American economy teaches lessons

Matthew Caster

The recent collapse of energy-trading giant Enron poses some serious questions to all Americans. Many people are asking whether the current
presidential administration was involved. Others question the current system under which corporations are permitted to make campaign
contributions to political candidates. Still others are pondering potential new names for Enron Field.

What is really of concern is what FoxNews.com referred to as the "Enron Effect." Is the biggest bankruptcy in American history going to have the
same sweeping effect on corporate America as the tragedy of Sept. 11 had on personal privacy issues? In other words, will the freedoms of
corporations to conduct business be subjugated by the American government?

To put these questions aside, it's time for a lesson in democratic capitalism. "Democracy" is what politicians call the government of the United
States when they want us, the people, to think we have power. "Capitalism" is what politicians call the mode of our economy right before they
regulate it.

Perhaps one of the niftiest things about capitalism is the parity between success and failure. Eighteenth-century economic genius Adam Smith
said a capitalistic economy would be regulated not by the government, but by the "invisible hand" of competition. Sell a superior item at a superior
price, and success is likely. But Smith also alluded to something called "business ethics," which appears to be where Enron fell through.

The point is, in a capitalistic society such as ours, businesses either succeed or fail based on how they conduct themselves. Though the financial
hardships thrust upon the employees of Enron are unfortunate, the company itself got what it deserved. There is no honor in lying to investors,
and it is foolish that companies even allow these questionable accounting techniques to be used.

Now what should the government do to help out these poor employees? Not a blessed thing. The collapse of Enron was undoubtedly the fault of
upper-level management. But the reason so many lost their life savings was, quite simply, because they were poor investors.

Aesop warned 2,500 years ago, "Don't put all your eggs in one basket." Apparently, the message was lost on Enron's employees. Those who
would choose to invest their entire life savings in one company hardly even deserve pity, let alone government aid outside the realm of
unemployment benefits.

However, the Rev. Jesse Jackson, in an attempt to take the spotlight off his illegitimate child, has rallied former employees into thinking the
government owes them for Enron's collapse. 

What nerve. How does one approach the government and ask for money in this situation? "Hey, Uncle Sam? Yeah, I was a complete idiot and
invested my entire life savings in a company that just went bankrupt. Any chance you'd care to bail me out?"

That is the supreme triumph of laziness and stupidity. Wouldn't it be wonderful if the government reimbursed every American who lost money in
the stock market? No. Neither the companies themselves nor the government would survive if it were equally profitable whether a stock went up
or down. Since when has it become a policy to reward people for foolish investments? I sympathize with their plight, but these people don't
deserve to see a dime.

The government is talking about placing strict regulations on 401(k) retirement plans and the way corporations can control them. While the
intentions behind this legislation are well placed, the only thing it will do is provide investors with a false sense of security. Businesses can still
fail, and if investors don't realize that, this debacle will only be repeated.

The biggest lesson everyone must learn from the Enron collapse is that this is still a free-market economy where companies occasionally go
under. By investing a little time and effort into safeguarding our own nest egg, this sort of situation can be easily avoided. Some are content to let
the government tell them where to put their money. Perhaps these folks have forgotten some of the other worthwhile projects the government
spends our money on.

This country is an economic powerhouse because of one word: freedom. Let's try and keep it that way. God bless America.

Caster, a senior chemical engineering
major, can be reached at patrioticcatmaster@yahoo.com.