A Beginner's Guide to Freedom

Political Quotes (Intentional or Not)

2012-01-27T16:39:00.001-08:00

"It is difficult to get a man to understand something when his salary depends upon his not understanding it."

- Upton Sinclair, on journalists and politicians.

"From my tribe I take nothing. I am the maker of my own fortune."

- Tecumseh, on how a true public servant would act.

"When we have begun to take charge of our lives, to own ourselves, there is no longer any need to ask permission of someone."

- George O'Neil, on the radical notion that other people are not your property.

"Sir, I have found you an argument; but I am not obliged to find you an understanding."

- Samuel Johnson, on arguing with non-libertarians.

"It is a besetting vice of democracies to substitute public opinion for law. This is the usual form in which masses of men exhibit their tyranny."

- James Fennimore Cooper, on the merits of a living, breathing Constitution.

"It is seldom that the miserable of the world can help regarding their misery as a wrong inflicted by those who are less miserable."

- George Eliot, on the average Occupy Wall Street protester.

"A man of such obvious and exemplary charm must be a liar."

- Anita Brookner, on (fill in name of politician here).

"About the most originality that any writer can hope to achieve honestly is to steal with good judgment."

- Josh Billings, on intellectual property law.

"If you have an apple and I have an apple and we exchange apples then you and I will still each have one apple. But if you have an idea and I have an idea and we exchange these ideas, then each of us will have two ideas."

- George Bernard Shaw, also on intellectual property law.

"All socialism involves slavery. That which fundamentally distinguishes the slave is that he labours under coercion to satisfy another's desires."

- Herbert Spencer, on…well…socialism.

"You can get much further with a kind word and a gun than you can with a kind word alone."

- Al Capone, on the nature of government.

Fear and Envy

2012-01-27T11:18:00.001-08:00

I watched the last part of CNN's Republican debate from Florida Thursday night, and to my surprise I came away with a much better understanding of the stark choice that American voters will face this November when they go to the polls to vote for President. Regardless of who the GOP nominee is (assuming it won't be Ron Paul), Americans will have to decide between fear and envy.

Fear is what the Republicans have to offer. Based on last night's debate, it may be all they have. This point was driven home when Rick Santorum answered a question relating to the Cuban embargo. Naturally, Mr. Santorum is all for it. As I'm sure readers are aware, the US government maintains strict sanctions against the tiny third-world island nation (technically the US government punishes American citizens who wish to interact with Cubans, but I suspect that distinction is lost on most of the candidates). The embargo, which was allegedly designed to drive Castro from power, has been in place longer than I've been alive. And yet the Castro boys are still running the show in Havana. To Rick Santorum, this is exactly the kind of wildly successful government program that should be maintained.

The former Senator from Pennsylvania did not rest his support for the embargo on its efficacy in achieving its stated objective, though. Instead, he claimed that now was not the time to reward Castro by lifting the embargo*, because Castro associates with other anti-American tin-pot dictators like Noriega.

That's right, he said "Noriega." (I had to rewind just to make sure).

For those of you who (like Rick Santorum) don't know, Manuel Noriega was imprisoned in France until just last year. He was recently extradited to Panama, where he's now serving a 20-year sentence. Though there may be many threats to American security out there, we can rest assured that Noriega is not one of them.

But clearly the GOP no longer limits itself to actual threats to national security. They're worried about imaginary ones, too (you can never be too careful). In addition to the terrifying specter of Manuel Noriega, Santorum is also keeping a watchful eye on jihadists who are (wait for it)…going to set up missile sites in Latin America. That's right. They're not planning suicide attacks with small explosives, they're not building IEDs, and they're not attacking soft targets with machine guns. They're building missile sites.

And Ron Paul is considered the "nutty" one? The unelectable one?

Aside from the existential threat posed to the United States by Cuba (Latin America's poorest country) Rick Santorum is also deeply worried about Iran, Nicaragua, Venezuela, and presumably (though it didn't come up during last night's debate) Iraq, Afghanistan, and Pakistan as well. Which leads me to wonder if there are any underdeveloped countries the GOP is not afraid of?

Fear. That's what the Republicans are offering. That's the driving force behind all their saber-rattling.

This is not to say that Obama has put forward anything more inspiring for the voters in November. From what I gather from his recent State of the Union address and other speeches, the only thing President Obama has to offer is envy.

"Right now, because of loopholes and shelters in the tax code, a quarter of all millionaires pay lower tax rates than millions of middle-class households. Right now, Warren Buffett pays a lower tax rate than his secretary."

Naturally, Obama wants to raise Buffett's tax rate to rectify this injustice. It never occurs to him to lower the tax rate of the secretary, of course. (Personally, I'd rather have 15% of Warren Buffett's capital gains than 28% of his secretary's salary, but that's just me). But with a national debt of over $15 trillion, multi-trillion dollar deficits projected as far as the eye can see, and anywhere from $50 to $100 trillion in unfunded liabilities, it should be clear to anyone paying attention that no tax rate, no matter how high, no matter how rich-soaking it may be, will ever be enough to satiate the Federal government's appetite for spending. But that is not the point, of course. The point is to throw red meat to blue voters, and in today's highly emotional and economically illiterate climate, that means serving up envy – and lots of it.

In a recent speech in Michigan, President Obama channeled the odious Elizabeth Warren, saying, "We do not begrudge wealth in this country. I want everybody here to do well. We aspire to financial success, but we also understand that we're not successful just by ourselves. We're successful because somebody started the University of Michigan. We're successful because somebody made an investment in all the federal research labs that created the internet. We're successful because we have an outstanding military that costs money. We're successful because somebody built roads and bridges. And laid broadband lines and these things didn't just happen on their own. And if we all understand that we've got to pay for this stuff, it makes sense for those of us who've done best to do our fair share and to try to pass off that bill on to somebody else, that's not right. That's not who we are."

In Obama's worldview, government expenditures in infrastructure and defense provide a justification for limitless predation on the productive sector. In an America motivated by envy, the more successful a person is, the less secure his property becomes. And despite Obama's frequent entreaties not to call it class warfare or envy, that's exactly what it is.

Envy. That's what the Democrats are offering. That's the driving force behind all their "eat the rich" sloganeering.

So which will it be this November? Fear or envy? Remember – if you don't vote, you can't complain.

* Note to Rick Santorum: Lifting the embargo is not a reward for Castro, it's his greatest fear. Once the embargo is lifted, Castro will no longer have a convenient scapegoat for all the misery his evil and idiotic policies have inflicted on the Cuban people lo these many years.

Teachable Moments

2012-01-24T11:59:00.000-08:00

As pessimistic as I usually am about the prospects for liberty in the United States, two stories cropped up this week to remind me that not all modern Americans actively cheer their own enslavement. The first was Senator Rand Paul's recent run-in with the TSA.

As you're no doubt aware, Paul – an outspoken critic of the TSA – was detained Monday while traveling through the Nashville airport. A TSA agent claimed that the naked radiation bath Paul had just passed through indicated some sort of irregularity, and that the Senator would have to be felt up just to make sure the nationally-known politician wasn't also moonlighting as an Al-Qaeda operative. The Senator declined the TSA agent's come-on, offering to go through the scanner a second time instead to clear up any security concerns. Evidently enraged by having his advances publicly spurned, the TSA agent started barking orders at Paul and detained him in a cubicle long enough for the Senator to miss his flight.

It might have ended there, but Rand Paul decided instead to use the incident as a teachable moment. He quickly penned an op-ed for The Washington Times in which he wrote, "Despite removing my belt, glasses, wallet and shoes, the scanner and TSA also wanted my dignity. I refused." When speaking to CNN about the incident, he asked, "Is it too much to ask to have a little dignity when you travel? And shouldn't an adult be able to get back in line and go through the scanner? I don't think that's too much to ask."

Personally I think it's too much to "ask" anyone to be sent through Michael Chertoff's money siphoner even once, much less twice. And to be clear, no one is "asking" us to go through them – they're commanding us. Nevertheless, I applaud Senator Paul's decision to stand up to the TSA and use the spotlight he's been given to keep the public discussion over the agency's usefulness (or lack thereof) going.

Continuing from his op-ed piece,

"Ever since the news of my struggle with TSA, the phones in my office have been ringing off the hook with calls from citizens who sympathize with my frustration, as they, too, feel their liberties are being compromised every time they travel. My office is being inundated with their stories of assault and harassment by TSA agents. This agency's disregard for our civil liberties is something we are expected to understand and accept. But we are tired of being insulted and we are tired of having our dignity compromised. TSA was created in the aftermath of the Sept. 11 terrorist attacks, but was it necessary? Has it overstepped its bounds? Is it respecting the rights of citizens? It is time for us to question the effectiveness of TSA. America can prosper, preserve personal liberty and repel national security threats without intruding into the personal lives of its citizens. Every time we travel, we are expected to surrender our Fourth Amendment rights, yet willingly giving up our rights does not make us any safer. It is infuriating that this agency feels entitled to revoke our civil liberties while doing little to keep us safe."

Senator Paul brings up a number of good points, none of which had the slightest impact on President Obama, the one person who might be able to do something about TSA abuses. Rather than work to restore some sense of sanity to air travel in the United States, the White House instead defended the TSA's relentless assault on Americans' civil liberties.

The second ray of hope this week comes from Boston Bruins goalie Tim Thomas, who chose not to accompany his teammates to the White House to receive the blessings of the Oval Office for last year's Stanley Cup victory. Instead, Mr. Thomas used the opportunity as a teachable moment, issuing the following official Facebook statement:

"I believe the Federal government has grown out of control, threatening the Rights, Liberties, and Property of the People. This is being done at the Executive, Legislative, and Judicial level. This is in direct opposition to the Constitution and the Founding Fathers vision for the Federal government. Because I believe this, today I exercised my right as a Free Citizen, and did not visit the White House. This was not about politics or party, as in my opinion both parties are responsible for the situation we are in as a country. This was about a choice I had to make as an INDIVIDUAL. This is the only public statement I will be making on this topic. TT"

Well said, Mr. Thomas.

Not everyone agrees, of course. ESPN columnist Joe McDonald said, "Thomas' absence was uncalled for. The president has more important things to worry about with Tuesday's State of the Union address." (Which makes one wonder why the President is wasting his time meeting a hockey team in the first place). Mr. McDonald feels the "Bruins goalie picked inappropriate time, venue to make personal statement." I suppose he might have picked next Thursday afternoon instead, but I doubt it would have had the same impact.

Oh well, the sheep ye shall always have with you. Then again, we will also always have with us those who, though they may submit to the government's plunder, its violations of rights, and its endless interference in our lives, don't feel obligated to lick the boots resting firmly on their throats, as President Obama and Mr. McDonald would have them do. When offered a teachable moment, they take full advantage to remind us of the freedoms that we as Americans used to enjoy.

They may even inspire us to work to reclaim those same freedoms.

Economic Fascism Defined

2012-01-20T10:20:00.001-08:00

The most succinct description of the economic aspects of fascism I've ever read comes from Babylon.com's A Glossary of Political Economy Terms. There is no question that fascist systems are characterized by other elements that go far beyond economics – elements such as rabid nationalism, racism, and militarism - and the glossary does cover those as well. But it's hard to beat the following for a concise definition of economic fascism:

"Strict regulation and control of the economy by the regime through some form of corporatist economic planning in which the legal forms of private ownership of industry are nominally preserved but in which both workers and capitalists are obliged to submit their plans and objectives to the most detailed state regulation and extensive wage and price controls, which are designed to insure the priority of the political leadership's objectives over the private economic interests of the citizenry. Therefore under fascism most of the more important markets are allowed to operate only in a non-competitive, cartelized, and governmentally 'rigged' fashion."

It is this definition that always comes to mind whenever I read stories like the one recently published by New York Times reporter Robert Pear titled, "U.S. Seeks Rollback of a Health Insurer's 'Excessive' Rate Increase." To his (or his editor's) credit, he did at least put the word "Excessive" in quotes to indicate that the White House's assessment of the rate increase is highly subjective. Sadly, that's about the only creditworthy aspect of this particular piece.

The alarm bells start going off with the very first sentence, which states,

The Obama administration said Thursday that rate increases sought by a health insurance company were unreasonable, and it ordered the insurer to rescind them or justify its refusal to do so.

I realize that in modern American public discourse health care has become the end-all-be-all, something apart and above all other issues, goods, or services. I also recognize how the entire health care industry has been politicized, and I accept that most people approach the economics of health insurance from a highly charged, emotional perspective. That being said, I cannot help but feel a sense of sadness and disgust at the hubris displayed by the Obama administration's belief that it has the slightest idea as to what increases are or are not "reasonable" in a commercial setting. Neither Obama nor his Soviet-style health czar Kathleen Sebelius have ever worked in the insurance industry (nor any other private-sector industry for that matter). And they certainly haven't worked at Trustmark Life, the firm that has drawn the administration's PR-driven wrath. Even if they had, the government is unrelated to the contracts entered into by Trustmark and its clientele.

Or at least that's how it would be in a free market. In a fascist economic system, on the other hand… (See definition of economic fascism above).

Kathleen Sebelius, the secretary of health and human services, issued the finding against the carrier, Trustmark Life Insurance Company...

"It's time for Trustmark to immediately rescind the rates, issue refunds to consumers or publicly explain their refusal to do so," Ms. Sebelius said, wielding power granted by the new health care law.

Who the hell is Kathleen Sebelius to dictate Trustmark's or anyone else's rates? Obviously the wildly unconstitutional Obamacare law gives her the legal power to do so (see definition of economic fascism above), but where does she get the moral authority? If this precedent is allowed to stand (and I have no doubt it will be), what logical defense could possibly be given to prevent the government from setting the price of any other good or service? What would prevent one of Obama's flunkies in say, the FCC, from setting the price of cell phone service? What would prevent another government stooge in the Department of Energy from setting the price of gasoline?

The action fits in with White House efforts to demonstrate the value of the new health care law and to portray President Obama as fighting for the economic interests of middle-class families in this election year.

The action fits in with the definition of economic fascism (see above).

Cindy Gallaher, a spokeswoman for Trustmark, based in Lake Forest, Ill., said: "We respectfully disagree with the assumptions and conclusions drawn today by the Department of Health and Human Services. Our premiums are driven by the rising cost and increased utilization of medical services. Trustmark has been and will continue to be in compliance with all aspects" of the law, Ms. Gallaher added.

And this of course is the real reason why Trustmark's rates are going up. As everyone with an IQ above room temperature predicted (and Obama denied), the regulatory burden associated with Obamacare is driving up the operating costs for private insurance providers. Those providers can only respond by raising rates or by limiting coverage (or dropping it altogether). The completely predictable crowding-out effect of Obamacare is underway, which one can only assume was the administration's goal all along. (Never again will I use the term "unintended consequences" – they're intended).

The law, signed by President Obama in March 2010, set detailed federal standards for health insurance, which had for decades been regulated mainly by the states. The law calls for the annual review of "unreasonable increases in premiums." Under rules issued last year by Ms. Sebelius, rate increases of 10 percent or more must be reviewed by state or federal officials.

See definition of economic fascism above…

The administration used its rate review authority once before, on a smaller scale, in an effort to stop what it described as an unreasonable rate increase of 12 percent by the Everence Insurance Company in Pennsylvania. The company says the increase reflects the cost of providing coverage to small businesses there.

See definition of economic fascism above…

Under the new law, insurers must spend at least 80 percent of premium revenues on medical care and efforts to improve it. Gary Cohen, acting director of insurance oversight at the Department of Health and Human Services, said Trustmark did not meet this standard in any of the five states.

What other industry is required to spend its earnings in ways dictated by government officials? What kind of economic system allows that kind of intervention?

See definition above.

Good News and Miscellaneous Fun Stuff

2012-01-17T13:04:00.001-08:00

How about some good news for a change? Time for me to take a break from the doom and gloom and focus on something positive. So here's a round-up:

Liberty Conspiracy Live!

Regular readers know that I'm a big fan of Gardner Goldsmith's Liberty Conspiracy. Gard and I go way back, and I've even contributed pieces to his political podcasts from time to time. I'm pleased to announce that his show is now live five nights a week on Liberty Radio Network. Tune in Sunday through Thursday, from 10pm to midnight (Eastern) to check it out. You'll be glad you did… (There's also an app for streaming LRN directly to your mobile device).

Freedom Book Club

Another fellow Conspirator, Furb, is the creator of the Freedom Book Club. As the website explains, "Freedom Book Club is devoted to getting books promoting individual liberty on the New York Times Best Seller List. This is done through the bourgeoise multitudes buying the selection of the month all during a specified range of dates (during the same week). It is the goal of Freedom Book Club to transform the world to into a free society through the education of self and sharing with others." Go to the website and help make freedom a best-seller.

Laissez-Faire Books - Under New Management

Agora Financial (the Daily Reckoning crew) has bought Laissez-Faire Books, and placed Jeffrey Tucker (of the Mises Institute) in charge. Only good can come of this.

SOPA is DOA

President Obama finally did something right this weekend, and informed Congress that he would not support its latest attempts to censor the internet. We can expect the SOPA/PIPA monstrosity to rear its ugly head at some future date under different acronyms, but it looks like internet freedom may have gotten a temporary reprieve. Just to make sure Congress gets the point, Wikipedia is planning a 24-hour blackout to protest these idiotic bills.

