Gas: 25¢/gallon

As I have mentioned before (here and here), I attempt to inject some basic economics into the water-cooler conversations that take place around my office about inflation and gas prices. This weekend, I attended an economics seminar where I met someone who gave me the following illustration, which I thought I would pass along.

Ask the typical “man on the street” if he thinks he could buy a gallon of gas these days for a quarter. If you’re lucky, he’ll just laugh at you. If you’re not so lucky, he’ll launch into a tirade about high gas prices, greedy oil companies, and what government needs to do to “fix” the problem. Wait for him to calm down, then show him a 1964 quarter. In 1964, a gallon of gas cost about $0.30/gallon, but it is my contention that the same quarter that wouldn’t quite buy a gallon of gas in 1964 could now be used to buy gas at today’s price of about $2.85/gallon. Impossible, you say? Let’s take a closer look.

In 1964 U.S. coins were still made of silver, not the copper/nickel “sandwich” found in modern coins. The 1964 quarter contains roughly .2 ounces of silver. At today’s silver price, that .2 ounces is worth about $3.28 - enough to buy a gallon of gas and even get some change back. So is the pain at the pump really caused by a cabal of evil oil companies, or is it more likely that it is primarily a reflection of inflation? Certainly there are real factors driving gas prices (such as increased global demand and artificially constrained supply), but we should not lose sight of the role inflation plays. Inflation, of course, is the increase in the money supply which causes prices to rise across the board. Say what you want about the “greedy oil companies,” but they’re not the ones responsible for doubling the money supply in the U.S. over the past decade.

The role of inflation is particularly important these days given the hostility shown by some toward the gas companies, and the many demands directed at politicians to “do something” to bring prices down. If we don’t properly diagnose the problem, it’s very unlikely that any of the “remedies” offered by Washington will be of much help.

Say It Ain't So, Joe! (REVISION)

AUTHOR’S NOTE: The following article has been modified from its original publication on January 23, 2008 to include additional detail that was provided by Julian Sanchez, Contributing Editor for Reason magazine, and co-author of the Reason article referenced in this blog entry. Many thanks to Mr. Sanchez for his input, and my apologies if I was not as clear as I should have been in the original text.

In 1919, the Chicago White Sox were the overwhelming favorites to win the World Series. They ended up losing because a few members of the team made a deal with the bookies to throw a few games. One of the most popular players at the time was Chicago’s “Shoeless” Joe Jackson. Baseball legend has it that a small boy stopped Jackson on the street and begged, “Say it ain’t so, Joe!” Jackson could only respond, “I’m afraid it is, kid.” Although there was never any indication that Shoeless Joe himself was involved in the plan to throw the Series, his association with the Chicago “Black” Sox was enough to get him banned from baseball for life, and shatter the illusions of at least one young baseball fan.

Lately I’ve been feeling like that kid from Chicago in 1919. I’ve written of my enthusiastic support of Ron Paul in this blog before (here and here), but my enthusiasm has waned since the publication of an article in The New Republic detailing a number of Dr. Paul’s newsletters which contained several offensive remarks about blacks and gays. Dr. Paul has denied personally writing the newsletters, saying they were written by a staffer who was fired as a result. He has accepted “moral responsibility” for not providing enough oversight of the newsletters that were published in his name, and has publicly rejected the racist sentiments they contained.

I had learned of this issue before the story broke in The New Republic, but the version I heard implied that it was an isolated incident that had been dealt with quickly. The New Republic story, however, provides much greater detail, and it’s pretty disturbing. The disparaging newsletters spanned a period of five years, from 1989 to 1994. That hardly qualifies as a one-time incident.

As if that weren’t enough, Reason magazine (the most popular libertarian magazine in print) now reports that Tom Lizardo, Ron Paul’s congressional chief of staff, has openly claimed that the true author of the newsletters in question was Lew Rockwell, founder of the Ludwig von Mises Institute, one of the most influential libertarian think tanks in the world. According to the full Reason article, the inflammatory comments were part of a larger scheme hatched by Lew Rockwell and Murray Rothbard, another controversial yet highly influential libertarian thinker, designed to tap into racist sentiment among rural white voters as a way of garnering their support for libertarians or libertarian-leaning candidates. This seems a dubious (not to mention disgusting) strategy, and quite surprising given Murray Rothbard’s previous work with, of all groups, the Black Panthers. Rothbard was famous for forming unusual alliances, but a libertarian/redneck coalition seems to defy all logic.

