Tom Mullen's Blog

Tom Mullen's Blog Has Moved!

2011-05-26T17:02:00.000-04:00

If you are looking for new articles by Tom Mullen, they can be found at his new website at http://www.tommullen.net/. All new posts since the February 2011 launch, as well as all previous posts, can be found there. Thank you for your interest and support.

Government Solutions Are Anti-Intellectual

2011-03-14T12:31:00.001-04:00

One of the first things that children are taught is that might does not make right. When a fight breaks out among children, their parents tell them that the person who threw the first punch was wrong. Not only was the aggressor wrong, but he was acting unintelligently. It is the one who has run out of ideas that resorts to the use of force. The bully is the dummy, while the child who seeks to resolve disputes through conversation and agreement is the intelligent one.

Most adults continue to recognize this fundamental law of nature, at least most of the time. An adult who resorts to initiating violence to solve disputes is recognized as childish and unintelligent – except when it comes to public policy.

Somehow, we have forgotten that all government action represents the use of force. This is obvious when the government is utilizing its military during wartime, but it is no less true when the government provides healthcare, education, or regulates business activity. Regardless of what problem the government is attempting to solve, it is applying the use of force in order to solve it.

When the government runs a health care program, those who must pay for it are forced to pay. When the government guarantees loans for education, taxpayers are forced to pay when those loans default. Even the most minor laws are backed up by the threat of force. If anyone doubts this, he should neglect to pay a traffic ticket and see what happens.

America was founded upon the principle that government action was only justified when one individual or group had committed aggression against another. As Thomas Jefferson put it,

“Our legislators are not sufficiently apprised of the rightful limits of their powers; that their true office is to declare and enforce only our natural rights and duties, and to take none of them from us. No man has a natural right to commit aggression on the equal rights of another; and this is all from which the laws ought to restrain him.”

How far we have drifted from this basic understanding of the natural law. Today, Americans not only look to government to address every aspect of life that they find displeasing, but they hold up those who advocate this use of brute force as the intellectuals and those who argue that most issues should be addressed through consensual agreement as unsophisticated or unintelligent. While Jefferson said that governments are instituted solely to secure our rights, we now have a government that violates them on a massive and systemic scale.

Instead of trying to understand elaborate theories on how government intervention into our lives is good for us, we should remember what we learned when we were five years old. Only dummies resort to the use of force.

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

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© Thomas Mullen 2011

Austrian Economics Is Scientific (Keynesianism Is Not)

2011-02-26T23:14:00.003-05:00

On February 9th, Rep. Ron Paul of Texas chaired his first meeting of the House Monetary Policy Subcommittee that he now leads due to the Republican victories in last November’s congressional elections. Congressman Paul invited several expert witnesses to testify to the committee on their opinions about monetary policy. Among these were Austrian economist Tom Dilorenzo.

Much has been made of Rep. Lacy Clay’s attack on Dilorenzo’s credibility due to his alleged association with a “politically incorrect” group called the League of the South. However, Clay also attacked the Austrian school of economics itself, calling the “Austrian deductive method a non-rigorous scientific method.” Clay bases this allegation on the fact that Austrian theory is not based upon “an empirical method to study economics.” He refers to the fact that the Austrian school does not recognize the Keynesian theoretical models or the aggregate data that those models rely upon to “prove” their theories scientifically.

However, as Robert Wenzel has pointed out, Nobel Prize winner F.A. Hayek has already addressed this criticism and argued that economists should indeed use the deductive method, rather than an empirical one to understand economic principles. He even suggests that Robert Rubin would likely agree with Hayek’s argument, because of what Rubin called “the very nature of reality--its complexity and ambiguity.”

It is somewhat futile to try to win this argument with entrenched government policy makers. The Keynesian school advocates massive government intervention into the economy in order to protect us from the supposed shortcomings of the free market. When crises in the economy occur, the Keynesians recommend even greater intervention in the form of increased government spending, regulation, and monetary expansion.

The Austrian school advocates no government intervention into the economy at all. They argue that monumental crises are actually caused by intervention, so their cure is to cease whatever intervention has brought on the crisis, to relax regulations that impede adjustment in the labor market, and to allow the economy to rebalance itself through natural market forces.

Therefore, governments are not likely to reject Keynesianism, which grants them enormous power, and listen to the Austrians, who would strip it all away. One is reminded of the medieval governments that refused to acknowledge that the world was round and called upon appointed court scientists to legitimize their assertion that it was in fact flat.

However, it is important for investors to understand which theory within the “dismal science” truly does pass scientific muster. If you cannot dissuade the government from basing their policies on the wrong theory, you can at least choose the right one yourself to protect your own wealth and economic viability.

Anyone who has taken a basic chemistry class in high school remembers how you prove or disprove a theory. You conduct experiments to determine whether the predictions that your theory makes are correct. For example, your theory might predict that mixing two colorless chemicals in a test tube will result in the mixture turning blue. To prove it, you must not only conduct the experiment once, but over and over again, yielding the same result. If your test tube turns blue under the same conditions every time, you have proven your theory. If not, your theory is considered invalid and a new one must be formulated.

