Laws of Liberty

Keynes vs. Hayek Part 1 and 2

2011-04-28T15:53:00.002-06:00

Part 1:

Part 2 is even better:

How 'CLICK-IT OR TICKET' Keeps You Safe

2010-06-07T23:45:00.002-06:00

Hypothetical situation:

Q: What happens if I get pulled over and I am not wearing my seat belt?
A: They write you a ticket and ask you to sign it

Q: What happens if I refuse to sign?
A: They will ask you to get out of the car

Q: What happens if I don't get out of the car?
A: They will pull you out of the car and taser you

Q: What happens if I resist and try to get away?
A: They will taser you again

Q: What happens if I continue to struggle until they run out of taser shots?
A: They will wrestle you to the ground and handcuff you

Q: What happens if I break free before I am handcuffed?
A: They will chase you

Q: What happens if I get in my car and manage to get away?
A: They will get in their car and chase you down?

Q: What happens if I don't stop?
A: They will ram your car

Q: What happens if I try to defend myself?
A: They will shoot you

Q: So, what is the reasonable conclusion of not obeying the seat belt law?
A: Your car gets wrecked and you get shot

Q: Why does this law make me more safe?
A: Because obeying it means you don't get shot

Intellectual Property

2010-05-29T23:23:00.003-06:00

I have been thinking a lot about intellectual property. No matter what your opinion is on the matter, or even if you have no opinion, I recommend a great piece by Stephan Kinsella. You can get an audio book version of it, as well as the pdf. There is no charge for this, since charging would almost be hypocritical, seeing as how the work is titled "Against Intellectual Property"

Here is a presentation given on IP as it relates to fashion. The conclusions she makes are very interesting.

Reductio Ad Absurdum: Immigration and Babies

2010-05-23T23:19:00.001-06:00

They're Coming To America
by Gene Callahan

Many libertarians have been far too complacent in the face of a growing threat to our cultural cohesion, our way of life, and our liberty. I'm talking, of course, about the thousands of people who arrive in our country everyday, hoping to make it their new home.

Those arrivals present us with a myriad of social problems. For the most part, they do not speak our language. They are unfamiliar with our culture. It will take time to assimilate them all, and the government's effort to promote multi-culturalism through the public schools and other government institutions can only lengthen that assimilation time.

Few of these strangers arrive in America with job offers in hand. The odds are high that many of them will rely, at some point in their lives, on government handouts. And studies show that the longer new arrivals reside in the country, the more likely they are to receive welfare.

They will make use of public transportation, public roads, public utilities, public schools, and so on, further straining resources that are already stretched thin in many cases. Their arrival results in a "dumbing down" of the public education system, prompting politicians to throw even more money at it.

All of the above means an increased tax burden on the productive members of society, many of whom already work over half their day to pay their federal, state, and local income taxes, sales taxes, excise taxes, tariffs, and fees.

Because of the lure of government largesse dangled before them, the new arrivals represent a ready-made voting block for a bigger state. Unfamiliar with the American tradition of limited government, the arguments against expanded social programs seem remote and abstract to them, while the benefits appear immediate and tangible. The resultant swelling of the class of tax consumers portends an ominous increase in the scope of the welfare state.

As we have time to watch them adapting to our country, we find their customs strange. Whether it is their music, dress, dating, or manners, their distinct cultures present what appears to be an unbridgeable gulf between them and traditional American life. Americans find themselves longing, as Peter Brimelow put it, "for some degree of ethnic and cultural coherence."

It is true that many of them will become productive members of the workforce. But, so long as there are people already living in our country who are without work, or stuck in menial jobs, it ill-behooves us to bring in newcomers to grab the good jobs that the economy does create.

Libertarians are correctly suspicious of any increases in government power. In the case of these new Americans, however, it should be clear that the cause of liberty is advanced, not retarded, by limiting their influx. So great are their numbers, and so enormous is the difficulty in assimilating them, that the current situation amounts to little less than a foreign invasion of our shores. Libertarians should at least be able to agree that as long as we have any government, its most essential role is to protect the nation from foreign invasion!

Of course, in a purely libertarian society, it would be property owners who would have the right to accept or reject anyone wishing to live on or otherwise use their property. But we don't live in that society. Property owners today are limited by law from excluding individuals from their place of employment due to affirmative-action and anti-discrimination laws, and from their neighborhoods by civil-rights legislation.

Simply reducing the number of arrivals allowed in the country each year would be a step forward. But given the vast numbers who have already arrived in the past two decades, it would be wiser to place a several-year moratorium on all new…

What's that you say? Immigration?! You think I've been talking about immigrants?

I've been talking about babies. What we need is a several-year moratorium on births. Our battle cry should be, "Outlaw babies, for the sake of our liberty!"

A History of Iran

2010-05-18T23:24:00.002-06:00

This is nearly ten minutes long, but definitely worth watching all the way through. Particularly watch for the part which imagines a reversal of American and Iranian situations and asks American viewers to consider what they would hope Iran would do in that scenario.

Lady Liberty

2010-05-05T23:42:00.003-06:00

Not like the brazen giant of Greek fame,
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
"Keep, ancient lands, your storied pomp!" cries she
With silent lips. "Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tossed to me,
I lift my lamp beside the golden door!"

-----Emma Lazarus

At the risk of insulting the intelligence of anyone who already understands the allusions made by this poem, I will share a few thoughts about it. This is an inscription on display inside the Statue of Liberty. It first makes reference to the Colossus of Rhodes, one of the ancient wonders. The Colossus was built to celebrate military victory--in stark contrast to the Statue of Liberty, a symbol of peace. Thus, America was to be a land which didn't stretch its limbs to conquer other lands. The poem depicts a land which stands as a beacon and example to other nations. Of course this is a far cry from what modern foreign policy tells us about "making the world safe for democracy" through military conquest.

America does not care for the "pomp" of the old world. It does not care for the nationalism, the pride, and the arrogance that characterized the nations of that time. America does not seek the fame and glory of empires nor the grandeur of ancient kingdoms. It cares only to "breathe free". How different is this from statements of "no apology" or "the power of pride", or even the declaration "I'm proud to be an American!"?

What does America stand for? America stands ready to accept all who come to be free. All who are oppressed and worn down by tyranny are accepted here. They can be of any color, race, or creed. They can come from any nation and speak any language. They come here to experience liberty and to afford the same to their fellow man.

Is this the America we live in today? What are our responsibilities if we would reclaim it?

Economically Feasible Asteroid Mining: !!

2010-04-16T00:36:00.003-06:00

According to the Interplanetary Superhighway concept, the gravity and movement of planets create a network of low-energy orbits which may be viable as efficient transit routes throughout the solar system. For her project, Erika DeBenedictis developed a software navigation system - based on an original optimizing search algorithm - that may help autonomous spacecraft better navigate these pathways.

Erika, a senior at Albuquerque Academy in Albuquerque, New Mexico, was a 2009 Davidson Fellow and first-place award winner in the New Mexico Supercomputing Challenge. The 18-year-old is also an accomplished pianist and vocalist, and hopes to attend Caltech or MIT.

A Note on Krugman

2010-03-06T20:36:00.006-07:00

The following comes from Creighton Harrington on the YAL Blog. I was just about to post something along these lines, but he says it pretty well:

The Problem with the "Expert"

...by "expert" I mean Paul Krugman. Here is a guy who is, essentially, the economic authority in America. He teaches at Princeton, won the Nobel Prize in Economics (which is almost as insane as Obama winning the Nobel Prize for anything), and, worst of all, preaches his Keynesian blather all over the New York Times for every impressionable would-be scholar to read.

Now, what has Krugman said that perterbs me so? Well, honestly, its just that he was mentioned in an article and it got me thinking about it again, but soon enough I was back to fond memories of Krugman preaching how wonderful our economy is, how we need to offset the dot-com bubble with a housing bubble, how interest rates need to go lower and lower and government spending needs to go higher and higher. And while every “expert” on Wall Street, at the Fed, and on the Hill is crying the same thing (except Ron Paul of course) while simultaneously mocking legit economists like everyone at the Mises Institute, Peter Schiff, and, to some extent, Jim Rogers for their archaic outlook on economics.

Oh how the tides did turn, but, yet, instead of the status quo moving to sanity, in comes Krugman preaching the same exact stuff!! Lower interest rates, spend, print more money, bailout, OR WE'RE ALL GONNA DIE!!!!!

One of his greatest feats, however, is to basically get people to believe in a false history. He always preaches about the laissez faire style of Hoover and the damage it did to the economy during the Great Depression, but everytime he is called out on how absolutely wrong that thought is, he, almost like a reflex, just adds, “he did too little too late.” That's why its so hard to convince people that Keynesians are wrong...they have academic credibility already, for one, and they also just fall back on the “if spending doesn't work then spend more and more and more ad infinitum.”

This guy is nothing more than a well respected con-artist who doesn't realize he is a con-artist, by which I mean he can promote extreme falsehoods everyday and when they fail, as they always do, it was not his advice that was insufficient, but some mistake by the other party. He has been wrong on nearly everything, a great example of which is Japan. If there is one historical example, outside of the Great Depression, that proves how Keynesian economics just fails miserably, it is Japan. This country tried every Keynsian trick there is to fix themselves, but to no avail. Even Krugman himself said they were doing the right thing when they tried to stimulate the economy via public works projects.

Over the past decade Japan has used enormous public works projects as a way to create jobs and pump money into the economy. The statistics are awesome. In 1996 Japan’s public works spending, as a share of G.D.P., was more than four times that of the United States. Japan poured as much concrete as we did, though it has a little less than half our population and 4 percent of our land area. One Japanese worker in 10 was employed in the construction industry, far more than in other advanced countries.

What baffles Krugman is how this failed miserably. Even as Japan nipped at the heels of “full employment,” interest rates were near zero, spending was running wild, and all the other Keynesian cures to the business cycle were being employed Japan still went nowhere.

And here we are. Another recession and more of the same old same old from Krugman. I don't think Krugman could ask for a more identical policy maker than Geithner and when healthcare finally blows over, they will have to answer for the failure they have had with the US economy. Hopefully when either the currency crisis occurs or the economy tanks again after whatever catalyst causes it it will be the final straw for Keynes, but I doubt it.

When Krugman finally opens his eyes and realizes how wrong Keynesian economics is and, instead, promotes sound fiscal policy where the Fed is gone, our money is backed with value not trust, fractional reserve banking is prohibited, and the government stays passive in spending, then we will never grow as a nation. Our economy will be plagued with cyclical depression after boom after depression until the world ends. People like Krugman are some of the most dangerous people to liberty because they are percieved as experts by everyone, yet they preach a doctrine that opposes liberty. I can only hope that this resurgence of interest in Austrian Economics stays strong and becomes the norm like it would have done had John Maynard Keynes not opened his mouth

Function of Profits: A Short Explanation

2010-03-01T22:47:00.002-07:00

Nuclear Weapons Reprise

2010-02-18T23:38:00.002-07:00

I saw this video the other day and thought about the discussion on
Nuclear Weapons and Iran a while back.