From what I’ve read so far, Lew Rockwell has neither confirmed nor denied his authorship. The witnesses for the prosecution can be found in The New Republic and Reason articles. The defense, such as it is, is here and here (there are others in the blogosphere as well). The fact that offensive comments were indeed published under the Ron Paul moniker does not seem to be in dispute. Instead, the defenses that I have read seem to focus more on the motives of those publishing the allegations. The reader will decide for himself, but one thing is certain - whatever the truth is, it’s not good. The comments quoted in The New Republic and Reason articles do not seem to have the same “voice” as various other books and publications in which Ron Paul’s authorship is not in doubt, so personally I doubt that Dr. Paul wrote the newsletters himself. But I also realize that this is not a whole lot to go on, so I absolutely respect the opinions of those who come to different conclusions. If Congressman Paul did write the articles, then he’s clearly got some distasteful attitudes (although I have not seen any evidence of that in anything he’s said during his presidential campaign). Even if he didn’t write the articles himself, he did allow them to be published in his name, which at the very least makes him guilty of hiring the wrong people and of a gross lapse in managerial oversight. Neither option highlights the kind of qualities a voter looks for in a president.

If it were any other candidate, it might not be that big a deal. If I were a Giuliani supporter and something like this were revealed about him, I’d be disappointed but I could shrug it off and get behind one of the other candidates like Romney or McCain – they’re all basically interchangeable, after all. Ron Paul, however, is not just another candidate. For better or worse, he is the face of the libertarian movement right now. What reflects badly on him reflects badly on the freedom philosophy and all those who espouse it. It may not be fair to place the weight of an entire movement on the shoulders of any one person, but that’s the way it is nonetheless.

Ironically, the saving grace in all this (from a strictly political perspective) is the fact that Dr. Paul was never realistically going to be in contention for the GOP bid. The same obscurity that led the major media outlets to ignore both his fundraising success and his broad support among non-GOP voters has apparently worked to his advantage in this case. Although the CNN and others have run the story, they appear to have moved on fairly quickly. Perhaps that’s just as well. This is not the kind of publicity we really need, although I obviously think it’s an important issue that should be addressed.

As bad as the whole thing is for Ron Paul the candidate, it doesn’t stop there for the libertarian movement as a whole. The allegation that Lew Rockwell was the author of the offensive comments, if true, may be even worse than the damage done to the Paul campaign. As I mentioned before, the Ludwig von Mises Institute is one of the main sources for modern libertarian thought and is without a doubt the world’s foremost proponent of Austrian economics. The LVMI offers an incredible array of books, articles, and lectures online, and has probably influenced more new libertarians than any other source. To have suspicions raised about the attitudes of its founder is troubling indeed, particularly since libertarianism is so susceptible to these kinds of charges to begin with.

As I stated in the article For or Against, it’s easy to misrepresent libertarian positions. Most people usually judge libertarianism on an issue by issue basis, rather than starting from the non-aggression axiom. Take the current controversy over racism, for example. Hopefully by now most people believe racism to be morally reprehensible - the vast majority of libertarians certainly do. Nevertheless, a libertarian will oppose a government mandate forcing businesses to open their doors to all customers regardless of race. If one does not understand the principles that underlie this opposition, it is easy to mistake the allowance of discrimination with approval of that discrimination. This is a very nuanced distinction, and even under the best of circumstances it is not easy to explain how protecting deeply unpopular attitudes actually protects more fundamental freedoms. When people who are closely associated with libertarianism publish articles containing expressions of actual bigotry, it becomes virtually impossible.

