Monday, October 13, 2008

Fear and Hysteria can be rational

I have seen numerous articles (here, here, etc.) bemoaning the perceived fear and hysteria in the American people. In defense of the American people, their actions have been a rational response to the known facts. The known facts are:
  • American wealth has been lost.
  • Additional wealth remains at risk.
  • Through taxes, laws and regulations the government can affect the value of wealth.
  • America is in the middle of an election.
  • It seems probable that the Democratic Party will come out of the election with unchecked political control.
  • The Democratic party believes that economic restrictive laws and regulations, and some high taxes benefit society.
  • Taxes, laws and regulations that the Democratic party prefer reduce the value of wealth.
  • The Republican party believes in cutting taxes, and easing the economic burden of restrictive laws and regulations.
  • Cutting taxes, and easing the economic burden of restrictive laws and regulations increase the value of wealth.
  • Just because something is probable does not mean that it is a foregone conclusion.
  • People respond to their own self interest.
All of these facts create a large incentive for those who do not want to see anymore American wealth destroyed to become very vocal in their attempt to educate others about the cost of the election so that they might feel it is in their self interest to vote Republican rather than Democratic. Additionally, those who are selling or refusing to buy assets are doing so not out of fear or hysteria, but in a rational attempt to protect as much of their wealth as they can.