Thursday, June 27, 2013

The Diminished Value of Human Beings in the Dependency State

Land, labor, capital and entrepreneurship are the essential factors of economic production.  Two of these factors, labor and entrepreneurship, are human factors.  Production has been defined as the mixing of human ideas and effort with natural resources (land) to create utility – i.e. something of value.

In a free economy, human beings are the most valuable components of productivity.  Humans bring their effort, energy, skills, vision, creativity and ingenuity to bear in creating those goods and services that profitably meet the needs of other human beings.  It can be safely said that, in this world, there will always be unmet needs and, therefore, work to be done.  Thus, by introducing more human beings into the economic equation, more work gets done and more needs are met.

However, in the modern dependency state; people are more likely to be looked upon as liabilities than as assets.  The economies of the developed Western nations curtail production with a myriad of taxes, subsidies, regulations and work rules. 

To say that productivity is curtailed is to say that human beings are forced out of performing productive, creative work.  Because great numbers of people are prevented from producing useful goods and services they become wards of the state.  And once people become wards of the state, they are no longer productive assets, they are now expensive liabilities.

Thus when the modern welfare state begins to consider a great many of its constituents to be costly liabilities, it is only natural that they will want mitigate their liabilities by reducing the absolute number of dependents. 
Therefore it is only logical that we find Western governments subsidizing the non-production of new people / new liabilities by underwriting contraception and abortion.    And now the latest foray is the systematic state promotion of homosexuality.  Western democracies are actively promoting same sex relationships that are as infertile and unproductive the economies that they have ruined.

In the early 1950s millions of refugees from Communist China flooded into the British Protectorate of Hong Kong, then a tiny fishing village.  At that time the world’s thought leaders were predicting a demographic and economic catastrophe and for this tiny city-state.   They said that it could never support more than 1.5 million people.  The rest is history.  Hong Kong became a free market, capitalist miracle that today supports over 7 million prosperous residents. 

Ironically, while crowded little Hong Kong was thriving, its big sister, the People’s Republic of China was floundering economically while forcibly restricting couples to one child.  This policy led to the genocide of millions of baby girls by couples who wanted a boy.  Because of this gender-cide China now faces a woman shortage which has encouraged a vibrant underground sex-slave trade.


Hong Kong taught the PRC to liberalize its economy and has unleashed a powerful engine of growth.   Hopefully Hong Kong will also show China, along with the rest of the industrial world, that people are assets to be cherished and not liabilities to be limited.


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Thursday, June 20, 2013

Get Government Out of Marriage: An Austrian Perspective

Underlying the same-sex marriage controversy are two legitimate but seemingly irreconcilable concerns.  On one hand "live and let live" is a quintessential American attitude.  After all, many reason, why shouldn't gay Americans live as they please and enjoy the same rights as everyone else as long as they are not harming anyone else?  This is the instinctive, gut level response of many libertarians including Gary Johnson, our presidential standard bearer, and the Cato Institute.

Conservatives fear the long term unseen consequences that may result from a radical redefinition of one of society's bedrock institutions.  Their concerns are not without merit.  In States where same sex marriage has been legalized, vital faith based social service agencies have been forced to cease operations.  Private business operators, who, as a matter of conscience have wished to withhold services from same-sex couples, face civil and criminal penalties.  Surely libertarians cannot condone such state sponsored coercion.

The Austrian method of analyzing human action via verbal thought exercises reveals a common sense resolution to this conflict.  Traditional marriage would seem to have originated as a logical solution to resolve the problems created by heterosexual relations, problems that would not emerge from homosexual relations.  Let’s consider the thought exercise that follows.

Long before there were civilizations, nation states, governments, laws or religious dogma, there were people.  Without going back to the either the scientific or religious origin of our species, it is safe to say that these people came from other people by means of sexual intercourse.