The newsletter controversy is deeply troubling, and the whole affair has certainly blunted my earlier enthusiasm. That being said, it’s important not to throw the baby out with the bath water. The libertarian philosophy is ultimately one of tolerance and equal rights. Greater freedom benefits everyone regardless of race, creed, or national origin, and this message is strong enough to overcome any shortcomings that may characterize some of its proponents. In addition, I do not want to lose sight of all the good that has been done by the people in question. Ron Paul may not be the liberty’s most eloquent proponent, but he is without question its staunchest defender in Congress. Murray Rothbard refined and expanded libertarian thought, and continues to be a driving force for the freedom movement long after his death. And finally, Lew Rockwell’s contribution to liberty through his establishment of the Mises Institute cannot be overstated. Nevertheless, it may turn out that these particular heroes do indeed have feet of clay despite their considerable good works.

I just wish they could say it ain’t so.

Nominees for Political Quote of the Year

The new year has barely begun, but the competition for the coveted A Beginner’s Guide to Freedom Political Quote of the Year Award is already heating up! Here are a few gems that will certainly be in the running when the final votes are tallied:

“Whatever the future holds, for me his role will always be that of a rebel angel.”
-Naomi Campbell, describing Venezuelan president Hugo Chavez after her interview with him for British GQ magazine. Although she’s now officially part of the Useful Idiots Club, I for one think her description of Chavez as a “rebel angel” is spot on - after all, the original rebel angel was Lucifer. Kudos to Naomi for recognizing the similarities between the two (and for going an entire week without throwing a phone at anyone).

"I say you have to be true to yourself. No one story is the same as any other story. I don't know your reality. I can't possibly substitute my judgment for yours. You have to do what is right for you and that may not be what anybody else believes."
-Hillary Clinton on The Tyra Banks Show, giving her expert advice to women with cheating husbands. If she applied this same principle consistently, she’d be a libertarian. It’s a very succinct justification for the free market and individual liberty, and it nicely summarizes why government “solutions” don’t work.

"I will not allow them to come and survey my land. I have an American-given right to protect my property."
-Eloisa Tamez, on why she will not meekly surrender her land to the federal government for the construction of a border fence.

"Can we simply abandon an enterprise because it is a problem for a particular individual? I don't think I can accept that."
-Michael Chertoff, Director of Homeland Security, on why Eloisa needs to get over her love of liberty and individual rights.

Be sure to send your entries for Political Quote of the Year to: stephen.smith@abeginnersguidetofreedom.com. Entries must be received no later than midnight Central time on December 31, 2008. Offer void in AK, HI, and where prohibited by law. Must be 18 or older to enter.

The Needs of the Many

With the election cycle underway, the talk around the office has turned political. I’ve had a number of interesting conversations recently with one particular co-worker who believes himself to be a small-government fiscal conservative. Like most people, he’s accustomed to discussing politics "by the book" - primary results, potential nominees, odds of winning, etc. He’s quite knowledgeable about these things, but I think I'm becoming a real source of frustration for him because I rarely approach political issues from the comfortable perspective of the Sunday morning news shows. Instead of simply accepting the role of government as it currently exists, I always ask two basic questions about any government program: how can the intervention be justified on ethical grounds, and how can the intervention be more efficient than voluntary market solution?

These two questions can be a real head-scratcher if you haven't heard them before, as my friend from the office can attest (although to his credit he is at least willing to consider them, which is more than most people). He and I have gone back and forth on a number of issues, including public education and the roads. When I ask him my two basic questions, his natural reaction is to justify the public funding of these services on the basis of some benefit that accrues to certain individuals or to society as a whole. For example, he believes government has a legitimate role in education because we all benefit from having an educated populace. Similarly, when we discussed the roads I pointed out that although we both live in north Texas, we pay for road construction in places like Galveston even though neither of us have even been there. His response was, "Well, maybe I have relatives in Galveston who benefit from the roads."

At this point, I was the one getting frustrated. The idea that government is justified in doing anything whatsoever as long as it is possible to identify some benefit - no matter how limited, expensive, tangential, or inconsequential that benefit may be - is troubling to say the least, particularly when it comes from an alleged conservative. If the mere existence of a benefit is sufficient for government intervention in the marketplace, then ultimately there can be no limits on government whatsoever. It will always be possible to identify or invent some benefit for some group in order to justify ever-increasing government restrictions on liberty.

