Hello folks.
We are seeing the beginning of the end of thousands of years of history taking place in America today. The end of commerce as it has been practiced since before the birth of Jesus.
Commerce, by its very nature, is based on the inviolability of contracts. People make contracts (written or otherwise) and they gain from each side holding up their end of the contract. If one side or the other violates the contract, the system breaks down and the transaction is unable to be completed. Often this ends up in front of courts whose job it is to uphold the contracts and enforce them. In cases where the contract cannot be enforced, damages occur, and one side or the other loses something as a result of the failure of the contract. That is how business works.
The basis for that whole system of trade is the inviolability of the contract. Without that assumption, there can be no commerce, because who would trust someone to fulfill their side of the bargain if contracts were not inviolable. If anyone could break a contract at any time without any penalty, loss, etc. there would be not trust between trust partners. Commerce REQUIRES that contracts be honored to the letter.
What I have been hearing recently from our government disturbs me greatly, because what I have been hearing about is that contracts should no longer be considered binding and inviolable.
Take the recent news with AIG. According to some members of our government, the contracts that AIG made with their employees for bonuses should no longer be binding. Regardless of whether you believe that the compensation of the employees was excessive or not, they were based on legally binding contracts. Yet certain high-ranking government officials want to eliminate those contracts as being binding.
Another example: Congress has recently been talking about giving courts the legal power to revise mortgage contracts at whim, or even dismiss the contracts completely. In other words, if someone walks into court and says that they can't afford their mortgage payments, a judge would have the authority to change the interest rate, amortization shcedule or any other part of the contract they want to change, regardless of what that would do to the lender. The contracts would no longer be binding.
If these things come to pass, it will end commerce as we know it. If contracts are no longer binding, then there can be no trust between business partners. Without trust, the commerce system cannot function.
Without commerce, we all go back to herding sheep and cattle for a living... and not even that good a living, because we won't be able to trade for more sheep and cattle. Farmers won't be able to sell their produce. Loggers won't be able to contract for shipments of wood. Forget employment contracts, nobody will trust an employer to pay what they promise to pay without a system where contractual agreements are honored.
Without contracts, EVERYTHING ceases to exist. Without contracts there are no businesses. Without business, there is no technology. Without technology, we cannot survive as a modern society. There will be no medicines... who would produce medicines in mass quantities if they aren't sure they are going to get paid for their products.
It would be the end of everything.
Even a nuclear war wouldn't cause this level of devastation. Survivors of a nuclear holocaust would continue to trade with each other if they knew that they could trust each others' contractual agreements. Eventually, society could rebuild itself after a nuclear holocaust.
Only the end of commerce could be so devastating, because there is no way for society to recover without the basic trust necessary in commerce. Eliminate that trust and society falls.
Scary thought, huh.
Elliot
