The Truth About FDR and Hitler
As a child both of my parents had dreams for me…
My biological dad, my poor dad, wanted me to go to school and get my Ph.D. and work for the government or climb the corporate ladder.
My mom, a registered nurse, wanted me to become a medical doctor.
My rich dad, my best friend’s father, wanted me to become a capitalist. He believed in education, just not the type my parents believed in. My poor dad looked down on my rich dad because he never finished high school. In his mind, those that didn’t finish high school ended up working on the sugar plantation or in a factory.
But today, even those that do well in education will have trouble once they get to the real world. This is why the world needs better schools and more financial education.
Because I had two dads with differing attitudes on education, I became aware that there is more than one type of education. I believe that if we truly valued education, we would teach people financial literacy. We’d recognize that money is a central and important aspect of our existence.
So while many so-called “advocates of education” deride my ideas, I simply ask: Why continue advocating a system that is designed to create cogs instead of free thinkers?
Our system is designed to suppress financial knowledge rather than create financially literate people who can prosper in a capitalist system.
Here’s why that’s such a tragedy and what we can do about it…
The True Definition of Capitalism
There are many academic definitions of capitalism, but I learned from my rich dad that capitalism is seeing opportunity and capitalizing on it. He was not well-educated in the traditional, academic sense. But he did have street smarts. He knew how business and money worked.
Andy Grove, former chairman of Intel, titled his book, Only the Paranoid Survive. He got that title from Dr. Joseph A. Schumpeter, a former Austrian Minister of Finance and Harvard Business School professor. Dr. Schumpeter expressed this idea that only the paranoid survive in his book, Capitalism, Socialism, and Democracy. (Dr. Schumpeter was the father of the modern study of dynamics, growth, and change in economics.
Dr. Schumpeter’s idea is that capitalism is creative destruction — a perpetual cycle of destroying the old, less efficient product or service and replacing it with new, more efficient ones. Dr. Schumpeter believed that governments that allow the existence of capitalism, which tears down weaker and less efficient businesses, will survive and thrive. Governments that put up walls to protect the less efficient will fall behind.
My rich dad agreed with Dr. Schumpeter, which is why he was a capitalist. Rich dad challenged me to constantly challenge my ideas because if we didn’t, someone else would.
I’m a capitalist because I believe it is the best economic system to reward those who see opportunity and go after it. In the process, they also provide opportunities for others. No other system in the world has produced so much wealth and such a high standard of living.
What Socialism Really Is
Recently there has been a rise in acceptance of socialism in the US. Popular politicians like Bernie Sanders and Alexandria Ocasio-Cortez are the darlings of a generation of young people who see inequality in income, which is a real problem, and think that socialism is the answer.
There are many academic definitions of socialism, but I learned from my rich dad that socialism is just an entitlement mentality formalized in government. Socialism has a Robin Hood mentality. Take from the rich and give to the poor.
But rich dad knew that while the idea of “taking from the rich to give to the poor” could be helpful in the short term, it wouldn’t build generational wealth or teach people how to see opportunity and create innovation. Ultimately, socialism creates more poor people.
I’ve been around long enough as well to see that socialism and its cousin, communism, are disastrous to a country and economies.
The Rise of Despots
If this global financial crisis is not solved, the final act will not be pretty. During times of financial crisis, a new type of leader often emerges. A few of these leaders are infamous. They are Franklin Delano Roosevelt, Adolf Hitler, Mao Tse-tung, Joseph Stalin, Robespierre, and Napoleon.
I know, it may seem like blasphemy to list FDR in this rogues gallery. I’m severely criticized for doing this. He’s one of our most beloved presidents…
But let me offer you my reasoning. Both Hitler and FDR came to office in 1933, and both were elected to bring their respected economies out of a depression. Both men failed. Hitler’s solution was to go to war. FDR’s solution was to go to war, as well as initiate a massive social welfare program.
The Social Security Act of 1935 is America’s most beloved government program. The problem is, FDR’s solutions didn’t work. Roosevelt simply “kicked the can down the road” pushing the problem to future leaders. Today Social Security and Medicare are huge elephants sitting in the room. The same is true in Greece, England, Japan, and other countries of the world.
The problem is, the can cannot be kicked much farther. Does this mean the rise of a new despot?
Social welfare is destroying the soul of America. Social programs are cancers growing within the spirit of the people they were created to serve. Social programs do not make people stronger. They keep people weak, depending on the government to solve their problems.
I realize some people may deserve government programs. Some people are truly in need. The problem is, millions of able-bodied Americans are also on government welfare.
What I am fearful of is the growing “entitlement mentality,” the attitude that “the government should take care of me,” which has become so pervasive in our culture. Today, when a worker loses his or her job, the first thing they do is apply for unemployment benefits.
I’m critical of our school system and much of traditional education for failing to teach people to fish. Instead of teaching kids to fish — teaching kids the skills and attitudes that will make them strong and self-reliant and resourceful — our schools breed a culture of entitlement. It is this entitlement mentality that is eroding the foundations this country was built upon. The “entitlement mentality” is bringing down the American empire and the world.
Money Doesn’t Cure Poverty
My education business was formed to teach people to fish. When it comes to money, while I do support charitable causes, I do not think financial handouts work. I believe that giving poor people money only keeps them poor longer.
As my rich dad often said, “Money does not cure poverty.”
Financial education gives us the power to solve our own financial problems rather than expect the government to solve our problems for us. Stop the bailouts and all the handouts.
Financial education has the power to change the world. I predict the first country that adopts a comprehensive financial education program for all students, rich or poor, will emerge as a financial world power.
If we don’t teach people about money, we will have many more people like my poor dad, a very good, well-educated, hard-working, and honest man, but a man who died angry at the rich and expecting the government to take care of him.
It is time we set people free. Financial education can do that.
Play it smart,
Editor, Rich Dad Poor Dad Daily