Tuesday, May 18, 2010

The Fed Audit Goes the Way of the Tea Party

"Once you admit that the individual is merely a means to serve the ends of the higher entity called society or the nation, most of those features of totalitarianism which horrify us follow of necessity."

- F.A. Hayek, The Road to Serfdom (1944)

When Congressman Ron Paul proposed his bill to subject the Federal Reserve System to regular audits, it was no secret what his ultimate objective was. If there was any doubt, his subsequent book, End the Fed, eliminated it. Congressman Paul hoped to educate the public about just what the Federal Reserve does – transfer wealth. With regularly scheduled audits, average Americans would see that new money and credit created by the Fed in the form of loans makes its way quickly and consistently to Wall Street, defense contractors, and government agencies.

Meanwhile, people would slowly begin to catch on that this apparent act of magic was not without a cost; that in fact, they were bearing the cost themselves through the loss of their purchasing power due to inflation of the money supply. This could plausibly start a popular movement to do exactly what Paul has been calling for throughout his political career. The key to the strategy was to educate Americans on the principle at issue with the Federal Reserve.

The principle is each individual's right to keep his own property, which the Fed is completely antagonistic to. The Federal Reserve System is an instrument of theft. Even if managed flawlessly (which it never has been) by its government-appointed central planners, the Fed would still accomplish every one of its goals by taking property from some people and giving it to others. It is no less a wealth redistribution scheme than Medicaid, food stamps, or Social Security. The only difference is a cosmetic one. Instead of clumsily removing dollars from Person A’s bank account and depositing them into Person B’s, as Congress does through taxation and appropriation, the Fed operates with a more graceful subtlety. It allows Person A to keep his dollars while merely creating new ones for Person B.  However, Person B’s new purchasing power has not been created.  It has been stolen from Person A, whose dollars are now worth something less than they were before the new dollars were printed.

It is no mistake that a state-controlled central bank with an exclusive monopoly was one of Karl Marx’s ten planks of the Communist Manifesto. A system in which people are forced to use a state-sponsored currency, manipulated by a central bank to transfer wealth in support of the goals of the state at the expense of the individual is a completely communist, collectivist idea. No matter which monetary policy is pursued, the existence of monetary policy is anti-capitalist and anti-freedom.

Sadly, that central point has been largely obscured due to the varied ideologies of the people that make up the coalition that Congressman Paul has put together.  Instead of an indictment of the ongoing theft that central bank monetary policy represents, the focus has shifted exclusively to the money and credit created during and after the financial crisis of 2008.  The newly proposed one-time audit will show that the funds were directed towards Wall Street banking giants and foreign central banks.  Both then and now, the cries of "but what about average Americans?" can be heard from populists of every political persuasion.  It  is no longer a question of whether or not we should steal, but rather how we should split up the loot.

It is important to remember that even if 100% of the money and credit in question was instead directed to average Americans in danger of mortgage foreclosure, it would still be stealing.  The purchasing power in question would still have been taken from Person A in order to be redistributed to the troubled borrowers.  Moreover, it would be just as economically destructive, as all wealth redistribution by government ultimately is.  The only distinction would be that a different special interest group would be benefitting at the expense of the rights of those victimized to underwrite them.

This dearth of principle is pervasive in political protest movements in America today.  There are no end of demagogues calling up the ghosts of early American heroes of liberty; some even wearing three-cornered hats for effect.  The Tea Party is one example.  Certainly it is laudable that its members oppose "Obamacare," but how many would show up for Tea Party rallies if opposition to Medicare was also part of the platform?  In reality, the lion's share of support for the so-called Tea Party comes from Medicare beneficiaries who object not to government-provided health care, but to the program that they benefit from being cut to fund a program for other people.  They also largely support the forced redistribution of wealth from individuals to military contractors and the government in support of the United States' worldwide military establishment, which they extol as if it weren't also a massive government program.

It is a sobering reality that any real understanding of liberty has been completely eradicated in the minds of most Americans today.  Instead, we have become a collection of special interest groups, all competing with each other politically for other people's money.  Our "progressive" education system has rendered most Americans completely incapable of conceiving that there is an alternative to a government-directed economy.  When confronted with the bank bailouts of 2008, the universal, conditioned response was one of outrage that wealthy bankers were getting public funds and average American homeowners were not.  The idea that it was a violation of the rights of those from whom the money was taken never entered into their minds. 

Why would it?  That principle had never been taught to them in school.  It was not voiced in the media.  No politician, conservative, liberal, or otherwise, articulated it at all.  The closest thing to it was the "moral hazard" argument, that rewarding the people who caused the problem would only lead to further problems.  However, this is a sound economic argument made from a collectivist perspective, based upon what might acheive the best aggregate results, rather than one based upon freedom or individual rights.  That the economic analysis happens to be true in the case of the "moral hazard" argument only further obscures the fundamental principle that makes it true.  One might conclude from this argument that central planning and wealth redistribution would be beneficial if the planning and redistribution were done more wisely.  The moral hazard argument correctly points to a negative effect but distracts us from the underlying cause - the violation of individual rights.  It is this underlying cause that is at the root of every societal problem facing America today.