Health Care Competition

2010-02-16T22:37:00.003-07:00

Stossel has actually done several pieces on health care competition, and all the ones I have seen are really good. But what is up with his hair in this one?

Profit, Wages, and Capitalists

2010-02-07T21:55:00.006-07:00

Perhaps one of the most influential and popular economic theories over the past century has been the theory of exploitation. The theory, which found its footing, ironically, in the writings of Adam Smith, was mostly promoted by the writings of Karl Marx. The exploitation theory laid the groundwork for the more recent theories of Keynes and the overall prevalence of socialist economic policies in our society.

According to the exploitation theory, capitalism promotes a system of slavery wherein the labor of workers is exploited to attain profits on behalf of the relatively few businessman or capitalists. These capitalists are seen as parasites upon the masses. Never mind the steady increase in the standard of living and working conditions. If it weren't for government intervention and labor unions, we would all still be working for $1 per day and dying of black lung.
George Reisman* explains the framework of the labor theory of value, one of the main aspects of the exploitation theory:

This framework is the belief that wages are the original and primary form of income, from which profits and all other non-wage incomes emerge as a deduction with the coming of capitalism and businessmen and capitalists. The framework easily leads to the assertion of the wage earner’s right to the whole produce or to its full value. It itself is based on the further belief that all income which is due to the performance of labor is wages and that all who work are wage earners.

In order to illustrate this assertion, let us imagine a pre-capitalist economy, if there ever was such a thing. In this economy, each person is the sole producer of any given commodity. Thus, each person would sell his or her commodity for a price. According to this theory, all income received in this economy is supposed to be wages, not profit, because all income is received by workers. The conclusion Marx made from this theory is that profit did not exist before capitalism because all income was wages. Thus, the advent of capitalism brought profit, at the expense of the wages of the laborer.

Marx says that in this pre-capitalist economy, production follows the sequence C-M-C. That is, a worker produces a commodity (C), sells it for money (M), and then buys other commodities (C). Here there is no exploitation because there is no supposed profit; all income is wages. Profit, or surplus value, comes about with capitalism which follows the sequence M-C-M. The capitalist spends money to pay for materials, machinery, and wages, a commodity is produced, and the commodity is sold for a larger sum of money than it cost to produce. The difference is profit.

Many non-Marxist economists actually ascribe to this framework but reach differing conclusions about profit based on the law marginal utility and time preference. These arguments are valuable, but they miss the point: the framework itself is flawed and needs to be re-evaluated. The definitions of the terms profit, wages, and capitalist themselves serve in restructuring the idea of a proto-capitalist economy.

Profit is the surplus in money received from the sale of commodities over the money costs of producing them
A capitalist buys products in order to sell them at a profit
Wages are money received in exchange for the performance of labor--not the products of labor, but the labor itself

It follows from these definitions that if there were only workers who made and sold their commodities, the money received from the sale of their commodities is not wages, but profit. In buying commodities, one does not pay wages, and in selling them, one does not receive wages. These roles are performed by the capitalist. Now, in the strictest sense, the workers in this economy are not capitalists because they have incurred no money costs in the production of their goods. Still, they have acted as capitalists in that they sell their products, not their labor, for money. Thus, all income received is profit, not wages.
Reisman* explains again, better than I can:

Wages are not the primary form of income in production. Profits are. In order for wages to exist in production, it is first necessary that there be capitalists. The emergence of capitalists does not bring into existence the phenomenon of profit. Profit exists prior to their emergence. The emergence of capitalists brings into existence the phenomena of wages and money costs of production.
Accordingly, the profits which exist in a capitalist society are not a deduction from what was originally wages. On the contrary, the wages and the other money costs are a deduction from sales receipts—from what was originally all profit. The effect of capitalism is to create wages and to reduce profits relative to sales receipts. The more economically capitalistic the economy—the more the buying in order to sell relative to the sales receipts, the higher are wages and the lower are profits relative to sales receipts.
Thus, capitalists do not impoverish wage earners, but make it possible for people to be wage earners. For they are responsible not for the phenomenon of profits, but for the phenomenon of wages. They are responsible for the very existence of wages in the production of products for sale. Without capitalists, the only way in which one could survive would be by means of producing and selling one's own products, namely, as a profit earner. But to produce and sell one's own products, one would have to own one's own land, and produce or have inherited one's own tools and materials. Relatively few people could survive in this way. The existence of capitalists makes it possible for people to live by selling their labor rather than attempting to sell the products of their labor. Thus, between wage earners and capitalists there is in fact the closest possible harmony of interests, for capitalists create wages and the ability of people to survive and prosper as wage earners. And if wage earners want a larger relative share for wages and a smaller relative share for profits, they should want a higher economic degree of capitalism—they should want more and bigger capitalists.

*George Reisman's complete article on capital and the exploitation theory originally appeared in The Political Economy of Freedom Essays in Honor of F. A. Hayek, Edited by Kurt R. Leube and Albert H. Zlabinger (München and Wien: Philosophia Verlag, The International Carl Menger Library, 1985).
The article can be accessed in pdf form here

Some Points about Haiti

2010-01-25T22:04:00.011-07:00

This post is probably overdue, but I wanted to make some observations and tackle some issues that have been brought up by the terrible earthquake that destroyed so much of Haiti. Please understand my comments in the context that they are meant to be understood. I am speaking from the stance of one concerned about the role of government and how it has increased in size and scope beyond what is both moral and necessary. I am actually quite optimistic about the capacity of the individual to act charitably toward another in need. I think this capacity is rather obvious and even overwhelming at times such as this.

1) The role of government is not to respond to natural disasters and provide humanitarian aid. The government is not a humanitarian aid organization. It is an entity of force established to provide equal protection of property rights under the law. All humanitarian and relief efforts are the responsibility of the individual who gives as he or she sees fit and how he or she sees fit. It thus follows that the military is NOT an organization designed to aid other countries after a natural disaster. The military was formed to defend against invasion and insurrection. That is all. Any performance of acts beyond this scope is an exercise of authority that simply has not been given to the government or the military. The Constitution does not authorize it. If we want government to perform these functions, we need to amend the Constitution to give it power to make the military a worldwide humanitarian aid organization. This would likely make our military the most ironic organization in the world, but at least we could say we weren't ignoring the Constitution because we felt like it.
As one blogger puts it:

Extreme cases like this have a certain educational value, in that they separate the libertarian wheat from the chaff. They separate those whose libertarianism is rooted in a philosophical adherence to the non-aggression axiom and those whose libertarianism is only an emotional predisposition toward less government.

Consider the words of Ron Paul, the only one who opposed government aid to Haiti, on this very issue:

Statement of Congressman Ron Paul

United States House of Representatives

Statement in Opposition to H Res 1021, Condolences to Haiti January 21, 2010
I rise in reluctant opposition to this resolution. Certainly I am moved by the horrific destruction in Haiti and would without hesitation express condolences to those who have suffered and continue to suffer. As a medical doctor, I have through my career worked to alleviate the pain and suffering of others. Unfortunately, however, this resolution does not simply express our condolences, but rather it commits the US government “to begin the reconstruction of Haiti” and affirms that “the recovery and long-term needs of Haiti will require a sustained commitment by the United States….” I do not believe that a resolution expressing our deep regret and sorrow over this tragedy should be used to commit the United States to a “long-term” occupation of Haiti during which time the US government will provide for the reconstruction of that country.
I am concerned over the possibility of an open-ended US military occupation of Haiti and this legislation does nothing to alleviate my concerns. On the contrary, when this resolution refers to the need for a long term US plan for Haiti, I see a return to the failed attempts by the Clinton and Bush Administrations to establish Haiti as an American protectorate. Already we are seeing many argue that this kind of humanitarian mission is a perfect fit for the US
Certainly I would support and encourage the efforts of the American people to help the people of Haiti at this tragic time. I believe that the American people are very generous on their own and fear that a US government commitment to reconstruct Haiti may actually discourage private contributions. Mr. Speaker, already we see private US citizens and corporations raising millions of dollars for relief and reconstruction of Haiti. I do not believe the US government should get in the way of these laudable efforts. I do express my condolences but I unfortunately must urge my colleagues to vote against this resolution committing the United States government to rebuild Haiti. military. I do not agree.

2) Haiti does not benefit economically from the natural disaster (though there may be arguments for it benefiting in other ways). This idea is commonly voiced after natural disasters of all kinds. The fallacy is known as the broken window fallacy and takes the following form in this case: Haiti will have to rebuild and that process will create jobs for Haitians and improve their economy.
I understand why one would come to this faulty conclusion, but it is wrong for the same reason that government cannot create real jobs. If it were true that destruction actually helped the economy, why are we not excited about hurricane or tornado season? Why don't we just blow up our own houses and then rebuild them? That would keep us all working and our economy would boom! Right?! The ridiculousness of this idea is clear. The resources that are used to rebuild could have been used otherwise to improve the economy without having to reconstruct buildings. Again, this is the same reason that the Cash For Clunkers program was one of the most ridiculous and economically wasteful programs ever.

3) Haiti is not poor because we don't send it enough money. In fact, a strong argument could be made that Haiti remains poor BECAUSE we send them money. The corrupt government uses that money to maintain power. Haiti is poor primarily for political purposes. Political oppression more often than not manifests itself as economic oppression. The political history of Haiti shows it to be an unstable country, which has discouraged investment, making it difficult, if not impossible, for anyone to raise capital and grow the economy. Some may argue that Haiti was first poor and that the poverty lead to political corruption and a vicious cycle. They may insist that the cycle of poverty must first be broken through foreign aid and then the political side will follow. Not only does this fly in the face of reason, but it ignores historical experience. If this were the case, no country would ever become prosperous. All countries were poorer than they are now, relatively speaking, and even the richest of countries was at some point poorer than the poorest country today. It is freedom that brings prosperity. Economic freedom and political freedom go hand in hand. You cannot truly have one without the other.

Now, all this aside, I believe it is the moral obligation of every person to seek ways to serve others and do it. I encourage those who can to give any way they can to help those who are suffering in Haiti.

