The degree of the shutdown’s impact depends on how you’re connected to government.

I don’t think what scares the average person living in the United States is whether I can get on with my day without government participating in the market.   Government employees, contractors and social welfare beneficiaries may beg to differ, but most consumers don’t wake up with that concern nor should they.

Let’s look at the basic rule of the market and government.  Government creates and maintains the institutions and rules that manipulate the behaviors of producers and consumers of goods and services.  Government, via rules and institutions, determines who access the natural resources industries may need in order to produce those goods and services and as the bottleneck to those resources, government has an indirect impact on prices and flow of capital.

In short, a shutdown means that the gatekeeper is asleep at the wheel of the economy.  Unlike most consumers, my first thought when I wake up is how do I circumvent these rules and institutions in order to access and leverage capital.

The greater the lack of social capital and community (traditional social) networks, the greater the fear of a government shutdown.  Imagine if the resources we pray to government to receive came directly from friends, neighbors, and social institutions?  Friends, neighbors, and social institutions would probably have more to give if their incomes weren’t taxed away.

The rebuttal may be that the government has greater resources than friends, neighbors, and traditional social networks, but given the debt ceiling tide rolling this way come October 17th, that argument should prove hollow.  Government has been borrowing to finance the act of providing these resources, but given unemployment and flat growth in incomes, most consumers can’t provide government with the tithe and offerings necessary to sustain government.

I would prefer see consumers merely shrug off what’s happening in Washington.  That’s not going to happen. (Fortunately as the Senate convenes at 12:00 noon, the Seminoles will be taking on the Terrapins, so there will be some relief)  The discussion has been centering on what government does for contractors and beneficiaries; the 800,000 federal employees who aren’t getting paid; and how much of the shutdown is a Republican response to having lost the 2012 presidential election and their disdain for Obama Care.

Government does not typify the strength of a nation.  What indicates a nation’s strength is how the individual can make the most of his or her capital while using social institutions to protect it.  Federal government promotes fake capital and it is this reliance on fake capital i.e. corporate welfare in the form of bank bailouts and social welfare that fuels a vicious cycle of poverty, especially among minorities, that concerns me the most.   Focusing on refilling the trough is a wasted opportunity during this shutdown.

About Alton Drew

Alton Drew brings a straight forward and insightful brand of political market intelligence. Alton Drew graduated from the Florida State University with a Bachelor of Science in economics and political science (1984); a Master of Public Administration (1993); and a Juris Doctor (1999). You can also follow Alton Drew on Twitter @altondrew.
This entry was posted in Barack Obama, Budget, commerce, Congress, Economy, Elections 2012, free markets and tagged , , , . Bookmark the permalink.

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