Kim Jong Il

…is still dead.

Political Fashion Statements

2012-01-13T16:09:00.001-08:00

Time magazine recently published its list of the Top Ten Political Fashion Statements. Here they are:

10. Rick Santorum's sweater vests

9. Fidel Castro's tracksuits

8. Every Male in American Politics, Ever (dark blue suit, white shirt, red or blue tie, flag pin on lapel)

7. Kim Jong Il's Khaki Safari Suits and Sunglasses

6. Jimmy Carter's Cardigan

5. Mao Zedong's Suits

4. Jawaharlal Nehru's Jackets

3. Muammar Gaddafi's Everything

2. Hillary Clinton's Pantsuits

1. Sarah Palin's Glasses

I don't know if those were supposed to be in any particular order - it's hard to imagine Sarah Palin's glasses being a stronger fashion statement than the Nehru jacket. (And I'll never understand how Rick Santorum's sweaters managed to beat out Che Guevara's beret). No matter, it's still a pretty impressive list. But on more than one occasion I've seen Time magazine take a more charitable view of government than I do, and I think that attitude is reflected in the list they've compiled here. Whether they're talking about some anonymous bureaucrats, political lightweights, or mass-murdering dictators, it seems that just about anyone in the public sector has something to offer Time's world of fashion.

But since we're talking specifically about political fashion statements, I've come up with my own list of government-inspired garb, haberdashery, and accoutrement which I feel more accurately reflects the importance of the state in our lives (as seen through the prism of fashion). Here it is – let me know if I've left anything out:

10. A badge

9. Riot Gear

8. Handcuffs

7. Combat fatigues

6. Black robes

5. Mirrored sunglasses

4. Orange prison jumpsuits

3. Hangman's noose

2. A boot (stamping on a human face)

And last but not least, the sine qua non of government fashion, the absolutely, positively, don't-leave-home-without-it, must-have government accessory of this (and every) season has to be…

1. Guns, guns, and more guns!

"Government is in the last resort the employment of armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential feature of government is the enforcement of its decrees by beating, killing, and imprisoning. Those who are asking for more government interference are asking ultimately for more compulsion and less freedom." - Ludwig von Mises

Check Back in 2050

2012-01-12T15:45:00.001-08:00

HSBC's global research department recently released a report that predicts the ranking of world economies forty years from now. According to the researchers, the top thirty economies in 2050 will be:

1) China

2) U.S.

3) India

4) Japan

5) Germany

6) UK

7) Brazil

8) Mexico

9) France

10) Canada

11) Italy

12) Turkey

13) S. Korea

14) Spain

15) Russia

16) Philippines

17) Indonesia

18) Australia

19) Argentina

20) Egypt

21) Malaysia

22) Saudi Arabia

23) Thailand

24) Netherlands

25) Poland

26) Peru

27) Iran

28) Colombia

29) Switzerland

30) Pakistan

HSBC did add one caveat to the analysis stating, "…we assume governments build on their recent progress and remain solely focused on increasing the living standards for their populations. Of course, this maybe an overly glossy way of viewing the world."

You think?

Lagniappe

2012-01-10T15:59:00.000-08:00

Step away from the cupcake! In its never-ending mission to keep American travelers safe from dessert and pastry products, the TSA confiscated a woman's cupcakes in the Las Vegas airport last month. Once the agents determined the woman was (probably) not a terrorist, she was allowed to board her flight. The cupcakes were defused and the plane landed safely, thanks to the agency's tireless efforts. When asked about the incident, TSA spokesperson Bob Burns stressed that "…this wasn't your everyday, run-of-the-mill cupcake…," and that there have been "two very real liquid related incidents from the past." Mr. Burns did not specify the number of dessert-related incidents from the past, but it's reassuring to know that our government is taking the threat of chocolate frosting attacks very seriously.

Be afraid, be very afraid – On January 2^nd, CNN "journalist" Dana Bash stated on-air that's she's worried about the risk of Ron Paul doing well in the GOP primary. "I'm sure you talk to Republicans who are worried as well, just like I am [emphasis added] that Ron Paul will continue on long into the spring and summer…He could really hurt whomever the Republican nominee is because, still, nobody thinks, even if he does well here in New Hampshire, that he will ultimately be the nominee." Revolution PAC, a group that supports Ron Paul, has called for CNN to reassign Ms. Bash to other duties, and has asked those who agree to call CNN at (404) 827-1500 to let them know.

How conservatives and libertarians differ, by Rick Santorum - "One of the criticisms I make is to what I refer to as more of a Libertarianish right. They have this idea that people should be left alone, be able to do whatever they want to do, government should keep our taxes down and keep our regulations low, that we shouldn't get involved in the bedroom, we shouldn't get involved in cultural issues. That is not how traditional conservatives view the world. There is no such society that I am aware of, where we've had radical individualism and that it succeeds as a culture." (Unless we count American society and culture).

I hope I get out of jail in time to celebrate the birthdays of the men who put me there – The world's youngest dictator, North Korea's Kim Jong Un, has decided to release an unspecified number of prisoners next month (unfortunately,those released will still have to live in North Korea). The move is timed to commemorate the birthdays of the two previous lunatic dictators from the Kim family, Mssrs. Il Sung (grand-daddy dictator) and Jong Il (daddy dictator). It shouldn't be too hard for the littlest Kim to locate a few parolees - prisoners are just about the only thing found in abundance in North Korea. It is estimated that the country holds as many as 400,000 prisoners, half of whom are political prisoners. If those numbers are correct, North Korea's incarceration rate would be approximately 1,739 per every 100,000 people.

More civilized countries have much lower rates, of course. For example, the UK's incarceration rate is 151 per 100,000. Germany's is 88. Japan's is 63. The incarceration rate in the United States? 751.

Well, at least we're not Pyongyang (yet).

Cutting off one's nose to spite one's face – Right-wing talk show host Mark Levin has threatened to defeat Rand Paul's re-election bid in Kentucky should Ron Paul decide to leave the GOP and run for President as a third-party candidate. He's worried that Ron Paul would take enough votes away from whomever the GOP eventually nominates to tip the election to Obama.

Personally I don't think it will matter one way or the other – the Republicans are shooting airballs in a match that should be a slam dunk. And I suspect that if Ron Paul were to run a third-party campaign, he would take far more votes away from Obama than from the GOP on the basis of his anti-war and civil liberties positions (positions that Obama campaigned on but later betrayed).

But regardless of how the presidential race shakes out, the GOP is still the minority party in the Senate. Levin's stated threat against a Tea Party-backed Republican incumbent seems an awfully counterproductive way to express his outrage over the senior Paul's hypothetical party disloyalty.

I wonder what clever revenge Mark Levin has in store for Gary Johnson?

If you can't beat 'em, sue 'em – Kodak is suing Apple. No word yet on whether that caveman guy from the Geico commercials is going to sue Bridgestone for violating his patent on the wheel.

The Left's Turn to Attack

2012-01-05T15:32:00.001-08:00

The neocon-dominated GOP's hatred of Ron Paul is well-established, and I've mentioned it here on numerous occasions. So it's not exactly news when the likes of Rush Limbaugh, Sean Hannity, or Mark Levin attack him. But Paul's stubborn refusal to follow Herman Cain, Tim Pawlenty, and Michele Bachmann out of the limelight is now starting to grate on the nerves of some Democrats as well. One would think that Dr. Paul's strong record on civil liberties, his opposition to the drug war, and his consistent denunciation of imperialist foreign policy and elective wars would buy the man a little sympathy from people who profess to care about such things - and in some cases it has. But by and large the professional left is showing how little the issues actually mean to them in practice. Whatever importance they may assign to those worthy values pales in comparison to their primary objective of ever-larger government, and they correctly perceive Ron Paul's brand of libertarianism as a threat to their dream of a warm-and-fuzzy totalitarian state.

Case in point is an interesting article from Michael Lind over at Salon.com titled "Race, Liberty, and Ron Paul." At least I found it interesting. (Then again, I always find it interesting when hyper-educated people like Mr. Lind make such poorly reasoned arguments in public).

The angle of attack, naturally, is Dr. Paul's alleged racism, as evidenced by the fact that he does not believe the Civil Rights Act of 1964 was absolutely, positively, 100% perfect. That he feels there may have been some unintended consequences associated with the Act is a heretical idea, and Mr. Lind is determined to burn Ron Paul at the Salon.com stake for it. But Lind's piece is only superficially about Ron Paul. The real thrust of the article is a broadside against libertarianism in general, and I feel his claims merit closer analysis than the average Salon.com reader (as evidenced by the comments section) seems willing to give. There's at least one problematic statement per paragraph – but please read the entire article first just to make sure I'm not taking things out of context.

Here's the starting point:

Appearing on CNN's "State of the Union" on Sunday, Paul explained that the Civil Rights Act of 1964 "destroyed the principle of private property and private choices" and "undermine[d] the concept of liberty." The candidate drew a direct line from the Civil Rights Act to illiberal legislation passed in the panic that followed the 9/11 attacks: "Look at what's happened with the PATRIOT Act. They can come into our houses, our bedrooms our businesses … And it was started back then."

Whether one agrees or not, Dr. Paul's analysis is hardly prima facie evidence of racism. As Walter Williams once wrote, "One does not have to be a racist to recognize that the federal government has no constitutional authority to prohibit racial or any other kind of discrimination by private parties. Moreover, the true test of one's commitment to freedom of association doesn't come when he permits people to associate in ways he deems appropriate. It comes when he permits people to voluntarily associate in ways he deems offensive."

Indeed. Moving on:

By equating the Civil Rights Act, which expanded American civil liberty, with the Patriot Act, which reduced it, on the grounds that both are federal laws with sanctions, Ron Paul displays the moral idiocy of someone who declares that a person who pushes a little old lady out of the path of a bus is just as bad as a person who pushes a little old lady into the path of a bus, because both are equally guilty of pushing little old ladies around.

There's definitely some idiocy here, but Dr. Paul is not the one displaying it. The problem is not pushing little old ladies into or out of the paths of buses. The problem is Mr. Lind assigning an equal moral value to the act of pushing a little old lady out of the path of a bus as he does to the act of saving the little old lady by pushing someone else into the path of the bus instead. Because that's how government operates – it can only help some people by harming others – and this is what libertarians object to.

Like other libertarians, Ron Paul does not understand American values. The American experiment is an experiment in creating and maintaining a democratic republic, not a minimal state. American political culture is founded not on the theories of Ayn Rand or Ludwig von Mises but on the reasoning of natural rights theorists like John Locke, for whom coercion in the service of communal self-defense is perfectly legitimate.

Neither Ron Paul, nor Ayn Rand, nor Ludwig von Mises ever objected to using government coercion in the service of communal self-defense – they just insist that the coercion be strictly limited to self-defense. In fact, they have all written extensively that some government is absolutely essential for maintaining a basic social structure. Perhaps Mr. Lind should try actually reading Rand and Mises before he writes about them – he might learn something about their positions. While he's at it, he may even want to pick up one of Ron Paul's many books – the man is a much better writer than public speaker.

While abuses of military and police power are to be guarded against, the idea that the military and police and government as such are inherently tyrannical, a familiar theme in libertarian and anarchist thought, is utterly alien to America's Lockean republican tradition.

Oddly enough, the idea that military and police and government are inherently tyrannical was not an utterly alien concept to the writers of, say, the Declaration of Independence, Common Sense, or The Federalist Papers. They penned rather lengthy warnings against things like war and standing armies, wrote lines like "Those are governed best who are governed least," etc. But I guess those nutters just aren't part of America's republican tradition. Maybe we should start taking down a few monuments.

Libertarians typically argue that only government, backed by military and police power, can be tyrannical.

I know a lot of libertarians, and I've never heard any of them make this claim. Libertarians do not dispute the existence of social hierarchies and power structures that often result in unfair treatment or disparate outcomes - they just view them as less of a problem than government tyrannies that have historically resulted in mass plunder and lots of dead people. Let's just call it a question of priorities.

Libertarians are not the brightest lights in the candelabra, a fact that is evident from the alternatives they tend to offer to public prevention of private abuses. For example: if you don't like working a hundred hours a week for twenty-five cents a day, then find another employer! It is obvious to intelligent people, if not libertarians, that more generous employers will price themselves out of a market whose standards are set by the most rapacious.

Mr. Lind's definition of "intelligent people" must not extend to those who understand basic economics. Wages are not determined by the generosity of employers, they are determined by marginal productivity. If you're working for twenty-five cents a day, it's only because it takes you a whole day to produce something that's worth more than a quarter to someone else. (I suspect it would take Mr. Lind substantially longer).

The other popular libertarian remedy for exploitation is to move somewhere else where you will be treated better. But what if you can't emigrate? Well, it seems, you must suffer your exploitation in silence, rather than enlist the aid of the law in restraining your thuggish employer, your predatory landlord, your exploitative banker or the vendors who sell you toxic food and dangerous products.

Actually, this is a great argument in favor of a more libertarian society. Whatever the difficulties in relocating away from an employer, landlord, banker, or vendor, they're nothing compared to the difficulties of relocating away from an oppressive government.

Some libertarians concede the legitimacy of government coercion in protecting property rights. But in doing so, these libertarians, like Ron Paul, give up any principled objection to government coercion. They simply want government coercion to be used for some purposes—protecting property rights—and not others—enforcing civil rights.

Actually, the vast majority of libertarians make this concession. Ron Paul makes it, Ayn Rand made it, and Ludwig von Mises made it. In doing so, they in no way, shape, or form give up their principled objection to the use of government coercion – they simply claim that it is immoral to use coercion against those who have not first aggressed against others. That a certain degree of coercion is necessary to maintain even a minimal state is, to them, an unfortunate fact of life – but it hardly provides Mr. Lind carte blanche to point government guns at anyone at any time for any purpose he deems worthy. And unlike Mr. Lind, libertarians do not make arbitrary distinctions between civil rights and property rights – they just understand the distinction between a right and a wish list.

Until the federal Civil Rights Act was passed, the coercive power of state and local governments was routinely used to enforce the "private choices" and "property rights" of racists. If a diner owner banned blacks from his diner, and blacks sat down at the counter and insisted on being served, then the diner owner could call the police, who, protecting the property rights of the owner, would drag the would-be black patrons of the restaurant off to jail.

Yes, and if another diner owner wanted to serve blacks and whites equally, he risked fines and imprisonment from those same police. The point of having segregation laws was precisely that some people did not wish to discriminate on the basis of race – if everyone did, there would have been no need for Jim Crow laws to force them to do so.

The straightforward way to interpret Paul's remarks on CNN is to read him as saying that bigoted property owners, like owners of restaurants, should to this day have the right to call on the coercive power of the police department to enforce their decisions to refuse to serve certain categories of customers on their property. Anti-semitic store owners, for example, should have the right not merely to put up a "No Jews" sign, but also to summon the police, at the taxpayer's expense, to arrest any Jew who insisted on entering the store.

A more straightforward interpretation would be that the Civil Rights Act of 1964 made a fundamental change to the way private property was treated by law. Prior to the Act, private property – whether a house, a diner, or an office complex – was private. After the Act, that same property was simply declared to be "public" and thus subject to a much greater degree of government control than before.

From his statement that the Civil Rights act "destroyed the principle of private property and private choices," I think his meaning is quite clear: civil rights legislation at any level—federal, state or local—should never have been passed. To this day, store owners should be free to call on the public police at public expense to drag blacks, Jews, or members of other groups that the owners do not like from their business establishments, in the name of property rights.

Again, this seems out of line with the statement presented. Although I don't know the man personally, my understanding of his principles would lead me to think that Dr. Paul would have fully supported a federal initiative that struck down the racially discriminatory laws that were imposed by state governments, but that left individual citizens free to associate as they saw fit – neither forcing people to accept one another, nor forcing them to avoid one another. It is certainly possible – indeed, highly probable – that many odious racist business owners would have continued to deny service to some customers on the basis of skin color. But then again, lacking the support of their state governments' Jim Crow laws, those business owners would have borne the full cost of their racism directly – and ultimately green would have been the only color that really mattered.

Should we be impressed if Paul says that as a personal matter he would oppose such things, while defending their legality? It is hard to see any daylight between an overt racist and someone who claims to oppose racism or anti-semitism, but also denounces the only effective ways to put a stop to them—that is, civil rights laws.

Is it really so hard to understand opposition to criminalizing everything with which one personally disagrees? So much for "I disapprove of what you say, but I will defend to the death your right to say it." Here again we see the statist's inability to conceptualize any means other than violence to solve social problems ("If the government doesn't do X, then X can't possibly get done!"). Libertarians, on the other hand, can envision any number of voluntary ways to achieve positive social outcomes, and those voluntary ways are solidly grounded in fundamental economics.

If you argue that private racism is bad but anti-racist laws are worse, and if you have no problem with the state's coercive power when it enforces racism but object to coercive state power only in the service of anti-racism, then you cannot complain when others draw their own conclusions about your motives (even if, unlike Ron Paul, you did not publish white supremacist newsletters for years under your own name).

