Some time ago, I wrote a blog about Auctions. When I was a kid, my father used to take me to the local Livestock Auction. I was impressed how fast the auctioneer could talk, but the lesson I learned was a lot more important than just talking fast. After we got home from the auction one day after selling a steer, I asked my father why we did not get more for the steer because I thought it was worth more. He told me that he got, "what the steer was worth". It still seemed to me that we did not get what the steer was worth. Now when I look back, my father was right. We did get exactly what the steer was really worth. Now, that was and is an important lesson.
Now let me bring this whole thing up to date and see how it applies to today's economics. The best economic system that us humans have been able to come up with is what we call "capitalism". This is a total system that is based on "merit", "fairness" and "worth". Individuals make decisions every day on the basis of those three points above and the results is the near optimization of a very big economic system where the maximum amount and value of goods and service are produced and distributed. Don't think so? If not, then what system do you know of that has done a better job? Now, how does the "Auction" come into all this?
Let's start with the economics of the United States. What can we produce that we can sell at the "Auction"? How about corn? We can grow corn right here that we can sell at any public auction in the world and get a price that will allow us to make a profit. Our corn has "merit", "fairness" and "worth". That point is proven by the fact that it could be sold for a profit in a worldwide public auction.
Next, let's look at passenger planes made by Boeing. We can make them right here and people from all over the world will pay us in good money for them and enough extra that we end up with a profit. Like corn, our planes have "merit", "fairness" and "worth", again proven in the worldwide auction.
Next, take cars. GMC claims they made a big profit last quarter, but did you notice how few cars made here were sold out side the United States? We can't make cars here that can compete in the worldwide auction. GMC did make a profit by making cars outside the United States and then selling those cars, also, outside the United States.
How about oil produced here in the United States? We could sell every drop that we produce on the worldwide auction for a price that we could make a profit on. I am getting closer to the final point that I want to make. We are good at producing oil if our government does not get in the way.
We educate in our medical schools about 50% of the doctors that we need. The others we import. Isn't it interesting that we don't "export" very many doctors? Did you ever think about the reason why? Maybe it is exactly like cars, we can't compete with the rest of the world on price. What if we auctioned our doctors off in the worldwide auction. How much do you think we would get for them? Do you think we would make a profit. Why in a capitalistic country would we spend so much to produce a doctor when we would have to sell it on the worldwide auction market for a loss? The only way we can do it is to take value from other areas and put it into producing our doctors for more than it would cost for us to import 100% of our doctors. Isn't this a little like what has happened with TV sets and Cell Phones? We don't make any of them. We import 100% of them. We would save money if we imported 100% of our doctors. See how stupid all this is?
How about Green Energy? We can make solar panels, but no one in the worldwide auction wants to buy them. Ours cost too much. We can't compete. What about the energy that we produce with solar panels and wind mills? It has a cost of at least 10 times that produced from coal. You know that no one in the worldwide auction market would by green energy from us at those prices. If that is the case, then why should we be forced by our government to buy the expensive green energy? We have better things to spend our money on and so does our government.
This brings me to my final point. How much are you worth on the worldwide auction market? What kind of jobs do you think that 90% of the people who work for our government could get in a free auction market here in the United States? My guess is that 90% could not get a job that paid half as much. How much do you think they could make with their skills in any other country? How about the 40% of our kids who do not finish high school? What are they really worth? If they had to stand for auction in the worldwide market, it would be very sad indeed.
There is an old saying that goes, "you can bull shit most people, but don't bull shit yourself". Isn't that what we have been doing? What will happen when all of our net worth is spent and our credit has run out? Remember the other saying, "the chickens are coming home to roost". I am not sure there will be any place for many of us to roost. Next time a politician give you a line of BS about "fairness", think about the worldwide auction market. That is where you can find out how much his BS is really "worth".
