Here is the second in my posts inspired by an editorial cartoon. Today’s edition was drawn by Bruce Beattie last month.

BP dividend check

Look! It’s an oil-drenched bird bringing the guy his dividend check. Oh, the tragic irony!

Eh, not so much.

See, President Obama strong-armed BP into ponying up $20 billion to fund clean-up along the Gulf Coast and to help people whose businesses and livelihoods have been affected by the spill. But try as I may, I can’t find anything in either Section 2 or 3 of Article II in the Constitution that grants President Obama the authority to tell a foreign-owned company how to spend its money here. But much of what President Obama has done so far has been outside of his Constitutional powers.

But back to the dividend checks. The $20 billion isn’t coming from the coffers of BP. Instead, BP has suspended paying out any dividends to its stockholders to raise the money. So who is being given the bill for the BP payout? Could be you, if you own any BP stock or mutual funds that contain BP stocks, and about 40% of BP is owned by Americans. I sure hope you aren’t living off your investments, because President Obama has just taken some of your money.

What should he have done? There are billions of unspent stimulus money that should have been used. Then President Obama could have recovered the money by using the Justice Department to sue BP for any criminal negligence that contributed to the disaster. That would have freed up money to people harmed by the spill as well as keep paying out dividends to BP stock-holders.

Moral Compass

Ooo! Evil Goldman Sachs! Evil, nasty, money-grubbing Goldman Sachs! They’re just in it for the money. And did I mention evil?

OK, I’m getting really tired about how people are demonizing Goldman Sachs specifically and Wall Street generally. Demonizing Wall Street is a transparent attempt of the Obama administration to discredit them and drum up yet another crisis. And once they have properly ginned up this crisis, then government will ride up on its white horse and “fix” the crisis by taking control over the financial sector of the economy. And every time people like cartoonist Bruce Beattie demonize Goldman Sachs, they play into the power-grabbing government’s hands.

But it’s clear to me that Beattie doesn’t understand the nature of business. Goldman Sachs isn’t in business to do some moral good. It’s in the business of making money because making money is what businesses do. Businesses that don’t make money just don’t last long as businesses.

Do you think Apple makes iThis and iThat because it loves the public, or does it do it because it loves the revenue that comes from each sale? Obviously, it is the latter. And it is precisely the love of profit that drives Apple to improve and innovate their products to the benefit of people. Adam Smith explained it centuries ago, and it is just as true today.

“It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own self-interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.”

Yes, a business has a moral compass, and it points towards money. That’s what a business does, and if it is successful in achieving money, it has done so by pleasing and benefiting people. If a business has done something illegal, then the government certainly should step in to enforce the law. But just making money isn’t illegal, regardless of President Obama saying, ” I do think at a certain point you’ve made enough money.”