Don’t You Know That Egypt Is Destroyed Yet?

Chapters four through twelve of Exodus describe the plagues on Egypt that resulted in Israel being freed. Historically it takes place at the very end of the Middle Kingdom, shortly before the Hyksos domination around 1600 B.C. It is probable that the events listed in Exodus were major factors in the Hyksos being able to conquer Egypt even though they were rather weak. The story provides some interesting parallels to the present situation in the United States.

Some 430 years before, the Hebrews or Israel had gone into Egypt to escape famine in Palestine. They settled in the area known a Goshen, raising livestock and separated from the main Egyptian culture. In time, as their numbers grew, they came to be viewed as a threat to Egypt because their culture was different, and were subjugated by the Egyptian government under the Pharaohs. The slavery became increasingly severe as time passed and Israel began to seek their freedom. Moses was designated to negotiate with Pharaoh.

Pharaoh refused to discuss lessening the burden, further aggravating the the desire for freedom. A series of disasters or plagues ensued, each weakening the economic strength and stability of the nation, and the resolve of the Egyptian people. Pharaoh was able to isolate himself from most of the effects and maintained his position, unwilling to give up or delay his agenda for the benefit of his people. Each time he backed off his position, but as soon as the problem was alleviated, he went back to the original position.

In several of the plagues, Pharaoh’s advisors were able to cause similar effects thus convincing him that it was not of God and that they could control it. They did so, not by eliminating the cause of the problem but by repeating it. Finally, even his advisors gave up, and in Exodus 10:7 we find them telling him to let the people go because Egypt has already been destroyed. He promised to resolve the problem and the plague was removed, but as soon as the immediate symptom was reduced, changed his mind and resumed his original position. The final plague resulted in the deaths of members of every family in Egypt, including Pharaoh’s. This finally got his attention to the point of actually making real changes, freeing Israel. Even then, he changed his mind and tried to go back to the way it had been.

In the United States, several of our founding fathers resisted formation of parties, believing that they caused an isolation of the politicians from their constituents. Elections have become increasingly contests between the party issues and platforms, rather than candidates positions on the peoples interests, As one staunch Democrat said, its not about the candidate but the philosophy.

For several years, our Government has repeatedly faced economic crises. Each time they have promised changes. Republican controlled congresses have pledged tax relief, while Democrat controlled Congresses have promised regulatory reform. Tax rebates by Republicans and guarantees of loans by the Democrats, and other programs have been offered to alleviate the immediate symptoms. Quick, superficial changes then convince people that the problem is solved.

As soon as the pressure is reduced, we have returned to the original program that caused the problem, Political and financial figures are effectively isolated from the daily problems, and ignore it until it becomes severe enough to catch their attention again.

The common people are deal with the problems every day. Because they have discretionary income, price and tax changes have a much more immediate and dramatic effect on their situation. For example, the actual food a millionaire eats costs about the same as that for the fast food employee making minimum wage. The difference is in what they have left after buying food. A 10% increase in the price of the food, or sales tax, may make it unaffordable for the minimum wage earner, and be unnoticed by the millionaire. Few poor people are able to get into political life. They are too busy surviving. Congressional advisors, having a vested interest in maintaining the status quo, insist that the problem will go away if the pressure is relieved., encouraging inaction.

Even when the attention is obtained, like Pharaoh, when he was informed that Egypt was destroyed, the needs of the people are ignored. The town hall meetings about healthcare reform demonstrated that the political representatives are disconnected from the experiences of the people, passing it off as a Republican sponsored action, rather than recognizing that it was a demand from the people to focus on their problems rather than the party agenda.

Over fifteen million are un employed and another eleven million are not working full time at the present time. They are not worried about buying insurance. They can’t buy it. They have to spend what they have for food and shelter. Those who are employed are facing the possibility of losing their jobs. Requiring everyone to buy insurance could be enough to drive many of them or their employers into bankruptcy. They would like Congress to act on their real problem of how to support themselves.

Thirteen months after he was elected, President Obama finally held a meeting to discuss jobs. The sad part of that is that Congress was elected to deal with the needs of their individual districts. They have refused to do so until the president has been forced to do their job. Some in the news media have referred to an anti incumbent bias by the voters.
The switch to Democratic power in the 2006 and 2008 elections, the switch from Democratic to Republican majorities under Clinton all indicate that the people feel they are not represented. They are not anti incumbent, they want their problems addressed, and the incumbents are not listening.