Gitmo, Jobs, and Habeas Corpus

2009-12-16T22:32:00.003-07:00

I realize I haven't posted in a while. Facebook makes it too easy to soapbox.
I try to choose topics that can lead to meaningful discussion. Usually this means that the topics are somewhat controversial, even among some who read my posts. I find this much more interesting than writing on topics that will spark very little disagreement, but I hope those will come up as well. I find that even if I agree with someone on an issue, it is still beneficial to discuss it.
I came across an article about the moving of Gitmo detainees to Illinois and it brought up a couple of issues that are otherwise pretty unrelated. Here's the article: Ill. town welcomes plan to house detainees

I wanted to first address the issue of job creation. This probably deserves its own post, which may come later, but it came up in the article so I wanted to explain why I feel it is so off-base. It seems that many are preoccupied with the existence of jobs, as if jobs were the whole point of an economy. The goal of politicians seems to be to create jobs. They seem to think that creating jobs will make the economy better. The problem is, they have the whole thing backwards. Jobs don't make the economy better, they are merely one way of measuring the health of an economy. High unemployment is a symptom of a sick economy, not the disease itself. Treating the symptoms of the disease is not a likely cure.
The reason we have an economy is because food and things don't appear at the snap of our fingers in as great abundance as we could ever want. In short, there is scarcity of resources. Economics is the study of how these resources are allocated and the theories of economics postulate how they can best be allocated. Jobs exist as part of the economy, but it is not jobs per se that we need. We need food and stuff. Jobs are simply an aspect of how those things are provided.
So, to assume that we can merely create jobs, and that by so doing, stuff will come into existence is foolish. All the talk about creating jobs will do nothing to actually improve economic conditions unless the stuff exists to allocate. Now, it is true that stuff is produced by people who have jobs, but these jobs need to be productive jobs, not boondoggle jobs as some call them. For instance, it will do no good for a trucking company to hire more drivers if there is nothing for them to transport. Sure, jobs are created, but there is no actual productive work to do. Most government-created jobs consist of digging a hole and filling it again. One can easily see the folly in this, but many advocate this exact type of thing for improving the economy . (This is an Op Ed piece by Paul Krugman--quintessential idiot) Improvement in the economy comes when there are more things to allocate, not when there are simply more jobs to allocate the same amount of stuff. Vedder and Gallaway wrote about this at length in their book Out of Work.
The idea that government can create actual jobs is perpetuated in the AP article:

Federal and state officials estimate the federal takeover will create as many as 3,000 jobs in the area within several years, including an estimated 800 to 900 at the prison and at local businesses that would sprout up as a result.

Why are these not real jobs? Well, these jobs don't create any wealth. These jobs are unproductive in the sense that we gain nothing by their existence. Now, whether or not they are necessary is another question, which I address below, but the fact remains that we would be better off if these jobs didn't have to exist. The resources that government is redirecting from elsewhere to pay for this prison and employees could be used for productive means. This is the problem with so-called government-created jobs: they take real resources from the productive economy and reallocate them toward something less efficient and often completely unproductive.
Now I come to the second issue raised by this article. The saddest part about the whole thing is that quite frankly, this prison is completely unnecessary and unconstitutional. Holding prisoners or "detainees" without a writ of habeas corpus is strictly against Article 1 of the Constitution:

The privilege of the Writ of Habeas Corpus shall not be suspended, unless when in Cases of Rebellion or Invasion the public Safety may require it.

This statement is particularly interesting because Habeas Corpus was thought to be so important that it was actually included in the body of the Constitution and not only implied in the Bill of Rights. The only exceptions that the Constitution allows for the suspension of Habeas Corpus are for rebellion or invasion. Prisoners of war captured in a country on the other side of the world (Afghanistan or Iraq) obviously do not fit this description. Personally, I don't see any reason to suspend Habeas Corpus even in these cases. Basically, a writ of habeas corpus is a judicial mandate requiring that a prisoner be brought before the court to determine whether the government has the right to continue detaining them. The individual being held or their representative can petition the court for such a writ. There are few if any cases where these criteria cannot be satisfied. There is certainly no reason to deny this to the detainees in Guantanamo. It's not as if we don't have any judges available to take their cases. Rather, this is another disturbing case of government disregard for the rights of the individual, which are explicitly protected by the Constitution.
Some argue that since these people are not citizens of the United States that these rights do not apply to them. I think this argument is disturbing and just plain wrong. A person does not have rights because he or she is a citizen of any given country. Our own Declaration of Independence is built on his fact:

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

We cannot justly go around the world promoting "democracy" and "freedom," denying it at home all the while.
When, if ever, do you think an executive could justly suspend a writ of habeas corpus? Has there ever been such a time in US history--when habeas corpus was or could have been justly suspended?

Soda: the New Cocaine

2009-10-18T22:07:00.003-06:00

A newly proposed tax would pay for health care, and it as a lot of people upset, but I am not sure how they are justifying their objections. I guess this is another case where principle has little or no influence on the strongly-held opinions of some.
Apparently, since soda and other sugary drinks are bad for us, we should tax them in order to discourage consumption and improve the overall health of our country. But the real motive is obvious and even blatant:

The beverage tax is just one of hundreds of ideas that lawmakers are weighing to finance the health-care plans. They're expected to narrow the list in coming weeks.

That is, it's all about money--money and control. Here lies the slippery-slope of government intervention into things like drug prohibition and health care. There no longer exists any consistent precedent for NOT passing such laws. Most have already accepted the notion that government can regulate what substances we can and can't take into our bodies (FDA, drug laws etc.), and with the push for a universal healthcare plan, many are also accepting the premise that government is responsible for our health. One cannot remain consistently opposed to a soda tax and, at the same time, defend anti-drug laws and the like. However, since it is unlikely such laws will be repealed, we can expect many opponents of a soda tax will eventually fall in-line with the program of government regulation of our lives. Thus, we can certainly expect more and more regulation on things we consume simply based on how healthy they are:

Health advocates are floating other so-called sin tax proposals and food regulations as part of the government's health-care overhaul. Mr. Jacobson also plans to propose Tuesday that the government sharply raise taxes on alcohol, move to largely eliminate artificial trans fat from food and move to reduce the sodium content in packaged and restaurant food.

I can only imagine one day someone getting arrested for hiding fried chicken down their pants. Don't get me wrong, I don't drink much soda, I don't drink any alcohol, and I can't remember the last time I ate fried chicken. BUT, outlawing fried chicken is just a hop away from bacon. That creates a problem for me.
What foods do you like that might be illegal or taxed? Would you still buy them on the black market?

Nuclear Weapons and Iran

2009-09-30T23:05:00.003-06:00

There has been a lot of talk in the news about Iran testing missiles and its possible nuclear capabilities. First of all, I certainly don't have any particular desire for Iran to have nuclear weapons. On that note, I don't have any particular desire for anyone to have nuclear weapons. Nuclear weapons are, by definition, a weapon of aggression, not defense. They are designed to kill mass amounts of people indiscriminately. Thus, they don't have any place in a purely defensive armament.
That being said, it is very hypocritical of the US to try to deny these weapons to any other nation when the US itself is the only country who has ever dared to use them. Someone who respects the principle behind the second amendment would ultimately have to concede that we cannot both allow the individual to bear arms and deny a whole country that same right.
As far as practicality, Iran has little reason to use a nuclear weapon, especially against its supposed enemy Israel. For starters, Israel would wipe Iran off the map before Iran's missile even reached Israeli borders. Secondly, any nuclear fallout would certainly reach Iran, which is a short distance downwind from Israel.
Glenn Greenwald takes on several people on exactly this point and adds some other great points while he is at it. I think his arguments are difficult to refute. What are your thoughts?

Obama just defeated his own argument

2009-08-11T21:24:00.003-06:00

Obama:
"UPS and FedEx are doing just fine....It's the Post Office that's always having problems."

Can I get a 'duh'?! How many BILLIONS of dollars has the Post Office lost to prove that government can't even deliver the mail at a profit. How can we expect government to deliver affordable healthcare?
By the way, the Post Office has a monopoly on letter delivery, so the fact is that UPS and FedEx can't even compete on that level. Government health insurance will bankrupt private insurance because it can run at a loss, just like the Post Office, and stay operational. This is pure and simple economic waste.

Education and Freedom

2009-07-29T20:38:00.002-06:00

Ben has been asking me for a while to write a post on education. I have been hesitant, mostly because I am not confident in my writing skills or in my ability to convey my thoughts, but since it has been a while since Ben has written a post I feel my attempt is better than nothing. As most of you know Ben has many "soapboxes" which he loves to write about. He enjoys the challenge of refining his thoughts and arguments against all of you. There is one thing that he has yet to write about, even though he has strong opinions on the matter--that is educating children. He has left this task to me for many reasons. I will give a little background for those of you who do not know us. Ben and I have been married for over 3 years. I teach fourth grade at a public elementary school close to our house. My mom and sister are both public school teachers. I am actually a 4th generation teacher. It is in my blood and something that I love, but times have been changing.
There was a comment on a previous post about how I work for the public school system and that it is not in-line with the principles that we profess. There is definitely a contradiction there that I would love to address outside of this forum, but I would like to take the time in this post to discuss what I believe to be the role of education and some of the problems that I have seen today.
Since marrying Ben I have had to rethink the purpose of education and the people who are responsible for it. I have come to realize that the most important factor in a child's education is the parents. This is contrary to what my professors in college taught and to what the policies of my school district have tried to drill into my head. The argument that I have heard against this thinking is that if we (teachers) are not the most important factor in education then we will not be able to succeed. I argue against this idea. The parents are the ones responsible for their children's education. They are the ones who hire me because they feel I can meet their child's needs. At least I feel this is the best way to focus on a child's education.

The family's role in education is recognized, studied and counterfeited. I was recently reading the want ads for teachers. There was a posting from a school in the east for a teacher/house parent. This combination intrigued me, so I looked into it further. This school was a type of boarding school--pre-K-12 grades. It was for low income students who would not be able to afford a normal private school. It had nice accommodations, great testimonials, and lots of resources. I was still puzzled about this house-parent thing, so I continued to research. I then found something that scared me. Instead of the normal dorms that you would find at a boarding school, there were houses. 10-13 children would live in a house with a teacher and the teacher's spouse. They would be in family units and taught family values, such as responsibility, kindness, and hard work. The parents could have contact with their children by phone, e-mail, and occasional visits. The family was replaced. Where would morals be taught? Who would guide in spiritual decisions? What about the emotional stability that comes from a loving parent?
This school did what a lot of educators and parents have been asking for: it took the most important variable out of the equation and replaced it with something that can be controlled. If it is true that education would be best if the teachers, the ones who are trained, were completely in-charge, then we should expect to see these types of schools having succes. I predict the opposite. I predict these schools will fail fundamentally, because they are not based on true principles.

One of these principles is responsibility. Responsibility is inherent in freedom. When you make a choice, you are accepting the consequences of that choice. If the choice is good, you are free to receive the benefits of your choice. If the choice is bad, you must also accept its consequences. A person cannot be free if he or she is unwilling to accept or prevented from receiving the consequences of a choice.