Maybe not, but neither Ron Paul nor any other libertarian I know objects to coercive state power "only in the service of anti-racism." They object to pointing guns at people who have not first aggressed against others.

Abraham Lincoln dissected the sophistical rhetoric of people like Ron Paul, long before the noble word "liberty" was tortured into "libertarianism." In 1864, during the Civil War, he told an audience:

"The world has never had a good definition of the word liberty, and the American people, just now, are much in want of one. We all declare for liberty; but in using the same word we do not
all mean the same thing. With some the word liberty may mean for each man to do as he pleases with himself, and the product of his labor; while with others the same word may mean for some men to do as they please with other men, and the product of other men's labor. Here are
two, not only different, but incompatible things, called by the same name———liberty. And it follows that each of the things is, by the respective parties, called by two different and incompatible names———liberty and tyranny.

The shepherd drives the wolf from the sheep's throat, for which the sheep thanks the shepherd as a liberator, while the wolf denounces him for the same act as the destroyer of liberty, especially as the sheep was a black one. Plainly the sheep and the wolf are not agreed upon
a definition of the word liberty…"

Unfortunately for Mr. Lind's case, it is the libertarian who defines liberty as the right of "each man to do as he pleases with himself, and the product of his labor." As the t-shirt says, libertarianism is the radical notion that you don't own other people. Sometimes those other people might not act as we believe they should, but liberty means more than just the freedom to behave in ways approved by the government and Michael Lind. As is painfully clear from the Lind article, it is statists like him who define liberty as the right for "some men to do as they please with other men, and the product of other men's labor." After all, he's the one arguing for the right to use government coercion to control the property of those with whom he (and I) disagree.

There's no shortage of people who, like Michael Lind, oppose Ron Paul specifically and libertarianism in general. And I'm sure there are some people out there who can make legitimate points against both – as opposed to the litany of straw man arguments outlined here.

From what I've read, though, it seems that Salon.com hasn't been able to find any.

Bill Bonner on Government

2011-12-23T14:37:00.001-08:00

The Daily Reckoning's Bill Bonner has written a number of posts lately outlining his personal musings on the nature of government. They're good. Really good, in fact, so I thought I'd combine them into a single view here. The writing, of course, is all his (as anyone familiar with my vastly inferior work will immediately realize). If you haven't already, go The Daily Reckoning website and sign up for the free daily newsletter. You'll be glad you did. Enjoy…

A New Theory of Government

12/06/11 Baltimore, Maryland – Not much to report from yesterday. Dow up 78 points. Gold bouncing around.

All eyes are on Europe. If the Europeans can pull off a save…well, we're all saved. At least for a few weeks. Maybe through the holiday season.

The euro has been remarkably stable. It has never collapsed — despite all the talk of Europe falling apart. Apparently, people with money don't think it is in real danger. They think it is too important to let go. They may be right. And the more people talk about the 'end of Europe' the more it doesn't end. Instead of letting it go, the authorities become more and more stubborn in trying to hold it together.

It's hard to know how this will play out. But we feel we know how this week will go. Frau Merkel and Monsieur Sarkozy will put together a new plan… It will include promises of fiscal tightness along with monetary looseness. The EZ money is expected to put short-term investors' fears at ease. The fiscal austerity, it is hoped, will help long-term investors sleep better at night.

Governments will pretend to tighten up. The ECB will lower interest rates and print up some new ersatz money. What could go wrong? The combination of mendacity and counterfeiting should do the trick…for a while. The liquidity from the central bank will come like Christmas pudding, or perhaps more like spiked eggnog. It will put some cheer into the markets during this 'dark passage' of the winter solstice. And then, the promises of austerity will allow everyone to think that things will be fine in the long run too.

So…keep your eyes on Europe…and your hands on your wallet.

Meanwhile, the US is keeping its eyes on football games and the race for president. Newt Gingrich has pulled ahead in the Republican field. According to the papers, he's the only candidate that seems to know what he was talking about.

That is probably true. A man like Herman Cain was out earning a living…building a business…creating jobs. He didn't have the time to keep his eyes on every flimflam coming out of Washington. How could he be expected to know about every disastrous piece of legislation, wrongheaded policy initiative, regulatory meddle, and military boondoggle that has come down the pike in the last 30 years? Newt on the other hand, had not only his eyes…but his fingerprints…on practically every one of them!

That makes Newt the leader of the pack. Americans don't want a leader who admits that he has no idea of what is going on. They don't want an honest president who will offer to 'learn on the job.' They much prefer a professorial blow-hard who claims to have all the answers in advance… All he has to do is to speak with authority and confidence, even if he is saying absurd and obnoxious things.

And they can love a scalawag, too. But can they love one as un-loveable as Newt Gingrich?

How about this? A new theory of government.

"I can't lead. And I don't want to follow." — Martin Clark

Yes, dear reader, we've been thinking.

We have been disappointed with political ideas and theories of government. They are nothing but scams, justifications, and puffery. One tries to put something over on the common man…the other claims it was for his own good…and the third pretends that he'd be lost without it. Most are not really 'theories' at all…but prescriptions, blueprints for creating the kind of government the 'theorist' would like to have. Not surprisingly, it is a blueprint that flatters his intellect and engages his imagination.

But it does not answer the critical questions: Why do we let other people tell us what to do; are we not all equal? What is the purpose of government? What does it cost and what benefits does it confer?

You may find these questions have drifted far afield from our usually Daily Reckoning fare. But they've been on our mind. We're coming up on a major election in the US. Several men have come forward offering to take charge of the US government. Maybe it would be worth wondering what it is that they are taking charge of. And since The Daily Reckoning is free, we feel entitled to write whatever we damned well please.

Government is a fact. It exists. It is as common as stomach gas. It is as ubiquitous as lice and as inescapable as vanity. But what is it? Why is it? And what has it become?

We know very little about the actual origins of government. All we know, and this from the archeological records, is that one group often conquered another. There are skeletons more than 100,000 years old, showing the kind of head wounds that you get from fighting. We presume this meant that 'government' changed. Whoever had been in charge was chased out or murdered. Then, someone else was in charge.

Tribal groups, or even family groups for that matter, probably had "chiefs." They could have been little more than bullies…or perhaps respected elders. Over the millennia there were probably as many different examples of primitive 'government' as there were tribes. Some elected their leaders. Some may have chosen them randomly, for all we know. Many probably simply conferred leadership by consensus. Some probably had no identifiable leaders at all. But it seems to be a characteristic of the human race that some people want to be in charge…and many people want someone to be in charge of them.

In adversity, there was probably an advantage to having a leader. Hunts were often collective enterprises. There were also group decisions to be made…about how food was stored up or rationed out, for example, that would affect the survival of the whole group. Under attack from another group, a strong, able leader would make the difference between life and death.

We can guess that people enter into leader/follower roles today because they are programmed for it by evolution. Those who can't or won't…perhaps they died out many millennia ago.

We don't have to look back to the Last Glacial Period to see what happens in small political units. We can see them today. They are all around us. Every church has its governing board. Every community has some form of government. Every corporation…group…club…every place where humans get together seems to develop a political/social order. Rules evolve. Leadership arises. Informal groups typically yield to the strong personality. Juries try to control it. Families resist it. Dinner parties try to avoid it.

But that's just the way it is. Some people seek to dominate. Others like being dominated.

Trouble is, there is usually more than one person or one group that wants to do the dominating. This leads to conflict. Treachery. Murder. Rivalry. And elections. But let's not get ahead of ourselves. We're talking about the origins of government and trying to guess what they were like. On a small scale, we conclude, they were both extremely variable in form…and extremely limited in scope. That is, how much governing can you get away with in a small group? Not much. You can boss people around, but they won't take too much bossing. And there is always a rival bosser who is ready to topple the big boss if he should lose his popular support. In a tribal setting, we imagine that the strongest, fiercest warrior might have been able to set himself up as the governing authority. But he could be stabbed in the back as he slept…or even shot with an arrow in a hunting accident. Even in the best of circumstances, his reign wouldn't last much longer than his own strength.

In a small town, government proceeds tolerably well. There is not much distance between governors and the governed. The latter know where the former live…and how they live…and how little difference there is between them. If the governors over-reach, they are likely to find themselves beaten in the next election…or in the middle of the street.

But as the scale increases…as the distance between the governed and the governors increases…and as the institutional setting grows and ages…government becomes a bigger deal. More formal. More powerful. It can begin governing more effectively.

The first large scale, long-term government we know about was in Egypt. After the unification of the upper and lower kingdoms in about 3,150 BC, the dynastic period began. It continued for two millennia, not ending until the Romans conquered Egypt in 30 BC. We don't know exactly how government worked during those many centuries, but we know that a theory of government arose out of them. At the time, it was not considered a theory at all, but a fact. The ruler was divine. A god.

As a theory it is a good one. It answers the question: why should you take orders from another human being? In Ancient Egypt, the question didn't arise. Because Pharaoh was not another human being. He was something else. Precisely what he was…or what people thought he was…is not clear. But the archeological record shows that he was treated as though he was at least a step or two higher up on the ladder than the rest of us. If not a full god, he was at least a demi-god…a missing link between man and the heavens.

If that was so…and who are we to doubt it?…the theory holds together perfectly well. The divine authority is transmitted from heaven to man via his intermediary…the pharaoh.

You might think that would be the end of the story. It was not. There were Asiatic settlers moving in the delta area — the Hyskos — who apparently had a different idea. And the Thebans. And the Nubian. And the Assyrians. And the Hittites. And hundreds of years of internal warfare against dozens of different groups…not to mention the struggles within the divine families themselves.

If God had wanted his man on the throne, you'd think he would have done more to help him. Or at least you'd think he would have been a little clearer about who His man was. Why let people guess and rumble, trying to decide who is really God's choice? But who can figure the mind of God? Maybe the whole divinity hypothesis was just a lie. Maybe God liked to see His man get a workout. We can't know.

Pharaohs may have lived like lords. They may have governed like gods. But they died just like everyone else. And after the 30 dynasties, as counted by Menes, the whole system was kaput. Cleopatra Ptlolemy got herself rolled up in a carpet so she could spin out at the feet of Julius Caesar. She had a child by him…but then went over to Marc Antony's side. That proved a mistake. Caesar's nephew, Octavian, was better organized and a shrewder politician. Antony's army was beaten at Actium.

But the idea of a divine ruler survived. Antony had already begun to feel the blood of divinity pumping in his veins. And then, after he was out of the way, hardly had the half-god pharaohs gone to their graves in Egypt than the half-mad Caesars in Rome started to sprout wings…

More to come…

More on A New Theory of Government

12/07/11 Baltimore, Maryland – You'll remember from yesterday that we have some question as to the actual divinity of the Egyptian dynastic rulers. Certainly, either the Egyptians had some doubts themselves, or they were among the most impious people who ever lived. Pharaoh was supposed to be a god. He was supposed to be in charge of everything, even the annual flooding of the Nile, the weather…life, death, you name it. But that didn't stop him from getting the old heave-ho from time to time. Rival groups didn't wait for God to decide who would sit on the throne. Men fought it out.

We don't have any way of knowing about the pharaohs' divine bona fides. We just note that as a theory of government, it does the job. Government claims the right to tell you what to do. Using the blunt instrument of 'government' some people are able to categorize, regulate, tax, inspect, dragoon, conscript, enslave, bully, incarcerate, murder and push around other people. Why do the other people stand for it? That's the general subject of these little reflections.

There must be at least 10,000 commandments we Americans are expected to obey. The IRS code probably has that many alone. We cannot build a house or cash a check without fulfilling hundreds of (often invisible) requirements. We pass through an airport and we submit to indignities, usually without question. We know the TSA agent is a moron. But "dress'd in a little brief authority," as Shakespeare put it, "most ignorant of what he's most assur d, glassy essence, like an angry ape, plays such fantastic tricks before high heaven, as make the angels weep."

Whence cometh that authority is our question.

If it comes from God, who are we to question it? We accept God's authority, at least when He's looking. And if Pharaoh were divine, we would have certainly buckled to his power too. How could we do anything else?

And yet, many people did not. For the two thousand years of the 30 dynasties, men killed each other to determine who would hold the pharaonic power. The last of them was clearly an interloper. The Ptolemies weren't even Egyptian. They were Greeks, who conquered Egypt with Alexander. Then, finally, Julius Caesar and his nephew Octavian put an end to the divine tradition in Egypt forever. God either abandoned His man on the Nile, or he is playing tricks with us.

Caesar took the role of emperor of the whole Roman world. He did not seem to be too concerned about the theory of it. People bowed to him and paid tribute. That was how an empire worked. And he never had too much time to think about it anyway. He was cut down on the Ides of March at the age of 55 in 44 BC.

But the appeal of divinity did not die with the Ptolemies. Four score years after Cleopatra's death the emperor Caligula declared that he was a god. This didn't seem to take him very far. Romans came to the conclusion that he was not divine at all, but insane. He was murdered soon after by his own guards.

Rome struggled on for another 4 centuries. If there was a theory to dignify one man's bending to another we aren't aware of it. It was considered normal and natural. Those who got control of the government of Rome were able to exercise the rights of governors. They were victors on the field of battle…and in the halls and assemblies of Roman government.

What did they do with this power? "Ad victorem spolias." Simple enough. You defeat someone. You take his stuff. His land. His wife. His children. At least there was no humbug about it. And the rules were simple. Government operated its naked form. As Mao described it two millennia later, political power came "from the barrel of a gun," not from the Rights of Man or the Social Contract.

In the exploits of Genghis Khan and Tamerlane, too, we find a very pure form of government at work…and a very clear theory about it. Genghis announced his theory of government as follows:

"Man's greatest good fortune is to chase and defeat his enemy, seize his total possessions, leave his married women weeping and wailing, ride his gelding, use his women as a nightshirt and support, gazing upon and kissing their rosy breasts, sucking their lips which are as sweet as the berries of their breasts."

Tamerlane was no less direct. He saw government as a legitimate enterprise. He raised troops with the intention of conquering other peoples and replacing their governments with his own. His warriors were paid in booty — jewels, coins, horses, women, and furs. He was paid in loot, tribute and taxes.

This is not to say that there was anything wrong with running a government in such a way. We are not giving advice or making suggestions. We are just trying to understand the essence of what government is.

In the case of Egypt, people listened and obeyed — at least, as much as they did — because Pharaoh was, in theory, a god. In the case of Rome — with the exception of Caligula's claims — and the Mongol empires, the theory was similarly simple, though different. Tamerlane made no claim to divinity. He merely made it clear what he would do to you if you resisted him. Towns that submitted were generally governed passably, according to the standards of the day…and taxed, but not razed to the ground. Those that contested his authority were destroyed, often with all the inhabitants killed.

In Rome and out on the steppes, those who controlled the 'government' were in the favored position. They could reach out and impose their will on those who were not favored. Which is exactly what they did. As long as they were able, the insiders took from the outsiders. In both cases, the outsiders were literally outside the ruling group and its homeland.

This is perhaps a good point to introduce our new theory about what government really is. It is a phenomenon, not a system. It is best understood as a fight between the outsiders and the insiders. The insiders always control the government…and use it to conquer and control the outsiders. Why do they want to do so? The usual reasons. Wealth. Power. Status.

Everybody — or everyone who isn't either feebleminded or a saint — wants wealth, power and status. And the easiest, fastest way to get it usually is to take it away from someone. That is government's role. Only government can take something away from someone else lawfully. Why? Because governments make the laws.

More to come…on the Divine Right of Kings…the Social Contract…and the Greatest Good for the Greatest Number….

More Governmental Insights: Insiders, Outsiders, and the Question of Divinity

12/09/11 Baltimore, Maryland – You'll recall that two days ago we introduced our new theory of government. Of course, we are not entirely serious. And not entirely unserious either.

But it hardly rises to the level of a theory. It is more like an insight:

Government is the natural phenomenon wherein the "insiders" take wealth, power and status from the "outsiders." They may provide a useful, even necessary, function — such as keeping the peace. Or they may not. They sometimes redistribute wealth among the outsiders. Sometimes not. They sometimes claim to be acting in the name of the greater good…and often do not. Sometimes they claim their privilege from God; sometimes, they don't bother. But they always take wealth, power and status from those who are not among the insiders.

We've already seen how a small group of Romans were able to reach beyond their home town, for nearly 1,000 years, taking wealth from people on the outside. One tribe fell under their control. Then another. Then, one town. And another. And always the power, prestige and wealth flowed back to Rome.

But not all Romans benefited in the same way. Rome itself was divided. During the Republican period the insiders were the leading families who controlled the Senate. Then came the dictators, the emperors, and the scalawags who were able to get control of the government. Often, they were military men, popular or cunning generals who rose through the ranks, murdered their rivals, and took the reins of power for themselves. Each brought in new insiders…and kicked out some of the old ones. Rome sizzled with intrigue…and sometimes erupted into open warfare, with one group of insiders battling it out with another.

After Rome fell, barbarian tribes swept over Europe. Local strongmen were able to set up their own governments. There was little theory or justification involved. They used brute force to take what they wanted. Then they settled down to govern. One local lord provided protection from other local lords. All demanded payment, tribute, wealth and power. In the largely un-moneyed economies of the Dark Ages, taxes were in the form of a share of output…and/or days of labor. A serf typically worked one day in 10 for his lord and master.

