Have any of you noticed that Congress turned out the lights, shut the doors and left Washington for a long vacation a few weeks ago. All but a few Republicans, that is. They used the opportunity to blast the Democrats for their failure to address critical national issues.
But something strange has happened. As soon as Congress went away, so did a number of the problems. During their absence, the price of gasoline has plummeted, thousands of illegal immigrants have been packing up their bags and returning to Mexico and the value of the U.S. dollar is showing signs of recovery. Is this a coincidence? Maybe, maybe not. But just in case, perhaps we should encourage them to stay away and see if the improvements continue.
The free enterprise system, when it is working properly, is self correcting. For example, one of the economic principles in our economy is called “elasticity of demand.” It is a corollary of the supply and demand system. It says that the demand for any given service or product will expand or shrink according to the changing price. As the price of gasoline shot up over the past months, we the consumers reduced the amount of gasoline we used. At that point the law of supply and demand kicked in and the prices started to drop, just as I had previously predicted.
As our economy slumps, the demand for cheap labor is dropping. Large numbers of illegal workers are having problems finding jobs and are choosing to return home where living expenses are much lower than here. Border patrol officers report that more Mexicans are crossing the border back into Mexico than are coming this way. Some of them are having a problem finding schools for their American-born children.
And as the value of the U.S. dollar declined, U.S. products have become more affordable on the world market, creating more stability for our currency. The rebounding dollar is adding to the drop in crude oil prices, speeding the drop in gasoline prices.
As long as economic power is widespread, the economy will take care of itself. It is when economic control becomes concentrated in a handful of power brokers that we get into trouble. It was the Northeastern business tycoons who’s monopolistic grip on our economy following the War for Southern Independence and the so called “Reconstruction” that gave rise to the Great Depression. And it is the high taxes and massive regulations of the federal government that is causing most of the problems now.
When Congress returns, I think they ought to act quickly to reduce the massive bureaucracy, purge most of the unnecessary regulations and strengthen the ones that actually protect the economy such as anti trust rules that prevent a handful of companies from dominating any sector of the economy. Then go back home and let the economy proceed with its self healing.
President Ronald Reagan once said that government cannot solve our problems. Government is the problem. The signs that the economy is trying to fix itself while Congress is on vacation might be proof of that statement.
Frank Gillispie is founder of The Madison County Journal. His e-mail address is frankgillispie671@msn.com. His website can be accessed at http://frankgillispie.tripod.com/