My friend’s default position, although obviously not reasoned out to any significant degree, seems to be some sort of watered-down utilitarianism. But instead of following the maxim of “the greatest good for the greatest number of people,” his philosophy (to stretch the term) seems to be better stated as “some good for at least a few people,” which provides at least anecdotal confirmation of the suspicions that I have always had about the utilitarian approach. Although defenders of classical liberalism such as Jeremy Bentham and John Stuart Mill have tackled the subject from a utilitarian perspective, I always felt their arguments were built on a shaky foundation. Utilitarianism superimposes the fiction of measurable objectivity over the thoroughly subjective notion of happiness, and grants those in power far too much leeway both to define the greatest good and to determine which policies will lead to it.

Thus, the consequentialist approach is more likely to open the door to creeping socialism than one based on the natural rights tradition, which more carefully delineates the proper function and limits of government. The Lockean philosophy that helped provide the philosophical foundation for the American Declaration of Independence and the Constitution draws bright lines around those government actions which are designed to protect liberty, and allows one to identify actions that exceed those bounds and are therefore detrimental to liberty. Thus, a well-understood concept of natural rights is a more effective constraint against government overreach than a utilitarian approach, which is always subject to endless debates over what constitutes the nebulous “greatest good.”

Indeed the entire Progressive movement of the late 19^th and early 20^th centuries and its contribution to socialism is a good example of the dangers of a political philosophy based on the idea that government exists to do whatever the electorate seems to desire, rather than one based on individual rights. The limitless nature of government expansion justified solely by some benefit to a particular group lays the seeds for endless predations on the wealth of the citizens. As government moves into the provision of more and more services (roads, schools, health care), it naturally crowds out private actors from those areas. Once people begin to utilize the now-public goods – as they must – the government can use this as a de facto justification of its initial intervention and as “evidence” that there must have been something inadequate with the original voluntary, market-based solution. Thus utilitarian arguments enable the government to lay claim to an ever-increasing percentage of the individual’s income, with no identifiable limit.

This used to be understood. Although the reader would be hard pressed to find any trace of it today, there was a time when the publishers of The Economist actually understood economics and even defended the free market. Thomas Hodgskin, who served as editor for the magazine, identified the risks inherent in the utilitarian approach in the following critique:

“...Messrs. Bentham and Mill, both being eager to exercise the power of legislation, represent it as a beneficent deity which curbs our naturally evil passions and desires (they adopting the doctrine of the priests, that the desires and passions of man are naturally evil) -- which checks ambition, sees justice done, and encourages virtue. Delightful characteristics! which have the single fault of being contradicted by every page of history…[in the utilitarian view] Man, having naturally no rights, may be experimented on, imprisoned, expatriated or even exterminated, as the legislator pleases. Life and property being his gift, he may resume them at pleasure; and hence he never classes the executions and wholesale slaughters, he continually commands, with murder -- nor the forcible appropriation of property he sanctions, under the name of taxes, tithes, &c., with larceny or high-way robbery. [Sir Robert] Filmer's doctrine of the divine right of kings was rational benevolence, compared to the monstrous assertion that [quoting Mill] "all right is factitious, and only exists by the will of the law-maker." But though this may be comfortable doctrine for legislators, it will not satisfy the people; and in spite of false theories and unreasonable practices, events are now teaching mankind to place a just value on law-making. Day does not follow day, without increasing our knowledge of the consequences of actions; and it is fast becoming apparent, that the wise men, such as Cicero and Seneca, as Bacon and Locke, and as Burke and Smith, who have advocated a totally different system from that of Messrs. Bentham and Mill and their arrogant disciples, have not cast the seeds of their faith in nature, on a barren and ungrateful soil.”

Mr. Hodgskin was quite perceptive. Government is either strictly limited to a few key functions or it is total – everything in between is just killing time. As soon as those in power are able to appeal to the greater good as justification for their actions, the individual no longer factors into the equation. Under these circumstances the best one can hope for is merely to be ignored. At worst, the individual can be eliminated if those in power deem his existence inconvenient or detrimental. After all, it would be a lot easier to achieve the greatest good for the greatest number of people if there just weren’t so damn many people in the first place. The bloody history of the various experiments with totalitarianism during the 20^th century should be enough to prove the point.