The local warlord and his entourage were the insiders. They took from the outsiders as much as they could get away with. Or as much as they thought it prudent to demand. Some even asserted a droit du seigneur, known in France by the more carnal expression "the right to the thigh." The local chief demanded the right to deflower the brides of his peasants. Even as recently as the beginning of the last century, Kurdish chieftains claimed the right to bed Armenian brides on their wedding night.

As the Dark Ages progressed, government became less locally peculiar. Across Europe, serfs, lords, and vassals knit themselves together into the feudal system. One governed a small area and was in turn governed by another, who governed a bigger one. At the top was the king, who owed his allegiance to God himself.

Justifying and explaining the phenomenon of government also evolved. How to make sense of it? Why was one man powerful and rich and another weak and poor? Europe was Christianized by then. All men were supposed to be equal in God's eyes. How come they were so different in the eyes of each other?

Reaching back into antiquity, the doctrine of the "Divine Right of Kings" was developed to explain it. Scholars did not maintain that kings were divine, because that would undermine the foundations of Judeo-Christian monotheism. Instead, they claimed that kings had a special role to play, that they were appointed…and anointed, by God (through his ministers in the church of St. Peter)…to rule. Some people thought the kings were descended directly from the line of Jesus Christ. Others thought that God gave kings a "divine" right to govern in His name.

In the fixed order of the world, each person had a job to do. One was a hewer of wood. Another was a drawer of water. A third was a king. Each man did his duty.

Scholars in the middle ages spent a lot of time on the issue. As a theory of government it seemed coherent and logical. But there were traps and dead ends in it. If the right to rule were given by God, man could not contradict Him. But men did. One divinely-appointed ruler met another divinely-appointed ruler on the field of battle. Only one could win. What kind of game was God playing?

And if God granted a man the right to rule other men, did that mean that every order he gave must be obeyed, just as though it had come from the mouth of God himself? And what if the king seemed not to be doing God's work at all? Adultery was clearly a no-no. God disapproved of it. But kings often made it a habit and a sport. Did not the king defile his body and betray his Lord? In an effort to explain away the problem, scholars put forth the idea that the king actually had two bodies. One sacred. One profane.

But which was which?

More to come…

On the Uses of Government

12/13/11 Baltimore, Maryland – "The Divine Right of Kings" was a theory of government that held water. But you had to put the water in the right container. You had to believe in God. You had to believe that He gave out job assignments. You also had to believe that He didn't mind when His employees and agents made a mess of things…or even when they contradicted His own orders. Looking at the history of the monarchs who were thought to have been given this divine authority, you would have to conclude that God was either a very tolerant task-master, or a very negligent one. Adultery, murder, thieving, lying — there was hardly one of God's commandments they obeyed.

As a theory of government, the 'divine right of kings' would have been okay had it not been for the kings themselves. Some were reasonable men. Others were tyrants. Many were incompetent, largely irrelevant and silly. Taken all together, it was very difficult to believe that they had been selected by God, without also believing that God was just choosing His most important managers at random. Kings were not especially smart. Not especially bold or especially timid. Not especially wise or stupid. For all intents and purposes, they were just like everyone else. Sometimes smart. Sometimes dumb. Sometimes good. Sometimes evil. And always subject to influence.

Towards the end of the 18th century, the 'divine right of kings' lost its following. The church, the monarch and the feudal system all seemed to lose market share. The Enlightenment had made people begin to wonder. Then, the beginning of the "Industrial Revolution" or the "energy revolution" made them stir.

In 1776, Adam Smith published his "Wealth of Nations," arguing that commerce and production were the source of wealth. Government began to seem like an obstruction and a largely unnecessary cost. Its beneficial role was limited, said Smith, to enforcing contracts and protecting property.

The school of laissez-faire economics maintained that government was a "necessary evil," to be restrained as much as possible. The "government that governs best," as Jefferson put it, "is the one that governs least."

Government was supposed to get out of the way so that the 'invisible hand' would guide men to productive, fruitful lives. Smith thought the arm attached to the invisible hand was the arm of God. Others believed that not even God was necessary. Men, without central planning or God to guide them, would create a 'spontaneous order,' which would be a lot nicer than the one created by kings, dictators or popular assemblies.

This theory of government, such as it is, leads to what we know of today as "libertarianism." Libertarians argue about how much authority the government should have. They scrap among themselves over what the government should do and how big it should be allowed to get. But all libertarians agree with Jefferson. And all agree that the governments in the world circa 2011 are much too big.

Here at The Daily Reckoning we are sympathetic to this point of view. Not that we are libertarians. We just don't like anyone telling us what to do.

But libertarianism is hardly a theory of government. It makes little attempt to explain why government is what it actually is. In fact, it is purely prescriptivist day-dreaming, focused on what government ought to be. In theory, a government ought to be small, say the libertarians.

Government ought to mind its own business, they say. It ought to sort out disagreements between members of the public…and protect the public from wrongdoing. It ought to have not to drain the resources and productive output of one part of the population for the benefit of another. But so what? Who cares what the libertarians want?

Throughout history, government has operated in pretty much the opposite fashion. The insiders who get control over the police power of the state use it to promote their own agenda. Sometimes it is an apparently selfless agenda. Adolf Hitler, for example, took little wealth for himself. Nor did Stalin raid the public treasury for his own benefit. Instead, each worked long and hard in the interests of his people. (It would have been better if they had been on the make for money. It might have distracted them.)

Whether the insiders want money or power hardly matters. If they seek money, they take it from the outsiders — those, by definition, who neither control nor are favored by the insiders. If they seek power, that too must be taken from someone. The outsiders pay, every time.

While the proto-libertarians focused on how much harm an activist government could do, the utilitarians, positivists, and collectivists turned their attentions to how much good it could do. According to John Stuart Mill and Jeremy Bentham, a government should provide the "greatest good to the greatest number."

Again, this was not a theory of government, it was merely an idea about what government should do. And a dumb idea, at that. Who knows what is 'good' and what is not? Only God…or people themselves. Since God keeps his own counsel, only the people can decide. But how? They can only decide if they are allowed to choose for themselves — how they will spend their time and their money. And the only way they can spend their time and money as they wish is if they are given the liberty to do so, which takes us back to libertarianism, the very creed to which the utilitarians, positivists and collectivists opposed themselves. They wanted an elite to decide what was 'good' for the masses.

Which, of course, is what really happens. The elite insiders decide what they want. They call it 'good.'

More to come…

The Diabolical Genius That Is Modern Government

12/14/11 Baltimore, Maryland – More on our new theory of government.

You'll recall that this series began by pointing out how worthless most "theories of government" really are. They're not theories at all. They don't explain anything. Instead, they are just wishful thinking…flattery…and apologia for the elite who use government for their own ends.

The "social contract," for example, is a fraud. You can't have a contract unless you have two willing and able parties. They must come together in a meeting of the minds — a real agreement about what they are going to do together.

But what is the 'social contract' with government? There was never a meeting of the minds. The deal was forced on the public. And now, imagine that you want out. Can you simply "break the contract?" You refuse to pay your taxes and refuse to be bossed around by TSA agents and other government employees. How long would it be before you got put in jail?

What kind of contract is it that you don't agree to and can't get out of? They can dress it up…print out a piece of paper…have a solemn ceremony in which everyone pretends it is a real contract. But it's not worth the paper it's not written on.

Also, what kind of a contract allows for one party to unilaterally change the terms of the deal? Congress passes new laws almost every day. The bureaucracy issues new edicts. The tax system is changed. The pound of flesh they got already wasn't enough; now they want a pound and a half!

Every theory of government we've come across is a scam. So we offer a better theory: government is just a way for the insiders to take advantage of the outsiders.

Until the Industrial Revolution, the apologists relied on God to justify government. If one man bossed around another, it was God's doing they said. The Almighty got the blame. Which was neat and clean as long as you accepted the major and minor premises of it.

But the system came apart for two reasons.

First, it made God look like a fool. Monarchs governed in ways that must have been inexplicable to the "divine right of kings" theorists. Kings were frequently incompetent, murderous and venal. Finally, the theorists gave the theory and the kings the heave-ho at the same time.

Second, the rising wealth and power of the productive classes required a new idea.

Insiders always use government to transfer power and money from the outsiders to themselves. When wealth was easy to identify and easy to control — that is, when it was mostly land — a few insiders could do a fairly good job of keeping it for themselves. The feudal hierarchy gave everybody a place in the system, with the insiders at the top of the heap.

But come the industrial revolution and suddenly wealth was accumulating outside the feudal structure. Populations were growing too…and growing restless. The old regime tried to tax this new money, but the new 'bourgeoisie' resisted. It wanted to be an insider too.

"No taxation without representation," was a popular slogan of the time. The outsiders wanted in.

There never is one fixed group of people who are always insiders. Instead, the insider group has a porous membrane separating it from the rest of the population. Some people enter. Some are expelled. The group swells. And shrinks. Sometimes, a military defeat brings a whole new group of insiders sweeping into power. Elections change the make-up of the core group.

But the genius of modern representative government is that it cons the masses into believing that they are insiders too. They are encouraged to vote…and to believe that their vote really matters. Of course, it matters not at all. Generally, the voters have no idea what or whom they are voting for. Often, they get the opposite of what they thought they had voted for anyway.

But the common man likes the humbug that he is running things. And he pays dearly for it. After the insiders brought him into the voting booth, his taxes soared. In America, with taxation without representation, before the war of independence, the average tax rate was as little as 3% or so Now, with representation, government spends about a third of national income. And if you live in a high-tax jurisdiction, such as Baltimore or New York, you will find your state, local and federal tax bill will run to nearly 45% of your income.

In short, the insiders pulled a fast one. They allowed the rubes to feel that they had a solemn responsibility to set the course of government. And while the fellow was dazzled by his own power…they picked his pocket!

It didn't stop there. Under the kings and emperors, a soldier was a paid fighter. If he was lucky, his side would win and he'd get to loot and rape in a captured town for three days. Relatively few people were soldiers, however, because societies were not rich enough to afford large, standing armies.

The industrial revolution changed that too. By the 20th century, developed countries could afford the cost of maintaining expensive military preparedness, even when there was not really very much to be prepared for. But the common man was skinned again. Not only was he expected to pay for it, still under the delusion that he was in charge, he also believed he had a patriotic duty to defend the homeland insiders! That is the real reason that the modern democratic system has spread all over the world. It allows the insiders to mobilize more of the resources of the country on their behalf. Nothing can compete with it.

But now the insiders are in trouble. The typical citizen is beginning to realize that he's been had. As long as the insiders could plausibly promise him more and more benefits, he was willing to go along. But now, growth has stalled. They can't deliver. The insiders keep borrowing — more than $10 trillion this year alone. Soon, they'll be out of credit…out of time…and out of luck.

Regards,

Power Corrupts

12/20/11 Baltimore, Maryland – This is the [next to] last in a series. We began by wondering how come some people get to boss other people around…

We're not talking about wives and husbands or employees and their employers. In those cases, the bossing is legit. Husbands ask for it. And employees can walk off the job anytime they like.

We're talking about people who have the right — by law — to tell other people what to do. The TSA agent…the policeman…the building inspector…the customs agent…the IRS clerk…the FDA…the CIA…the FBI…

It is a remarkable thing, don't you think, dear reader? It says right there in the Declaration of Independence that 'all men are created equal.' Equality under the law is supposed to be the law of the land. And yet, some people are clearly above the law…some give orders to complete strangers…and some people even claim the right to make laws any way they want.

There are laws that tell you not to murder…and not to steal. In the 10 Commandments given to Moses, God named 10 laws that he considered important. But the folks walking the floors of Congress, the EPA, the SEC, the IRS and a plethora of other government agencies have added 10,000 more commandments. 'Thou shalt' this… 'thou shalt not' that. You can barely go to the bathroom or drill an oil well, without asking permission from a dozen different bureaucracies. 'Ignorance of the law,' is said to be an ineffective defense. But it's a very effective explanation. There are so many laws, rules, regulations, edicts, commandments, prohibitions, interdictions, injunctions, requirements and obligations that you are bound to miss one or two of them.

The latest Defense Authorization Bill just passed by Congress shows how far the law-makers and law-enforcers will go. The doctrine of habeas corpus goes back to before the signing of the Magna Carta in 1215. It was an ancient Anglo-Saxon limitation on the power of government. If the feds held a prisoner, a writ of habeas corpus required them to "produce the body." The government had to either release the person or charge him with a crime. For more than 800 years, this gave people some protection against government.

But now, in the Year of Our Lord 2011, the Congress of the United States of America, with the complicity of POTUS, himself, has seen fit to deny the right of habeas corpus to American citizens. Henceforth, the feds can capture you, put you in prison and waterboard you every day for the rest of your life. They don't have to charge you with murder or jay-walking or any crime at all. They don't have to let you talk to a lawyer. Or to your spouse. Or to your Congressman… They don't have to read you your rights or provide any evidence against you. Like the Argentines in the '80s, they just 'disappear' you. And you're gone forever.

The Guardian reports:

Human rights groups accused the president of deserting his principles and disregarding the long-established principle that the military is not used in domestic policing. The legislation has also been strongly criticised by libertarians on the right angered at the stripping of individual rights for the duration of "a war that appears to have no end".

The law, contained in the defence authorisation bill that funds the US military, effectively extends the battlefield in the "war on terror" to the US and applies the established principle that combatants in any war are subject to military detention.

"It's something so radical that it would have been considered crazy had it been pushed by the Bush administration," said Tom Malinowski of Human Rights Watch. "It establishes precisely the kind of system that the United States has consistently urged other countries not to adopt. At a time when the United States is urging Egypt, for example, to scrap its emergency law and military courts, this is not consistent."

Rand Paul, a strong libertarian, has said "detaining citizens without a court trial is not American" and that if the law passes "the terrorists have won".

"We're talking about American citizens who can be taken from the United States and sent to a camp at Guantánamo Bay and held indefinitely. It puts every single citizen American at risk," he said. "Really, what security does this indefinite detention of Americans give us? The first and flawed premise, both here and in the badly named Patriot Act, is that our pre-9/11 police powers were insufficient to stop terrorism. This is simply not borne out by the facts."

So now the feds, whose salaries we pay, can spy on us with drones we paid for too. They can send a swat team to disappear us…and keep us in prison.

Our question is: 'what gives them the right?' What bread to these people eat? What air do they breathe?

We've seen the theories. We've seen them in practice too. The 'divine right of kings.' The 'social contract.' 'From each according to his abilities…' 'The greatest good for the greatest number.'

What they all have in common is that they are not theories, but apologia. One claims to know God's own plan. Another imagines that the powerless masses agreed to be pushed around. Still another pretends that it's for their own good.

Some of the excuses are implausible or unbelievable. Others are absurd. The 'theories' make no sense. But the facts are undeniable. And the fact is that there are always some people who are willing, ready and able to boss others around. Some rulers — the 'insiders' — are smarter than others. Some are nicer. Over time, you see all sorts. Their goal is always the same — to take power and wealth away from the outsiders. How much? As much as they can get away with.

You may wonder, for example, how come the governments of the developed countries all seem to be in the same deep hole of debt. If you listened to the politicians, for example, you might conclude that France and America were an ocean apart. Actually, overall tax, spending, and debt levels are similar in all OECD nations. And tax levels, generally, are about 10 times higher than they were in the last century. And their forms of government are about the same too — even though the insiders claim to have very different ideas about how to govern. So what happened?

The genius of modern democracy is that it makes the citizen a party to his own enslavement. Rather than give up 10% of his output to his feudal lord and master, he gives up 30% to 50% to his democratically-elected bosses. They tell him what to do. And he believes he is giving the orders!

And then, he believes he has discovered the best form of government in the world. It is so good he can't wait to force others to be democrats too.

What Government Really Is

12/23/11 Baltimore, Maryland – A theory should explain something without reference to something else. That is, a metaphor doesn't work. It's just a description. If you say that government is a kind of 'social contract,' you are merely describing how it seems to you…or what you think it might be comparable to.

Our theory is that government is a natural phenomenon, an expression of power relationships, in which some people seek to dominate others by force. These dominators gather 'insiders' together so that they can take money, power and status away from other people, the 'outsiders.'

Many people think that government provides some service. That is true, but it is incidental. Governments often deliver the mail. But they don't have to. They would still be governments even if they didn't control the Post Office. And what if they didn't have a department of inland fisheries, or a program to teach retarded democrats to count to 20? They would still be in the government business…and still have their helicopters, chauffeurs and expense accounts. But if they lost control of the police or the army it would be an entirely different matter. Force is the essence of government, not a decorative detail. Without armies and police, they would no longer be governments. It is "from the barrel of a gun," as Mao put it, that political power projects itself.

At the end of the 19th century, people were asked what they thought the new century would bring. Almost universally they predicted that government would grow smaller. Why? Because people were becoming much richer and better educated. The thinkers of the time thought there would be less need for government. People who were rich and well-educated had no use for government, they believed.