I think that we can also take it as a given that human beings are hard wired for sexual activity.  And even back then we can assume that there were a variety of preferences in the marketplace for sexual partners.  Some men preferred women while other men preferred men.  Likewise some women preferred men while others preferred other females.

However, heterosexual unions had much more profound and long lasting outcomes than same sex encounters.  In her landmark anthropological study, Male & Female, Margaret Meade observed that in the sex act for males was, “originally focused to no goal beyond immediate discharge”.  And again, “The male sex act is immediately self resolving and self satisfying”.  This would seem to hold true in any male-female, male-male or even female-female encounter.  She then goes on to point out that for the woman in a male-female relationship, “the female analogue is not the single copulatory experience”.  Instead it is just the beginning of “the whole cycle of pregnancy, birth and lactation”; a cycle that can last for several years and start anew shortly after each childbirth.

Thus one can easily imagine that, upon facing such far reaching consequences of sexual activity, the woman of the primitive world would begin to insist on some sort commitment of care and support from her partner prior to granting sexual favors.  Likewise, one could imagine a man agreeing to this pact if he could be assured of the exclusivity of her affections.

Thus we can logically discern a plausible basis for male-female marriage that is rooted in human action.  And while same sex couples of that era may have felt a deep affection for one another, there was no biological or economic necessity to formalize their relationship.

This institution male-female marriage would have come into existence though voluntary and mutual consent and free from the coercion of the state or the taboos and totems of religion.

These voluntary associations are the basis of civil society.  In Libertarianism – A Primer, Cato’s David Boaz defines civil society, assesses its utility in facilitating human happiness and the proper role of government to said civil society.

“Civil society may be broadly defined as all the natural and voluntary associations in society.”

“We want to associate with others to achieve instrumental ends – producing more food, exchanging goods, developing new technology – but also because we feel a deep need for connectedness, for love and friendship and community.  The associations we form with others make up what we call civil society.”

“Government’s protection of individual rights is vital for creating a space in which people can pursue their many and varied interests in voluntary association with others. When government expands beyond that role, however, it pushes into the realm of civil society.  As government borrowing “crowds out” private borrowing, government activity in any field crowds out voluntary activity.”

Marriage is a bedrock institution of civil society.  Throughout the ages men and women have married for many reasons including love, companionship, procreation, money, power, prestige as well as social / familial obligation.  They have voluntarily married for millennia without the benefit of state incentive, regulation or subsidy.

Sadly we live in an era of overreaching government where no aspect of human life goes untouched including marriage.  Because the modern nanny state has elected to license marriage and to grant specific immunities and privileges to married couples, it has politicized an age old civil institution. Everything that government touches becomes a political battleground including education, charity, tax codes, scientific research and on and on.  Therefore, it is only natural that same sex couples will demand the same legal rights and protections that heterosexual couples enjoy.

However, for libertarians to endorse the “legalization” of same sex marriage is capitulation to the statists.   By doing so, they implicitly acknowledge that the state, not consenting individuals, has the right to decide what constitutes marriage and to override civil institutions.

Calls for the redefinition of marriage play into the hands of the collectivists.  In his treatise, Socialism, Ludwig von Mises explores Socialism’s agenda as regards sex, marriage and family.

“Proposals to transform the relations between the sexes have long gone hand in hand with plans for the socialization of the means of production. Marriage is to disappear along with private property, giving place to an arrangement more in harmony with the fundamental facts of sex. When man is liberated from the yoke of economic labour, love is to be liberated from all the economic trammels which have profaned it. Socialism promises not only welfare — wealth for all — but universal happiness in love as well. This part of its programme has been the source of much of its popularity. It is significant that no other German socialist book was more widely read or more effective as propaganda than Bebel's Woman and Socialism, which is dedicated above all to the message of free love.”

“Marxism indeed seeks to combat marriage just as it seeks to justify the abolition of private property, by attempting to demonstrate its origin in history.… For the Marxist, historical research is merely a means of political agitation.”

