Poor stock market investors, their beloved Dow Jones plummeted recently. While not quite in free fall, its shrinking value seems to have the financial pundits concerned. They seem to argue that there are two causes to the exchange’s shrinking. They note that the Chinese Stock Market has suffered major financial challenges. With China’s increasing involvement in the worldwide financial community, its setbacks impact the entire globe. The second cause most frequently blamed is the worldwide petroleum glut. There is little that America can do about China’s conundrum. Why is not America rejoicing, though, about the lower costs for fuel?
Liberals, especially Bernie Sanders, argue that the spread between haves and have-nots is too wide. There is nothing at all wrong with a hardworking entrepreneur achieving success. What constitutes financial success may differ greatly among the American people. Perhaps the lowering of profit among the biggest producers of petroleum bothers them. However Exxon and Mobil’s losses may be most Americans’ gain. Trickling down of prices can help all find the success they want. The lowering of gas costs offers all classes of American society an opportunity to pick themselves up and seek opportunities that even months ago were ethereal. The lowering costs for petroleum products not only makes them more affordable to get to and from work, it also lowers the cost of all American manufacture.Sanders may question, if it is proper that chief executives earn many multiples of their lowest paid employees’ wages? Rather than redistributing money earned by the upper echelons, as the senator would suggest, the government could create rules to limit disparity between the working class and those who hire them.
Capitalism, the foundation of the American economy is built on a basis of the interplay of supply and demand. As the cost of supplies decreases, the demand increases. Perhaps this downturn of gas prices proves that the free market of capitalism truly works. Perhaps it shows that innovations of oil production utilized recently to make oil production easier are more effective at controlling costs than a would-be capricious determination by a government of what prices must be.
While it may not have been until the eighteenth century that capitalism was identified as an identifiable, economic approach, its roots go far deeper into the past. When Abraham, the Jewish patriarch, purchased the cave of Machpelah from Ephron the Hittite, one could observe in the transaction a pattern of behavior for both the purchaser and seller. The multitude of Jewish laws that limit behaviors in the marketplace all make particular sense in what is today identified as Capitalism. While the system may hardly be a mitzvah for Jews to follow, it was hardly new when it was adopted by the new US as its system of doing business, or earlier by the British Empire.
There might be prices that are either too high or low, and there may be times when a government must step in to stop the market from running amok. However, it seems only right that when things work out for the good of Americans, that it be allowed to live by its ongoing processes.