Austrian economists like F.A. Hayek predicted the Great Depression when the Keynesians said that the economy was fine. Once the crisis hit, the Austrians argued that the Keynesian policies prescribed to cure it would fail, as they were just an increase in the interventions that had caused the crisis in the first place. When massive government spending and devaluation of the currency failed to pull America out of the Depression, the Keynesians argued that more of the same to underwrite WWII would finally do the trick. Yet, the Depression lasted throughout the war and only subsided when it was over and there were massive cuts in government spending, consistent with the predictions of the Austrians.

The Keynesian answer to this anomaly? Ignore the results and just state that Keynesian policies did cure the Depression, regardless of indisputable facts to the contrary. This is science?

The Keynesians were also explicit that high unemployment and price inflation could never coexist together. The Austrians made no such claims, as they recognized that monetary expansion causes both price inflation and the malinvestment that leads to unemployment. In the 1970’s, Austrian theory was again proven correct and Keynesian theory proven wrong.

Most recently, the Keynesians argued that the technology and housing bubbles were not bubbles at all, but sustainable increases in wealth caused by their wise stewardship of the economy. If you listened to them, you were either wiped out by the NASDAQ crash or left owning a house with an underwater mortgage, or both. If you listened to the Austrians, you got rid of your technology stocks early during the formation of the bubble and avoided buying houses whose price had been bid to unsustainable levels by the combination of monetary expansion and government intervention.

Even after all of this proof is in, the Keynesians are still employing the only defense they have left that their theory is sound. Deny, deny, deny. With government and consumer debt threatening to cause cataclysmic economic collapse, the Keynesians are encouraging government and consumers to borrow and spend more. The Austrians advise consumers to pay down their debts and investors to avoid the next bubble. They urge investors to protect their wealth in gold and other commodities, as they have for the past decade. Those that have listened to them have turned huge profits during this historic economic calamity.

Imagine that you are back in your high school chemistry class lab, conducting experiments. In the row behind you, an Austrian economist is testing his theory. The test tube turns blue one time after another, just as he predicted it would. In the row ahead, a Keynesian economist is testing his theory. His test tube turns a different color every time and then finally explodes, lighting his beard on fire. Which one would you deem the better scientist? Which one would you bet your life savings upon in the next experiment? If you wish to take the scientific approach, listen to the Austrians.

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

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© Thomas Mullen 2011

Release the Kraken

2011-02-21T18:35:00.001-05:00

I prefer the 1981 film version of Clash of the Titans for many reasons. Among them is its nuanced portrayal of Zeus’ decision to release the Kraken upon the city of Joppa. He clearly does this reluctantly due to the immense power and possible unforeseen consequences of letting loose this uncontrollable force. When Poseidon opens the undersea gate and watches the creature emerge, he is clearly awestruck by the size and destructive potential of the beast. One can imagine what question must have been preeminent on his mind. “How am I going to get this thing back into the cage?”

There is no better metaphor for the United States and its government since the turn of the 20th century. It was at that time that government was released from its chains – and it has been on a rampage ever since.

In his seminal book, The New Freedom, Woodrow Wilson wrote,

“We used to say that the ideal of government was for every man to be left alone and not interfered with, except when he interfered with somebody else; and that the best government was the government that did as little governing as possible. That was the idea that obtained in Jefferson’s time. But we are coming now to realize that life is so complicated that we are not dealing with the old conditions, and that the law has to step in and create new conditions under which we may live, the conditions which will make it tolerable for us to live.”

While Wilson’s unqualified dismissal of America’s founding principle of government might startle 21st century readers, the reasoning he employs to justify it is even more incredible. Just a few pages after declaring that Jefferson’s system is no longer viable, he goes on to say that the Americans of his time are actually living under Alexander Hamilton’s system. He is to a great extent correct on this. By 1912, the Republican Party, philosophical descendants of Hamilton’s Federalists, had indeed made great strides in establishing the Hamilton platform of corporate welfare, protectionism, and a large and adventurous military establishment.

However, this system was completely antithetical to Jefferson’s truly free market, whereby the government merely enforced contracts and protected individuals from aggression against their rights. Here, Wilson has made a colossal non sequitur – that Jefferson’s system should be scrapped because Hamilton’s system isn’t working. The confusion – between crony capitalism and truly free markets – persists to this day.

Thus, we have not only released the Kraken, but we have done so for completely illogical reasons. It has been rampaging over our lives, liberties, and properties for over a century now and shows no signs of tiring. It is time to either get it back in its cage or find a man on a flying horse to save us.

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

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© Thomas Mullen 2011

Orlando Sentinel Op Ed: Vitriol Has Been a Proud Tradition

2011-02-09T01:02:00.001-05:00

In the past, it has taken a war for the government to summon the courage to attack the very first right protected in the “Bill of Rights.” While constantly under attack, the right of free speech has withstood the invocation of all manner of horrors to convince people that it must be violated by the government to keep us safe. Now, it seems, the solitary act of a mentally ill man is enough to persuade Americans to falter.

The shooting in Arizona on January 9 was tragic. However, the argument that “irresponsible speech” had somehow helped to motivate it is completely separated from reality. In fact, the assertion that political speech is more “extreme” now than in the past is false. The spewing of raw invective at political figures is one of America’s oldest and proudest traditions.