The Wall

Now that the primaries are in full swing, the major candidates are debating who among them can most thoroughly violate the Constitution. My money is on John “Opie the Commie Redneck” Edwards, but a number of others seem to be giving him a run for his money, particularly when it comes to their plans to stop illegal immigration. John McCain, Ron Paul, Hillary Clinton, and Barrack Obama voted in favor of a bill authorizing the construction of a 700-mile wall along the 1700-mile border with Mexico. Mike Huckabee, Rudy Giuliani, and Mitt Romney have all stressed the importance of building a physical wall during their campaigns.

Although the border wall issue has been discussed in great length by both the candidates and the media pundits, one small item in all this has gone largely unreported. It turns out that the land upon which the wall will be built is owned in large part by private citizens, not all of whom are that anxious to have their property stolen from them. And the Department of Homeland Security is sick and tired of waiting on these scofflaws to get with the program. As the Associated Press reports,

The federal government is preparing to go to court to force dozens of property owners in the southwestern U.S. to give it access to their land for possible construction on it of a U.S.-Mexico border fence. The government is readying 102 cases to gain entry to lands along the border owned by private individuals, local governments and others. A deadline for many of the owners to grant entry passed Monday or should expire in a matter of days...

The Homeland Security Department…says some of the properties may not be needed, but it needs to assess which ones it may need to purchase or seize through eminent domain for the fence or other barriers…

One of the holdouts is 72-year-old Eloisa Garcia Tamez who owns three acres of property in El Calaboz, Texas, a community about 12 miles west of Brownsville, a city at the southernmost tip of Texas. "I'm waiting for whatever they've got coming and I'm not going to sign. I'm not," said Tamez…

Officials are considering building the fence north of a levee that crosses the property, which she fears would make much of her land inaccessible. She was told she could get access to the land south of the fencing through a gate that would be manned and be located 3 miles from her property.

"Here we are, American citizens, and have to go through a checkpoint to go through our own property," Tamez said. "If they come in and do all that they are going to, they'll leave me with nothing."

Unfortunately, people like Eloisa seem to be completely left out of the immigration debate. Although the Kelo decision fueled popular backlash against the use of eminent domain for the benefit of private developers, apparently that outrage didn’t go far enough. In my opinion, eminent domain is an idea that should never have survived the American Revolution. It derives from the notion that all the land in the country really belongs to the king, and the individuals are mere custodians of His Majesty’s realms. So whenever the king needs his property back, the subjects are obliged to return to him that which is his. This concept seems rather difficult to square with traditional American principles of individual liberty.

But then again, very little of the immigration debate seems to fit within traditional American ideas of freedom. As a Cold War kid, I grew up pitying the poor souls behind the Iron Curtain because they were hemmed in by a concrete wall and had to present their “papers” to every soldier and government official that happened to demand them. We felt blessed to live in a country that was free of that kind of tyranny, but now we seem to clamor for it.

Why the change of heart? Well, most of the anti-immigration arguments revolve around welfare, jobs, and national security. But before we seal ourselves behind a 21^st century Berlin wall of our own, perhaps it would be worthwhile to review each of these arguments critically to see if they hold water.

“Illegals get welfare and public services without paying for them!” Actually, immigrants (even the illegal ones) do pay taxes. They pay property tax (in their rent), sales tax (on the goods they buy), and even withholding tax (albeit under false social security numbers). In addition, the overwhelming majority of welfare payments in the United States fall under two categories – WIC and Medicare. WIC is the supplemental nutrition program for women, infants, and children. Medicare is for the elderly. Since most illegal immigrants are healthy young men, and since the 1996 Welfare Reform Act greatly limited illegals’ ability to collect welfare in the first place, this angle seems to be greatly overhyped. Besides, the idea that illegals “don’t pay their fair share” seems to miss the point of any welfare program, which is necessarily to transfer wealth to poorer people who by definition don’t pay their fair share of the benefits they receive. There are plenty of ethical and pragmatic reasons to oppose the welfare state in general, but the nationality of the recipient is irrelevant. The real issue is simply the redistribution of wealth.

