The Topsy-Turvy World of Capitalism and Ways to Straighten Things Up Locally

One good place to start is to end the cronyism

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By Rocky Boschert

Even though the fat cats on Wall Street are being bailed out by the two-headed one party system in Washington DC, we Wimberley and Hays County residents need more than ever to work together and learn more about how to feign for ourselves.

But before I go on, I have a confession to make. I applied for some federal bailout funds. But since I run my business well and have no debt and didn’t lie to my clients, I was told I don’t deserve your bailout tax dollars. I even asked for a multi-million dollar “golden parachute” lump sum paid for with your tax dollars but was told I would simply have to live on my normal and healthy annual income. Bummer!

Yes, the lesson here is simple: the American capitalist free markets are great until we get ourselves into trouble. And now that the stock markets, administered by crony-run banks and brokers, have blown up, our tax dollars are all of a sudden really important and welcome. See, we are now being told by the free markets fans that if we don’t cough up more tax revenues, our businesses will fail and we’ll lose our homes, cars, and big screen TVs. Not only that, but our young adult children will have to get a job at Dairy Queen or go to community college instead of UT and we would lose our health insurance while our spouses are forced to work at some unnecessary government agency processing home foreclosure forms. At least that’s what we’re being told.

Now don’t get me wrong, most people in America are great. But you have to admit, when the opposing politicians accuse Mr. Obama of “redistributing the wealth” and calling him a communist because he wants to go back to the 1990s tax code that saw the best US economy of the last fifty years, it rings real bogus.

Think about it: What has the Bush Administration been doing for eight years but giving more and more money through tax breaks to the top 10% while the rest of America sees inflation-adjusted wages decline, jobs shipped overseas, houses foreclosed on, retirement plan values drop like a rock, and children go without basic health care? To me that’s really “redistributing the wealth” – the wrong way.

Redistributing the wealth, hometown style

But enough said about politics. Let’s focus on what we as a community can do together to support our local economy during the current recession. We can start by looking at the way our community works. Hence, here are some ideas that may help “redistribute the wealth” to each other here in Wimberley and Hays County:

First, make use of the local Farmer’s market every Wednesday across from the Market Days field. By shopping there, we can eat fresher produce, save money on gasoline, and support local small farmers. In addition to the farmer’s market, local residents should consider a long-term effort to organize community food gardens where both knowledgeable and concerned citizens can help each other as well as lower income families survive in what will probably be an extended economic downturn.

Second, instead of going to Austin and San Marcos, shop for food and services at the local-owned businesses that aren’t ripping you off just because we live in the outpost of Wimberley. I have a bumper sticker that reads: “Break the chains; shop at local independently-owned businesses.”

Third, if you don’t like shopping for all your food at the local grocery store, organize homeowner association ride sharing groups to go to HEB in San Marcos or Whole Foods in Austin. Ride sharing would again lower petrol use and give you a chance to meet and get to know people in your neighborhood. By being more self-help focused, we can quit blaming lying politicians for our lack of control over our lives. And we can be less dependent on what will no doubt be increased corporate control of our day to day lives. 



Don’t believe the Wall Street hyperbole

Fourth, to deal with the stock market and your retirement and investment plans, organize and establish local investment clubs. An investment club is comprised of individuals who pool funds in order to make investments and to learn about investment self-management. That is, they help each other invest, and in most cases, they learn to research the investments as well. Most investment clubs set up accounts with a discount broker so they do not have to pay antiquated and costly full service broker commissions.

Considered a small business for tax purposes, investment clubs are generally social groups of like-minded people who want to see their money grow (or protected in a bear market). If you are interested in pooling money and working together with friends and neighbors to help each other invest without the high cost of a broker, then starting and joining an investment club may be a good start in understanding and surviving in the new global economy.

In fact, let me tell you a little professional insider secret. Most investment advisors don’t know any more than you do about how to invest in a bear market. They usually recommend that investors stupidly sit and hold on to their investment without regard to what is really happening in the economy. And believe me, we are in a bear market and we probably will be for another couple of years.

Consider this: Just a few months ago, Goldman Sachs was forecasting $200 a barrel for oil! Today it’s down to about $70.00 a barrel. These guys are masters at giving the investor public buy recommendations at the top of the markets and sell or downgrades at the bottom of the market. And remember when brokers were telling you to buy bank stocks just this past June? Tell me they didn’t know banks were in trouble.

These Wall Street “masters of the universe” are not entirely fools. They want you to buy at the top so they can sell their own positions to you and then turn around and tell you to sell at the bottom so they can buy back cheaply what you are selling. Any investment professional who tells you different has been brainwashed by the economic system we are now seeing fail. And they are probably losing clients because their accounts are down 35% to 40% year to date.

Organize, get smart and stop supporting stupid propositions

In the end, as a community we don’t have to be victims of what is happening economically around the rest of the country. Between buying from local businesses, organizing co-ops and community gardens for food, smart money management, and not voting for stupid bond propositions that ultimately drain our tax dollars, Wimberley could do surprisingly well in the current recession.

It is time for Wimberley and Hays County residents to shed itself of the arrogance of entitlement and take matters into our local hands. Get rid of politicians who are sneaky promoters of local crony capitalist projects and vote in the ones who want the most people to benefit from the use of our tax dollars. But most important, use your consumer and investment power to work together and help make our local area an intelligent survivor of the American Dream.

Rocky Boschert has resided in Wimberley since 1993. He currently serves as board president of the Katherine Anne Porter School (KAPS) in Wimberley. Mr. Boschert owns and manages Arrowhead Asset Management.