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But I Paid Into It...

2011-02-06T15:21:00.004-05:00

Critics on the left have quite correctly pointed out that Tea Party activists who oppose President Obama’s “socialism” are hypocritical in that they do not oppose Social Security for themselves. The most common rebuttal to this criticism is usually something along the lines of Social Security being fundamentally different because the recipients pay into it. However, this argument is no different than arguing for a right to steal your younger neighbor’s car because an older neighbor has stolen yours. Allow me to explain.

Most people are aware that Social Security has begun paying out more in benefits than it collects in payroll taxes. However, it had run surpluses for decades that most beneficiaries honestly believe is funding the shortfall until the demographic imbalance caused by the baby boom evens out. Since they “paid into it all of their lives,” supporters of Social Security distinguish it from Aid to Dependent Children or other wealth transfer programs. Inherent in this thinking is both factual inaccuracy and flawed logic.

First, even if those surpluses had gone into a “trust fund,” no one disputes that Social Security has always been a predominantly “pay-as-you-go” program. In other words, the overwhelming majority of the money collected from payroll taxes went to fund benefits for current beneficiaries. Thus, payroll taxes were taken from one group of people and paid out to another, just like public welfare.

One might argue that the surpluses generated previously meant that at least part of the money being paid to current beneficiaries was their own money, held in trust for their retirement. However, this is also completely untrue. The surpluses have not been held in cash since 1939. Instead, when the program runs a surplus, the government is legally obligated to use the money to purchase U.S. Treasury bonds, which are nothing more than securities documenting that you have loaned the federal government money. So, by law, any surplus collected in payroll taxes for Social Security must be lent to the federal government (which immediately spends it on operating expenses). In return, Treasury Bonds are put into the trust fund.

For those who remember and decry this change in 1939 as a betrayal, remember that the FDR administration had also taken the U.S. off the gold standard (domestically). Had the government continued to merely hold reserves in cash, the reserves would have been outstripped by inflation by the time the benefits were payable to most beneficiaries.

Most people think of the treasury bond arrangement as the government putting their money into a “secure investment” that will pay them interest with very little risk. However, this is logically absurd. Treasury bonds are not “an investment.” An investment is a loan or advance of capital made in the hopes of earning interest from a producer of goods or services. The fundamental question anyone asks before risking their money with a bond issued by a private business is “How are you going to pay me back?”

The answer that would be given by a private sector business would be, “By using the capital that you have loaned us, we are going to expand our productive capacity. With the new products that we will produce and sell, we will be able to pay back your investment with interest and still make a profit.” Thus, if you purchase a bond issued by a computer manufacturer (i.e. lend it money), then the computer manufacturer is able to repay you with interest out of the new computers it was able to produce with the money it borrowed from you.

However, the federal government does not produce computers. The federal government does not produce anything. So, how does it answer the question, “How will you pay me back?” There is only one answer: “We will tax people in the future to pay back your loan principle and interest.”

Thus, even the so-called “trust fund” does not represent a store of your own money, held in trust for your retirement. 100% of your money was spent the moment that it was received by the government. Most went to underwrite the benefits of current beneficiaries. The rest was spent on other government boondoggles and replaced by promises to repay you by taxing other people. Not one dime of current benefits represents a “payback” of one’s own money. Social Security is every bit as “socialist” as Aid to Dependent Children, Medicaid, Medicare, or any other government transfer of wealth. Where do you think it got its name?

There is a bit of irony here that probably also escapes most Americans. While the federal government’s modus operandi for many years now has been to merely pay off the interest on its debt and issue new debt to cover the principal as bonds come due, let’s consider what would happen if they actually started repaying the principal on their bonds.

The longest term bond is a 30-year Treasury note, which means that you loan the government the money for 30 years. Suppose that in 1970, you were a 34-year-old, dutifully paying your Social Security taxes. Most of your money went to pay current beneficiaries, but a small portion (your share of the surplus) went into 30-year Treasury notes. In 2010, you are one year from retirement and ask the government, “Where are you going to get the money to pay back the principal and interest on that 30-year Treasury bond?” As bizarre as the answer might seem, the answer would be, “Why, from you, of course.”

However, the most socialist aspect of Social Security is not that it represents a transfer of wealth. It is that the program is mandatory. The only way for the government to accomplish a transfer of wealth from one party to another is to force people to participate. This is why George W. Bush’s proposal to “privatize” Social Security would not have made it any less “socialist.” People would still have been forced to participate; only they would now have the option of handing their money over to W’s tax-subsidized buddies on Wall Street rather than to the federal government. Imagine if he had been successful in implementing this in 2004.

Free market capitalism and socialism truly are opposites, but the fundamental difference is one of rights, not economics. True free market capitalism recognizes every individual’s right to keep the product of his labor and dispose of it as he sees fit. Social Security denies this right. It must be responsibly phased out, without cutting off present beneficiaries, and replaced with nothing. That prospect should scare no one at this point. With a government that is $14 trillion in debt and planning to borrow more every year for the foreseeable future, I would trust the most irresponsible individual that I know before the federal government – with his retirement money and mine.