It didn't turn out that way. Because the thinkers misunderstood what government really is. They had the wrong theory. Government is not an organization that provides benefits and services, and therefore shrinks as the need subsides. Governments grew tremendously in the 20th century. Because they are essentially parasitic luxuries. As a society grows richer it can afford more illusions, more waste, more re-distribution of wealth, more regulation, higher taxes, and more unproductive government employees.

The outsiders take more, because there is more to take.

Bill Bonner for The Daily Reckoning

Sick Joke

2011-12-16T11:55:00.001-08:00

Evidently December 15^th is Bill of Rights Day here in the United States. Setting a day aside to celebrate the Bill of Rights strikes me as a bit anachronistic – it's like celebrating Electric Typewriter Day or National Commodore 64 Day. We no longer use the Bill of Rights, so why bother commemorating the date it was added to the Constitution in 1791?

I wasn't even aware that yesterday was Bill of Rights Day until the White House tweeted about it:

"Happy Bill of Rights Day! The US continues to stand with citizens & governments around the world who empower free expression. #FreeToTweet" @whitehouse

Someone "@ the whitehouse" is either completely ignorant of basic American civics, or has a wicked sense of irony. Either way, I thought it was a sick joke given the timing. Yesterday may have been Bill of Rights Day, but it was also the day that Congress passed the 2012 National Defense Authorization Act (NDAA)– a bill that, once signed into law by the "Constitutional scholar" Barack Obama, will completely eviscerate Amendments Four through Eight of the Bill of Rights, which state:

4. The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

5. No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

6. In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence.

7. In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any court of the United States, than according to the rules of the common law.

8. Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.

Of course that's just the Constitution's opinion. The 2012 NDAA, on the other hand, states the following:

The disposition of a person under the law of war as described in subsection (a) may include the following:

(1) Detention under the law of war without trial until the end of the hostilities authorized by the Authorization for Use of Military Force.

As well as:

(a) IN GENERAL- That the President is authorized to use all necessary and appropriate force against those nations, organizations, or persons he determines planned, authorized, committed, or aided the terrorist attacks that occurred on September 11, 2001, or harbored such organizations or persons, in order to prevent any future acts of international terrorism against the United States by such nations, organizations or persons. [Emphasis added].

As Glenn Greenwald of Salon.com points out, the language in this bill codifies indefinite detention without trial, expands the scope of the war on terror, and places US citizens at risk both at home and abroad. I'm not sure how anyone could pound the NDAA's square peg into the round hole of the Constitution, which is probably why they didn't even bother trying.

So Happy (belated) Bill of Rights Day, everybody! What a joke.

Hoisted With His Own Petard

2011-12-09T16:01:00.000-08:00

"I simply do not know where the money is, or why the accounts have not been reconciled to date."- Jon Corzine, December 2011

Oops. It appears that $1.2 billion has gone missing from the coffers of MF Global, the formerly solvent financial firm formerly run by the former Governor and Senator from the great state of New Jersey, Jon Corzine. And even though he doesn't know where the money went, he did tell the House committee that he was very, very sorry.

Corzine even went above and beyond his really, truly, heartfelt, and very sincere apology. Rather than taking the Fifth (as I'm sure his legal team begged him to do), Corzine told the committee that he was stunned when he first learned on October 30th "that MF Global could not account for many hundreds of millions of dollars of client money."

Of course, as CEO he was not involved in day-to-day trades, and therefore he couldn't possibly know where the money went or how. And since his resignation on November 3rd, he obviously hasn't had access to the information he would need to get to the bottom of things and crack this case wide open.

"It is extremely difficult for me to reconstruct the events that occurred during the chaotic days and the last hours leading up to the bankruptcy filing."

Completely understandable. And like Mr. Corzine I, too, am at a loss. After all, wasn't Sarbannes-Oxley put in place specifically to prevent these Enron-esque scandals from ever happening again? Often referred to as a "full-employment act for accountants," Sarbannes-Oxley imposed a heavy regulatory burden on businesses, requiring them to use external accounting firms for all their audits and reports. (SOX was a shining example of George W. Bush's commitment to deregulation). When he signed it into law, Bush declared the act to be one of "the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt."

And he was right. One of the key provisions of SOX was that it imposed criminal liability on CEOs who falsely certify corporate financial reports. Section 906 of the law specified that a CEO and CFO must certify that "the periodic report containing financial statements fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the periodic report fairly presents, in all material respects, the financial condition and results of operation of the issuer." There was no explicit mention that the certification be limited to what a CEO or CFO is "aware of," however, so basically the CEO and CFO can be held criminally liable for any misrepresentations contained within the documents, regardless of intent.

That's a pretty high standard, and the cost of compliance with SOX has been astronomical – estimates vary, but generally range from $100,000 to $1M annually per firm. So with all that money being spent and all those documents being signed, the question remains. How could $1.2 billion go missing from the accounts of MF Global customers? It's almost as if the legislation didn't do what its authors claimed it would do, and we all know that can't be right. George Bush himself told us "The era of low standards and false profits is over, no boardroom in America is above or beyond the law."

We'll see about that. I have no idea what Corzine did or did not know about the day-to-day dealings at the company he ran, but I do know that he was well aware of his liability as CEO under Sarbannes-Oxley. After all, he co-authored it.

Probably seemed like a good idea at the time. People were baying for the blood of corporate bigwigs, and politicians like Jon Corzine were only too happy to give the mob what it wanted, so they delivered up Sarbannes-Oxley, a type of Patriot Act for the business world. Like the Patriot Act, the various components of SOX had been rattling around the corridors of power for a while, and were hastily cobbled together and pushed through Congress without much debate or thought. It might have been prudent to stop for a moment to consider the impacts (for good or ill) that such a sweeping law would have, but no doubt those considerations paled in comparison to the need for the political class to be seen to be "doing something."

And now that Corzine may find himself on the pointy end of the law he helped write, I'm reminded of a line from Shakespeare's Hamlet (Act III, Scene IV):

"For 'tis the sport to have the engineer
Hoist with his own petard: and 't shall go hard"

Whether 't shall go hard for Mr. Corzine or not is still an open question. It's difficult to imagine him in the kind of perp walk normally reserved for private-sector thieves like Bernie Madoff. Corzine is a former Goldman Sachs guy with years of "public service" to his "credit." In short, he's as in as in can get.

Which brings to mind another line from that same scene in Hamlet. Hamlet is talking about Rosencrantz and Guildenstern, but his approach works equally well when dealing with anyone from the Goldman/government nexus,

"Whom I will trust as I will adders fang'd"

Newt Over Obama?

2011-12-08T17:59:00.000-08:00

My GOP friend (you know, the allegedly small-government guy who supports summary executions of American citizens based on nothing more than the say-so of a secret American Star Chamber) sent me an e-mail yesterday. In it he asked,

“I know you libertarians hate Newt, but will you vote for him over 0bama?” (He spells Obama with a zero to represent the number of jobs created in the US during the Obama administration).

I responded, “No.”

“So you're voting for another 4 years of 0bama?”

“No,” I replied. “Just wouldn’t be voting.”

“What’s the difference?” he asked.

I said, “When you vote, you're indicating (in a completely anonymous and meaningless way) that you support a particular candidate - or at least that's how it's interpreted. When you don't vote, you're not indicating that you support a candidate (though I grant that one's non-support is equally anonymous and meaningless).”

Since then I have given some more thought to the question of voting in general, and a potential Newt Gingrich nomination in particular:

Some general reasons to skip Election Day:

1. My vote (or lack thereof) is irrelevant. It will make no difference whatsoever to the outcome. I boldly predict (and you heard it here first) that Obama will win the state of California by more than one vote. Voting may be cathartic for some people, but they shouldn’t expect their vote to have any more impact on the fate of the Republic than a rain dance has on a drought.

2. Whereas the Democrats are overtly statist, the GOP goes to great lengths to be equally statist while trying to maintain a façade of limited-government principles (a façade that is quickly crumbling around their feet). The last thing the GOP will do is nominate a pro-liberty candidate - the one they’ve got is treated like a leper. Instead, they will nominate yet another neo-con. So regardless of which party wins the White House, the result will be the same. Federal spending, the regulatory burden, and the national debt will all increase. Civil liberties will continue to deteriorate, and the US government’s foreign policy will continue as it has. Bailouts, reckless monetary policy, and inflation will continue unabated.

3. I completely agree with my friend that, as predicted, Obama has been an unmitigated disaster. Then again, so was his predecessor, and his predecessor, etc. And although I hate the idea of another four years of this nimrod (and I really hate the idea of how the press will crow about an Obama re-election), I don’t see how replacing him with a different big-government guy would be an improvement just because he puts an “R” after his name. The Republican would just become the next unmitigated disaster. Even if I could distinguish which of the candidates would be marginally less awful, the lesser of two evils is still evil.

The specific reasons why I will not be voting for Newt Gingrich include (but are not limited to) the following:

1. In his own words, he’s “a Theodore Roosevelt Republican…I believe government can lean in the regulatory leaning [sic] is okay.” As any self-proclaimed genius historian should know, Teddy Roosevelt was a big-government Progressive who didn’t respect limited, constitutional government or the free market any more than his half-witted cousin, FDR (to whom Gingrich referred as "the greatest figure of the 20th century").

2. If his Wall Street Journal piece titled, “Lincoln and Bush” is any indication, his foreign policy views are downright frightening. (Check out Thomas DiLorenzo’s analysis on LewRockwell.com).

3. Gingrich supports escalating the war on drugs.

4. He supports socialized medicine.

5. He supports increased gun control.

6. He supports ethanol subsidies.

7. He supports government action on climate change. Whatever one’s position on climate change science, it is simply ludicrous to believe that governments – the world’s worst polluters by many orders of magnitude – can or will change global temperatures through taxation. (And as an aside, when Romney stated he believed the AGW theory, Rush Limbaugh said that position would cost him the nomination. I didn’t hear Rush’s explanation as to why Gingrich shouldn’t also be eliminated from contention after he sat on a couch with Nancy Pelosi to push the government to fight global warming).

8. Despite Limbaugh’s assertion that Gingrich was the last person “to actually cut government,” I can’t find any evidence to indicate that government actually shrank during his tenure as Speaker of the House. According to the Historical Tables provided by the Office of Management and Budget, total federal outlays (on- and off-budget) in 1994 were $1.46T. In 1995, that number grew to $1.51T. In 1996, $1.56T. In 1997, $1.6T. 1998, $1.65T. 1999, $1.7T, and so on. At no point do I see total expenditures decrease from the previous year. So much for the vaunted “Republican Revolution.”

9. He took millions from the pharmaceutical industry to push Bush’s expansion of the Medicare drug plan.

10. He took millions more from Freddie and Fannie to lobby for additional favorable treatment from the government in the lead-up to the mortgage crisis. (Of course, he doesn’t call it lobbying – the money was for “strategic advice”).

These positions all indicate that Gingrich is just as hostile to small-government, free-market principles as John McCain was (and is). And I suspect he will fare no better against Obama than McCain did for that very reason.

So on the night of November 5, 2012, turn off my alarm clock – looks like I’ll be sleeping in.

Rush, Heritage, and...Hayek?

2011-12-07T12:40:00.000-08:00

On his radio program the other day Rush Limbaugh gave a sales pitch for the Heritage Foundation, one of his show’s key sponsors. According to the organization’s website, the Heritage Foundation is “America’s most influential conservative ‘think tank,’ with 270 experts and staff based in Washington, D.C. Heritage experts passionately advance the conservative principles and ideas of America’s founding.” That certainly sounds in line with what one would expect from a sponsor of The Rush Limbaugh Show, but what struck me as odd was the particular inducement that Rush offered for listeners to join the Heritage Foundation. For a limited time only, Heritage is giving a free abridged copy of Friedrich Hayek's The Road to Serfdom (plus a free copy of the Constitution) with any gift of $25 or more.

During the spot, Rush did caution his audience that The Road to Serfdom was heavy stuff, but that it was definitely worth the read. He went even further to recommend Hayek’s The Constitution of Liberty (again, warning listeners that The Constitution of Liberty was potentially even heavier than The Road to Serfdom).

As regular readers are aware, I’m all for spreading the Hayekian word. But I was suprised to hear that Rush Limbaugh and the Heritage Foundation want it spread, too. The Heritage Foundation’s stated mission is “to formulate and promote conservative public policies.” Rush Limbaugh is known far and wide as the country’s leading conservative voice. So why are they so eager to promote Hayek, an avowed liberal (in the classical sense)? It’s a bit like NPR offering free copies of Ayn Rand’s Atlas Shrugged during a membership drive. After all, one of Hayek’s most famous pieces - contained within The Constitution of Liberty – is the essay titled, “Why I Am Not a Conservative.” In it, Hayek writes,

“It is that by its [conservatism’s] very nature it cannot offer an alternative to the direction in which we are moving. It may succeed by its resistance to current tendencies in slowing down undesirable developments, but, since it does not indicate another direction, it cannot prevent their continuance. It has, for this reason, invariably been the fate of conservatism to be dragged along a path not of its own choosing. The tug of war between conservatives and progressives can only affect the speed, not the direction, of contemporary developments. But, though there is a need for a ‘brake on the vehicle of progress,’ I personally cannot be content with simply helping to apply the brake. What the liberal must ask, first of all, is not how fast or how far we should move, but where we should move. In fact, he differs much more from the collectivist radical of today than does the conservative. While the last generally holds merely a mild and moderate version of the prejudices of his time, the liberal today must more positively oppose some of the basic conceptions which most conservatives share with the socialists.” [Emphasis added].

And here is the danger for today’s conservatives who wish to claim Hayek as one of their own – prolonged exposure to classical liberalism and the Austrian school of economics inevitably leads to the realization that modern “conservatives” and modern “liberals” are really just two sides of the same authoritarian coin. Despite its rhetoric to the contrary, conservativism has nothing to do with liberty. Like modern liberalism, conservatism seeks to impose its idea of a better society on the public by force – the only point of contention among the two groups is what constitutes that better society. Liberals may believe an all-encompassing nanny state is the objective, and conservatives may believe in an all-encompassing police state, but the two camps are in complete agreement that their vision of a better society can only be achieved through ever-larger doses of government coercion. Neither side is interested in real freedom.

Case in point, Rush finished his plug for the Heritage Foundation by saying that every elected official should be forced to read Hayek’s The Road to Serfdom and The Constitution of Liberty.

Ah, the irony...

Lagniappe

2011-11-22T20:15:00.000-08:00

Look - up in the sky! It’s a joke! It’s a farce! It’s the Super Committee! As expected, the Super Committee failed to agree on how to pretend to cut $1.2 trillion from the deficit over the next ten years. In order to achieve the stated objective, the committee would have had to reduce Federal spending by $120 billion annually (from Federal budgets in excess of $4 trillion each year). So even if they had succeeded, they still wouldn’t have made any discernable improvement to the government’s finances. Is there a word in English for failing to succeed in failing?

Landrieu Air – Senator Mary Landrieu (D – Louisiana) has sponsored a bill to prevent airlines from charging for checked bags. Think of it as a Dodd-Frank bill for the air travel industry. I miss the days when she was governor of the great state of Louisiana - at least then her incompetence only harmed the people in her state. As Senator, she gets to inflict pain on all of us.

Praise the Lord and Pass the Ammunition – Earlier this month CBS hosted a GOP debate focused exclusively on foreign policy. There were eight Republican candidates, seven of whom seemed to be engaged in a contest to see who could bay for blood the loudest, waterboard the most enemy combatants, or be the first to start a war with Iran. The one candidate in the debate who has consistently called for a non-interventionist foreign policy based on the Jeffersonian ideal of "peace, commerce, and honest friendship with all nations — entangling alliances with none," received ninety seconds of airtime. Because his views are just “nutty.”

Maybe They’re Focusing on the Wrong 1% – Two police officers have been placed on “paid administrative leave” (in the private sector, we call that “vacation”) for casually pepper-spraying a group of Occupy Wall Street protestors who were sitting down quietly on the UC Davis campus. This was not the only unpleasant interaction the Occupy movement has had with the nation’s police forces. An 84-year old woman in Seattle was also pepper-sprayed, tear gas was used against Occupy Oakland, and some New York protestors got the business end of police batons and riot shields as their encampments were broken up. And yet Occupiers still seem to believe the same government that’s beating them senseless will protect them from banks.

The Benedict Arnold of the Drug War - A US immigration officer was arrested for drug smuggling after leading Arizona police on a high-speed car chase for 45 minutes. During the chase he allegedly tossed 10-14 bales of marijuana out of his government-issued car. According to the Department of Homeland Security, 129 US customs officers and border agents have been arrested on corruption charges since 2003. (No word on how many TSA agents have been arrested for sexual assault).

Hey, That’s What I Said! – In a debate with a team of American lawyers in Philadelphia last month, British lawyers argued that the American Revolution was illegitimate. The British side invoked Lincoln to support their argument that secession “was not only illegal, but actually treasonable.” (A point I made back in 2010, in a post titled “Roach Motel”). Sorry, Justice Scalia, but you can’t have it both ways. If there is no right to secede, then the entire American experiment itself is illegitimate. By the way, the “jury” in the debate sided with the American (i.e., secessionist) side.