Without even being explicitly Marxist, our government pretty much destroys everything that it touches from the economy, to currency, to health insurance, to retirement savings and mail delivery.  While professing to be helpful, the welfare state has destroyed family formation and stability.  In a world of starving people, government pays farmers not to produce and to destroy food.

Therefore we must get the government out of the marriage business for both gays and straights.
Much of the civil protections and privileges that people seek in marriage can be accomplished via existing contract law.  What does not exist will soon be invented by lawyers who are nothing if not resourceful.

Proponents of the “marriage equality” movement compare it to the civil rights movement of a half century earlier.  Clearly libertarians aspire to world where all people of diverse backgrounds and outlooks can enjoy life and the liberty to pursue happiness.  However there is right way and a wrong way to go about things.

During the civil right struggle of the 1960s Ayn Rand denounced racism as “the lowest, most crudely primitive form of collectivism”.  Still, she could not support the Civil Rights Bill of 1964 denouncing it as, “the worst breach of property rights in the sorry record of American history in respect to that subject”.

Let’s not repeat this mistake by using government force to bestow “rights” on one group at the expense of others.  Frederick Bastiat warns against the tendency to counterbalance one bad set of laws with an equally unjust set of legislation: “As soon as the plundered classes gain political power, they establish a system of reprisals against other classes.”  This is what happened with the Civil Right Act of 1964 and is happening now with the violations of property and religious rights that we have seen in states where same sex marriage was legalized.


Better that we wipe the slate clean and get government out of marriage altogether.  Allow freely acting human beings to define their own marriages via voluntary personal contracts to be enforced by the courts.  This frees people to be creative in their lifestyle choices and restores government to its proper role.


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Friday, June 14, 2013

Democratize the Fed

Critics of the Federal Reserve’s monetary policies complain that they are fundamentally unfair.  When the Fed creates new money, the first people to get their hands on it are the big fat cat bankers and their rich friends.  Those fortunate few are then able to spend the new dollars first.  However, by time this new money reaches Joe and Jane Six-pack, the flood of new currency will have inflated the money supply and raised prices.  Thus Joe and Jane wind up paying more for the same stuff than the fat cats bought for cheap.
The obvious solution is to get the new greenbacks directly to the average guy and gal on the street.  And the way to do that is with Currrency.com an innovative new Treasury Department program.

Modeled after the popular Stamps.com which enables Postal customers to print stamps right at home, from their own computer, Currency.com will allow average Americans to print legal tender in the comfort of their homes or offices.

Each Curency.com customer will receive sheaf of official U.S. Currency paper along with the software to print his or her own money.

Of course no one would be able to print as much money as they want on a whim.  That would be crazy.  So how much could the typical American household expect to print?

A good place to start is QE 3.  Fed chairman Bernanke plans to inject about $85 billion into the economy each month with no end date mentioned.  This works out to a smidge on $1 trillion a year in new money.
By using Currency.com and bypassing the Fed, each U.S. household should be able to print $680 month or about eight grand a year.  But do the Gates, Buffet or even the Streisand households really need another eight large a year?  I don’t think so.

Therefore, let me propose a sharply graduated printing plan whereby the less you earn, the more you print.  Under my proposal, the richest 10% print nothing.  The next richest 10% would get about $800 per year.  That’s about enough for an evening on the town including dinner and theater for two couples.  A nice perk for a busy professionals.

However those on the lowest rung of the earnings ladder can print up to $1,700 a month or over $20K per year.  Of course this would be in addition to any welfare, food stamps, housing subsidies, unemployment, disability, Social Security, Medicare or Medicaid payments that they might be getting.  Therefore the whole $20K is found money, disposable income.   (See chart below)

With an extra $1,700 a month at their fingertips, America’s lowest earners would  easily be able to afford new car payments, a spruced up wardrobe, the latest electronic gizmos, a resort vacation timeshare and one or two Vegas getaways each year.

Talk about stimulus!  Consumption goes through the roof.