“But they come over here and take American jobs!” I suppose this argument is persuasive to all those Americans desperately trying to land jobs picking strawberries and plucking chickens, but it doesn’t really ring true beyond that narrow constituency. The idea that illegals take jobs from Americans is based on a number of economic fallacies, like the notion that there are only a certain number of jobs available, and that if it weren’t for illegal immigrants, the wages in industries like food services and housekeeping would rise to the point where Americans would find them attractive. As Dan Griswold of the Cato Institute reports, “The pool of Americans who have traditionally filled such jobs continues to shrink as native-born workers become, on average, older and better educated. Yet our immigration system offers no legal channel for peaceful, hardworking if low-skilled workers to enter the country to fill those jobs.”

“September 11^th changed everything! It’s an issue of national security!” Despite the fact that none of the 9/11 hijackers came across the Mexican border, I actually do think this is the strongest argument in the anti-immigration arsenal. Or at least it would be if it were consistent. If national security is really the issue, then surely a border wall on the Canadian border would be every bit as important as one on the Mexican border. In fact, given the ease with which foreigners can enter Canada, it would seem to be even more important. Since no one is talking about walling off everything from Seattle, Washington to Houlton, Maine, I have to conclude that national security is not really the driving issue after all. And as I have argued before, real national security will never be achieved while the U.S. government maintains an interventionist foreign policy.

“What part of ILLEGAL don’t you understand?” I know, I know. It’s against the law. I get it. However, the fact that something is illegal does not necessarily mean that it is wrong. It merely indicates that there is a penalty associated with a particular action. For example, the Texas state legislature could pass a law against wearing blue ties, punishable by a $50,000 fine and up to 5 years in prison. Does that mean that the day the law is passed it becomes immoral to wear a blue tie? Of course not. You may be risking jail if you dare defy the law, but that doesn’t mean that blue ties have suddenly become a menace to the security of the republic.

At the end of the day, the arguments given by those who wish to curb illegal immigration are little more than xenophobic bumper sticker slogans. Politicians are happy to tap into this fear, of course, because it gets them votes. But before we succumb to the hysteria, it may be worthwhile to recognize that all of the plans aimed at curbing this “crisis” have one thing in common - they all restrict the freedoms of American citizens:

• Authorizing the U.S. government to take land from American citizens to build a wall.
• Requiring everyone in the U.S. (immigrants and citizens alike) to carry a national ID card, and present it upon demand.
• Penalizing American business owners with fines and imprisonment for hiring the “wrong” people.
  

And here’s one more nugget to consider before a concrete curtain descends across the American southwest - there are an estimated 500,000 illegal Chinese immigrants in the U.S., and there’s a lot more than just a wall separating us from China. If the Pacific Ocean can’t stop illegal immigration, how much success can we really expect from a wall built by the same people who brought us the Post Office and the TSA?

National Insecurity

Once again, the sparks flew between Ron Paul and the other Republican candidates over the issue of terrorism in last night’s ABC News/Facebook Republican debate from New Hampshire. As he had done in the South Carolina debate a few months earlier, Dr. Paul stated that the primary motivation for the attacks of September 11^th was the interventionist foreign policy of the American government in the Middle East. Mitt Romney, Rudy Giuliani, and Fred Thompson all took turns lambasting the Texas Congressman for his heresy, flatly denying the possibility that US foreign policy could in any way be related to either the World Trade Center attacks or any of the other terrorist attacks that have taken place during the past few decades.

Perhaps all of the other Republican candidates are right, and Dr. Paul is wrong. I suppose it’s possible that all of the hatred expressed by many foreigners toward the United States is completely irrational and unwarranted. It could be, as Giuliani believes, that it is not possible for the US government to make mistakes in the realm of foreign policy, and we should not waste any time whatsoever in considering the ridiculous notion that people in other countries might occasionally disagree with US government policies that affect them.

In order to think through this a bit further, let’s imagine a room full of people. All of a sudden the scrawniest person there hauls off and clocks the biggest, strongest guy in the room. Upon seeing this, we could draw one of two conclusions. One, that the scrawny guy who threw the punch is just crazy. Maybe he felt that the other guy was better dressed and was having too much fun that night. After a few minutes of this, he was so incensed by the other guy’s apparent wealth and freedom that he just went nuts and attacked someone three times his size, even though the big guy had not so much as looked at him sideways the entire night. The other conclusion we might draw from the event is that the big guy had done something earlier to provoke the little guy, who finally decided to “do something about it” by taking a shot once he felt the time was right. Granted, either one of these scenarios is possible, but which one seems more likely?

