Concentrated Interest

I used to think that Barack Obama was one of the more intelligent Presidents of the United States, but I no longer do.  Consider his recent statements, which show his socialistic attitude:

     There are a lot of wealthy, successful Americans who agree with me — because they want to give something back.  They know they didn’t — look, if you’ve been successful, you didn’t get there on your own.  You didn’t get there on your own.  I’m always struck by people who think, well, it must be because I was just so smart.  There are a lot of smart people out there.  It must be because I worked harder than everybody else.  Let me tell you something — there are a whole bunch of hardworking people out there.  (Applause.)

     If you were successful, somebody along the line gave you some help.  There was a great teacher somewhere in your life.  Somebody helped to create this unbelievable American system that we have that allowed you to thrive.  Somebody invested in roads and bridges.  If you’ve got a business — you didn’t build that.  Somebody else made that happen.  The Internet didn’t get invented on its own.  Government research created the Internet so that all the companies could make money off the Internet.

No man is an island.  We know that.  But in any big enterprise, there is the difficulty of organizing the efforts of all to create something that will satisfy the needs/desires of many.  It is true in business; it is true in war; it is even true in politics, more’s the pity.

Those that structure and plan, who create work so that others can do relatively simple tasks and be paid are valuable people; they have unique skills, and deserve to earn a lot if their efforts result in a lot of satisfied customers.

Our public schools do not train people to be entrepreneurs; they train people to be clerks and technicians.  That said, one advantage the US has over other nations is that we are willing to be flexible, and let failures figure out how they will survive.  Not knowing how you will pay the bills is a great incentive toward initiative.

Back to the main topic.  If you have built a successful business, you have done an amazing thing that most people could not do.  You took the efforts of many men and concentrated them toward a specific task of satisfying the needs of customers.  That is tough stuff, and few can do that well.

Bureaucrats can’t create a business.  Okay, maybe they can create failures like Fannie and Freddie.  They might be able to create a technology by accident, but not know what it could be used for.  Though Arpanet was the precursor to the Internet, it could not create the wide diversity of services created in the private sphere.  It’s like talking about the things the Chinese invented ahead of the West, but they never exploited those inventions.  The private sector did far more to make the Internet useful than the US Government did.

Having a concentrated interest for profit is what sharpens businesses, and makes them more responsive to the needs of people.  This is preferable to having a big government dictate what businesses and individuals ought to do, because the government by its nature is either “one size fits all” (good, sort of) or cronyist, playing favorites (bad).

Everyone has people who helped them and trained them in this life.  That doesn’t mean the government can take credit and demand full allegiance and high taxes.  Most of the time, productive people had good parents, and as one of my mentors said to me, “Children who are not taught by their parents do not get taught.”  He put five children through the public schools, all of them bright.

It takes thought and effort to create a big organization and prosper.  Don’t let naysayers deceive you.  If you built a successful business, you did something significant.  You built it.  Yes, the common resources of society support many of us, but using the common resources and the efforts of those who are only capable of doing a job is significant, and worthy of praise, not condescension from a man who has never built anything significant in his life, and presently destroys opportunities through bad policy.

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About David Merkel 145 Articles

Affiliation: Finacorp Securities

David J. Merkel, CFA, FSA — From 2003-2007, I was a leading commentator at the excellent investment website ( Back in 2003, after several years of correspondence, James Cramer invited me to write for the site, and now I write for RealMoney on equity and bond portfolio management, macroeconomics, derivatives, quantitative strategies, insurance issues, corporate governance, etc. My specialty is looking at the interlinkages in the markets in order to understand individual markets better. I still contribute to RealMoney, but I have scaled it back because my work duties have gotten larger, and I began this blog to develop a distinct voice with a wider distribution. After one year of operation, I believe I have achieved that.

In 2008, I became the Chief Economist and Director of Research of Finacorp Securities. Until 2007, I was a senior investment analyst at Hovde Capital, responsible for analysis and valuation of investment opportunities for the FIP funds, particularly of companies in the insurance industry. I also managed the internal profit sharing and charitable endowment monies of the firm.

Prior to joining Hovde in 2003, I managed corporate bonds for Dwight Asset Management. In 1998, I joined the Mount Washington Investment Group as the Mortgage Bond and Asset Liability manager after working with Provident Mutual, AIG and Pacific Standard Life.

I hold bachelor’s and master’s degrees from Johns Hopkins University. In my spare time, I take care of our eight children with my wonderful wife Ruth.

Visit: The Aleph Blog

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