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

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© Thomas Mullen 2011

A Modest Proposal for Interposition

2011-02-01T08:24:00.007-05:00

So, the Tea Party Congress is seated and the “revolution” is underway. After voting to repeal Obamacare, a largely symbolic gesture that has no hope of passing in the Senate or overturning a presidential veto, the new Congress has outlined its plan to attack the federal deficit. The result: A proposal to cut $100 billion in “non-defense discretionary spending.” While that may sound like a lot of money to someone who hasn’t taken a gander at the federal budget in about 50 years, it amounts to a little under seven percent of this year’s deficit.

That’s right. Seven percent of the deficit, not the budget. In other words, the tea parties, the stormy town hall meetings, the supposed “mandate from the people” to cut the size and scope of the federal government will result in the government spending $1,380 billion more than it collects in taxes this year instead of $1,480 billion more. Worse yet, the same people who “stormed the Bastille” and threw the former bums out will defend this proposal with half-hearted panaceas like “you have to start somewhere.”

However, if history has taught us anything, it is that this isn’t “just the beginning,” with more substantial cuts to follow. This will be the high water mark as far as reduction in government spending is concerned. We should expect that by the time that this proposal goes through the process of back room deals and compromises with special interest-motivated committee members, that the $100 billion number will be reduced by at least half, perhaps more. They may even end up increasing federal spending. Would anyone honestly be surprised?

It has been obvious for at least a century that “throwing the bums out” doesn’t make a lick of difference in the behavior of our elected officials. Now we know that staging protests, waving signs, raising a ruckus at town hall meetings, and then throwing the bums out doesn’t make a difference either. Clearly, it is time to stop doing the same thing over and over again and expecting a different result.

The nullification movement has been decried by the left as right wing extremism at its most dangerous, despite the fact that it was conceived and introduced by Thomas Jefferson, the father of the Democratic Party. However, I have a proposal that I believe both conservative and liberal Americans would find very reasonable. There is a way to use the idea of state interposition to force the Congress to at least listen to its constituents. Let’s put the idea of interposition together with another of Jefferson’s ideas, drafted by him in a resolution of the Continental Congress in 1775 in response to Lord North’s Conciliatory Proposal.

“That this privilege of giving or of withholding our monies is an important barrier against the undue exertion of prerogative, which if left altogether without our control may be excercised to our great oppression; and all history shews how efficacious is its intercession for redress of greivances and reestablishment of rights, and how improvident it would be to part with so powerful a mediator.”

Let me be clear. As opposed as I am to all taxation, I am not suggesting that one dollar be cut from the existing tax schedule for 2011. What I am suggesting is that the people exercise their right to withhold their taxes until the Congress does what the people have clearly mandated them to do – balance the budget. A seven percent cut in the deficit just isn’t enough and we are running out of time. We can argue later about the role of government and the wars in the Middle East and Social Security and the rest. Right now we have to take away this Congress’ ability to borrow any more money or we’re going to be in the same boat as Greece.

I am not calling upon people to exercise civil disobedience or rebel. The stakes are high in either of those endeavors and we have other options. I am calling upon people to utilize their state legislatures to support them in withholding their taxes until a balanced budget is passed by Congress. As much as I’d personally like to see them withhold their tax money permanently, they would then release the funds to the federal government.

This would be accomplished in the same way as several other recent nullification/interposition efforts. The state legislatures would pass a law indicating that no person or business in their state could be prosecuted or fined by the federal government for failing to file an income tax return or failing to pay their quarterly payroll tax deposits, so long as said filings and payments were made within sixty days of the Congress passing a balanced federal budget. For those who still trust the people less than they do the government, a stipulation could be added that the funds go into escrow and be audited by the states, if necessary.

This would accomplish two things. First, it would reestablish exactly who works for who in this relationship. Obviously, elections have failed to do that. More importantly, it would work. The blind fear that would grip our legislators when they realize that the party is really over would at least scare them sober enough to balance what would still be an over $2 trillion budget. While it wouldn’t solve our long-term problems, that truly would be a start.

Bloated governments are imploding all over the world and ours is poised to do likewise for all of the same reasons. Now that we have seen what “extremism” really looks like in Greece, Egypt, and Tunisia, this proposal should strike any rational person as reasonable and moderate. We do not need a rebellion or violence to balance the federal budget - just a little adult supervision.

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

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© Thomas Mullen 2011

You're On Your Own

2011-01-12T00:36:00.005-05:00

There are no end of commentaries on the recent murders in Arizona, resulting in the usual debates. Pundits argue over whether there should be stricter gun laws, whether talk radio, the movies, or “extremism” contributed to the tragedy, and, most obtusely, what the government should do to prevent a similar incident from occurring again. What is lost is the fact that this tragedy provides yet more proof of something that has been demonstrated to Americans repeatedly over the past decade. The government cannot protect you from the harsh realities of life.

Most people are good people, most of the time. Under normal circumstances, most people would rather cooperate with their fellow human beings in order to achieve their goals rather than steal from them or kill them. However, some people, at least some of the time, do not “live and let live.” During every moment that we are alive, someone somewhere is committing a crime. Someone is experiencing hardship, whether due to their own bad judgment, laziness, or just plain bad luck. Worst of all, someone is planning to commit an act of violence. These truths are confirmed by all of human history.