I see this in education. Many parents expect me to “fix” their children. They send their children to me, “a trained agent of the state” to be the specialist. If a child can’t memorize her math facts or can’t read fluently, it is my fault and my responsibility to fix it. At least, that is the mentality of many parents and educators in the public school system. This mentality is facilitated by the public school system as parents are given incentives to NOT be personally involved in their children's education. Parents do not know what their children are learning, how their children learn, the social interactions of their children from day to day, or the morals that are being taught their children by the state. They are instead encouraged to raise money for the PTA, cut out pictures, and make sure their child reads for 20 minutes everyday. These are the duties of an "involved" parent who, according to some, are truly watching out for the best interest of their children. We can thank the benevolent state for providing such important guidelines, or else parents wouldn't know how to raise their children. (that last sentence was Ben's thought)

I saw something else that appalled me this summer that will further illustrate my point. Our school provided free breakfast and lunch to any child under 18 that walked through the door. I saw many mothers drive to the school and walk in with their children to watch them eat the government-provided food. The parents gave up the responsibility to feed their children to the government. Whose children does that make those kids?

No Limit to Government: Why Liberals AND Conservatives get it wrong

2009-07-02T18:55:00.002-06:00

Cash for Gold...If only it were still possible

2009-06-22T21:58:00.000-06:00

US To Trade Gold Reserves For Cash Through Cash4Gold.com

This Man is a Hero

2009-06-19T18:24:00.003-06:00

I first heard of this some months ago, but just now CNN has decided to make it news. We need more people to stand up to intimidation by the government. The full recording of the incident is available here.

Principles

2009-06-07T18:00:00.002-06:00

Over time, after many conversations regarding the role of government and the importance of freedom, I have come to realize that I often operate on a different premise than those I discuss these matters with. This realization has been difficult to deal with because I have come to recognize that my outlook on life is considered irrelevant by some. I will attempt to explain what I mean.
My life philosophy is based on the idea that there are certain principles, which, if applied correctly, are universal and uncompromising in every situation. Thus, I have tried to discover those principles and apply them so that my actions have a consistency which is based on unchanging principles. Whenever I realize that my behavior does not conform to one of these principles that I have previously determined to be correct, I have to re-evaluate my actions and/or the principle to understand if I need to change my behavior or my understanding of the principle.
By this, I have come to certain conclusions about liberty. According to my understanding, liberty is a principle that is universal and correct. It is a virtue in and of itself that is to be protected at all costs, even if it allows for uncertainty. In my attempt to understand the principles that are related to liberty, I have started these discussions of the laws of liberty so that I can evaluate my own behavior and understanding of the principles.
However, as I wrote before, I have recently been realizing that many people do not base their understanding or beliefs on such a premise. Many do not accept the notion that there are universal principles that can govern behavior. So far, I have been limiting my discussions to the role of government since I see the government as the most prominent idea whereby human beings seek to legitimize coercion. The idea of coercion directly opposes the principle of liberty. Thus, the principle of government which relates to liberty must be that government (force) can only be used to protect the principle of liberty. Anytime government becomes destructive to the principle of liberty, instead of upholding it, government has overstepped its bounds.
This principle is foreign to many, so much so that even when presented, it has no effect to change their ideas because they do not base their ideas or philosophies on principles at all. Their ideas and philosophies are based on sound-bytes and emotionalism. They are based on short-sighted political whims and false traditions. Some are based on ignorance and hypocrisy.
At times, even the most basic principles are rejected by some because they are not "practical". I ask: if a principle is not practical, is it even a principle? If we cannot follow principles because they are not practical, we have no principles at all. It seems that for some, their only principle is practicality. Thus, they are subject to the sound-bytes, emotionalism, political whims, false traditions, ignorance, and hypocrisy that plagues our society and has literally destroyed faith in the supremacy of principles at all.
My call is for a return to principles and a realization, as a good friend puts it, that principles ARE practical, and if we defer to practicality instead of principles, we will find we lose our principles all together.

Got it...finally

2009-05-16T00:21:00.002-06:00

Here is the picture of the Prostate Cancer billboard....in case any of you are interested. This is related to my post from a while back.

Proof We Need an Audit of the Fed

2009-05-07T15:07:00.003-06:00

This shocks me, as it does the Congressman. Call your Rep. and tell him or her to support HR 1207 to audit the Federal Reserve.

Classified...

2009-04-29T08:35:00.002-06:00

This is what we should really be afraid of. Forget terrorism.

**I thought this was real until the end.

Quick Screenshot

2009-04-26T20:48:00.002-06:00

Where do you think Bart got the idea anyway?

Fascism 101 and Conservative Hypocrisy

2009-04-19T14:14:00.003-06:00

Here is one of the best explanations of economic fascism that I have seen. A lot of people blame the economic crisis on the free-market when, in fact, our system is full of government intervention. What we are moving towards is a form of socialism most commonly associated with the tenants of fascism (corporatism).

I love this cartoon because it exposes many so-called conservatives for what they really are: hypocrites. They tout the idea of lower taxes while at the same time advocating higher government spending and bailouts. The real cost of government is NOT what it TAXES, but what it SPENDS.

Fair Tax, Flat Tax....How about NO TAX!

2009-04-15T17:07:00.000-06:00

A lot of people advocate a fair tax or a flat tax instead of an income tax. I can see that, but let's make it truly fair and really flat....LIKE ZERO!

Illegal Immigration: Why I don't really care

2009-04-09T20:02:00.008-06:00

I was reading an article about Obama's plan for immigration and the controversy over the issue. I started thinking and feeling some of the same things that I think and feel each time I hear the issue discussed on the news or by others: simple indifference. This may strike some people as odd. For many, the issue of immigration is strongly emotional and frustrating. But as far as I am concerned, I am not personally affected by "illegal" immigration. Let me give some reasoning as to why this is such a non-issue for me.
Those who oppose illegal immigration often claim that the immigrants are taking jobs that could be filled by Americans. Thus, immigration is bad for the economy. First off all, this is a simple non-sequitur. Someone "taking" someone else's job does not make the economy weaker. Economic growth happens because of the division of labor and the law of comparative advantage. Producers continually seek ways to cut their costs so that they can make profits. Profits are invested as capital in future production of goods so that more can be produced. The effect is that we get lower prices--a good thing, because we can buy more stuff with the same money. Part of lowering costs means that a producer seeks employees that give the highest marginal benefit/cost ratio. Immigrants will often work for lower wages or benefits, thus increasing the benefit/cost ratio of the producer and increasing profit. This will result in cheaper goods in the end.
Now, immigrants sometimes work for wages below the minimum wage limit. This makes it more difficult for "Americans" to get the same job because of tax laws. However, this is not a problem of immigration, but a problem of the government's regulation of wages. It is a simple economic law that price floors create surpluses. That is, a minimum wage will create unemployment since some workers have a benefit/cost ratio that is below the minimum wage. If this seems too confusing, I am sorry. Feel free to comment/ask questions.
There is another economic factor related to immigration though that I think is more influential but almost totally ignored. Immigrants come here almost exclusively for economic reasons: they can earn more money. But as I explained above, immigrants who are willing to work for lower wages is good for the economy. They don't object (or else they wouldn't come) and we shouldn't either. However, there is another economic incentive that draws immigrants to the US. It is our welfare state.
I don't have any statistics, but anyone who cares to can find them without too much difficulty. The fact is that many immigrants come here because we give free healthcare, food stamps, education, and other forms of welfare. Emergency rooms are often overwhelmed by illegal immigrants. Hospitals are required by law to give free emergency care to immigrants and there are even Federal programs for people who are not US citizens. A large percentage of people who receive food stamps are illegal immigrants and public schools are loaded with their children.
So why don't I care about all these outrages? Well, I do care, but I don't see why these problems are the immigrants' fault. First of all, if we don't want them to come here for the free stuff, we should stop offering it. It acts as an effective subsidy on illegal immigration, while at the same time we are taxing our people to prevent it.
Secondly, I don't see any difference between a US citizen who participates in welfare and an illegal immigrant who does. Either way, the money they receive was taken from another by force or the threat of force. Thus, I don't care so much where you come from. I consider an illegal immigrant just as entitled to welfare as a US citizen, i.e. NOT AT ALL!
Other common points of opposition are issues of security and national sovereignty. I can understand these objections, but I feel they are not based on solid Constitutional principles or principles of liberty. The issue of security is best handled by the states, or, even better, by the land owners themselves who have an incentive to protect their property from trespassing. Should a threat of invasion occur, there is authority within the states and even Federal government to deal with it. Immigration, however, is not an issue of invasion because it is a matter of individuals or very small groups who are acting independently in their own economic self-interest. They do not constitute a security or military threat anymore than the criminals who already reside or were born in the US (such as those in Washington D.C.).
Besides that fact is the reality that stopping "illegal" immigration is hardly something that can be realized by force. Patrols and fences have done little to really prevent the majority of immigration that happens illegally. See John Stossel's recent piece on this issue here.

Three Cheers for the British MEP!

2009-03-26T23:18:00.000-06:00

Great speech!

Tough Questions from Minnesota

2009-03-25T21:03:00.002-06:00

Rep. Michele Bachmann from Minnesota drills Bernanke and Geithner on the constitutional source of the authority for the actions they have recently taken, as well as their avoidance of providing full information to the public and the Congress. Not surprisingly, they have trouble making a coherent answer and Barney Frank is noticeably irritated by the end. Finally, someone else is asking tough questions.

Notice how even Bernanke is calling it a bailout now. HAHA!

A New Record: Largest Bill Ever Printed

2009-03-23T19:46:00.007-06:00

I remember sitting in my economics class when the professor talked about inflation and showed examples of some of the largest denominated bills ever printed. Check these out:

In 1946 Hungary issued a 100 Million B-Pengo, which was the the largest circulated banknote at the time, unfortunately it was worth only about $0.20 USD in 1946.

Hungary also printed a 1 Milliard (Trillion) B-Pengo in 1946 but it was never released into circulation.

On December 23, 1993, the former Yugoslavia issued a new banknote to keep up with rampant inflation, the 500 billion dinar note, that's a 5 followed by 11 zeros, but shortly after cut off nine of the zeros. One of the 500 billion dinar notes could have bought you lunch if you were very frugal.

The 500 Billion note just blew my mind. That was, until I saw this, just released from Zimbabwe:

Look at all those zeros!

Apparently, I am a Terrorist, and You May Be Too....

2009-03-17T19:58:00.006-06:00

Maybe you've heard, or maybe not, but the Missouri State Police think I might be a security threat (maybe you are too).

Why? Because I support Ron Paul and the Campaign for Liberty. Also, because maybe I own guns, oppose abortion or support homeschool.

Even, and I'm serious, because I support the U.S. Constitution.

This is no joke. Read it for yourself here. On the top of page 7.