Of course the ultimate beauty of it all is that this is a totally self-funded program.   Americans will pay back the government for the software, paper and shipping costs with the money that they print up.  Need we say more?




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"Half the people are stoned and the other half are waiting for the next election.
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Paul Simon




School Daze - Philly Style


This is a reprise posting.  It seems timely in light of the current Oregon condom giveaway program in the to middle and high school kids. http://eagnews.org/oregon-district-halts-condom-giveaway-amid-community-uproar/


The Philadelphia School Board recently announced that machines dispensing condoms at no-charge will be installed in the City’s high schools.  The City’s thinking is that with a very high percentage of students being sexually active, they may as well be having safe sex.

If this is the program’s objective, then it has not gone far enough.  Having safe sex involves more than a condom.  Does it not also demand a safe, secure and sanitary environment?  Who can say what dangerous, compromising and filthy conditions, Philly’s youth are exposed to in their quest for Eros.

Therefore, it is essential that the City provide this safe environment by setting aside a suite of rooms in each school building for the express purpose of safe and protected coupling.  To ensure sanitary conditions, the City must also provide fresh linen service after each couple finishes and the next arrives.

Still academic achievement must be job one.  But how can we expect students to be attentive and alert in class after exhaustive lovemaking?  Teenagers are still growing children with high metabolisms.  They require a high intake of calories to be at their best.  Therefore, the city should also provide each couple with a post-coital room service meal of high carb foods plus an energy drink.

These initiatives will clearly meet the needs of Philly’s sexually active students.  But what about the poor lonely hearts?  A great number of Philly’s high school students are not sexually engaged and it is reasonable to postulate that, for many of them, this abstinence is not voluntary.  These unfortunate youths are part of a long ignored underclass - the “romantically challenged”.  These are the multitudes who society stigmatizes as “dweebs”, “dorks”, “geeks”, “nerds” and “losers”.  We can only speculate the enormous amount of frustration and psychological damage that these unfortunates suffer by knowing that, just beyond closed doors, their luckier brothers and sisters reveling in coital bliss.  The long term effects of this privation are beyond measure.

Earlier, academic achievement was cited to be ultimate aim of our American schools.  But perhaps building high self-esteem is the true Holy Grail for today’s educators.  As such, the damage to self-esteem that we are inflicting on these sensitive and romantically challenged youths is positively criminal. Are they not entitled to the same levels of gratification as their more gifted, attractive and charming classmates?  How can they be denied this basic human right?

Therefore, it is incumbent for the City to provide for those who cannot provide for themselves.  It only just that the school district provide Professional Gratification Facilitators (PGFs) to any student who requests it and demonstrates need.  However, the City may save taxpayer money and encourage charity by soliciting volunteers among the more fortunate students to lend a helping hand , as it were,  to their fellow students in need.  Community service is another of vital part of the contemporary education experience.


It’s the right thing to do.


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Thursday, June 13, 2013

A Well Regulated Militia

Gun control advocates of use the “well regulated” phrase in the Second Amendment as a pretext to assert that the government reserves the right to dictate what if any arms its citizens may own and under what conditions they are permitted to acquire, use and dispose of them.

By employing textual criticism, this argument can be easily debunked.

Textual criticism involves understanding the words of antique documents in the sense that they were used in the era that the document was authored.

For instance if writer of century ago were to refer to the decade of the 1890s as the “gay ‘90s” or the capital of France as “gay Paris”, we understand that this has nothing to do with same sex relationships.  Gay in this sense conveys the notion that this decade and this city were exuberant, happy and high spirited.

In such a fashion, a recent reading of Adam Smith’s Wealth of Nations shed new light on the Second Amendment for me.

Although Smith was a stout proponent of free markets, he was no anarco-capitalist.  Smith believed that there were legitimate functions for government to undertake.  One of these functions was the common defense of the citizenry from foreign invaders.