Like Pharaoh, if Congress continues to focus on their ideals rather than resolving the problems, a collapse is inevitable. It doesn’t have to be, but it will require elected officials being willing to give up their own agendas for the good of their constituents. Until we make politicians responsible to the people rather than the party, it is unlikely to change. Governments have repeated this same scenario throughout history.

Killing The Goose That Laid The Golden Egg

Remember to old story of the goose that laid golden eggs? A fellow took the goose away from an evil giant. For several years, he and his wife kept the goose and became quite prosperous as a result of her eggs.

One day a thief observed them getting the eggs, and stole the goose. For a little while he enjoyed the benefits, but he wasn’t getting rich as fast as he wanted. He tried stopping feeding the goose to save the money for her feed but that didn’t make enough difference.

One day he decided to kill the goose and take the eggs out so he could get them quicker. Only a few small eggs were found inside, and when they were gone, there were no more eggs. The thief eventually lost everything as a result of his greed.

This story and others like it have fallen out of favor with the educational experts today, but they taught some important lessons. Our children are being deprived of some very basic education as a result.

In recent years, we have seen real life examples of this particular story time after time. The Enron scandal is a prime example. The founders of Enron built up a large oil producing company that made profits for many years. Ken Leigh was able to take control of the company, and began to try to get more from it. At first, he stopped spending money on development of new supplies. While it gave a temporary spike in profits, by reducing expenses, it left the company with less ability to produce, effectively starving the company.

The increase in profits prompted a raise in stock prices, even though it indicated a loss of value. The increase in stock prices gave Leigh a large personal profit, but he couldn’t starve the company any more so he began to disembowel the company, selling off oil rights and production facilities. The influx of capital was seen as a positive thing by the stock market and stock prices mushroomed, Finally all the production assets were gone, and there was no further increase of cash, and it was discovered that the company was no longer producing. Leigh had sold his stock and walked away, but those who had bought lost their shirts. The company collapsed because the goose was dead.

The same scenario is being played out on a much larger scale with the U.S. economy. For years, the economy had steadily produced slowly increasing profits. Over time those benefiting became more concerned with the profits than with the health of the economy. Government began to demand more and more, as did investors and financial institutions.

The increased taxes, compensation requirements, and difficulty of obtaining employees, coupled with increased competition from overseas competitors began to starve the companies. They began to move production outside our economy in an effort to make profit. This in effect was a cutting open the goose to get to the next egg. It greatly weakened the goose, lowering production , but was not immediately fatal.

Banks and insurance companies got greedy, and began using derivatives such as Credit Default Swaps to increase their profits. A few financial institutions realized that they could obtain a huge cash influx by forcing profitable companies into bankruptcy. This seriously damaged other financial institutions, and cut a huge hole in the underbelly of the economy, resulting in massive layoffs, and loss of buying power, weakening the entire economy. They the began foreclosing on homes, enlarging the hole.

In a frantic attempt to maintain their current spending level, Congress, and the Federal Reserve ripped another hole to get to those undeveloped eggs, borrowing huge amounts of money and doubling our federal deficit. By putting the money back int the banks, the illusion of health has been restored and stock prices skyrocketed. Unfortunately, the goose is near death., and not producing eggs at the moment. Various states are proposing increasing taxes to maintain their programs. To do so will further disembowel the goose. At some point it will be fatal, and the economy will collapse.

Saving the goose will require stopping attempts to get more and repairing damage already done. It will also mean learning to get by without her production until she recovers. That will require not only not increasing taxes, but limiting financial charges by financial institutions, cutting and in many cases eliminating Government programs, and removing some restrictions from businesses to allow them to compete successfully.

Since seventy five percent of our economy is estimated to depend on discretionary spending by consumers, the customer must have more discretion in how he spends. Increased taxes and forced payments for insurance or government fees reduce his available discretionary funds. While it is felt that savings slow recovery, it is necessary to realize that those savings are available discretionary funds. Loan and mortgage payments reduce available funds, weakening the economy. We need to review our entire approach.