John Stossel: Bailouts and Bull

2009-03-14T09:57:00.003-06:00

When I was growing up, I used to watch Friday night TV on ABC. Afterwards, 20/20 came on and I often found it interesting, even when I was 10 or younger. My favorite part was always John Stossel's 'Give me a Break' bit. It made so much sense. This guy is actually still making sense. Good for him. Check out a special he did last night (Friday). He makes some excellent points.

Part 2

Part 3

Part 4

Part 5

Part 6

Pro-State Cancer

2009-03-08T22:50:00.006-06:00

I saw a billboard the other day and it gave me an idea for a title of a book. However, since I am not interested in writing a book anytime soon, I thought I would just make it the title of a blog post. This was the best image I could find of what the billboard said:

Suffice it to say that we are suffering from what could be called pro-state cancer. It is the malignant idea that the state can somehow solve our problems. It also reminded me of a demotivational poster I saw on depair.com that was funny. It fits the current situation perfectly.

A Novel Idea

2009-03-06T14:14:00.003-07:00

The is funny, but it is absolutely true. And yet, at every turn, the government is trying to get people to ignore this, even setting the worst possible example by spending trillions of dollars it does not have. Savings is just as important to the economy as investment and consumption. The sooner we learn this, the sooner we can recover economically.

Politics vs. Statesmanship

2009-03-03T22:51:00.004-07:00

It is often lamented that politicians are fickle and unprincipled. They promise one thing in order to get elected and do another when in office to please special interests. They lie, cheat, deceive and elude questions with great skill at times. The word politician has a derogatory connotation--so much that it has become an insult in itself. In fact, this connotation has become a truism and I doubt the need to explain my meaning further.
And yet, there is an interesting phenomena that occurs particularly around the time of presidential elections. From among a broad range of candidates, people choose a favorite politician and find themselves defending that politician by all means. If their politician said this and the media thought it was wrong, they will say their politician meant that and the media is simply taking it out of context or misconstruing his words. This game is known as politics and we all got more than two earfuls of it during the presidential campaigns. We probably even participated in it to some extent, arguing over what he meant by this and what he didn't mean by that. At the same time, we were quick to point out the flaws in the words of politicians we didn't like as evidence that they were incompetent or dishonest.
First of all, I think it very sad that the media has embraced this practice and called it politics. They revel in this sort of bickering and he-said-she-said noise. I see the political pundits constantly searching for any snippet of a sound bite or excerpt that could be controversial in any way. The art of being elusive and avoiding this sort of criticism is known as political correctness. Politicians, under constant threat of being attacked personally because of the way they chose to phrase something, seek more refined, vague, and mostly cryptic ways of speaking their message. This translates into political positions that aren't really positions at all. They do not dare take a stance on important issues for fear of sounding politically incorrect or deemed radical and uncompromising. Their favorite phrases are some of the following: "I am committed to working with....to accomplish....for the good of our country" or "We need to come together on this to find a solution that works for the American people" or "This bill has strong bipartisan support" or "I have experience working with people on both sides of the isle". What do these statements really even mean?! They certainly don't articulate a true position on any certain issue.
This whole mess that the politicians and media have created does nothing more than muddy the waters. The bickering over the meaning and intent of words and phrases distracts from the truly important debates that need to happen in order for people to understand issues and decide what they believe about them. If the water were cleared, I think we would find that many who are continuously at each others' throats about what the other has said about X, are really not in any disagreement at all. Their argument is simply to distract from this fact and maintain the illusion that there are deep ideological differences among key political figures. Generally speaking, there are few, if any, ideological differences, and politics-as-usual masks this fact rather well to the untrained eye.
Gone, it seems, are the days of true statesmanship. The days when a man stood up for what he believed and didn't revel in the mud of personal attacks and semantics. Rather, there was honest and serious intellectual debate about issues that mattered.
For this reason, I breathed a sigh of relief that some of these statesmen may still exist when I saw Ron Paul take on a political pundit today, touching on this very issue. The reader may know of my affinity for Congressman Ron Paul, but let me say that there are certainly others out there like him. I just don't know where they are at the moment. We should seek these good, honest men, and uphold them in the principles that they espouse.
The video is well worth watching and shows perfectly what I mean.

The Word is Spreading

2009-03-02T23:10:00.004-07:00

Not all the articles I read in the mainstream are ridiculous. Every once in a while, I will run across an article that seems to at least get some things right and be fair about it in the process. I wanted to point out one article from Newsweek that at least puts a plug in for free-market Austrian Economics. The author gives a small explanation of the Austrian business cycle theory--which I hold to be fact, not theory per se and have tried at length to explain in some of my posts. I would highly recommend that those seeking to understand the economics of today study the Austrian Business Cycle Theory. There are some excellent books out on it but you can get free articles and audio books/lectures from www.mises.org

Here's the Newsweek article.

An Email to Mr. Schoen

2009-03-01T22:50:00.003-07:00

I read an Answer Desk article the other day on MSNBC.com that really got my blood moving. After I took a few breaths, I typed up a quick response to the author, Mr. Schoen, explaining some things that I think he missed in his article. As I think this article touches on a few important points about the issues at hand, including Obama's mortgage bailout plan, I decided to post my response. I recommend reading the article first to get the context. It can be found here.

Mr Schoen
Your recent article about the mortgage bailout and income taxes was quite disturbing, to say the least. Without going into too much detail (since I doubt you will read this anyway), I wanted to respond to your misguided attempt to cover for the failed policy of price-fixing.
You mention in your article, and I have heard many times throughout the past several months, that the government is justified in rescuing bad mortgages in order to keep the prices of houses from falling too low. You write that it is legitimate for the government to use our tax dollars to pay for the mortgages of others so that the value of our house will not fall. There are two important economic problems with this argument, besides the moral hazard it creates. The first problem is that not everyone owns a home. Not everyone is concerned with a mortgage and therefore with the falling value of houses. In fact, many people are looking forward to buying a house and have been saving their money, paying their taxes, and otherwise living frugally. And yet, our tax dollars are being used to keep housing prices high--exactly what we do not want if we are going to buy a house. This works directly against our interest.
The second problem with this plan is that it, quite simply, creates a price floor for homes, not allowing the market to fix the correct price. The simplest laws of economics teach us that price-fixing creates distortions in the efficient outcome of the market. In particular, price floors, such as would be created by keeping house prices higher than the market would set them at, create surpluses in housing and general waste. The prices of houses MUST go down in order for the surplus to be liquidated. The fact that you do not understand this should exclude you from writing about economics at all.
I also wanted to touch on another point you made in your article about the income tax. First of all, the dates you listed for the ratification by each state are heavily disputed and have not been clearly verified to have taken place in the correct manner. Second of all, there was mention in the title of your article about whether or not income taxes are legal. You actually never address this point. And NO, just because it was "ratified" does not make it legal. The Constitution clearly states that there shall be no direct tax on the people. You can dance around this all you want, but the fact is that the income tax is simply unconstitutional. This does not mean that I do not pay it. To do so would be unwise. But I have to object to your dismissal of the argument and your treatment of those who espouse it as juvenile and ignorant.

What just happened?!

2009-02-25T09:06:00.001-07:00

I was just watching Congressman Paul question Federal Reserve Chairman Ben Bernanke. He asked him some very important questions and Bernanke gave some very elusive answers, as usual. Then Paul asked Bernanke if WWII pulled us out of the Great Depression. Paul was immediately cut-off by Barney Frank, even though he still had some time left, and they went on a break. This effectively nullified Paul's question and Bernanke didn't even have to answer it.
I will post the video as soon as possible, but honestly this was blatant censorship and I am amazed.

The Revolution is Brewing

2009-02-19T18:37:00.001-07:00

I am surely not the only blogger to put this up, but this is a taste of the frustration that so many people are feeling right now. The government is creating the worst moral hazard ever and stealing from our grandchildren to do it.

The Principles of '98 (1798)

2009-02-15T13:08:00.003-07:00

Well, what was once thought lost after the Civil War may now be brewing again. Thomas Jefferson's Kentucky Resolution, also called the principles of '98 or 1798, asserts that when the Federal Government oversteps its powers enumerated in the Constitution, states have the right to 'nullify' that action. This nullification principle takes different forms, but it was the basis for the Civil War and it is the principle under which at least 20 states are now reclaiming powers usurped by the Federal Government.
Here is the resolution introduced recently in the Texas legislature.

By:AACreighton H.C.R.ANo.A50

CONCURRENT RESOLUTION

WHEREAS, The Tenth Amendment to the Constitution of the

United States reads as follows: "The powers not delegated to the

United States by the Constitution, nor prohibited by it to the

States, are reserved to the States respectively, or to the people";

and

WHEREAS, The Tenth Amendment defines the total scope of

federal power as being that specifically granted by the

Constitution of the United States and no more; and

WHEREAS, The scope of power defined by the Tenth Amendment

means that the federal government was created by the states

specifically to be an agent of the states; and

WHEREAS, Today, in 2009, the states are demonstrably treated

as agents of the federal government; and

WHEREAS, Many federal laws are directly in violation of the

Tenth Amendment to the Constitution of the United States; and

WHEREAS, The Tenth Amendment assures that we, the people of

the United States of America and each sovereign state in the Union

of States, now have, and have always had, rights the federal

government may not usurp; and

WHEREAS, Section 4, Article IV, of the Constitution says,

"The United States shall guarantee to every State in this Union a

Republican Form of Government," and the Ninth Amendment states that

"The enumeration in the Constitution, of certain rights, shall not

be construed to deny or disparage others retained by the people";

and

WHEREAS, The United States Supreme Court has ruled in New

York v. United States, 112 S. Ct. 2408 (1992), that congress may not

simply commandeer the legislative and regulatory processes of the

states; and

WHEREAS, A number of proposals from previous administrations

and some now pending from the present administration and from

congress may further violate the Constitution of the United States;

now, therefore, be it

RESOLVED, That the 81st Legislature of the State of Texas

hereby claim sovereignty under the Tenth Amendment to the

Constitution of the United States over all powers not otherwise

enumerated and granted to the federal government by the

Constitution of the United States; and, be it further

RESOLVED, That this serve as notice and demand to the federal

government, as our agent, to cease and desist, effective

immediately, mandates that are beyond the scope of these

constitutionally delegated powers; and, be it further

RESOLVED, That all compulsory federal legislation that

directs states to comply under threat of civil or criminal

penalties or sanctions or that requires states to pass legislation

or lose federal funding be prohibited or repealed; and, be it

further

RESOLVED, That the Texas secretary of state forward official

copies of this resolution to the president of the United States, to

the speaker of the house of representatives and the president of the

senate of the United States Congress, and to all the members of the

Texas delegation to the congress with the request that this

resolution be officially entered in the Congressional Record as a

memorial to the Congress of the United States of America.