Defense requires a fighting force and Smith segregates these forces into two broad classes.  These are standing armies and militias.  Standing armies are professional forces, whose sole profession is fighting and who continually, drill, study and practice the arts of warfare in preparation for battle.  Militias by contrast are amateur armies composed of tradesman, merchants, farmers, mechanics, etc, etc.  These forces come together only periodically, like our National Guard and Reservists, as their livelihoods depend on the practice of their sundry occupations.  They cannot afford much time away to for martial exercises.

Smith uses the word “regulated” to convey a condition cohesiveness, discipline and preparation for combat on the part a fighting force.  In one passage he observes:  “Regularity, order, and prompt obedience to command, are qualities which, in modern armies, are of more importance towards determining the fate of battles, than the dexterity and skill of the soldiers in the use of their arms.”

Further on he returns to the concept of “regulated” when he concludes that in, “the history of all ages, it will be found, hears testimony to the irresistible superiority which a well regulated standing army has over a militia.” Thus he contends that a well trained and disciplined (i.e. regulated) army will be superior to a group of rag tag amateurs.  Hence we often hear this well trained / disciplined / regulated force referred to as the” Regulars” as opposed to the “Reservists” even to this day.

Now we know that America’s Founders were suspect of large standing military establishment.  George Washington writes, “Altho' a large standing Army in time of Peace hath ever been considered dangerous to the liberties of a Country, yet a few Troops, under certain circumstances, are not only safe, but indispensably necessary. Fortunately for us our relative situation requires but few.”   

In the same document he lays out his defense proposal for our new nation.  The first two points are as follows:

“First. A regular and standing force, for Garrisoning West Point and such other Posts upon our Northern, Western, and Southern Frontiers, as shall be deemed necessary to awe the Indians, protect our Trade, prevent the encroachment of our Neighbours of Canada and the Florida's, and guard us at least from surprizes; Also for security of our Magazines.
Secondly. A well organized Militia; upon a Plan that will pervade all the States, and introduce similarity in their Establishment Manoeuvres, Exercise and Arms.”

Thus he uses the word “regular” to describe well trained and disciplined forces in paragraph one.  In paragraph two Washington employs the phrase “well organized” as a synonym for “well regulated”.
Thus when we read the Second Amendment that “A well regulated militia, being necessary to the security of a free state” it could just as easily read “A well trained, ordered and disciplined militia, being necessary to the security of a free state”.  That makes complete sense.  An untrained, undisciplined and disorganized force won’t do much good.


Hence the second clause, “the right of the people to keep and bear arms, shall not be infringed” clearly means what it says.  It states with unqualified certainty  that no governmental entity, be it federal, state or local, has the right to prohibit law abiding citizens from procuring, keeping, using and trading weapons for self defense or any other peaceful purpose.



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"Half the people are stoned and the other half are waiting for the next election.
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Paul Simon




Wednesday, June 12, 2013

The Failure of Conservatism

Libertarians often depend upon self styled “conservative” politicians to protect them from the unending encroachments of the collectivist sate.  However, the unabated growth of intrusive, expensive and overbearing government provides ample proof of their failure.  This disturbing trend has been sustained through Republican, Democratic and mixed governments.

The root cause of this futility is that conservatism is neither a governing philosophy nor an organizing principle for society.  As defined by its father, Edmund Burke, conservatism is an outlook that reverences a given society’s culture, traditions and institutions as gifts of Divine Providence.  Thus the culture, traditions and institutions of China are right for the Chinese, while those of England are right for the English and those of Russia are right for the Russians and so on and so forth. 

Thus Burke, who was a British MP, supported the American Revolution as he believed that the Colonies had naturally evolved their own unique culture, institutions and traditions and that the English monarch was unjustly suppressing them.  By the same token, Burke opposed the French Revolution as he viewed as destructive of uniquely French institutions, customs and traditions.  In retrospect, Burke proved to be prophetic.  The American Revolution gave birth to a great and glorious nation while the French Revolution produced a bloody train wreck that plunged Europe into decades of armed conflict.