All resistance to government wealth redistribution is a good thing, regardless of whether the motives of every protestor are completely "pure" as defined by political theorists.  The one-time audit of the Fed will be helpful, even if it is motivated in large part by the politics of jealousy rather than principle.  However, it is the job of everyone who believes in and yearns for freedom to point out early, often, and loudly that the central objection to the Fed should be that it steals in the first place, not to how it divides up the take.  Once that distinction is clear in the minds of average Americans, it is a cure for virtually all of our afflictions of government.

Check out Tom Mullen’s new book, A Return to Common Sense: Reawakening Liberty in the Inhabitants of America. Right Here!


© Thomas Mullen 2010

Monday, May 3, 2010

Fighting For Our Freedom?

To even question the active wars in Iraq and Afghanistan or the now-institutionalized worldwide military empire being maintained by the U.S. government draws tourrettes-like attacks from all who identify themselves as conservatives.  Not only are critics of U.S. foreign policy accused of being unpatriotic or even traitorous, but conservatives routinely go so far as to label them ungrateful.  The argument goes that critics of the empire enjoy the freedom of speech with which they criticize the government only because the military has fought to defend that freedom.  Therefore, those who oppose the present wars or our military presence around the world should be ashamed of themselves for "biting the hand that feeds them."

Of course, this argument rests upon an assumption.  The assumption is that if the U.S. had not fought any of its past or current wars or had not maintained its military presence around the world, that we would have lost some or all of our freedom.  This fundamental assumption is never questioned (or I suspect even considered) by supporters of U.S. foreign policy, despite the fact that it completely disintegrates under even superficial examination.

Let's give conservatives WWII for now, Pat Buchanan's interesting arguments notwithstanding.  Is there any credible argument to be made regarding any of the major wars that the United States has waged since 1945 wherein one could conclude that not fighting it would have resulted in a loss of freedom for Americans?  What chain of events can any reasonable person construct whereby U.S. citizens would have lost their freedom if not for the invasions of Korea, Viet  Nam, Afghanistan, or Iraq?

The first two post-WWII wars were justified for ostensibly the same reason.  We supposedly had to prevent the communist governments of North Korea and North Viet Nam from taking over South Korea and South Viet Nam, respectively, because if we did not, communism would spread like a virus throughout all of Asia and eventually the world.  This was the so-called "Domino Theory."  While anyone with a globe that is more or less correctly scaled can see through the ridiculousness of the argument in terms of Korea, one need not even resort to conjecture to refute this argument regarding the Viet Nam war.  History has shown in its case that the domino theory was completely untrue. 

North Viet Nam did take over South Viet Nam.  The U.S. pulled out of Viet Nam in defeat and the very outcome that the U.S. had spent 14 years, the lives of 50,000 U.S. soldiers, and hundreds of billions of dollars attempting to prevent came to pass.  The communists took over all of Viet Nam.

Did American citizens lose any freedom as a result?  No.  In fact, as young men were no longer conscripted into the army to participate in this futile exercise, anti-war protestors were no longer being suppressed, and a huge chunk of government spending was eliminated (in theory, anyway), Americans were actually far freer once the war was lost than they were while it was being fought.  

There is no argument to be made, no matter how far logic is stretched or how much disbelief is suspended, that Americans lost any freedom as a result of the loss of the Viet Nam war.  Therefore, the assertion that the troops fighting it were "fighting for our freedom" must be false.

Moreover, communism didn't spread like wildfire beyond Viet Nam. After approximately 12 years, it imploded there just as it did in China at about the same time.  In the mid-1980's, the Vietnamese began transitioning to a market economy, just as China did.  Today, both countries are arguably as capitalist as the United States, which unfortunately isn't saying much.

As for Korea, the most generous conclusion one could come to regarding the "fighting for our freedom" theory is that the jury is still out - sixty years later.  U.S. troops are still stationed at the 38th parallel, supposedly keeping the communist barbarians from taking over South Korea as a stepping stone to the rest of the world.  Here speculation is certainly necessary, but not random speculation.  While it certainly would not be a postive outcome for South Koreans, can anyone seriously argue that if North Korea took over South Korea tomorrow that American freedom would be lost or even noticeably diminished?  How?

Fast forward 25 years and consider the present war in Iraq.  That war was started based upon on the assertion that Iraq possessed weapons of mass destruction that it was preparing to use against its neighbors to destablize the Middle East.  Let's pretend for a moment that this assertion was not proven completely false.  Exactly how would another war in the Middle East, which would presumably resemble Iraq's ten-year war with Iran, jeapordize the freedom of American citizens?  What cause and effect relationship could possibly be established between Middle Eastern politics and American freedom?  This question has to be answered before the "fighting for our freedom" assertion can be proven. 