Black September: Now we find out how bad it really was

2009-02-12T23:06:00.004-07:00

Around the 2:00 mark, you will hear the meat of what happened in September 2008. If this was going to happen 6 months ago, what are we in for now that the government has spent trillions more?

“On Thursday, at about 11 o’clock in the morning, the Federal Reserve noticed a tremendous drawdown of money market accounts in the United States to a tune of $550 billion being drawn out in a matter of an hour or two.

The Treasury opened up its window to help. They pumped $105 billion into the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks.

They decided to close the operation, close down the money accounts, and announce a guarantee of $250,000 per account so there wouldn’t be further panic and there. And that’s what actually happened.

If they had not done that their estimation was that by two o’clock that afternoon, $5.5 trillion would have been drawn out of the money market system of the United States, would have collapsed the entire economy of the United States, and within 24 hours the world economy would have collapsed.

Now we talked at that time about what would have happened if that happened. It would have been the end of our economic system and our political system as we know it.”

The Warfare State

2009-02-05T23:51:00.003-07:00

I have been thinking quite a bit lately about war. This is not really much of a change from my earlier adolescent years when I idolized war heroes and played violent video games for hours. Some things never change, but my thoughts on war have definitely been refined over the years. There’s a lot to say about war, but I wanted to stick with some misconceptions that I have had or hear commonly.

Some people claim that war stimulates the economy, so it is good for economic growth. I heard this a lot in school, especially in the context of WWII. The theory is that the war brought us out of the Great Depression. Plenty has been written on this to disprove the idea, but I am interested in refuting the broader theory. The fact is that war cannot possibly be good for an economy, just as natural disasters cannot make us better off economically. War redirects the resources of an economy away from consumer demands toward destruction. Instead of producing goods for domestic consumption and trade, war channels production for destructive ends. Soldiers are consuming, not producing, and factories are making bombs to blow up bridges instead of steel and concrete to build them. This is all beside the fact that productive people are being killed, greatly reducing future abilities to produce.

Sure, war increases government spending, but the money government spends has to come from somewhere. People pay for war through higher taxes. Usually outright taxes are unpopular, so governments find other ways to get the money they need now—the ‘buy now, pay later’ gimmick that you saw last time you stepped into a furniture store. The easiest way to do this is debase the currency by inflation. The people pay the tax through higher prices instead of explicit taxation. Thus, a hidden tax levied without representation. I want to emphasize that I am not arguing that war is never necessary; I am simply refuting the claim that it has economic benefits per se.

Randolph Bourne astutely observed that war is the health of the state. War makes government thrive like nothing else. In wartime, governments increase their power over their subjects by nationalist rhetoric, taxes, and curtailing of individual liberties. The examples of this are numerous, and one need only look to the history of virtually any war to find that governments increase in power—particularly the governments of the victors but often the governments of the losers as well. In US history, war has followed the ratchet effect. After the war, the government’s power is sometimes decreased, but it never returns to the level it was previously, creating an ever-expanding state.

But above all other considerations, I must insist that war is nothing less than the conglomeration of every evil, horror, depravity, perversion, and violation of natural law of which man is capable of. In other words, it is the breeding ground for the sum of all the most terrible vices that man has ever expressed. It seems clear to me that much of the emotion I feel when watching a war film is a conflict between the apparent necessity of violence and the utter horror at witnessing what awful things we can do to each other under the guise of powerful ideologies.

Again, I am not advocating pacifism here. I am not saying that war is never justified, but I am saying that it is quite rare—much rarer than widely considered—and must morally be only in blatant defense. The idea of pre-emptive war feeds on this justification in a most pernicious way. To accept the doctrine of preemption is to make war totally subject to the whims of government. Under this doctrine, defense becomes offense and a country cannot defend itself without violently preempting every conceivable threat to any one of its so-called interests.

What are your thoughts on war? When is it justified? What wars in history do you think were just/unjust? Why?

Can we say: MORAL HAZARD!

2009-01-28T08:50:00.002-07:00

So the Fed is now bailing out "distressed" homeowners. Here's the catch: you have to be two months delinquent on your payments. Wow! If that's not an incentive to stop paying your mortgage, I don't know what is. These people are totally oblivious to the concept of moral hazard. This is going to compound the problem more than imaginable.

Here's the link:

http://www.msnbc.msn.com/id/28891956/

Negative Interest Rates: Can they be serious?!

2009-01-20T23:00:00.004-07:00

There's an absolutely mind-boggling article here which makes some of the most outrageous claims I have ever heard. I couldn't let these claims stand unchallenged, even if my voice is only a squeak.
The article claims that the current Federal Reserve interest rate of ZERO percent is not low enough. In fact, one report from Goldman Sachs actually says that the Fed needs to cut the interest rate to NEGATIVE 6 percent to provide the needed stimulus.
It gets better. The article goes on to claim that inflation will soon be zero percent. What it said next almost made me fall out of my chair:

The solution is obvious: The Fed needs to deliberately raise the rate of inflation — maybe not all the way to 6 percent, but significantly above zero.
One way to do that is to print lots of money. The Fed can create money from thin air by purchasing assets such as Treasuries and mortgage-backed securities and paying for them by crediting the seller with newly created reserves at the central bank.

As if this wasn't good enough to pass as the worst idea in history, the author goes on to explain more:

That way today's zero interest rates would be negative in inflation-adjusted terms and the economy would get the boost it needs. Fed rate-setters would need to swallow hard, since 99.99 percent of the time they try to quell inflation, not raise it. But most of the voters on the Federal Open Market Committee are aware that deflation can be an even greater nemesis than inflation.

Honestly, I am now speechless. Not only is this paragraph full of lies, it deliberately misleads people into thinking that the Fed fights inflation. The Fed is the SOLE CREATOR of inflation. What is there to do in the face of such blatant disregard for sound monetary policy? Can they really believe that inflation is not a problem? If they follow this policy, there is nothing stopping us from becoming the next Zimbabwe.

Zimbabwe update: Just to prove my point

2009-01-14T23:08:00.003-07:00

So remember how I said that the Zimbabwean dollar was $1 US = $9,570,555 Z? Well, as of today, the new rate is $1 US = $12,525,200 Z. So, the US dollar costs $3,000,000 (that's three million) MORE Zimbabwean dollars than it did TWO DAYS AGO!
This blew me away so I just wanted to share it. Don't think it can't happen to us.

Largest check ever written

2009-01-12T20:44:00.003-07:00

So this must be the largest check ever written:

In case you can't read it, its one quadrillion, seventy-two trillion, four hundred and eighteen billion, three million dollars. Well, that's what you get when the inflation rate is 12.5 million percent. This check was drawn on a Zimbabwean bank. That's hyperinflation folks. By the way, $1 US = $9,570,555 Z as of a couple minutes ago...
Not sure what it is now....
Or now...

Israel, Gaza, and [the] US

2009-01-11T13:39:00.004-07:00

I would like to make a quick note about the situation in Gaza as it is prominent in the news lately. First of all, most people will realize that there is nothing new going on here. Israelis and Palestinians have been bashing it out for decades. I could spend a lot of time talking about the history of this bashing. I could talk about the atrocities committed by both sides. I could present either side's case for its claim to ownership of the land. I could talk about the lopsidedness of the forces involved and those that suffer because of it. But it all is beside the point I hope to make. The point is: It's none of the United States' business.
And yet, the US government has been making it its business since the creation of the state of Israel. Sure, there are many reasons why, but none of them convinces me that it is in our national interest, security-wise or otherwise, to officially support Israel militarily or financially.
Israel can take care of itself. It has proven this for many years. Its enemies are vastly unequal to its power militarily. Israel cannot possibly need the military support of the United States. Furthermore, our support of other countries who are historically enemies of Israel has been counterproductive. Why do we continue to support both sides of an ongoing war? Are we not facilitating its perpetuation by our meddling?
These interventions have not made us safer or more prosperous as a nation. In fact, they have made us less secure by inciting hatred toward us in the Middle East and elsewhere. At the same time, our military ventures have placed undue strain on our financial resources, the consequences of which we are experiencing now.
Another point I would like to make is about Iran. Some have recently suggested that Iran has been supporting Hamas against Israel and that we should intervene to stop this. Frankly, I cannot understand this argument, even if the accusations are true. If we oppose Iranian (foreign) involvement in an area that Iran deems necessary to its interests, why should we not also oppose our own involvement in the area? Is this not a gross contradiction in principle?
Now, I do not wish to take sides in this conflict. Experience and research has shown me that there is not truly a side to which justice belongs and therefore I could commit myself. However, even if there were, this would not justify the intervention of our government in affairs over which it has absolutely no authority.
I am hoping to get some response to this post. What are your opinions on the conflict? What do you know about its history? What do you think the role of the United States should be, if any?

Money: Part 2

2009-01-04T21:10:00.004-07:00

Earlier I wrote about how money originates as a commodity through the barter system. While the origins of money may be clear, the idea of money may still be abstract for some. This is because our concept of money has changed dramatically from its original form. Our current system consists of a fiat paper currency which is nonredeemable for any commodity by the institution who issues it. That is, our “money” is simply ink on paper which the government forces us to use through legal tender laws. This paper money is issued by the Federal Reserve Bank, but the Federal Reserve will not redeem that money in any commodity other than an identical paper note.
Legal tender laws which establish the paper money as fiat money require that it be accepted as a form of payment for debts. This means that if fiat money was offered as payment for a debt, the courts will consider that debt paid. The courts will not enforce payment in any other form, even if that form of payment was specified in a contract (ever heard of the gold clause?...It was made irrelevant by legal tender laws).
The evolution of a commodity-based monetary system to a fiat paper money system is somewhat complicated, but I will try to explain the process as best I can. Originally, when gold was used as money, banks issued paper receipts to customers so that they could return and claim their gold at any time. People eventually began simply trading the receipts themselves as if they were gold because it was easier than withdrawing the gold to pay for everything.
Eventually, banks figured out that they could issue more receipts for gold than gold that actually existed in their vaults because virtually no one ever came to withdraw the gold. This led to what is called fractional reserve banking. That is, banks only held a fraction of the receipts in circulation in gold, but this practice was not particularly legal when it first started. This is because it was considered fraud. The receipts were titles to the property that existed in the bank vault. The bank was essentially committing fraud by issuing new titles to the same gold. The system became legalized through a partnership of the government and banks so that banks could provide quick and easy credit to governments to finance this project or that war.
However, there were problems with this type of system. Occasionally, banks expanded their credit or their paper receipts far beyond their actual reserves. When people started realizing this, they began to withdraw their gold from the bank before it was too late. If the panic grew, there was a “run on the bank,” causing the bank to fail. This wiped out the savings of those who falsely thought their money was safe in the bank because suddenly their paper notes where not worth anything as they were issued by an institution that didn’t exist anymore.
But instead of abolishing the system of fractional reserve banking, the government sanctioned it and setup a central banking system that linked all banks and regulated their activities. Central banks made sure banks kept a certain amount of gold in reserve and offered individual banks infusions of gold if problems arose. The problems with this solution may be obvious. The government could not prevent a full-scale bank failure (one that targeted all banks) it could only prevent isolated bank failures. Because the system was fully based on a fractional reserve, there would never be enough gold to cover the receipts, no matter how centralized the system was.
This led to the temporary, and eventually complete, suspension of redemption for gold of the paper notes. But this is not the end of the story; today we have moved into a whole new phase of currency evolution. Not only is our paper money not redeemable in gold in any way, our paper money itself has replaced gold as the reserve unit. That is, banks no longer hold gold in reserve, they hold paper money. They don’t even have to hold enough paper money to cover all their checking and savings accounts.
This new form of fractional reserve banking goes way beyond the old kind. But it is also somewhat strange, because it is, in a sense, also a 100% reserve system inasmuch as accounts are insured by the FDIC. The whole way that this came about is pretty complicated, as I said, but suffice it to say that the natural laws that govern money circulation and usage have come to bear on our current fiat paper monetary system. In order to prevent bank runs, the government has insured deposits, essentially removing the worries that one will lose his deposits’ nominal value. However, the government has not eliminated the workings of the fractional reserve system, such that banks can still lend more money than they have and collect interest on more money than existed in the first place.
In effect, this has created a monetary mess that can honestly only end in disaster for our currency. Returning to sound money, which is not subject to these weaknesses and caprices, would prevent a monetary disaster, but the transition would not be simple or easy. In the next part on money, I will give some of my ideas about how we can return to sound money.
What other weaknesses does our current system have? What are the benefits of our current system?