What is unique about the time that we live in now is the extent to which people believe that the government can shield them from these challenges. Never has a society had such high expectations of their government to ensure their security - both personal and economic security. The early 21st century is truly a high-water mark in terms of belief in government to eliminate all risk from the game of life. Over and over, we are offered proof of how foolish this misplaced faith is.

On 9/11/2001, a group of insane fanatics defeated what was at the time the most sophisticated security apparatus in human history and perpetrated heinous crimes against thousands of innocent civilians. The government failed to prevent this crime. The one set of murderers that was not successful was thwarted by private citizens acting on their own. They did not save their own lives, but saved the lives of hundreds, possibly thousands, of others. Our response to this outcome was to give the government more power and private citizens less liberty and privacy.

A few years later, another unbalanced individual tried to blow up a plane with explosives concealed in his shoes. He, too, had defeated the by that time even more powerful government security apparatus and was thwarted by private citizens. Our reaction to that incident was identical.

Last year, the pattern repeated with the so-called “underwear bomber.” The government failed and private citizens thwarted the killer. Again, more power was given to the government and more liberty stolen from the people. We are now allowing ourselves to be photographed naked and physically violated by the government in the hopes that the next time the results will be different.

In 2002, a deranged man walked into the Appalachian School of Law and began shooting students and faculty. There were no police on hand when the shooting started. This is not meant as a criticism of the police. It is unreasonable to expect that there will be an officer present whenever a random act of violence occurs. In any case, when the shooting started, two private citizens ran to their cars and retrieved their firearms. They confronted the shooter, forced him to drop his weapon, and tackled him to the ground. He was eventually arrested and prosecuted.

However, the fact that private citizens bearing firearms had prevented further bloodshed was omitted in the media coverage of the incident. Following the familiar pattern, the government was given more power and private citizens lost more of their liberty. Stricter gun controls were enacted in Virginia. A few years later, with campuses forced by law to be “gun free zones,” the victims at Virginia Tech were powerless to resist.

Luckily, this latest incident in Arizona did not take place on a college campus, an army base, or any other “gun free zone.” The brave man who tackled the shooter in Arizona said that he was not afraid to do so “because I was armed.” More importantly, this was another example of private citizens defending themselves and their neighbors. The police arrived after the shooter was subdued and fulfilled their proper function in a free society – to arrest the person who had committed the crime.

The repeated failure of government to protect us from the uncertainties of life is not limited to violent crimes. Over and over again, we have looked to government to provide us with economic security and have been similarly disappointed. We sanctioned its war on poverty and got more poverty. We allowed its central bank to loot our wealth in the hopes that it would prevent recessions and inflation and we got more severe recessions and more rampant inflation. We let the government bail out corporations to save jobs and restore economic growth and we got higher unemployment and less new businesses.

As with personal security, our reaction is to reward these failures with more power for the government. More wealth redistribution. More power to the central bank (but I repeat myself). More bailouts. Consistent with the pattern, the only economic security we get comes from private individuals cooperating voluntarily with each other to create new products, new industries, and new opportunities for those seeking work.

In a free society, the government should never be charged with preventing anything. The very definition of the word “prevent,” when used in relation to government, is a repudiation of liberty. Since government is nothing more than the societal use of force, it cannot prevent anything without initiating force against the innocent. The whole idea that someone is “innocent until proven guilty” assumes that the government is not allowed to act until after a crime is committed. Force must be initiated by one party or the other. Until a criminal commits his crime, he is innocent. To apply force against him at that point is a crime itself. Moreover, since we do not know who will commit the next crime, the government can only attempt to prevent it by initiating force against everyone. This is the trap we fall into by relying on government to prevent hardship in our lives.

If liberty and the state can coexist, the state’s role must be a retrospective one. It must only be allowed to act when one human being has committed aggression against another. This applies to crime, economics, safety, and foreign policy. At one time, the United States did not go to war unless the president could convince Congress that direct aggression had already been committed against the United States. If you doubt that, read the requests for a declaration of war made by Madison, Polk, McKinley, Wilson, and Roosevelt. Read the subsequent resolutions by Congress to declare war. In each case, those documents demonstrate the principle that military action by the government is not justified until aggression has been committed by the other nation.

This might prompt some to respond that in order to be free, we must relegate ourselves to being victims, or “sitting ducks,” able to act only after it is too late. This is a false assumption, rooted in a failure to recognize one undeniable fact of our existence. As far as the preservation and security of our lives is concerned, we are all on our own. No government, no matter how powerful, can assume the responsibility we each have to defend our lives and determine our own destinies. We can allow the government to rob us of our liberty, our property, and our privacy. We can create the kind of police state previously relegated to dystopian fantasies like 1984 or V for Vendetta. Even then, the government will fail - and then ask for more power as a reward for its failure. Must it come to that before we acknowledge the obvious?