A Chance To Be Consistent

2011-10-16T10:29:00.000-07:00

As I have mentioned before, I was invited to join a fantasy football league by a friend of mine. He had no interest in me actually playing fantasy football. Instead, he wanted an ally for the message board for his various internet flame-war debates with all the liberals in the league (he’s a hard-core Republican). So far, most of the topics have revolved around economics, and despite minor differences he and I have been pretty much in alignment.

But now the topic has turned to civil liberties, and my friend now finds himself debating me. Specifically, the topic is the al-Awlaki killing, and I find myself in the rather bizarre position of having to convince someone that the US government really shouldn’t be able to kill US citizens without due process. Admittedly, I’m not very good at working blue or hurling the random ad-hominem attacks as is customary in our league, but I do make the attempt from time to time. Here’s the debate so far – I’ll leave it to the reader to determine which of us has the better argument.

Boulder Drunken Irish (my Republican friend)
You guys in this league, and it was everyone but me, completely freaked out when under Bush, Jose Padilla was detained indefinitely after he attempted to detonate a dirty bomb on U.S. soil. I believe your arguments were that Padilla's rights to due process were violated. Forget the fact this guy had valuable intel and by allowing him to lawyer up would have jeopardized our ability to obtain that intel. Anyway…

Fast forward a few years and your guy Obama is in office. Last week Obama targeted and killed American born Al Quida terrorist Al-Awlaki. Now keeping w/ the same standards you held GW to, this would be a perfect example on a much larger scale of an Americans right to due process being violated.

So I would expect the league to decry such behavior and demand congress to impeach Obama……

No, nothing…. awful quiet in here….

Now me being consistent in my views. I was in favor of how the government handled Padilla under Bush. Today I say bravo to Obama for giving the green light to smoking that mofo Al-Awlaki.

Interesting article here by Reuters detailing a secret panel used by Obama to approve the killing of American citizens. Rush Limbaugh better look out…

http://www.reuters.com/article/2011/10/05/us-cia-killlist-idUSTRE79475C20111005

You guys should be outraged… Outraged I Tell You!!!!

Your Mom Plays Fantasy (Liberal #1)
I'm all about detaining f***heads. Torture 'em with blowtorches, pliers and heavy metal. Your narrow minded views on everything has once again backfired on yourself. Because you think of me as a liberal or whatever you call them these days, you assumed that I would be against detaining Padilla forever. WRONG mijo!

Smoke 'em all.

Boulder Drunken Irish
Your Mom Plays Fantasy…

You’re amazing.

Bush does it badddddd.......

Obama does it gooddddd......

I took on the entire league regarding this subject and not once did you jump in and take sides w/ me. Now, like a good liberal you play the revisionist history card since like a typical liberal you were on the wrong side of history.

You’re a hack, like your junk science called global warning.

Your Mom Plays Fantasy
I don't recall the conversation, but if I was there and did not join your side, it was probably due to guilt by association. Meaning, you're a turd, and if I sided with you in front of all, then I'd smell like a turd. But I really don't remember ever discussing that...you turd.

California Sons of Liberty (Me)
Since I wasn't involved in the league during those earlier debates, I can't comment on what anyone here said at the time. I agree that the professional left in general has shown itself to be completely craven on this issue.There are some exceptions, such as Glenn Greenwald of Salon.com, who has been consistent on civil liberties regardless of what party controls the White House, but most of what I've heard from the likes of Chris Matthews, Rachel Maddow, etc. has been rank hypocrisy.

For example, on Hardball last Sunday Chris Matthews's only concern was how the al-Awlaki killing would help Obama next November. And he said that those who were concerned with the Constitutional issues were "out to lunch." So in his mind, it was wrong for Bush to wiretap Americans or indefinitely detain them without due process, but it is right for Obama to kill Americans without due process. Evidently the left is fine with a President who claims to be judge, jury, and executioner all rolled into one (as long as he soaks the rich and nationalizes health care).

I'll be the first to admit that I have been inconsistent on this. I supported Bush's post-9/11 expansion of executive power at the time. I've since come to realize that I was wrong, and that the left (at the time) was correct to raise concerns over the erosion of civil liberties in this country. Despite Obama's hope and change rhetoric, he's shown on numerous occasions (warrantless wiretapping, Gitmo, TSA, etc.) that he is fully aligned with Bush-era policies in this area. And now the "Constitutional scholar" has taken it a step further by creating an American Star Chamber.

I realize conservatives are generally quite comfortable with untrammeled executive power as long as it can be tied to national security in any way. But the principle that a single person in the government (or a small group of anonymous government advisors) can mark Americans for death anywhere in the world without so much as charging them with a crime, much less proving the charges in a court of law, should be deeply troubling (even if the way that principle was implemented in this particular instance isn't).

(BTW, I'm off to China this weekend, so I probably won't be able to discuss this for a while).

Boulder Drunken Irish
Steve…

Let me get this straight, you are advocating giving terrorists access to civilian courts, the same terrorists who are at war with the United States. You are also advocating mirandizing terrorists, the same islamo facist pigs who at war w/ this country. When in the history of this nation, other than now under Obama, have we acted so irresponsibly?

Wow, since you joined that narrow minded religion that is Libertarian, you have lost your fricken mind. Liberal… Libertarian… you both have something in common, short term memory.

Now run off to China....

(I believe it's on....)

Lager Monsters (Left-leaning independent)
This is actually a pretty interesting topic. The reason is because of what constitutes "at war." In years leading up to and including World War II, it was quite clear with whom we were at war, since Congress (and therefore, the people of the United States) was the entity who could officially declare war.

The reason was that our country went to war with nation-states, not with people or shadowy organizations. As we all know, in times of war or "in cases of rebellion or invasion the public safety," it is possible that habeas corpus can be suspended. But how do we know where to draw that line?

This was why everyone questioned the Padilla case. What nation did Padilla represent? Under what nation's orders was he acting? Padilla didn't fit into the ready-made nation-state box that all of our laws were written around. Whatever his motivation, whatever his affiliation with al-Qaeda, basically he was just a dude who wanted to kill lots of people. If we can detain Padilla indefinitely without representation, the thinking went, why give any suspected murderer a lawyer? Just execute them. But by introducing Islamic terror into the equation, you can get away with it.

But we are at war with terror! We are at war with al-Qaeda! OK, but then how do we define "terror"? Who is in al-Qaeda, exactly? They don't exactly hand out passports like nations do. It would be like trying to determine who is in the Mafia.

Jose Padilla was obviously a danger to U.S. citizens. But so are a lot of other people. How do we determine who is eligible for representation and a fair trial and who is not?

I don't have the answers. For the last 10 years, as a nation, we have been trying to rewrite the rulebook. We're still working on it.

Boulder Drunken Irish
Lager Monsters...

A different kind of war means a different kind of rulebook. You can't compare conventional war w/ the war on terror. Terror is sponsored by many countries in and out of the Middle East. We can not go island (country) hopping as we did in the Pacific during WWII. Instead we need to strike where the threat is clear, present and real. Sometimes we may not know of the threat until days or even hours before the event happens. Therefore, to prevent the threat from happening, our intelligence agencies need to be creative and thinking outside the box. To treat this as a simple domestic police action and to be weighted down by bureaucracy would only hasten the threat to realization. We can not go back to the pre 9-11 mentality that allowed 9-11 to happen. As the 9-11 Commission pointed out, they were at war w/ us, we were not war w/ them.

Also, from the standpoint of constitutionality, it is my understanding that a time line for due process to occur has never been defined. Likewise, a speedy trial is not defined; correct me where I’m wrong. Padilla has since been granted access to lawyers and courts. So in my opinion, constitution upheld. Also, his relationship w/ Al Quida was established, he was not some random dude trying to kill people.

As for Anwar al-Awlaki, he gave up his constitutional rights when he moved to Yemen where he became a spiritual motivator for Al Quida and planned three terrorist attacks in the United States. It would have been irresponsible of Obama not to take out this threat, just as it was irresponsible for Clinton not taking out Osama when he had the chance back in 1996. We all know how that one ended…

California Sons of Liberty
You are advocating giving terrorists access to civilian courts, the same terrorists who are at war with the United States. You are also advocating mirandizing terrorists, the islamo facist [sic] pigs who at [sic] war w/ this country. When in the history of this nation, other than now under Obama, have we acted so irresponsibly?

Wow. One post and you’re already off topic. I offered no opinion on any of the items mentioned above. Your topic, if you recall, was about Obama’s extra-judicial killing of an American in direct violation of the Fifth and Sixth Amendments. Unlike you, I don’t actually trust Obama (or any government official for that matter) to manage my health insurance. I don’t trust Obama to manage government spending. I don’t trust Obama to make decisions about tax policy. I don’t trust Obama to “save or create jobs.” Hell, I wouldn’t trust Obama if he told me the sky was blue. So why would I trust him with the power of summary executions of American citizens? We all take it for granted that al-Awlaki was the evil guy he’s been made out to be (and for the record, I don’t doubt that he was). But the only things we think we know about al-Awlaki come to us from the guy who killed him. That’s hardly a legal standard that either small-government conservatives or civil libertarians are comfortable with – if they understand anything about the Constitution and why it was put into place, that is. Big-government types like you, on the other hand, can rest easy.

Sorry to jump back a bit – Lager Monsters, good points. Well said.

Lager Monsters
Boulder Drunken Irish, you and I feel much the same way. Your point of, "You can't compare conventional war w/ the war on terror" is absolutely spot-on and I agree 1,000%. My only issue is that when confronted with this new danger, it sometimes feels as though we are making up rules as we go along, which doesn't sit well with me, but at the same time, I understand that clear and present dangers to U.S. security have made it necessary to do so. Just don't ask me to be comfortable with it.

The "weight of bureaucracy," as you put it, is in many ways what makes the United States great. One person or one party (like the Communist Party in China) cannot go in and create drastic change overnight. The bureaucracy of Congress is intended to prevent this from happening. That was great in 1800 when threats were coming at you in a sailboat traveling across the Atlantic Ocean and you had the luxury of time. But we didn't go and completely rewrite the Constitution during the Cold War, which in my opinion, presented a threat of much greater widespread destruction than terrorism, and we should not do so now. But I get it -- a bureaucracy isn't much help in the face of terrorism.

Regarding Padilla, I was not trying to make the case that he was random. He definitely had ties to al-Qaeda and deserves what's coming to him, no question. My point was that in many ways, al-Qaeda itself is a pretty random organization in and of itself. Where is its headquarters? Does it have any rules or laws? Is there a regimented procedure for a person to become a member? I'm not a terrorism expert, but I'm guessing the answer to these all of these questions is no. That's the whole point of al-Qaeda -- it is a shadowly, loosely constructed organization with no center (not unlike the Mafia), which is what makes it so difficult to destroy.

Also, from the standpoint of constitutionality, it is my understanding that a time line for due process to occur has never been defined. Likewise, a speedy trial is not defined; correct me where I’m wrong. Padilla has since been granted access to lawyers and courts. So in my opinion, constitution upheld.
It is true that "due process" and "speedy trial" are not defined by the U.S. Constitution, but if you were arrested for a non-terrorist crime and held for three years without being formally charged of a crime, I don't think anyone would find that "speedy" or following "due process."

While a time-table for those phrases was never formally set by the Constitution, all you need to do is look at how those rules have been defined in the millions of cases that have been brought to court previously. Padilla was not treated the same way as others who have been arrested, nor was there a plan of what we were going to do with the guy at the time of his arrest. Yes, he got access to lawyers and courts, but only after the Supreme Court stepped in and said you have to charge him or let him go. This was the whole reason for the outcry. Obviously, Padilla also was not a run-of-the-mill criminal, which was what made the detention necessary.

But this gets back to my original point -- how do we determine who is eligible for due process, lawyer representation and a fair and speedy trial, and who is not? Should there be a separate set of laws for terrorist suspects? If you believe the answer is yes, OK -- let's talk about what those laws would be. If the answer is no, you really can't support the way either the Padilla or al-Awlaki cases were handled.

Boulder Drunken Irish
Lager Monsters…

No disagreement on all your points. However, I will never cry for some terrorist who gets a MOAB up his ass, regardless of constitutional rights. However, I do agree w/ your concern over a potential slippery slope. As for being in jail for three days, I’m married w/ 3 kids, I could use the vacation.

Steve…

First, I am not off topic. You stated the following…

But the principle that a single person in the government (or a small group of anonymous government advisors) can mark Americans for death anywhere in the world without so much as charging them with a crime, much less proving the charges in a court of law.

There are two key phrases in your quote, “charging them with a crime” and “proving the charges in a court of law.”

-Charging them with a crime:

If you’re charging terrorists w/ a crime and placing them under arrest, you would read them their Miranda Rights. So you are advocating mirandizing terrorists, correct?

-Proving the charges in a court of law:

Sounds like you are giving terrorists access to civilian courts. Tell me where I'm wrong.

Second, you wrote, “Big-government types like you, on the other hand, can rest easy.”

I'm not the one advocating big government here, it is you. Lighting up some terrorist w/ a hellfire missile deployed from an unmanned drone is what I call efficient government. You advocating Miranda Rights and access to civilian courts for terrorists is big government. Not the mention the fact in most cases you’ll need to mobilize the military to arrest these terrorists, again more big government.

My approach is simple and efficient and can be summed up in one acronym, WWJBD.

California Sons of Liberty
If you’re charging terrorists w/ a crime and placing them under arrest, you would read them their Miranda Rights. So you are advocating mirandizing terrorists, correct?
It depends. If an alleged terrorist is arrested on US soil, then yes, Miranda applies. If an alleged terrorist is captured by military forces on a foreign battlefield, then the military would have jurisdiction.

Proving the charges in a court of law: Sounds like you are giving terrorists access to civilian courts. Tell me where I'm wrong.
Same as above. The specific venue may vary, but the due process requirement remains.

I'm not the one advocating big government here, it is you. Lighting up some terrorist w/ a hellfire missile deployed from an unmanned drone is what I call efficient government. You advocating Miranda Rights and access to civilian courts for terrorists is big government. Not the mention the fact in most cases you’ll need to mobilize the military to arrest these terrorists, again more big government. My approach is simple and efficient and can be summed up in one acronym, WWJBD.
Incorrect. The term “big government” refers to more than just the size of the federal budget or the number of public sector workers. It also incorporates the degree of control government has over the lives of its citizens. Due process is the cornerstone of western jurisprudence, and is probably the single most important restraint on government power. By casting that constraint aside just because Bush or Obama point a finger at someone and shout “Terrorist!” you’re actually granting the government the power of life and death over its citizens – and government doesn’t get any bigger than that. Your approach is simple-minded and can be summed up in one phrase, “Totalitarian dictatorship.” This is not a slippery slope. This is a precipice.

Boulder Drunken Irish
By casting that constraint aside just because Bush or Obama point a finger at someone and shout “Terrorist!” you’re actually granting the government the power of life and death over its citizens – and government doesn’t get any bigger than that.

Steve…

Can you give me an example where this has happened or are you just suffering from libertarian paranoid schizophrenia? Padilla got due process since he has had his day in court. Anwar al-Awlaki was on the battle field and as you stated above, the military has jurisdiction.

WWJBD

California Sons of Liberty
An example of what? Of the US government singling out a citizen for summary execution? You started this thread with the example. Padilla eventually got due process only because of pressure from civil liberties groups – from people making the same arguments I’m making now. Al-Awlaki got none. He was not on the battlefield, he was in Yemen. Had he been killed while engaged in hostilities against the US military on a battlefield in Afghanistan then there would have been no controversy. The expectation on the battlefield is that the military will break sh** and kill people - not that they will check the nationality of every insurgent who's shooting at them before returning fire.

Off the battlefield, or whenever the government takes prisoners, the government has a burden of proof that may not be dispensed with simply because you wet your pants every time you hear the word “terrorist.” That someone is a terrorist is precisely the thing that the government must establish in a court of law (civilian or military, depending on the circumstances) by a preponderance of the evidence. The government cannot simply allege a US citizen is a terrorist and then bomb his house. (Well, I guess it can now). This is not designed to protect terrorists, by the way. This is designed to protect you and me from arbitrary government power.

But despite our difference of opinion on this, I really do get where you’re coming from. Now that you’re on the Obama bandwagon, you don’t want to let a crisis go to waste. That’s understandable, and I suppose you can be encouraged by the fact that Obama has now killed more people – Americans and foreigners alike – than any other Nobel Peace Prize winner.

We just want different things. I want to live in a constitutional republic where my fellow citizens and I are innocent until proven guilty. You want to live in a banana republic where everyone is considered guilty until carpet-bombed. If it helps, you’re more likely to get what you want than I am.

Lager Monsters
Damn! Advantage, Stephen Smith!

Boulder Drunken Irish, did you know there is a group of people who are U.S. citizens who were responsible for killing over 10,000 Americans (nearly 3X the number who died in the World Trade Center) in 2009? All of the deaths were completely preventable. It would be very easy to profile the individuals who comprise this group. Much like a terrorist, there is no discernible pattern to when or why they kill. They strike randomly and without warning and are a very real threat to every American's personal security.

Do you believe that, whenever possible, we should arrest this group of people and deny them due process, a speedy trial and legal representation?

