Dan Kennedy

First they came for the student loan providers, and I did nothing ...

Here’s a largely unreported story: Stuffed inside the health care reform bill is a measure summarily throwing private lending institutions out of the college loan business. That business is being taken over by the federal government, with purported savings of $68 billion by, quote, cutting out the middleman.

That premise suggests all private enterprise should be replaced by government as quickly as possible. What’s good for the college loan goose should be good for every gander.

Consider food. Right now, farmers grow it (increasingly in other countries). It is trucked here, sold to packagers and brand-name companies who add mark-up, then to wholesalers who add mark-up, and finally to retail stores that add mark-up. Along the way, sales representatives are paid – horror of horrors – commissions and bonuses to function as liaison between the layers. This bloated system is rife with middleman profit pushing up food prices, thus victimizing the poor, and costing us taxpayers a fortune as we shell out welfare and food stamps. Imagine how much might be saved by cutting out the middlemen!

Sean Hannity FREE

Obama should do just as he did with the banks and the college loan business: outlaw food packagers, wholesalers, retailers and sales organizations. Confiscate the warehouses, trucking companies and supermarkets, and replace it all with streamlined, middleman-free government food distribution.

While he’s at it, he can put McDonalds, Burger King, KFC, Olive Garden and all other restaurant chains out of business. Clearly, they bloat the cost of dining out, what with all their do-nothing investors and shareholders, interest paid to banks for financing development and construction, franchisors who skim money off the top for little more than a brand and a logo, advertising agencies and media.

This list of pirates profiteering from food is endless! Just think of the trillions of dollars of savings by replacing the entire mess with one government-owned and -operated restaurant chain. The red, white and blue arches and no others. With, of course, no trans-fats, no salt, no sugar.

Consider books. There’s something else everybody needs, just like a college education. Information, lifelong learning, inspiration – books are a clear benefit to citizens. But publishing is rife with greedy middlemen. I write books myself, but as an author, I’m a small part of the cost paid by the victimized consumer. (About 9 to 17 percent, if you’re curious.) My agent gets a percentage of every dollar, as does the publisher, its sales organization, then Amazon and bookstores and Wal-Mart, plus there’s advertising paid to everybody from Google to radio stations. If Obama stepped in, kicked the middlemen to the curb, had all books published by the government, more people could more easily afford more books, and billions might be saved. And some sensible control might be imposed on what gets published, too.

Same for clothes and apparel, shoes, travel, rental housing. Cars too: why let stockholders, unions, dealers, salespeople suck out money? Why not a real Government Motors? (I believe that’s been tried. The Yugo, wasn’t it? But never mind.)

Why not your business too, whatever it is? If you are in business you are a rapacious and unnecessary middleman yourself. Off with your head! If you are employed by such a middleman needlessly inflating the costs of goods or services, shame on you. Quit immediately and do something more honorable; work for the common good by working for His government, or don’t work at all. Don’t worry – your unemployment benefits will be endlessly extended, free health care provided and your kids sent to college, not quite free as promised, but with debt owed only to your benevolent government.

Of course, your government would never outlaw or confiscate your business. That was done to business owners en-masse in Russia and in Germany. But it could never happen here. You’re safe. Right?

So to the news media, if you get around to noticing this latest nationalization, here’s an obvious for you to pose. (And you should refuse to have it laughed off or shrugged off or dodged by Robert Gibbs or an administration economic advisor or even by The One Himself): If it makes sense to cut out the middlemen by government takeover of one industry, (a) why not do it with every industry? And (b) why is this such an unmitigated disaster everywhere it’s tried, here or abroad, in history or at present?


Dan Kennedy

Dan Kennedy is a serial entrepreneur and contributor to the Business & Media Institute.