Ron Paul believes that an attacker usually has a motive which needs to be understood so that steps can be taken to prevent future aggression. This in no way excuses the attack, any more than the police excuse a murder when they investigate the reasons that led the perpetrator to commit the crime in the first place. On the other hand, the rest of the GOP candidates apparently believe that whenever someone attacks the United States, they do so for no reason whatsoever. They obviously hate us to the point at which they are willing to kill themselves if they can just take a few Americans with them, but their hatred cannot be motivated by any legitimate cause whatsoever. That’s possible, I suppose, but then again, which scenario is more likely? And which candidates have the mindset that is better suited to address the root causes of terrorism? Those who seek to understand all facets of the issue, even if some are hard to accept, or those that studiously avoid any sort of critical self-reflection whatsoever?

These are important but uncomfortable questions to ask. Unfortunately, we have so conflated the US government with the American people that any critical analysis of foreign policy is generally equated with a criticism of individual Americans. This confusion between government and society plays into the hands of those politicians who prefer not to look too closely at the results of the interventionist foreign policy that they themselves have espoused, and that the founders of this country warned against. They are able deflect their critics by claiming that those who raise the hard questions are just “blaming the victim.”

Nothing could be further from the truth, of course. American society and American government are not interchangeable, nor were they ever meant to be. The founding fathers understood that there is a fundamental difference between the two. Society is formed by individuals interacting with each other in a voluntary manner through their own free market transactions and associations. Government, on the other hand, does not rely on voluntary interaction. It relies on coercion. Because of this fact, any government – even one that is freely elected by the people – necessarily stands apart from the larger society it claims to represent.

We must keep this distinction in mind if we are ever to deal effectively with the issue of terrorism. If our elected representatives refuse to examine the issue honestly, including all facets of the problem – no matter how uncomfortable they may be - they will never be able to take the steps necessary to prevent future attacks. At some point, we must recognize the wisdom of the principles upon which this country was founded, and accept the fact that an interventionist foreign policy is incompatible with real, lasting national security.

I Know Who Killed the Electric Car

In 2006, Sony Classic Pictures released a documentary titled Who Killed the Electric Car, which featured a bevy of Hollywood B-list celebrities including Alexandra Paul, Peter Horton, and Ed Begley. It’s narrated by Martin Sheen. The film is a Michael Moore-style documentary with a dash of Perry Mason whodunit thrown in. It comes complete with a list of suspects who may or may not be responsible for “killing” the EV1, GM’s battery-powered electric car which was test marketed in California and Arizona in the late 1990s. It was never mass-produced, and the filmmakers demand to know why. GM claims they shelved the EV1 because the product wasn’t viable – it cost more to produce than the consumers were willing to pay at the time. The filmmakers aren’t gullible enough to buy such a far-fetched claim, though. Who could imagine anyone not wanting an electric car, no matter the price? Besides, neither Tom Hanks nor Mel Gibson complained about their lease payments for the EV1, so clearly the problem couldn’t be the price tag. The film runs down a number of conspiracy theories to crack the case wide open, arriving at conclusions that are both predictable and humorous.

To summarize, GM created the EV1 and offered it to a select group of people on a lease basis for testing purposes. All of the individuals profiled in the film raved about the car’s performance and its environmentally friendly profile (the EV1 was a zero-emission vehicle). During the test period, the California Air Resource Board (CARB) got wind of the EV1, and thought it was such a great idea that they decided to enact the Zero Emission Vehicle (ZEV) mandate. This law originally specified that by 1998, 2% of all new cars sold by the seven major auto manufacturers in the state of California would have to meet 'zero emission' standards. The bar would then rise to 10% of all vehicles sold by 2003. The penalty for not meeting the ZEV mandate? $5000 per car. California is the world’s fifth-largest economy. Given the number of vehicles sold there each year, a $5000 penalty per car amounts to some serious cash.

