.washingtonpost.com/wp-dyn/...
I guess it's silly to be surprised by the tone of a book titled The Battle, but sometimes (most of the time) the tone was too much for me to bear. If you can get past that, and don't mind reading the phrase "30 percent coalition" five times per page, there's a lot of good stuff on free enterprise and happiness here. Instead of the book, I'd probably recommend just reading the Washington Post article version of the book: http://www.washingtonpost.com/wp-dyn/...
September 17, 2013
It was interesting about the middle of the book but than got repetitive and boring. More reflection of Atlas Shrugged in modern times but not well researched. More reference to third party research and studies. Would not read such titles unless it is better researched, and edited. Most of what read is what I already know and have had discussion with family and friends. America has dysfunctional government. Lives of normal people are at stake while Government is preoccupied in self preservation only. Very sad. America needs to clean its house before preaching to the world
September 30, 2011
I feel like I should add a caveat to this. Arthur Brooks is the President of the American Enterprise Institute, and I am working directly for him. Part of my responsibilities is to read all his books. So, this isn't one that I'd normally read, but I'll be neck-deep in conservative ideology for the next 4 months...not that that's necessarily a bad thing, but it's not something (nor is reading this type of book) that I would willfully do of my own accord.
May 20, 2016
"The Battle" by Arthur Brooks explores the on going disagreement between free enterprise and big government. Brooks explains the issue with great clarity. He clarifies that free markets(enterprise) allows individuals to lift themselves up out of poverty. On the other hand, monetary redistribution might help the poor for a moment, but in the long run will cause them not to work hard. Overall, a great insight into an important problem facing the nation.
February 5, 2017
Highly partisan but full of interesting data. Makes the case that there is a 70% majority in the United States in favour of free markets and small government against a 30% minority in favour of more government intervention in the economy. Argues in favour of the former and claims that advocates for free markets must reclaim the vocabulary of 'morals' from the left.
If you agree with Brooks' arguments you will find much ammunition here. If you don't, you are unlikely to be convinced.
If you agree with Brooks' arguments you will find much ammunition here. If you don't, you are unlikely to be convinced.
November 17, 2010
4 stars for ideas, 2.5 for execution. A very short, but concise, book on what's really fueling the current political climate and how free market advocates can fight the battle. I get a feeling that a lot of these books hitting the market these days are geared more toward Tea Party types with no political experience. That might be why this felt so unnecessary to me.
March 22, 2011
70/30 concept. 70% believe in free enterprise, if that is the right wording to use. Though I do believe I want my kids to be free to pursue any vocation they can create for themselves, so I must fall into this 70%.
The 30% are those who want more government control. Statism.
This little book was certainly enough to motivate me to be more encouraging with our children's bread business.
The 30% are those who want more government control. Statism.
This little book was certainly enough to motivate me to be more encouraging with our children's bread business.
December 16, 2015
I liked Brooks' book Who Really Cares?, largely because he had a lot of primary data behind his claims, and because he seemed uninterested in political cliches. I also liked Brooks when I heard him speak in person. However, in The Battle he's predictably partisan (as the subtitle indicates). The financial crisis was all because of government. And so is sadness.
Read
December 7, 2020At first, this book seemed a little fluffy...just some good old conservative bromides, but eventually Brooks got into some deeper concepts which left me with sticky notes all over the place. He really distills things down to the contrast between two groups of people in this country today; those who believe the government, especially on a federal level, should have more control in our lives, and those who believe the government's involvement in our lives should be as minimal as possible, and that we are all capable of determining our own destinies.
Now, I gotta admit that I have a short list of a few people (not the usual suspects) who really need some looking after to keep them out of trouble, but for the most part, I figure we can handle things ourselves, and get by with a little help from our friends.
One of the problems with the current debate about federal deficit spending is that the GOP did little to demonstrate that they were the responsible adults when they were last in power, during the Bush administration. Brooks says, "So Bush spent with abandon, and Obama went on to spend even more. Spending per se wsn't the real difference between the Republicans and the Democrats for voters. The difference was that the Republicans had no compeeling explanation for the crisis (real estate bubble and stock market bubble), seemed responsible for it, and had no obvious plans to fix it."
