Populism, for the People?
Research for Online Investors

by John Dalt

1/19/10

There is a game making a resurgence in Washington, called ‘populism.’   Do we understand where it can lead us?  Everyone likes sporting events, to cheer for our favorite team and snarl at the opponent.   In life, is an enemy necessary?  For us to feel successful, does someone else have to fail?  Is life a zero sum game?   If we fail, is it anyone’s fault other than our own?

If Steve Jobs makes another billion dollars, does it cost me anything?   His computers are smaller, faster, and cost less than a year ago.  In a free economy, I don’t have to buy his computer.  If I do buy, it is because I value the computer more than the money it takes to buy it.

Is populism for the people, or a cynical political ploy to exploit our desire for fairness?

First they came for the communists, and I did not speak out—
because I was not a communist;

Then they came for the trade unionists, and I did not speak out—
because I was not a trade unionist;

Then they came for the Jews, and I did not speak out—
because I was not a Jew;

Then they came for me—
and there was no one left to speak out.
---Martin Niemoller, German pastor and theologian---1946

Fast forward to 2010

First they said the mortgage lenders took advantage of people—
Those poor people with adjustable rate, low document loans!

Then they vilified the hospitals because they made too much money---
I agreed.  Emergency rooms ought to be free!

Then they said health companies denied coverage to people, and charged too much---
I believed them, but why didn’t people change insurance companies?

Then they blamed the banks for taking TARP money ---
I cheered, those greedy bankers.  Make them pay.  But, didn’t the government make them take the money?  And haven’t they paid it back?

When they said the oil companies could pay higher taxes, after all, they were profiting from high oil prices---
I guess it was ok, except I own oil wells.  Oh well, we all need to do ‘our share’.

Then they proposed a tax on every business transaction I make, when I buy or sell stocks---
Oh well, it won’t cost that much.

Then they proposed that I invest in treasuries and annuities---
And there was no one left to speak out.

This is meant as a small example of picking out a group, the smaller the better.  Making the argument they are greedy, their rights must be restricted, for the benefit of the public.  The problem for the ‘world improvers’ that like to practice this sort of control over our daily lives is the existence of our Declaration of Independence and Constitution.  The rights of all citizens are guaranteed individually, not as a group.

Our founders did not guarantee rights for 95% of the population, at the expense of a small group.  All rights and protections are for each individual citizen.  Each individual citizen has the “unalienable right to life, liberty and the pursuit of happiness.”  The pursuit is guaranteed, the results are not.

I am not advocating that you agree with my view on banks, health care, oil companies, doctors, hospitals, farmers, union members, non-union members, or stock traders.  If you chose to support or remain quiet when a group is singled out, that is your choice, but remember you may be next.  And who will defend you?

To the mailbag:
“I didn’t subscribe for your political views.”---former subscriber A.N.

John’s response:  I didn’t know giving money to a hospital in Haiti was political.  Be as it may, I hope the world improvers come after your money first.  If you are in natural resources, banking or the medical profession; you are in their cross-hairs.  Who is next?

“As a subscriber to SwingTrader, I was surprised to receive your newsletter today.  Our Rotary Club has supported the hospital for 25 years.  The money sent to them will certainly be put to good use.”---paid up subscriber K.R.

John’s response:  I believe the hospital staff is doing their best under very difficult circumstances.  I am impressed with actions of our subscribers to help.  I did Monday morning.  The hospital’s website takes donations by credit card.  I will comp you a free year of the Galt’s Long-Term Portfolio.  Just send a proof of your generosity to customer-service@galtstock.com

“I personally find your constant overuse of the term "Maobama" offensive and disrespectful of the office.  Common civility and good manners would require that he be addressed properly as President Obama.”---paid up subscriber D.W.

John’s response:  I do not intend to be offensive or disrespectful.  He is a socialist, and probably a communist.  This much is obvious by his appointments, actions and speeches.  I cannot bring myself to spend money on his books.  I do not use “Maobama” derisively, but portend to expose the truth of what he is.   I will monitor the use closely, and never use the term following ‘President.’

“My sister just sent me an email to sign a proposal supporting Maobama's bank fees. I told her no … I forwarded her your news regarding "The Financial Crisis Responsibility Fee.” So timely.”  ---subscriber G.C.

John’s response:  Thus, our article today.

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future. 

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