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

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© Thomas Mullen 2011

Jesus Christ, Libertarian

2010-12-24T11:38:00.008-05:00

“Then the scribes and the Pharisees brought a woman who had been caught in adultery and made her stand in the middle. They said to him, "Teacher, this woman was caught in the very act of committing adultery. Now in the law, Moses commanded us to stone such women. So what do you say?" They said this to test him, so that they could have some charge to bring against him. Jesus bent down and began to write on the ground with his finger. But when they continued asking him, he straightened up and said to them, "Let the one among you who is without sin be the first to throw a stone at her." Again he bent down and wrote on the ground. And in response, they went away one by one, beginning with the elders. So he was left alone with the woman before him. Then Jesus straightened up and said to her, "Woman, where are they? Has no one condemned you?" She replied, "No one, sir." Then Jesus said, "Neither do I condemn you. Go, (and) from now on do not sin anymore." (John 8: 3-11)

As we approach the new year with conservatism again ascendant in the political sphere, this story of Jesus’ uncompromising libertarianism seems even more timely than stories of his birth, despite the approach of his celebrated birthday. Nowhere does Jesus admonish “social conservatives” more harshly.

There is an important distinction here. By “social conservative,” I do not mean anyone who disapproves of certain human behavior. The freedom to follow the dictates of one’s conscience was the first inalienable right recognized by the founders of our nation. If one truly believes that homosexuality, adultery, or other “non-conservative” behavior violates the laws of God, it is that person’s inalienable right to disapprove of it, even to voice his disapproval of it, regardless of the anguished cries of the political correctness lobby on the left.

However, no one has a right to use violence against those who engage in behavior that does not harm another person, regardless of whether or not that behavior violates the laws of God. Since all laws are enforced under the threat of violence (as this story illustrates wonderfully), Jesus makes it clear in this passage that it is not for men to enforce the laws of God. With the exception of cases in which one human being has done injury to another, the right to punish human behavior is reserved for God.

It is important to recognize that Jesus does not condone the sin that the anonymous woman has committed. When he has shamed away the mob who would have stoned her, Jesus commands her to sin no more. Neither does he insinuate that her behavior might not have consequences for her soul. With flawless libertarian reasoning, Jesus teaches us the true meaning of freedom: that God grants us the liberty to do as we wish, even to reject him and his laws, but that we also bear the full consequences of our actions. If we harm another person, then we are subject to the laws of men. However, it is otherwise left to each individual to determine the will of God according to his conscience and to choose whether to act accordingly or not. There never has been nor can there ever be any body of corruptible men who can save an individual’s soul.

This is by no means the only place in the gospels that Jesus teaches us this lesson. His entire public ministry was one condemnation after another of the hypocritical, socially conservative theocracy. Indeed, it is the Jewish state that is Jesus’ chief antagonist throughout the gospels. He is noticeably disinterested in the more secular Roman government, despite its tyranny over his people. While he certainly doesn’t approve of the Romans, he has no interest in political revolution. As Jesus tells Pilate, “my kingdom is not of this world.” (John 18:36). However, his own government does not merely commit secular, political oppression against its people. It usurps the authority of God and attempts to judge in his place. For this, Jesus constantly lets loose his most venomous reproaches.

Throughout the gospels, “the chief priests and Pharisees” are constantly shown up for what they are. They do not seek to punish sins to defend the honor of God, but for their own selfish political motives. Their persecution and eventual murder of Jesus himself is quite obviously perpetrated out of fear of his influence over the people. And what is this subversive influence that warrants torture and death? “Love one another as I have loved you. Love your enemies. Do unto others as you would have them do unto you.” Of course the state would hate such a message. It runs afoul of every depravity that the state tries to exhort its citizens to, including its wars, its persecution of non-conformists, and its rampant looting of the citizenry dressed up as “public works.”

When Jesus encounters man-made laws masquerading as the laws of God, he openly condones breaking those laws. When his disciples pick fruit on the Sabbath and are caught in the act by the Pharisees, Jesus beats the Pharisees at their own game by citing Jewish scripture, which describes David actually eating sacred bread out of the temple, reserved for the priests by Jewish law.

Demonstrating how perverse any theocratic state eventually becomes, the Pharisees then bring a man forward with a “withered hand,” daring Jesus to cure him and break the law himself. They are willing to see this man miss his one chance to be cured in the hopes that they can use their distorted interpretation of God’s command to “keep holy the Sabbath” to ensnare Jesus for political ends. Jesus breaks the law without hesitation, saying that “it is lawful to do good on the Sabbath.” Caring little for the wisdom of the lesson and interested only in maintaining their own autocratic power, the Pharisees withdraw to begin planning Jesus’ murder. (Matthew 12: 1-14)

By attempting to use the law to enforce their morality, social conservatives violate the very principles that they say that they cherish most. Social conservatives decry Islam because it attempts to “propagate the faith by the sword.” However, there is only a cosmetic difference between promoting your religious views through acts of terrorism and doing likewise through passing unjust laws against minorities who have no recourse but to obey or suffer violence. In both cases, it is the sword that compels the victim rather than the mind or the heart. Neither can social conservatives rely on the argument that their laws are passed by an elected body representing the people. If that justifies socially conservative laws, then what is their objection to the welfare state?