About time somebody admitted that G.W. Bush was not a fiscal conservative, and the congresses under his tenure spent like no one else before them.
The underlying cause of the housing bubble was not predatory lenders, nor gullible buyers, but the federal government's own policy, pursued for almost two decades, of encouraging home ownership, especially to people who had not previously been able to qualify for loans. Fannie Mae and Freddie Mac were right in the middle of this problem, buying up subprime and Alt-A loans like crazy, and repackaging them for investors to buy as if they were prime mortgages.
"By 1997, Fannie Mae was stimulating and buying subprime and Alt-A loans secured with nothing more than a 3 percent down payment. Four years later (by this time under the Bush administration) it was buying mortgages with no down payment at all...New government mandates required Fannie and Freddi to increase their low- and moderate-income loans to at least 55 percent of their mortgage purchases. From 2001 to 2006 subprime loans rose from 7 percent to nearly 19 percent of all new mortgages and Alt-As from just over 2 percent to nearly 14 percent."
When home prices fell, as none of the experts expected (How in the world could they call themselves experts...plenty of us laypersons out in the real world were wondering how housing prices could continue to rise forever?), the bottom fell out of the market. Government policies - however well intentioned - caused this crisis.
Seems like whenever the government comes up with a plan to stimulate the economy or help people out, it ends up with massive waste and/or fraud. For example, when it comes to the First-Time-Homebuyer Credit, put in place to stimulate the moribund housing market after the crash, "The U.S. Treasury Inspector General for Tax Administration found that nearly 74,000 individuals who already owned a home claimed the First-Time-Homebuyer Credit. And more than 19,300 claims were made by those who had never bought a home at all. The youngest of the 'taxpayers' to receive the credit were 4 years old."
Why am I not surprised?
He succinctly states something I believe at my core to be true:
"Progressive taxation dismantles the cause-and-effect relationship between working hard and achieving success. Everyone knows we need to pay taxes for key services. But taxes for the simple purposes of income redistribution...is all pain, no gain, when it comes to optimism."
I believe in equality of opportunity in this country, not federally mandated equality of outcome. When politicians like to talk about "fairness", we should bear the following in mind:
"Equality of income is not fair. It is distinctly unfair. If you work harder than a coworker but are paid the same, that is unfair. If you save your money, but still retire with the same pension as your spendthrift neighbor, that is unfair. And if you stay in your house and make the mortgage payments even when its value drops but your neighbor walks away from his without recourse, that is unfair.
Fairness is a system that rewards hard work, merit, and excellence...Real fairness does not mean bringing the top (earners and producers) down. It means giving the bottom a fighting chance to rise."
Another telling quote:
"I once interviewed an executive of a large fast-food chain about his hiring practices. I asked him whether he felt bad about creating 'dead-end jobs' that paid minimum wage and offered little apparent possibility for advancement. He was surprised at my question. 'The best route to management in this company is by starting in the kitchen at minimum wage,' he told me. 'Most of our executives started that way. The problem is that so many entry-level employees have terrible work habits. They create their own dead ends.'"
As an employer, I can vouch for that.
All, in all a very enjoyable book and a quick read on some basic principles of free enterprise.
Now, I gotta admit that I have a short list of a few people (not the usual suspects) who really need some looking after to keep them out of trouble, but for the most part, I figure we can handle things ourselves, and get by with a little help from our friends.
One of the problems with the current debate about federal deficit spending is that the GOP did little to demonstrate that they were the responsible adults when they were last in power, during the Bush administration. Brooks says, "So Bush spent with abandon, and Obama went on to spend even more. Spending per se wsn't the real difference between the Republicans and the Democrats for voters. The difference was that the Republicans had no compeeling explanation for the crisis (real estate bubble and stock market bubble), seemed responsible for it, and had no obvious plans to fix it."
About time somebody admitted that G.W. Bush was not a fiscal conservative, and the congresses under his tenure spent like no one else before them.
The underlying cause of the housing bubble was not predatory lenders, nor gullible buyers, but the federal government's own policy, pursued for almost two decades, of encouraging home ownership, especially to people who had not previously been able to qualify for loans. Fannie Mae and Freddie Mac were right in the middle of this problem, buying up subprime and Alt-A loans like crazy, and repackaging them for investors to buy as if they were prime mortgages.