True conservatives acknowledge that no human enterprise can be perfect and that evolutionary changes in society are not only inevitable, they are desirable.  However, like good economists, true conservatives subscribe to the law of unintended consequences.  They fear that sudden and radical changes in societal institutions are likely to produce unforeseen and undesirable outcomes for years to come.  All too often they have been proven correct as in the cases of the modern welfare state as well as with America’s institutionalized military buildup following World War II.

Because of its embrace of tradition and cautious approach to change, conservatism can easily be caricatured as nostalgic and backward looking.

Its polar opposite, Progressivism, is clearly forward looking.   Unfortunately the future that it looks forward upon is fantastical.  Progressives build castles in the sky that ignore human nature and are unable to withstand legitimate economic scrutiny.  This is why collectivists call economics the “dismal science” because it invariably lets the air out of their dreams.  That is also why Barack Obama would entitle one of his campaign books, The Audacity of Hope.  He clearly understands that it requires audacity to fly in the face of logic and reason to accept his vision for America.

But Progressivism is not about logic or reason.  It is about resentment, envy and a sense of entitlement.  Progressive organizers understand that there exists a vast pool of dissatisfied people who are willing to believe that their problems are not of their own making.  These people are eager and willing to buy into the sophistry of demagogues who promise easy answers and better days.

Left wing organizer par excellence Saul Alinsky understood that his work was unending.  His victories on behalf of one constituency would displace another who would then be ripe for agitation.  Permanent anger.  Permanent revolution.

So what is the dynamic between progressives and conservatives that causes conservatives to continually yield ground?  And what, if anything, is the antidote to the collectivist onslaught?

Remember that both conservatism and progressivism are relativist.  Today’s mainstream conservatives are trying desperately to conserve the America that they grew up in, an America that is chock full progressive innovations that they now defend including government guaranteed retirement, farm price supports, public education, subsidized markets, fiat money, central banking, income taxes,  state sponsored enterprise and public-private partnerships.

While libertarians understand that these policies have only made Americans less prosperous and less secure, progressives will argue that we have not gone far enough.  Progressives will insist that America is only another program or two away from building the kingdom of Heaven on Earth.

Mainstream conservatives find themselves unable to counter new progressive entreaties on principle because they are already defending the indefensible.  Their objections are more those of degree and of percentages, not of superior alternative vision.  Therefore, conservatives continually find themselves face down; with their fingernails clinging to dust while progressives drag them leftward by their ankles.

What is needed to combat the seemingly inevitable advance collectivism is a cogent and compelling moral case for individual liberty and free markets.  It requires an anchor composed of universal and absolute principles to which free people can moor the ship of state to avoid the drift to arbitrary totalitarianism.  It needs a compass, always pointing to true north, to steer  this vessel into the warm waters of peace, freedom and prosperity.  Libertarian philosophy provides this. 

Classical Liberals such as John Locke,  Tom Payne and America’s Founders made the moral case via Judeo-Christian teachings about human dignity, individual worth and equality before the Creator and the Law.  Others, like Ayn Rand, make the moral case via secular Objectivist philosophy.  Still others like Mises, Hayek and Rothbard demonstrate, through economic utility, how freedom elevates the human condition by facilitating peace and prosperity.   However you approach it, the righteousness of liberty is unassailable and undeniable.   

Conservatism is a sentiment which, I must admit that I share.  But libertarianism provides a philosophy and a set of principles that is based in human reality that can rationally and logically debunk the demagoguery of the progressive soothsayers.


Our job a libertarians is to make this case in our schools, our churches and in our workplaces, among our friends, families and associates.

Since I originally posted this blog, I have had occasion tho revisit F.A. Hayek's Why I Am Not a Conservative.  This is a far better treatment of this topic than which I could ever hope to aspire.



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"Half the people are stoned and the other half are waiting for the next election.
Half the people are drowned and the other half are swimming in the wrong direction."
Paul Simon