Boulder Drunken Irish
Steve…

Yemen is most certainly a battlefield in the war on terror. Terrorist attacks on the U.S. were planned from Yemen (and by Al Awlaki). Al Quida’s Arabian Peninsular division (AQAP) operates freely out of Yemen. Are you telling me that terrorists can now operate out of countries deemed by the libertarian party as safe heavens or non battlefields? What, are you guys now the ACLU for terrorists?

Al-Awlaki defected to Yemen and declared war on the U.S. He planed not one, not two, but three attacks on U.S. soil since 2009. Al Awlaki’s actions made him an enemy of the state. 0bama was acting entirely within his rights as the commander and chief to defend this nation from a foreign threat.

You wrote, “This is designed to protect you and me from arbitrary government power.”

Spare me the speech. Al Awlaki planned the failed Christmas day bombing of an airplane over Detroit (underwear bomber) and the attempted SUV bombing in Time Square. It was just dumb luck that those attacks weren’t successful. Next time we won't be so lucky. I may be on that plane or walking down that sidewalk. To take this threat out makes me safe, not your delicate sensibilities.

Lager Monsters…

Wow, you’re comparing the swine flu to 9-11. OK……

The swine flu strain called A-H1N1, which did the bulk of the damage in 2009, originates in pigs. Swine flu is also preventable. However, since you want to play this game, I’ll bite. To prevent swine flu we should round up all them pigs for slaughter. No big deal to me. “Pigs are filthy animals and I don’t eat pigs.”

You have anything productive to bring to this conversation?

Advantage me against all you biotches!!!!

WWJBD

California Sons of Liberty
Yemen is most certainly a battlefield in the war on terror.
No it isn’t. To accept “the entire planet is a battlefield” claim is to stretch the term beyond all meaning. There was no declaration of war against Yemen. The post-9/11 authorization for force didn’t cover al-Awlaki (or Samir Khan, btw) because no one has claimed they had any connection to that attack.

Terrorist attacks on the U.S. were planned from Yemen (and by Al Awlaki).
That’s what your Dear Leader has claimed, and you continue to accept allegations as proven fact. As long as you do, we’re going to continue to talk past each other. It’s probably true in this case, of course, but no evidence was presented, no due process granted before he whacked al-Awlaki. Al-Awlaki was on a kill list compiled by a secret panel within Obama’s National Security Council and Justice Department. How many more Americans citizens are on that list? Don’t know. What are the criteria for getting on that list? Don’t know. Where is the evidence? Don’t know.

Are you telling me that terrorists can now operate out of countries deemed by the libertarian party as safe heavens or non battlefields?
No one has said that suspected terrorists shouldn’t be pursued, stopped, punished. The only point of caution is that we not throw the Constitution out the window in the process.

Al-Awlaki defected to Yemen and declared war on the U.S. He planed not one, not two, but three attacks on U.S. soil since 2009.
That’s the allegation. Guilty until proven innocent (or summarily executed, whichever comes first).

Al Awlaki planned the failed Christmas day bombing of an airplane over Detroit (underwear bomber) and the attempted SUV bombing in Time Square.
So you’re willing to throw out centuries of western jurisprudence and the US Constitution over a guy who couldn’t even blow up his own crotch?

It was just dumb luck that those attacks weren’t successful. Next time we won't be so lucky. I may be on that plane or walking down that sidewalk. To take this threat out makes me safe, not your delicate sensibilities.
That’s basically the point of defending the Fifth and Sixth Amendments from these kinds of violations. Today the target is al-Awlaki, about whom no one cares. The next time we might not be so lucky. Because if we accept the premise you’re offering (the entire world is the battlefield, the executive branch can at its sole discretion kill anyone – including Americans - on that battlefield on nothing more than an allegation) then the lives of US citizens become subject to the whims of the federal government. You may trust Obama with that kind of power, but I don’t.

Your Mom Plays Fantasy
Do you guys ever spend time with your families? ****? This conversation is solving nothing. Talk some sh** about football!!!! Please, this is a football league. Lighten up.

Boulder Drunken Irish
Steve…

To accept your premise that we might… Might… be next, would require an Orwellian leap that I just don’t buy. I am not concerned because we still have the checks and balances in this country, as Lager Monsters stated above, that in my opinion will keep our elected officials in check. On that note, we still have elections. If you don’t like the fact that Obama used the powers provided to him under the constitution and greased some terrorist who happens to be an American living abroad, then vote him out.

Other reasons why I’m not concerned that the government will confuse me for a terrorist are as follows…

-I ain’t moving to Yemen to work for Al Quida (AQAP)
-I wasn’t the spiritual advisor to two of the 9-11 highjackers
-I don’t broadcast on-line to western Muslims encouraging Jihad against the U.S.
-I don’t have connections w/ or serve as the spiritual mentor to the Fort Hood Shooter, Underwear Bomber, and Time Square Bomber
-I haven’t been “accused” of training the Underwear Bomber

I think that’s it… oh wait, one more….

-I haven’t called for the murder of a U.S. Cartoonist simply because she drew a picture of Mohammed

Yeah, I think I’m pretty safe. I may drink and swear a lot, occasionally drive really fast, but other than that I have been a good guy. Therefore, I’m not afraid that Uncle O is coming to get me. We’ll, I am afraid he may be coming to get my money but other than that, I feel safe, especially w/ Al Awlaki six feet under…. or is he fish food like Osama?

One more thing... just because you can't convince me that I'm wrong, doesn't mean we are talking past each other. It means I don't buy what you're selling, hence a debate.

California Sons of Liberty
…we still have the checks and balances in this country…that in my opinion will keep our elected officials in check. ...If you don’t like the fact that Obama used the powers provided to him under the constitution and greased some terrorist who happens to be an American living abroad, then vote him out.
But you’re supporting the elimination of the single most fundamental check on our elected officials. Voting Obama out will do nothing to change the precedent that has been set, and that is what is most important. Plenty of people voted against Bush because of his stance on civil liberties, and what has it gotten them? A guy who took those abuses and expanded them. I don’t object to Obama using his powers under the Constitution. I object to him violating his oath to uphold the Constitution (not that he’s alone in that regard), as he obviously has in this case.

Other reasons why I’m not concerned that the government will confuse me for a terrorist are as follows…
I’m not worried I’ll be confused for a terrorist either. I’m concerned about how this precedent will be expanded over time by future administrations, and how the government’s burden of proof will be gradually eroded in other situations. That’s how government grows – incrementally and on the basis of precedent.

One more thing... just because you can't convince me that I'm wrong, doesn't mean we are talking past each other. It means I don't buy what you're selling, hence a debate.
Okay, good. Because for a while there it sounded like you couldn’t understand the distinction between allegation and proven fact.

A Hitman For All Seasons

2011-09-30T11:30:00.000-07:00

After the September 11th attacks, then-President Bush gave the CIA, and later the military, the authority to kill U.S. citizens abroad “if strong evidence existed that an American was involved in organizing or carrying out terrorist actions against the United States or U.S. interests.” How he managed to give them this authority in the first place remains a mystery, as it is brazenly unconstitutional. As the Sixth Amendment should attest, the drafters of the Constitution never intended to give a single individual – no matter how high the office – the power to execute American citizens on nothing but his own say-so:

“In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence.”

Like most post-9/11 assaults on our civil liberties, however, what little opposition ever existed to this grotesque expansion of executive power quickly vanished as soon as President Hope and Change was elected. After all, Obama was going to chart a different course than that of his predecessor. He was going to close Gitmo. He was going to close all secret CIA prisons and end rendition. When asked whether he agreed with the Bush administration’s assertion that US citizens could be held without charges, candidate Obama flatly stated, “No. I reject the Bush Administration's claim that the President has plenary authority under the Constitution to detain U.S. citizens without charges as unlawful enemy combatants.”

The more things change, the more they stay the same.

Whereas candidate Obama claimed to be deeply suspicious of the Bush-era expansion of executive power, President Obama clearly has no such qualms. With the extra-judicial killing of US-born al Qaeda leader Anwar al-Awlaki, Obama has shown that he now embraces the most egregious abuses of presidential “authority” – not merely in theory, but in practice as well.

And of all the precedents that have been set since the September 11^th attacks, it’s hard to imagine any more dangerous than the claim that a single person may, at his or her sole discretion, order the execution of an American citizen without any semblance of due process whatsoever.

I have no reason to believe al-Awlaki was innocent. I don’t think he was a good guy. I don’t actually doubt the government’s claim that he was an evil man who meant to do Americans harm. And I’m not going to shed any tears over dead terrorists. Then again, how do I know one way or the other? The government presented no evidence in court. There was no trial by jury to review the government’s claims or evidence. And yet he was targeted for assassination anyway.

When I heard the news today, I was reminded of a scene from the 1966 film, “A Man For All Seasons,” in which Sir Thomas More argues with William Roper over the importance of the rule of law.

William Roper: So, now you give the Devil the benefit of law!

Sir Thomas More: Yes! What would you do? Cut a great road through the law to get after the Devil?

William Roper: Yes, I'd cut down every law in England to do that!

Sir Thomas More: Oh? And when the last law was down, and the Devil turned 'round on you, where would you hide, Roper, the laws all being flat? This country is planted thick with laws, from coast to coast, Man's laws, not God's! And if you cut them down, and you're just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I'd give the Devil benefit of law, for my own safety's sake!

President Obama has now fulfilled President Bush’s threat to become Hitman in Chief - judge, jury, and executioner all rolled into one. Anwar al-Awlaki may indeed have been the Devil himself, but even the Devil should have the benefit of law – not for his sake, but for ours.

Elizabeth Warren's Anti-Social Contract

2011-09-22T14:02:00.001-07:00

“I hear all this, you know, ‘Well, this is class warfare, this is whatever.’ No. There is nobody in this country who got rich on his own—nobody.

You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory—and hire someone to protect against this—because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific, or a great idea. God bless—keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.” - Elizabeth Warren

Quotes like this make me think the pace of this country’s decline is accelerating. On the other hand, they do go to show just how far collectivists can go to rationalize stealing. In that vein, I’d like to take a moment to apply the “logic” of Ms. Warren’s quote to other areas. From her point of view, how could any limits ever be placed on the government’s “right” to loot the citizenry to whatever degree it wished? Wouldn’t the following hypothetical statement be completely in line what she said above?

“You ate lunch today? Good for you. But I want to be clear. You ate the corn that the rest of us paid for through farm subsidies. You were only able to digest your food because the rest of us pay for this country’s socialized medical system. (The fact that your money also went towards those things is of no consequence).

As there is no aspect of human existence upon which the government hasn’t imposed itself to varying degrees, there is no part of your life that is really yours. We own you, and don’t you forget it! That we allow you keep anything at all just goes to show you how wonderful we are, because rest assured the terms and conditions of the social contract are only what those of us in power say they are at any given time. We can and will change them whenever it suits us, and you serfs will just have to lie back and think of England when that happens.

And whatever you do, don’t call it class warfare. That kind of incivility has no place in the well-oiled plunder machine we call government.

I’m Elizabeth Warren, and I approve this message.”

World War II Did Not End the Last Depression. Star Wars Will Not End This One.

2011-08-30T19:34:00.000-07:00

I’m sure most readers of this blog have already heard Paul Krugman’s infamous “space aliens” claim by now. For those who haven’t, allow me to recap. During a recent appearance on CNN’s GPS with Fareed Zakaria, Paul Krugman stated,

“If we discovered that space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months.”

Although Krugman’s statement made for a great laugh line for anyone with a basic understanding of economics, it didn’t evoke much reaction from Mr. Zakaria, who quite correctly recognized it as a 21^st-century update of the old Keynesian notion that paying people to dig ditches and fill them back up again is as valid as any other economic activity. (Mr. Zakaria gave no indication that he understands how ludicrous such an idea really is, however). Indeed, the spending-for-spending’s-sake idea is one of the many fallacies that can be found throughout the entire body of Keynesianism - an economic theory that mistakes spending and consumption as the cause of, rather than an effect of, prosperity. Like most everything else from The General Theory, it’s nothing but a dressed-up version of the broken window fallacy.

Although most of the commentary in the blogosphere has been focused on Krugman’s claim that a massive deficit-fueled military buildup to combat a non-existent enemy from Nebulon 12 is exactly what the economy needs right now, I was more interested in the comment he made just prior to that.

“Think about World War II, right? That was actually negative social product spending, and yet it brought us out” [of the Great Depression].

I had to play back the video a couple of times, as I could barely hear the Nobel Prize-winning “economist” over the sound of all that breaking glass. To my mind, this was the more disturbing part of Krugman’s CNN debacle. After all, the spurious economic benefits of an imaginary alien invasion will be dismissed easily enough by Krugman’s mainstream intellectual opponents, but the idea that World War II ended the Great Depression seems to enjoy unshakable bi-partisan support. How many times have you heard conservatives correctly claim that New Deal spending failed to end the Great Depression, only to turn around and claim that WWII did? Basically they’re saying Keynesian government spending in the form of unemployment insurance and public works projects doesn’t work, but Keynesian government spending in the form of tanks, bullets, and bombs does.

At least Krugman has the good grace to be wrong consistently.

But regardless of whether a liberal or a conservative makes the claim, there are a number of conceptual problems with the idea that WWII ended the Depression (and for this I draw heavily from the work of Dr. Robert Higgs of The Independent Institute). I suspect this misunderstanding is so widespread simply because historians, most of whom lack a strong background in economics, rely on statistics from the period without understanding the key assumptions behind the numbers. Wartime statistics are especially problematic because all standard macro models assume the existence of functioning markets for the pricing of goods and services – markets that did not exist during WWII, when the US was operating under a command-and-control economy, not a market economy.

Adherents of the “WWII ended the Depression” theory typically point to the fact that GDP went up during the war and unemployment went down, and therefore the Depression ended because of the war (post hoc, ergo propter hoc). However, GDP includes government spending – a problematic notion in peacetime, made even worse in wartime. GDP is supposed to be a reflection of the nation’s economic output – output that is created to meet real consumer demand. During the war, government spending as a percentage of GDP (on munitions and other war materiel) increased dramatically, and those government purchases were treated exactly the same as private purchases of consumer goods. But there was no consumer demand for Sherman tanks and B17 bombers – these items did nothing to improve the well-being of the individuals who made up the economy. In addition, the prices paid by government for those goods were not based on market factors (nor could they be), so the dollars paid for them also skew the GDP numbers up.

The fact that unemployment decreased during the war is also completely meaningless in real economic terms. During the war the government pulled the equivalent of 22 percent of the prewar labor force into the armed forces. Not surprisingly, unemployment went down. When it comes to government statistics, a soldier is every bit as employed as a carpenter (another problematic feature of economic statistics). But that does not mean that the previously unemployed were suddenly better off once they had been drafted into the Army to get shot at for low pay in Europe, North Africa, and the Pacific theater.

Presumably this is what Paul Krugman meant by the term “negative social product spending,” and he evidently approves of it as a rational means of ending a depression. For the rest of us, however, “negative social product spending” just means blowing things up and killing a lot of people – and few psychologically healthy individuals would support that particular government policy as a legitimate means for reducing unemployment.

Another problem with relying too heavily on statistical extracts is that the numbers don’t reflect the privation suffered during the war as industry converted to munitions production at the expense of consumer goods. Rationing, black markets, wage and price controls, etc. all lowered the real standard of living for American citizens at home during the war.

It was not until after the end of the war – when government expenditures as a percent of GDP were dramatically slashed – that prosperity returned. This despite dire warnings from Keynesians at the time that such a reduction in government spending would send the economy back into recession. It didn’t happen. Instead, the reduction in government spending and the general (though by no means complete) relaxation of various New Deal and wartime government interventions in the marketplace freed up scarce resources for private-sector use, setting the stage for an economic recovery the likes of which has not been seen since.

I suppose one could defend the Krugmanite claim that America’s entry into World War II ended the Great Depression if one’s definition of recovery is merely the point at which government-generated statistics start to look better on paper. If, on the other hand, we define the end of a depression as the point at which individuals’ standards of living begin to improve in real terms, then only the end of WWII and the return to normal peacetime economic activity makes any sense.

War does not create prosperity, it destroys prosperity. World War II did not end the last depression, and despite Paul Krugman’s claims to the contrary, Star Wars won’t end this one.

Note: As regular readers have no doubt noticed, I’ve been posting less frequently lately due to time constraints. I’ve also dropped the domain site for the same reason. The www.abeginnersguidetofreedom.blogspot.com site is now the sole repository for my full-length posts. That being said, I am doing more on Twitter (@abeginnersguide) and Facebook (www.facebook.com/abeginnersguidetofreedom) these days, so check it out if you’re so inclined. Thanks!

The Regulatory Burden in Action

2011-07-13T20:59:00.000-07:00

Dear T-Mobile Customer:

As you know, T-Mobile, like many other wireless carriers, charges its customers a regulatory cost recovery fee. T-Mobile's Regulatory Programs Fee (RPF) is not a tax but is a fee we collect and retain to help us recover the costs associated with funding and complying with a variety of government mandates, programs, and obligations, such as enhanced 911 programs, number portability, and governmental requirements concerning the construction and operation of our network. These programs and the costs of compliance vary over time, as do the costs that T-Mobile includes in the RPF. Starting with bills after August 15, 2011, the RPF is increasing from $1.41 to $1.61 per line per bill cycle. Additional information about the RPF can be found in the Terms and Conditions for your account. T-Mobile's Terms and Conditions are available at www.T-Mobile.com.