1933: The End of the Great Depression....Right?

2008-12-15T22:02:00.002-07:00

Nuff said:

The Ultimate Insult

2008-12-14T12:12:00.001-07:00

So President Bush made a surprise visit to Iraq today. He got an interesting reception. I can tell you from experience in the Middle East that getting a shoe thrown at you is not a compliment....but it is funny.

The Environment and Property Rights

2008-12-10T18:33:00.005-07:00

Perhaps one of the most ambiguous subjects pertaining to liberty and the role of government is the question of the environment. I say ambiguous because there are certain assumptions that rule the subject, making counter-arguments seem trivial. For instance, it would seem silly for an atheist and a Christian to argue over the necessity of a certain religious rite. The atheist assumes that God doesn't exist, so to him, a religious rite would be inherently unnecessary. The argument is trivial to the atheist insofar as he assumes the non-existence of God.
In a similar manner, there are certain assumptions about the role of government with relation to the environment that must first be dealt with. My assumptions here are that individuals are free and cannot be punished for the actions of another individual or a group as a whole. This is not to say that whatever one does is morally right as long as it does not harm another person. There may be any number of moral responsibilities of an individual toward the environment. However, these responsibilities cannot be enforced by government without taking away the liberty that government purports to protect.
Those who argue for government protection of the environment often make the assumption that the environment is an entity in and of itself that requires or merits legal protection from the state. However, since the environment is not in and of itself a legally responsible entity, it also cannot be legally protected, only insofar as it is itself property of an entity that is legally responsible and protected. Thus, the "environment" can only be protected legally if it is property of a person and is in danger of being harmed by another person.
According to property rights, I can do whatever I wish with my own property. I simply cannot harm the property of others. If it can be shown that I have harmed the property of another, that entity has grounds for legal action against me. If no harm can be shown, there can be no punishment.
Now, let's take the case of pollution and its affects on the "environment". If a factory pollutes and it can be shown that this pollution harmed another's property, then those harmed can sue the factory. However, if the factory can somehow collect its pollution and recycle or store it such that it does not harm another's property, even if it does cause harm to the property of the factory itself, no one can claim injury and no legal action can be taken.
Now, there are cases when the pollution of an individual entity does not cause harm, but the collective effect of several individuals does. The most apparent case of this may be car exhaust which causes smog. If it were true that one individual driving one car could cause smog and harm the property of another, the individual driving the car would be responsible. However, if the actions of the individual alone are not sufficient to cause harm, he cannot be punished as part of a group for his actions, because he is not personally responsible for any harm.
Here are some other examples of what I mean. In the 1800's, people moving westward over the plains chopped down trees along the Mississippi River and its tributaries. This caused more runoff that normal from rain and the result was flooding in New Orleans. (At least, this is what is generally accepted as the cause of some flooding in New Orleans in the 1800's). So, the people of New Orleans built higher dikes to channel the water and protect their property. They had no legal recourse against a large group of individuals whose collective actions caused harm. Furthermore, it cannot be said that any one individual caused the harm. It cannot be said that any one person caused flooding in New Orleans. As such, the people of New Orleans treated it as an act of nature and dealt with it as best they could to preserve their property.
There may be another example. The same people, coming west, found that their herds were being attacked by wolves and so they, as individuals, took measures to protect their property and elminated most of the wolves in the Midwest. As a result, years later, there was an enormous increase in the population of deer. Could this be blamed on any one individual? No, and therefore, the people who settled there began to deal with the lack of wolves as if it were an act of nature, taking it upon themselves to control the population of deer. Such is the approach that could be taken toward the proposed problem of global warming.
Now, the common practice widely accepted is that government has to regulate harm caused to the environment so that these costs imposed on others, such as pollution, can be redirected upon those who caused them. This is the principle behind certain taxes and the 'cap and trade' system. There are several problems with these assumptions and proposals of regulation. The first is the denial of property rights. That is, one is not allowed to use his property as he sees fit. The government denies the right to pollute one's own property, even if the person considers this an acceptable cost to achieve his ends. But more importantly, the system of 'cap and trade' assumes that people have the right to pollute others' property. Businesses are given credits to pollute and they can buy and sell these credits in the market. The fact that a factory may be polluting my property is of no concern to the government if that given factory is within its "pollution credits". I have no legal recourse because it is assumed that the factory was given that right by government.
In addition, the 'cap and trade' system presents a problem of economic calculation. That is, the government automatically assumes that it knows how much pollution is optimal. It sets the limit at that level and then distributes credits accordingly. But how does the government know that this level of pollution is the most efficient for property rights of the individuals affected? The optimal pollution level may be lower or higher. The limit imposed merely assumes to know that level. But this is impossible for a government to know, just as a government cannot know the optimal production levels of goods.

For more on this topic, check out Murray Rothbard's article here. (Beware, its a bit long)

A couple jokes...

2008-12-07T21:08:00.005-07:00

You will have to zoom-in on this one, but it's worth it:

More spending....We gotta have more spending

2008-12-04T14:23:00.004-07:00

The government's solution to the current economic problem is more spending. Where have I heard something like that before?
Oh yeah! More cowbell!!

Money: Part 1

2008-12-03T14:52:00.004-07:00

Money is really a simple topic, but the concept has been so corrupted over time that I anticipate this will take multiple posts to discuss. Hence, the Part 1 in the title.
In order to understand what money is, we have to look at its origins. Money was originally a commodity itself. That is, it had intrinsic value because it cost somebody something to produce. For instance, if two farmers used wheat as a medium of exchange, each knew how much work, resources, and time it took to produce one bushel of wheat. They knew likewise how much work, resources, and time it took to produce one gallon of milk. They could therefore decide what benefit, in terms of wheat, one gallon of milk had in order to determine a rate of exchange (price). But they had to denominate the benefit in terms of a real commodity, something that costs to produce, otherwise they wouldn't know the "price" of the good.
Eventually, large groups of people started using precious metals as a means of trade. This was because the metals didn't lose their value due to time or environmental conditions so they could be readily circulated and widely accepted. In addition, metals could be verified by a simple system of weight measurement. The most important thing to remember here though is that precious metals did not simply grow on trees. They took work and time and resources to mine and refine. Thus, the miners could measure their production in terms of gold mined and refined in a day and how much of that they were willing to exchange for the goods and services they required.
The fundamental and original concept that money itself must be a commodity has been all but lost in today's economy. However, because of our historic use of precious metals as money and denomination of those metals in terms of our currency ($$$), we are able to operate with a system of prices. That is to say, without the basis of money as a commodity, we would never know how much something costs in terms of dollars, because dollars are not themselves a commodity and cost virtually nothing to produce.
This concept is vital in understanding the challenges in our current monetary system. Along with a basic understanding of supply and demand, it logically leads to some important conclusions that I will discuss later. However, I would like to first propose this theory of money and ask: What am I missing? Is there anything in my explanation that needs to be modified?

The Similarities are Disturbing

2008-12-01T23:22:00.003-07:00

This is a bit overdue, but I had a bit of trouble finding the videos. So the first video is a typical infomercial done by that annoying guy that yells all the time. I thought it was a good primer for the second video:

The second video is a small clip of the automotive executives' testimony before the House Financial Services Committee. I wasn't sure whether to laugh, yell, or cry:

Marriage: right or rite?....or both?

2008-11-25T22:03:00.008-07:00

Let's take a step away from economics for a bit. We'll be back soon, I promise. The discussion of liberty invariably comes in contact with the modern discussion of rights. While there seems to be a common misunderstanding of the word "right" and its origins, we can discuss the corruption of our language another time.
A couple of weeks ago, I watched a protest by opponents of California's Proposition 8, hoping to be able to talk with some of them and discuss what their actual demands were. In a few words, there wasn't really an opportunity to talk with any one of them. Amid the accusations of bigotry and hate, I wondered to myself why it was that gays wanted so much for the state to legally sanction their unions as marriage. What was it that they gained from having a marriage as opposed to just a civil union?
The most obvious things are protections the state gives only to married couples. These include tax credits and visitation rights etc. For these reasons, the state regulates marriage closely. In fact, you have to get a license from the state to get married. Think about it...you have to ask the government permission to perform a religious ceremony; you have to ask the government permission to marry someone.
Black's Law Dictionary defines a license as, "The permission by competent authority to do an act which without such permission [...] would be illegal." This means that if the state has the power to license you to marry, it also has the power to prohibit it. If you don't get a license, you are breaking the law.
Thus, if the state can license heterosexual couples, it can prohibit homosexual couples. The question is merely what the state's policy is. Does it allow homosexual marriages or not? In the current case, it has been both, depending on who you ask: the people of the state or the judiciary. The people voted to prohibit homosexual marriage while the judiciary declared that prohibition unconstitutional. The debate is heating up even now.
To me, it is obvious that marriage is between a man and a woman. This is simply what the word means. But personal and religious definitions aside, I think we may all be having the wrong debate. Instead of discussing how the state should define marriage, let's go back and rethink if they should define it at all.
So there it is: Should the state define marriage? If so, why and how? If not, why not? It seems to me that the debate over whether the state should define marriage at all is so far gone that it has become next to impossible to revive it. But if we could, wouldn't this be a better way to preserve our religious freedom and Constitutional integrity? How do we revive the real debate? If we can't, how do we choose sides in the current one?