There is only one answer: none.  The Middle East has been unstable for thousands of years, and freedom has come and gone for countless western nations regardless of political devleopments in the Middle East, with the exception of the actual invasions of Western Europe by Muslim nations in the Middle Ages.  Those were ultimately defeated.  Certainly today the Middle Eastern nations pose no military threat to Europe, much less the United States.  To assert that Afghanistan could possibly threaten American freedom borders upon the absurd.

Putting the active wars aside for the moment, any objective observer would be even harder pressed to conclude that the U.S. military presence in the other 135 countries in which the U.S. maintains troops is contributing anything toward American freedom.  Can anyone seriously argue that if the U.S. government were to remove the 56,000 troops presently stationed in Germany that American freedom would somehow be jeopardized?  How?  The same question applies to  the 33,000 troops in Japan, the 10,000 in Italy, and so on.  There is simply no reasonable argument to be made that Americans would be one iota less free if all of these troops were to come home.

Warfare conducted for any purpose other than defending the borders of the nation does not make Americans freer.  On the contrary, it destroys freedom without exception.  More of Americans' property is confiscated in taxes to support warfare.  Freedom of speech is curtailed.  Opponents of the war are rounded up and imprisoned or exiled.  Privacy is destroyed by the government in search of enemy spies or saboteurs.  These destructions of freedom have occurred during every war that the United States has ever fought, including all of the wars of the past 60 years.

Furthermore, America's vast military presence in countries where no active war is being fought also results in less freedom for Americans.  Regardless of the public relations efforts of the U.S. military establishment, foreign troops are universally regarded the same way by the citizens of countries where they are stationed: they are resented.  This resentment breeds terrorism in some countries and other forms of protest in others.  Americans traveling abroad are much less free in what they can do, where they can safely go, and where they are welcome because of resentment born of U.S. troops stationed in foreign nations.

As Randolph Bourne famously observed, "war is the health of the state," and the state is the enemy of freedom.  America was founded upon the idea that the state was "at best a necessary evil" and that there was an inverse relationship between war and liberty.  James Madison wrote that if "tyranny and oppression come to this land, it will be in the guise of fighting a foreign enemy. No Nation could preserve its freedom in the midst of continual warfare."  History has proven him correct.  In the post-WWII era, the wars have become more numerous and longer and government has grown exponentionally.  With the expansion of war and the state, freedom has diminished.

This is not an argument for pacifisim or against the actual soldiers.  We live in a world with other nations that pose a threat to our lives and liberty and there must be some means to defend ourselves against an aggressor nation.  Whatever their reasons for joining, the men and women who serve in our miltary do make a huge sacrifice.  The overwhelming majority of them serve honorably both on the battlefield and off.  They join believing that they are defending our nation and freedom and the blame for our foreign policy does not rest with them.  A military force cannot function with each of its members questioning every order before carrying it out.  They have an obligation to disobey an order which is obviously immoral, such as shooting a non-combatant or torturing a prisoner, but beyond situations like those they must carry out their orders without question.  They place a sacred trust in their civilian leaders to deploy them only when it is absolutely necessary.

It is those civilian leaders who have violated that trust over and over again for the past sixty years.  It is they who have not supported our troops, spending their lives like so much loose change in wars that have been fought for everything but freedom.  They have sent them to countries that pose no military threat to the United States whatsoever and then tied their hands with rules of engagement that, whether intentionally or not, have prolonged those wars for years and even decades.  There can be no greater insult to the honor of brave soldiers than to exhort them to give their lives defending freedom when in fact freedom is not at issue in the war.

The United States government is broke.  It has accumulated a debt that can never legitimately be repaid.  While entitlement programs are ultimately far more economically destructive, costing over twice as much as U.S. military adventures, the $700 billion annual military budget is the next largest contributor to the deficits.  Of that $700 billion, less than $200 billion is spent fighting the two current active wars.  An active war should represent the high water mark of government spending, yet most of our military expenditures go to support standing armies in places like Germany and Japan. 

It is evident that the military could be downsized by orders of magnitude without jeapordizing U.S. security in the least.  In fact, the U.S. would be far more secure without troops in 135 countries inspiring resentment against Americans and fighting wars against nations that could not launch a military attack against the United States in anyone's wildest dreams.  Most importantly, the lives of hundreds of thousands of our troops, their opponents, and the innocent civilians in the countries that they fight in would be spared.

The gargantuan U.S. military establishment survives because American soldiers and civilians continue to accept the assertion that it is necessary to preserve our freedom.  This assertion is at best a destructive delusion and at worst an insidious lie, told by people who care nothing for our troops or the civilians they defend.  It is time to stop believing the lie and to truly support our troops.  Bring them home.

Check out Tom Mullen’s new book, A Return to Common Sense: Reawakening Liberty in the Inhabitants of America. Right Here!


© Thomas Mullen 2010