"By 1997, Fannie Mae was stimulating and buying subprime and Alt-A loans secured with nothing more than a 3 percent down payment. Four years later (by this time under the Bush administration) it was buying mortgages with no down payment at all...New government mandates required Fannie and Freddi to increase their low- and moderate-income loans to at least 55 percent of their mortgage purchases. From 2001 to 2006 subprime loans rose from 7 percent to nearly 19 percent of all new mortgages and Alt-As from just over 2 percent to nearly 14 percent."
When home prices fell, as none of the experts expected (How in the world could they call themselves experts...plenty of us laypersons out in the real world were wondering how housing prices could continue to rise forever?), the bottom fell out of the market. Government policies - however well intentioned - caused this crisis.
Seems like whenever the government comes up with a plan to stimulate the economy or help people out, it ends up with massive waste and/or fraud. For example, when it comes to the First-Time-Homebuyer Credit, put in place to stimulate the moribund housing market after the crash, "The U.S. Treasury Inspector General for Tax Administration found that nearly 74,000 individuals who already owned a home claimed the First-Time-Homebuyer Credit. And more than 19,300 claims were made by those who had never bought a home at all. The youngest of the 'taxpayers' to receive the credit were 4 years old."
Why am I not surprised?
He succinctly states something I believe at my core to be true:
"Progressive taxation dismantles the cause-and-effect relationship between working hard and achieving success. Everyone knows we need to pay taxes for key services. But taxes for the simple purposes of income redistribution...is all pain, no gain, when it comes to optimism."
I believe in equality of opportunity in this country, not federally mandated equality of outcome. When politicians like to talk about "fairness", we should bear the following in mind:
"Equality of income is not fair. It is distinctly unfair. If you work harder than a coworker but are paid the same, that is unfair. If you save your money, but still retire with the same pension as your spendthrift neighbor, that is unfair. And if you stay in your house and make the mortgage payments even when its value drops but your neighbor walks away from his without recourse, that is unfair.
Fairness is a system that rewards hard work, merit, and excellence...Real fairness does not mean bringing the top (earners and producers) down. It means giving the bottom a fighting chance to rise."
Another telling quote:
"I once interviewed an executive of a large fast-food chain about his hiring practices. I asked him whether he felt bad about creating 'dead-end jobs' that paid minimum wage and offered little apparent possibility for advancement. He was surprised at my question. 'The best route to management in this company is by starting in the kitchen at minimum wage,' he told me. 'Most of our executives started that way. The problem is that so many entry-level employees have terrible work habits. They create their own dead ends.'"
As an employer, I can vouch for that.
All, in all a very enjoyable book and a quick read on some basic principles of free enterprise.
October 13, 2010
This book should be called Atlas Shrugged for Dummies. It is a very well written, short, concise argument as to why capitalism is morally superior to socialism in every way. Only 130 pages. Very quick read.
February 6, 2011
Extremely biased us-vs-them conjecture backed up with ill-formed arguments relying mostly on irrelevant data, baseless accusations, and manipulative use of bs statistical data. Read like an unedited rant by any random guy on the internet.
June 20, 2011
This is a good primer on how to reframe the political discussion of values to influence culture towards a more responsible citizenry with a consequently more limited government. It was worth the read and the small amount of time that is required.
Currently reading
June 22, 2010Asserts based on surveys that the right occupies 70% of the political spectrum and that happiness if best earned and not given.
November 15, 2010
i saw this guy in an interview on book tv and the interview was much more riveting then the book... plus. he's preaching to the choir... still have a little crush on the guy.
August 27, 2010
An interesting book with an emphasis on the moral case for free enterprise.
August 27, 2010
This book ought to be required reading for all college students. It was a great eye opener to learn where our country has been and where this presidency is taking it. We all better wake up!
July 8, 2011
It was OK, not earth shaking but spot on regarding the fight between big government and free enterprise. Take heed business people!
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August 4, 2011An important book that presents compelling arguments for all that the left finds offensive.
February 27, 2014
The lines are drawn, the smoke is clearing. Where will you be when the day is done?
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