So here we have a case in which a major multinational corporation, following nothing but its own profit motive, attempted to deliver the Holy Grail of environmentalism to the state of California on a silver platter. And what was GM’s reward for bringing the world’s most environmentally friendly car to market? A threat from CARB. Anyone but Martin Sheen could see how that might change the calculus a bit. Companies expect a certain level of risk associated with research and development projects. However, that risk is usually limited to the dollars that have been invested in the projects under consideration. Thanks to California’s ZEV mandate, however, GM was no longer merely risking just its R&D investment in the EV1 – now it was risking its entire California market solely on the basis of an experimental product. That’s a very different proposition, and GM responded accordingly by suing the state of California to prevent the mandate from taking effect. They then shelved the EV1.

Now I don’t pretend to know all there is to know about the history of the EV1. The little I do know was learned from the movie. Who Killed the Electric Car is a very slanted, ideologically driven film, but the funny part is they answer their own question without even realizing it. The filmmakers blame the EV1’s demise on the left’s usual list of villains – George Bush, the oil companies, and the automobile manufacturers. Although they do lay some blame on the California Air Resource Board, it is only because CARB backed off its original mandate – not because CARB threatened the car manufacturers in the first place. Even if we are to take the filmmakers’ presentation of events at face value and reject GM’s claim that the EV1 was not economically viable at the time, it is clear that the real source of the problem was the initial mandate itself. Unfortunately, Martin Sheen et al are so blinded by their own ideology that they are incapable of recognizing this simple truth – even though they are the ones presenting it to us!

And to me this illustrates the problem with the environmental movement as a whole. It sees capitalism and the profit motive as an enemy of conservation and environmentally-friendly progress. Instead, every “solution” they offer to every environmental problem, real or perceived, is nothing but ever-increasing degrees of global socialism. As Lew Rockwell once quipped, “It’s as though the socialists realized their policies caused poverty, so they renamed themselves environmentalists and made poverty their goal.”

As someone who has spent significant time in the developing world, I can assure the reader that the richer the country, the cleaner it is. Rich countries are rich only because they have embraced capitalism to a greater degree than the poor countries. The world’s most polluted areas are not in the United States, Japan, or Germany. Russia and China, on the other hand, have always had the highest levels of socialist government control of natural resources and the highest levels of environmental contamination. This is not a coincidence, and it should serve as an important lesson for environmentalists everywhere. Only capitalism has the necessary built-in incentives for conservation, since greater profit is derived when one is able to find ways to increase output while reducing inputs. In contrast, socialism seeks to eliminate the price mechanism and the profit motive. In doing so, it also eliminates the incentive to conserve and maintain precious natural resources.

The most polluted areas in any country are those which are managed by government. In fact, the largest single polluter in the US is the federal government. This is completely predictable, of course. Whenever there is no ownership of a resource, the incentive is to take as much from the resource as quickly as possible before someone else does. This is known as the tragedy of the commons. The rational way to resolve this problem is to privatize the commons, thus providing the owners of the resource an incentive to maintain that resource in order to protect future revenue streams. The environmentalists’ solution to any issue, however, is always to increase the commons through more and more government control.

Take global warming, for example. The allegation is that the earth is getting warmer, that it’s man’s fault, and that it will be uniformly bad for everyone on the planet. The solution? Massive wealth transfers from the productive capitalist countries to the unproductive socialist countries. I’m a little fuzzy on how this is supposed to lower global temperatures. Maybe Swiss bank accounts held by corrupt Russian bureaucrats act as carbon sinks, like forests.

And I find it very telling that supporters of the Kyoto Treaty and other government-managed “solutions” to global warming refer to those scientists who dispute the standard narrative as global warming “skeptics.” In the realm of real science, skepticism is not a pejorative – it’s a requirement. Scientists do not accept any theory on faith. They form hypotheses, conduct experiments, and analyze the results. The fact that Al Gore attempts to disparage those who disagree with his Chicken Little story by calling them “skeptics” tells me that we are no longer within the realm of science, but rather that of religion.

All of this is a real shame, since no one disagrees with the overall goal of maintaining a clean environment. Unfortunately, the hostility that some environmentalists show toward capitalism and rational, property-based solutions leads one to wonder if they really wish to fix the problems, or whether their real goal is just more socialism, more government control over our lives, and more poverty for future generations.