No part of this argument should be misconstrued as an endorsement of political correctness or the left’s agenda to grant positive rights to their own special interest groups for political purposes. If we are truly a free country and we meant what we said in the first amendment to our Constitution, then every individual, whether the most fundamentalist Christian or the most libertine atheist, should have the right to speak freely, even if what they say offends another person. For many devout Christians, it is their sacred duty to try to persuade their fellow man to repent of his sins and embrace Jesus as his savior.

However, there is an ocean of difference between persuasion and coercion. The minute that we say, “there ought to be a law,” we are picking up the sword. If we do so in defense of the inalienable human rights of life, liberty, and property, we are within our rightful authority. If we do so to supplant the authority of God, we become the very type of people that Jesus spent his life fighting against. To truly be Christian, we must recognize the need for “a wall of separation between church and state.”

Jesus was very clear about his views on what would lead to salvation and what would not. Jesus condemned many behaviors, like adultery, that social conservatives likewise condemn. He also said that “no one comes to the Father except through me.” (John 14:6) However, he does not go on to say, “Therefore, if your brother does not come to me willingly, then draw your sword and force him.” Salvation must be chosen; God did not create a race of slaves.

As we celebrate the birth of this great libertarian, let us not forget the lesson of his life and death. Jesus was murdered by the theocratic state for exposing their hypocrisy and resisting their unjust, blasphemous laws. Let us follow his example of speaking our minds according to our consciences but never raising our hand to save our brothers’ souls. Each one of us will ultimately find that our understanding of the will of God is imperfect, as we are imperfect. Therefore, we must follow Jesus’ example of tolerance and forgiveness, lest we find that we ourselves have mistakenly punished the innocent. Our laws should keep us from harming each other, and leave each person’s soul to the judgment of God.

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

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© Thomas Mullen 2010

Progressives Should Target the Real Robber Barons

2010-11-28T13:02:00.008-05:00

The political winds have shifted wildly over the past four years. After decisive defeats in both the 2006 and 2008 elections, the Republican Party’s prospects seemed dreary. There was widespread talk of how the party needed to “remake itself.” There was even speculation from some quarters that it would fade from influence permanently, as had its predecessors, the Whigs and Federalists. Certainly, the conservative movement needed a rallying point in order to regain a foothold upon public sentiment.

That rallying point was public aversion to the radically socialist agenda of Barack Obama and the Pelosi Congress. Regardless of whether the Republicans had any new ideas to offer, they were able to remake their image quickly by jumping aboard and partially co-opting the Tea Party phenomenon. Somehow, they have again established themselves in the minds of most Americans as the party of small government, free markets, and individual liberty, their consistent behavior while in power notwithstanding.

Now, it is the Democrats who find themselves on the wrong end of a one-sided mid-term election defeat, with more of the same looming over the 2012 presidential elections. As much as the 2008 elections were a repudiation of George W. Bush and all associated with his philosophy, 2012 will be a repudiation of Obama and all associated with his. If the modern “conservative” philosophy had been thoroughly discredited two years ago, the modern “liberal” philosophy has been annihilated this year. Nothing that Democrats won on in 2006 and 2008 is going to fly with voters right now. The left needs a rallying point that will resonate with voters and make them forget why they voted them out of office just two years earlier, just as those same voters forgot why they had voted the Republicans out merely two years before the 2010 mid-terms.

If they are not to completely abandon their image as champions of the poor, disadvantaged, and working class against the power of the wealthy elite, they must find a way to restore that perception in the minds of voters without associating themselves at all with socialism, which average Americans have quite obviously choked on and spit out over the past two years. They need their own avenue to tap into the Tea Party phenomenon, or a grass roots movement like it, and appear as the party fighting for the people against a federal government run amok. Their traditional anti-corporate, pro-welfare platform won’t work. For better or worse, Americans right now associate corporatism with the free market and aversion to welfare programs has never been more ascendant. However, there is a rallying point available to the left that is completely consistent with the modern progressive philosophy and which conservatives are completely ignoring.

The left’s political dominance during the 20th century all began with the early progressive movement, which was given its first life under Republican presidents Teddy Roosevelt and William Howard Taft. However, it was the “new freedom” promised by Woodrow Wilson which established and defined the progressive platform, subsequently advanced in great strides by FDR and Lyndon B. Johnson. A core tenet of this philosophy was the need to protect “the little guy” against the robber barons of capitalism – which the progressives successfully defined in the minds of voters as anyone of great wealth, whether they have achieved that wealth legitimately or not.

Indeed, the tragic aspect of the early progressive movement was that they lumped together all successful business people as plunderers and exploiters of the working class, thus discrediting free market capitalism along with the crony capitalism that was as rampant at the time as it is now. Along with corrupt railroad companies that soaked the people for corporate welfare, only to deliver shoddily constructed railroads that all went bankrupt, the early progressives also targeted companies whose success was due to superior products and lower prices, with their profits earned from consumers voluntarily choosing to buy their products.

John D. Rockerfeller’s Standard Oil was one such example. His company was dismantled by the government after more than two decades of offering the public higher quality oil at lower and lower prices. Instead of holding him up as an example of what a truly free market could achieve for the common man, the left attacked Rockerfeller as the definitive robber baron, regardless of facts to the contrary. With his company dismantled by the government, Rockerfeller abandoned the free market and became the robber baron he was wrongly accused of being. He decided to get into banking.