Thank you for being a T-Mobile customer. We'll continue to provide our customers with the best services, features and benefits available in wireless.

Nothing Sooner

2011-07-12T17:29:00.000-07:00

Charles Riley of CNN/Money recently posted a piece titled, “Doh! A Bad Time for Spending Cuts?,” in which he frets over the impact that a reduction in federal spending might have on the economy. In the article Mr. Riley quotes Martin Baily, senior fellow at the Brookings Institution, who says,

“If we did make significant cuts over the next few years, it would put a drag on the recovery.”

That’s hard to imagine.

In the first place – what recovery? The Bureau of Labor Statistics just published the June job numbers – all 18,000 of them. And to add insult to injury, they also revised down the numbers for April and May (May numbers having been overstated earlier by roughly 200%). The official unemployment rate, U3, was bumped back up to 9.2%. The U6 rate, a broader measure of unemployment, now stands at a whopping 16.2%.

If this is what massive government spending does for an economic recovery, then I say the sooner we get rid of it the better off we’ll all be.

In the second place – who really believes Washington will actually cut spending? According to Mr. Riley’s article, any spending cuts would be phased in over the next decade or so - which is to say they won’t happen at all. The most any Congress can do is control its spending in the present session (and as history has shown, it usually can’t even manage that much). No Congress can restrain future sessions from doing whatever they feel is politically expedient at the time – including repealing any laws passed by earlier sessions that attempt to bind them to any sort of fiscally responsible behavior.

And let’s clarify our terms here. When you or I talk about cutting our spending, we actually mean spending less money in absolute terms. For example, if I spend $1,000 in September but only spend $900 in October, I’ve cut my spending. When politicians talk about cutting spending, however, they usually mean increasing their spending at a slightly reduced rate than they would otherwise prefer. So when Obama projects a $9 trillion annual deficit over the next ten years but then settles for an $8 trillion annual projected deficit instead, he claims a $1 trillion “spending cut,” even though spending in absolute dollars has gone up from one year to the next.

After the current debt-ceiling “debate” theatrics are over, which version of the term do you think we’ll be left with? Will next year’s budget be smaller than this year’s, or larger?

Semantics aside, the CNN/Money article makes a number of Keynesian assumptions that deserve to be examined more closely. The core idea, of course, is that government is (and should be) the prime mover in the economy. When aggregate demand falls, government steps in to spend money to make up the difference – thus taking money from taxpayers so that the government can do that which the taxpayers themselves have freely chosen not to do.

In the case of Obama’s 2009 American Recovery and Reinvestment Act, a significant chunk of that money went to state and local governments in an attempt to shield them from the unpleasant consequences of their own bloated budgets and fiscal irresponsibility. In essence the Federal government acts as the “heavy” by indirectly taxing current and future citizens and then funneling the money back to the states, which are spared the unpleasant task of shaking down the voters directly.

As Reason’s Tim Cavanaugh reports, for example, the State of California is getting almost a billion dollars from the ARRA to shore up its insolvent unemployment insurance fund – all because California made it easier for people to go on welfare. (If California were a separate country, this kind of thing would be handled by the IMF).

Such are the realities of a politically-driven, command-and-control economy. Money does not flow to economically rational projects. It flows to politically desirable ones instead, most of which are economically irrational. The wealth-destroying results should not be surprising. In fact, economists Timothy Conley and Bill Dupor have attempted to quantify the level of wealth destruction that may be attributed to the Obama stimulus program. According to their survey,

“…the ARRA created/saved approximately 450 thousand state and local government jobs and destroyed/forestalled roughly one million private sector jobs. State and local government jobs were saved because ARRA funds were largely used to offset state revenue shortfalls and Medicaid increases rather than boost private sector employment. The majority of destroyed/forestalled jobs were in growth industries including health, education, professional and business services.”

Saving state and local government jobs is a dubious proposition even in the best of times. During a protracted recession it becomes even more difficult to justify maintaining the parasitic class at the expense of the productive class - particularly when that maintainence comes at a cost of two private sector jobs lost for every one government job saved.

Given the devastating effects that massive government spending has had on our economy, the answer to Mr. Riley’s original question is clear. Now is the perfect time for spending cuts. No time like the present! According to a recent Reason-Rupe Poll, many Americans agree: 69% of those polled considered it “very important” to reduce the national debt. 17% said it was “important,” and another 10% said it was “moderately important.” And 84% want federal government spending cuts to be part of the solution.

Evidently the average American citizen is smarter than the average Keynesian economist.

It is said that one of the most influential proponents of the Austrian school of economics, Ludwig von Mises, was once asked what the government should do to overcome a recession. His answer was, “Nothing. Sooner.” And broadly speaking, this was the approach taken by the US government in every recession, depression, or panic prior to the Great Depression. Not surprisingly, whenever the government pursued a laissez-faire approach, those downturns were comparatively shallow and short-lived, usually ending within 12-18 months. As economic historian Thomas E. Woods, Jr. wrote in his article titled, “The Forgotten Depresssion of 1920,”

“The conventional wisdom holds that in the absence of government countercyclical policy, whether fiscal or monetary (or both), we cannot expect economic recovery — at least, not without an intolerably long delay. Yet the very opposite policies were followed during the depression of 1920–1921, and recovery was in fact not long in coming.

The economic situation in 1920 was grim. By that year unemployment had jumped from 4 percent to nearly 12 percent, and GNP declined 17 percent. No wonder, then, that Secretary of Commerce Herbert Hoover — falsely characterized as a supporter of laissez-faire economics — urged President Harding to consider an array of interventions to turn the economy around. Hoover was ignored.

Instead of ‘fiscal stimulus,’ Harding cut the government's budget nearly in half between 1920 and 1922. The rest of Harding's approach was equally laissez-faire. Tax rates were slashed for all income groups. The national debt was reduced by one-third.

The Federal Reserve's activity, moreover, was hardly noticeable. As one economic historian puts it, ‘Despite the severity of the contraction, the Fed did not move to use its powers to turn the money supply around and fight the contraction.’ By the late summer of 1921, signs of recovery were already visible. The following year, unemployment was back down to 6.7 percent and it was only 2.4 percent by 1923.”

It was not until the government’s experiments with massive interventionism, starting with Herbert Hoover, that depressions became “great.” The Hoover/FDR New Deal policies followed what would become the Keynesian playbook, spending unprecedented amounts of money to “stimulate” the economy. And what was the result? Historically high and intractable rates of unemployment, coupled with a massive public debt. It was not until the end of World War II – when the government slashed federal spending and eliminated many of its New Deal and wartime wage and price controls – that prosperity returned.

Much like CNN’s Charles Riley and countless others today, the Keynesians of the time all warned that steep cuts in the federal budget would send the economy back into recession after the war. It didn’t happen. The deep reduction in government spending and the general (though by no means complete) relaxation of government interventions in the marketplace freed up scarce resources for private-sector use, setting the stage for an economic boom the likes of which has not been seen since.

So which method should the government pursue in the face of the current recession? The hands-off approach that has historically allowed the economy to recover quickly and with less pain? Or the Keynesian approach, which has mired the economy in brutal and long-lasting stagnation?

For my part, I’d prefer the government do nothing – sooner.

Fourth Amendment - Void Where Prohibited by Law

2011-06-13T17:34:00.001-07:00

The claim that “the right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized” is simply untrue.

Anyone who has flown on a plane recently (other than Air Force One) knows that the Fourth Amendment has been relegated to the dustbin of history. Although writs of assistance were once grounds for Americans to revolt, today they are standard operating procedure.

And if being irradiated by porn scanners and sexually assaulted by blue-gloved goons isn’t violating the security of the people in their persons, then I don’t know what is.

Anyone who has conducted a financial transaction recently also knows (or should know) that the Fourth Amendment no longer applies to one’s papers and effects. No warrant is required, and no probable cause is needed for the Federal government to spy on private bank records. Customs officials now comb airports with cash-sniffing dogs to prevent people from taking money out of the country without the government’s say-so. Indeed, the very fact that an American citizen carries cash is often grounds for the government to seize it. In many cases, no charges are ever filed against the individual, yet the money itself is convicted of a crime and never returned to its rightful owner.

Anyone who has ever driven through the southwestern portion of the United States knows that the Fourth Amendment no longer prevents unreasonable searches. Scanners line the road to x-ray vehicles as they pass increasingly militarized checkpoints designed to spy on travelers to make sure they’re not transporting unapproved people or plants. Again, no probable cause needed, and no warrant issued.

Some may argue that the preceding examples don’t really mean anything. If you don’t want government agents to see you naked or feel you up, then you just shouldn’t fly. And if you don’t want your financial records scrutinized or your cash seized, then don’t keep your money in the bank – or on hand, either. And if you don’t want your car electronically searched by border guards, then just don’t drive.

To these arguments, I will only say three things.

First, may your chains rest lightly upon you.

Second, please explore the concept of “unconstitutional conditions.”

Third, direct your attention to two recent court decisions. The first is the US Supreme Court’s ruling in Kentucky v. King, in which they decided all that’s needed for the police to break into your home is the desire to do so. The vote wasn’t even close. Eight justices – including all of the alleged “strict constructionists” – decided that a man’s home is no longer his castle, and that the right of the people to be secure in their houses is simply a relic of a bygone era. Only Justice Ginsburg (hardly a consistent defender of individual rights) dissented, writing,

“The Court today arms the police with a way routinely to dishonor the Fourth Amendment’s warrant requirement in drug cases. In lieu of presenting their evidence to a neutral magistrate, police officers may now knock, listen, then break the door down, never mind that they had ample time to obtain a warrant.”

Continuing in her dissent, she states,

“In no quarter does the Fourth Amendment apply with greater force than in our homes, our most private space which, for centuries, has been regarded as ‘entitled to special protection.’…Home intrusions, the Court has said, are indeed ‘the chief evil against which…the Fourth Amendment is directed.’…

How ‘secure’ do our homes remain if police, armed with no warrant, can pound on doors at will and, on hearing sounds indicative of things moving, forcibly enter and search for evidence of unlawful activity?”

To ask the question is to answer it.

But the Kentucky v. King decision may be small potatoes when compared to the ruling handed down recently by the Supreme Court of the State of Indiana. The court, in a 3-2 decision, found that Indiana residents don’t even have the right to resist the unlawful entry of police into their homes.

In explaining the decision, Justice Steven David stated,

"We believe ... a right to resist an unlawful police entry into a home is against public policy and is incompatible with modern Fourth Amendment jurisprudence. We also find that allowing resistance unnecessarily escalates the level of violence and therefore the risk of injuries to all parties involved without preventing the arrest."

Let that sink in for a minute. Even when it is recognized that the police are breaking the law – either because they have a warrant but got the wrong house, or because they don’t have a warrant at all – citizens must simply lie back and think of England. By that logic, what crimes committed by the police would a citizen be justified in resisting?

And how long before the US Supreme Court upholds this interpretation?

Deep Thoughts

2011-03-20T08:19:00.000-07:00

“What would you think of someone who said, ‘I would like to have a cat provided it barked?’ Yet your statement that you favor an FDA provided it behaves as you believe desirable is precisely equivalent. The biological laws that specify the characteristics of cats are no more rigid than the political laws that specify the behavior of governmental agencies once they are established. The way the FDA now behaves, and the adverse consequences, are not an accident, not a result of some easily corrected human mistake, but a consequence of its constitution in precisely the same way that a meow is related to the constitution of a cat. As a natural scientist, you recognize that you cannot assign characteristics at will to chemical and biological entities, cannot demand that cats bark or water burn. Why do you suppose the situation is different in the social sciences?” - Milton Friedman

“One of the methods used by statists to destroy capitalism consists in establishing controls that tie a given industry hand and foot, making it unable to solve its problems, then declaring that freedom has failed and stronger controls are necessary.” - Ayn Rand

“No statute enacted by man can repeal the inexorable laws of nature. Our most dangerous tendency is to expect too much of government.” - Warren G. Harding

“We’ve never heard of a man who had 100 ounces of gold who was poor. On the other hand, we’ve read about millions of people with stacks of paper money who couldn’t afford a cup of coffee.” – Bill Bonner

“Federal legislators and administrators apparently cannot free themselves from the spell of Keynesianism. It has such a compelling attraction because it elevates to good economics the thing they like to do most — spend other people’s money.” – Hans Sennholz

“Any people, anywhere, being inclined and having the power, have the right to rise up and shake off the existing government, and form a new one that suits them better. This is a most valuable, a most sacred right, a right which we hope and believe is to liberate the world.” – Abraham Lincoln

“Peace will come to earth when the people have more to do with each other and governments less.” – Richard Cobden

“Nevertheless the theory of output as a whole, which is what [The General Theory] purports to provide, is much more easily adapted to the conditions of a totalitarian state, than is the theory of the production and distribution of a given output produced under conditions of free competition and a large measure of laissez-faire. – John Maynard Keynes

“The President does not have power under the Constitution to unilaterally authorize a military attack in a situation that does not involve stopping an actual or imminent threat to the nation.” – Barack Obama

No Silver Lining

2011-03-16T17:36:00.000-07:00

One of the difficulties with maintaining a blog like this one is the nagging feeling that I’m constantly repeating myself. After all, how many times do I have to go over the broken window fallacy in light of yet another news article that focuses solely on what is seen, while ignoring what is unseen?

At least once more, I guess.

We all knew this was coming, of course. Anytime there’s a disaster anywhere in the world, some halfwit starts yammering about how, in the long run, this latest tragedy will actually be good for the economy. As far as I can tell, Larry Summers was the first halfwit to weigh in on the earthquake and tsunami in Japan.

Unfortunately, he wasn’t the last.

On Wednesday, the team over at Liberty on the Rocks tweeted about a Huffington Post article by Nathan Gardels titled “The Silver Lining of Japan’s Quake.” Read the complete article at your own risk. It’s difficult to stomach on a number of levels. At its most superficial, it’s just really bad Keynesian economics (pardon the redundancy). At a more fundamental level, it illustrates the callousness toward individual human suffering that seems to be part and parcel of collectivist economic theories.

He starts off the article with the usual disclaimer, saying no one would minimize the grief, suffering and disruption caused by the disaster in Japan. And then he segues immediately into thirteen paragraphs in which he minimizes the grief, suffering, and disruption caused by the disaster in Japan.

Here are the lowlights:

“But if one can look past the devastation, there is a silver lining. The need to rebuild a large swath of Japan will create huge opportunities for domestic economic growth, particularly in energy-efficient technologies, while also stimulating global demand and hastening the integration of East Asia.”

There is no silver lining. Thousands of people are dead. The need to rebuild does not constitute economic growth. It may generate business for people in certain industries as Japan works to replace that which has been destroyed, but this is not growth. This activity will not be directed at expanding the country’s productive capacity. Rather, it will be directed at returning the country to the level of productivity it enjoyed prior to the disaster.

“Japan has been wallowing in stagnation for years despite massive government stimulus programs and zero-interest rates because, simply put, in such an advanced, mature economy there was too little demand to generate sufficient returns to attract private investment.”

Japan has been wallowing in stagnation for years because of massive government stimulus programs and zero-interest rates. The underconsumption theory of the business cycle was dispelled by James Mill and J.B. Say almost two hundred years ago, and is as relevant to economics today as alchemy is to chemical engineering.

“By taking Japan’s mature economy down a notch, Mother Nature has accomplished what fiscal policy and the central bank could not.”

So here we have a tacit admission that the Keynesian fiscal and monetary policies that the Japanese government has pursued lo these many years were actually intended to destroy the country. Why this is considered a laudable public policy goal is beyond me.

“Now there are more bridges to somewhere to be built than one can count. Entire cities and regions need to be reconstructed in toto, from housing and commercial buildings to roads, rail lines, information networks, the energy grid and even the tsunami warning system that must be digitally revamped…The result of all the new wealth creation will be money in the pockets of Japanese to buy global goods and services.”

The inescapable conclusion of this article is that destruction is good. So according to the Keynesian “logic” displayed by Mr. Gardels, we should immediately start dismantling our own cities and towns, and then watch how wealthy we all become as we rebuild all that we have destroyed.

Has there ever been a clearer (or more nauseating) example of the broken window fallacy?

So once again with feeling, so that even people like Larry Summers and Nathan Gardels can understand – DESTROYING WEALTH DOES NOT MAKE PEOPLE WEALTHY! Destruction, as the term would imply to anyone other than a Keynesian, destroys productive resources. It makes us poorer.

Granted, once the dust settles, there will be a flurry of business activity as Japan rebuilds. And after this long and bitter period of reconstruction, Japan will once again have what it had prior to the disaster. This will be seen. Japan will not, however, have all that is unseen – all the additional wealth that the people of Japan would have been able to create and enjoy had they not suffered a massive earthquake, tsunami, and nuclear catastrophe.

But the most important unseen consequence will be the loss of all that those who died would have created had they lived. We are all made poorer for that.