Could this guy be right?.....again

2008-11-22T10:13:00.002-07:00

Check out these videos. Peter Schiff predicted what is happening and they laughed at him:

Now, they aren't laughing anymore, but they still are reluctant to listen to him:

Inflation or deflation? What is going on?

2008-11-19T19:31:00.009-07:00

For a while now, I have been worrying about the prospects of inflation. Well...not really the prospects, because I know it is a problem, even the government admits that we have inflation. Rather, I have worried that inflation is rapidly destroying the value of the money I have saved in the bank. Recently though, I have started hearing news about deflation, which I thought was utter nonsense. How could deflation be happening now? Gas prices were high; food prices were high; movie ticket prices were high; car repairs were expensive. If we had deflation, I thought, I would be getting richer every day. My money would be worth more as prices went down.
But then I started hearing people say deflation was a bad thing. They said that falling prices made people defer their spending and that made businesses suffer. They said that people in debt suffered with deflation because it would be harder to pay back debts. They said it was a "wolf" that was at the door ready to eat us all alive.
Then I started seeing gas prices go down; food prices started stabilizing so to speak; housing prices were still going down, and I wondered how it was possible? How could all this money that the Federal Reserve was printing actually allow any prices to fall? Then I started to worry again. What if deflation really is a problem? What if it does stifle business growth? I think I have come to a conclusion: deflation is just what we need right now.
Let me explain. In 2001, a recession caused the Federal Reserve to lower interest rates and 'pump more liquidity into the system'. This means they printed more money and expanded the money supply so that people could keep on spending money as if nothing had happened. Well, they printed so much money for so long that people began spending money like they never had before. Loans were easy to get. Cars were easy to buy. Housing prices went through the roof. People refinanced their houses and took the apparent appreciation in value of their homes and spent it on that trip to the Bahamas. In fact, we even were able to fight two wars at seemingly no cost and people were still having a great time. Life was good. Democracy was spreading. Capitalism was making us all so rich. What could have gone wrong?
Some of the first indications were people starting to default on their mortgages. You see, they had borrowed all this money and spent it on cars, houses, vacations, hot dogs, iPods, computers, flat-panel T.V.'s, and the irresistible yummies that they saw on those flat-panel T.V.'s. Suddenly, they had nothing to show for it. The cars were breaking down. The houses needed to be painted, recarpeted, and refurnished. The vacations were mostly just pictures on facebook. The hot dogs had long served their purpose. The iPods were out of warranty, and the flat-panel T.V.'s were too small to see the whole football field. They had spent all their money on things that brought absolutely no return. Worse, it had all depreciated in value and they were still making payments on the stuff. This could be called malinvestment.
It gets worse. You would think that businesses would have been smarter. They would have spent their profits on retooling, upgrading, and training. But they didn't. Rather, they payed for employee vacations and golf tournaments etc. They malinvested even worse than the consumer. Why? Because money was cheap, and they would pay it back with the profit they got when they sold their houses and businesses into a stock market that was always in the green.
Well, let's get to the point. In few words, prices got high. They got really high, and now no one could pay back all the money they owed. So people and businesses started going bankrupt. One by one they went down and all the talking heads said, "It can't get any worse" or "This is just a little dip". Now we face widespread bankruptcy.
So what do they say we have to do to solve it? Here's what we hear from all the big shots: 'Well, we need more liquidity. People don't have enough money to spend. We can't let large companies fail. Get people spending money again like they were and all will be better.' But how can the cure be exactly what caused the disease in the first place?
Here's what we need: deflation. We need a correction to what prices are supposed to be at. We need to return to sustainable prices of years ago (perhaps more). How long will it take? No longer than we let it. I remember in 2001, gas prices were even lower than they are now. Maybe we are getting there. Is anybody truly worried about the price of gas? Not really. Its a good thing insofar as we don't have to spend so much on gas and can start paying back all our debt. In fact, the more prices go down, the better off we will be in the long-run, because we will have disposable income to pay back our debts.
Some ask what will happen to the businesses though who suffer from deflation and lower profits. They may go bankrupt. Well, this is exactly what we need! I am serious! If they participated in the malinvestment during the boom, they have to accept the responsibility of the hard times that come with the bust. What remains will be stronger businesses who are better able to suit demand and smarter at investing.
What is the alternative? Well, we could do what we are doing right now. We could bail out all of America to itself. We could just get a new credit card with an unlimited line of credit and just put it all on that and start over.
We need to start over alright, but by getting out of debt, not by going into more. A wise man said, "As long as we live above our means, we are destined to live beneath our means." Are we ready for this? The politicians are scared to death. They think they are responsible, and they are, at least in part, but they are trying to cover their tracks by passing the buck to coming generations. Can we sacrifice now for our children? Can we accept personal responsibility for our foolishness and not shift that to another person who might not even be born yet? I admit, I am not sure I want to. Can't we just keep on going like we have--pushing the debt to our children, just as our parents pushed in onto us? After all, we are doing them a favor and making the world safe for democracy right? Isn't that an investment? Won't America and the world be so prosperous some day that we can pay back all our debts and live in peace and harmony?
I know I sound cynical and mocking here, but these are actually legitimate questions that reflect the views of a lot of people, even mainstream politicians and economists. How do we respond to them?

**I should note that strictly speaking, inflation is not a rise in prices just as deflation is not a fall in prices. Inflation is an increase in the money supply/goods and services in the economy ratio. That is, the total money increases relative to the goods and services available. The effect of this is an increase in prices but inflation itself is not defined as that. Deflation is the opposite.

Ron Paul vs. Ben Bernanke

2008-11-18T16:24:00.006-07:00

Two old sparring partners go at it again. This time, Ron Paul calls Bernanke's bluff. Bernanke then tells an untruth about whether he has discussed this international currency with central bankers. Notice that at the end he says, with a hint of a smirk, that central banks are planning to sell gold. Is he looking to drive down the price of gold? For what purpose?

The Other Healthcare Crisis

2008-11-17T21:36:00.009-07:00

There has been a lot of talk, especially among certain prominent politicians, about the so-called "Healthcare Crisis" that is looming over so many uninsured and under-insured Americans. They tell us that something must be done to prevent this crisis from causing financial ruin for millions of Americans. They promise "failure" if we do not come together and agree to have the government fix the "crisis".

Our leadership believes that Americans should have access to affordable, quality health care and peace of mind about long-term financial security. We will ask our members and the public to demand solutions (dividedwefail.org).

Well, I feel it is the duty of freedom-loving Americans to certainly demand solutions...but not in the way they would have you believe is necessary. First, it begins with a need to understand the healthcare system and the economic principle of insurance.
Insurance groups people into pools based on risk so that it can estimate probability and costs. If insurance companies didn't group people according to risk, they would have to assume ultimate risk for all of their customers. Thus, customers who would rarely if ever use the insurance (the losers in this case) would end up paying the same premium as those who are more likely to use it (the "winners" as it were in this case). However, because of competition, insurance firms gather information about their customers in order to assess their risk. Customers at lower risk can be pooled into a lower-risk category and can pay lower premiums.
Now, there are certain things that are not insurable. Suicide, for instance. This is because suicide is wholly dependent on the actions of the insured. Suicide doesn't happen by accident. If insurance companies covered suicide, who would get coverage for it? I wouldn't. I wouldn't want to pay for it. This would not be a viable venture for an insurance company anyhow. This would be equivalent to insuring my house against arson, that is, burning down my own house myself. At any rate, actions or events that hold personal responsibility cannot be insured against because the firm cannot calculate that in their estimates of risk.
At least, that is what we would expect in a free-market. This is not the way things are today. For instance, there are many people who are put in the same risk pools who in fact belong in different pools. They have different risks, and yet they are grouped together and made to pay the same premiums. In addition, there are many people who are insured for things which are, by definition, uninsurable. Insurance has hereby become a system of income redistribution resulting from regulation.
There are several examples of these regulatory distortions imposed on the Federal and State levels upon insurance companies. In these cases, insurance companies must offer coverage for these things to their customers:
49 States mandate treatment for alcoholism by insurance companies
At least 27 States mandate treatment for drug addiction
Chiropractors in at least 45 States
Psychologists in at least 36 States
Social workers in at least 22 States
Hairpieces have to be included in Minnesota
Marriage counseling in California
In more than 12 States, companies cannot ask any AIDS-related questions
In D.C. HIV testing is prohibited for insurers
the list goes on....

The effect of these regulations is certainly not at all what was intended by legislators. The most important effect has been that insurance companies are forced to raise their premiums because they cannot assess the risks of certain individuals and cannot group others according to their risks. Therefore, customers who do not have these risks are forced to help pay for the risks of others in their artificially-high premiums.
What is the effect of this? Well, if I am being forced to pay for coverage that I do not need, I may choose to not be insured at all (after all, I haven't gone to the doctor in years). Those who remain insured are then charged higher premiums, and the problem compounds. And yet, as an uninsured person, I am then somehow part of this "Healthcare Crisis" which many propose to fix by imposing more regulation...the precise thing that caused me to be uninsured in the first place.
How do you solve the problem of people dropping their insurance? Well, a certain politician proposed a solution: mandate health insurance! Others say "single-payer" government insurance would solve the crisis. But what would be the economic effect(s) of these policies? Can we foresee them? How can we possibly solve this problem with the proposed solutions? What other solutions are there?

Topics for Discussion

2008-11-16T21:59:00.002-07:00

These are some of the topics I would like to discuss as I encounter them in the news or otherwise. For many of these topics, I have yet to form a concrete philosophy or explanation that formulates my philosophy. I would like suggestions for topics and I will add them to my list.

Monetary policy

Gold Standard

Competing currencies

Abortion

Definition of life

Marriage

Right or rite

Foreign Policy

Non-interventionism

World organizations

Economics

Sovereignty and free trade

Legislating Morality

Drugs

Environment

Education

Democracy vs. Republic

Confounding the language of liberty

Acts of nature

Immigration/Borders

Military

Standing army vs. Militias

Organizational Ambiguities

Seek change internally or externally?

Inception

2008-11-16T21:24:00.000-07:00

My wife suggested that I start a blog as a way to develop my political and economic ideas. The goal is to get insightful input from others on issues that I have either not fully developed as part of my philosophy or personal questions that I have yet to answer about the role of laws and liberty in society. I anticipate it becoming a forum for those of us seeking to understand the principles of liberty and how to apply them in our lives and project them into our society. I hope that many of my friends, family members, and acquaintances can contribute, as well as others who stumble across these posts.