This is not to repeat the mistake of early progressives. All bankers in the 19th and early 20th century were not robber barons, nor is banking a de facto dishonest profession. Like any other business, it offers a service of great value to the public when that service is voluntarily purchased by consumers. When consumers choose to store their savings in a bank or allow the bank to invest their savings by loaning it out at interest, the banks that most conscientiously and wisely protect their depositors’ interests will prosper the most. Those that make good loan decisions will be able to pay higher interest rates to depositors and provide more stability. In a truly free market, they will win, because they benefit average Americans – the political base of the progressives – the most.

However, this is not the banking model that John D. Rockerfeller helped found in 1913. Rockerfeller was no longer interested in competing on a level playing field and relying on talent and hard work to make his fortune. He had already done that successfully and had been plundered by the government for his trouble. He was not interested in being victimized again. This time, he would be the plunderer. Along with J.P. Morgan, Rockerfeller sent a delegation of men to Jekyll Island in 1913 to devise the mother of all robber baron schemes – the Federal Reserve System.

The Federal Reserve System is the most ingenious fraud in human history. It appeals to the right because it is seen as an institution of capitalism. It appeals to the left because it is seen as a regulator of the financial system that protects the little guy from the supposedly violent machinations of unregulated capitalism. In the meantime, it funnels trillions of dollars of plundered wealth to politically-connected corporations at the expense of average Americans and those corporations which still actually prosper because they offer superior benefits to the public.

Without getting into what really goes on behind the scenes at the Fed, let us consider what the Fed purports to try to do. Ninety-seven years of results notwithstanding, the Fed supposedly regulates the market by maintaining both full employment and price stability. The left supports this agenda because its constituency depends upon jobs and affordable consumer goods in order to survive. They never stop to think about how the Fed attempts to accomplish these goals.

The Fed attempts to maintain full employment through inflation. Inflation is properly defined as an increase in the supply of money and credit, not an increase in consumer prices (more on that in a moment). During periods when unemployment is higher and overall economic growth is lower, the Fed attempts to stimulate investment in new business ventures or expansion of existing ventures by “lowering interest rates.”

However, Mr. Bernanke cannot lower interest rates with a fiat command. Instead, the Fed manipulates the interest rate by buying large quantities of U.S. Treasury bonds from its member banks. This artificially increases the demand and lowers the supply of U.S. Treasuries. It also artificially increases the supply of money available to be lent in the market. With more money available to be lent, banks offer loans at lower rates than they would if money were in shorter supply. With lower rates, more businesses take out loans with which to expand or start new ventures. At the end of this chain of events, more average Americans supposedly get hired in order to support the new business activity that has been “stimulated” by the Fed’s monetary expansion.

Taking the Fed at its word, there is still a rub to this story. The magic described above and in the Fed’s press releases does not come without a cost. The money and credit infused into the economy during this process does not come from any “reserve” that is held by the public or by the privately-owned Federal Reserve. It is created out of thin air by the Fed, which enjoys this privilege as a result of legal tender laws and the Federal Reserve Act. By increasing the overall supply of dollars in the economy, this monetary inflation drives up the price of consumer goods.

It also causes capital to be misallocated, meaning that working people are hired for projects that are not ultimately going to succeed. This inevitably happens much more frequently when banks are able to loan “free money.” When they must convince depositors to invest their own money in loans the bank wishes to make, they are forced to make much wiser choices with that capital than when the money is simply created out of thin air and handed to them, with more fiat money forthcoming if they should make a mistake. In fact, a true understanding of the economics behind monetary inflation reveals that misallocation – economic booms and busts – are inevitable when monetary inflation is allowed to take place.

Progressives should automatically be suspicious of this whole charade simply because Wall Street loves it. Whenever the Fed makes an announcement that it will attempt to lower interest rates, the stock market immediately goes up. Of course it does. Cheap money hitting the market allows investors to get in on ground floor companies and pump up their stock value with newly-created money, subsequently bailing out long before the bust occurs. When the reality hits the market that half of these new companies had no viable business plan, the stock prices collapse and the ventures go out of business and lay off their employees. This is a recession. Average Americans are unemployed while the sharks who gobbled up the cheap money to pump and dump the stocks are sitting on a beach, enjoying the fruits of their heist.

Furthermore, while monetary inflation causes prices of consumer goods to rise for everyone, it is really average Americans and the poor who are most affected by it. When the price of gasoline rises to seven dollars per gallon, the Wall Street elite have lost purchasing power in terms of the dollars they hold, but they more than make up for it during the economic booms. Millionaires become billionaires, negating the effects of a further devalued money supply, while average Americans living paycheck-to-paycheck start looking for second jobs just to pay their rent and fill up their gas tanks to get to work.

However, the most compelling reason for progressives to oppose the Federal Reserve System is because of what it openly admits it represents. Taking the Fed and its supporters at their word, the Fed is nothing more than a subtler, more devious version of “trickle-down economics,” whereby large corporations receive huge sums of money in the hopes that they will then create jobs for the little guys. There is absolutely no difference between this argument and the “Reaganomics” of the 1980’s. Any self-respecting progressive who opposed Reaganomics must oppose the Federal Reserve System. If they are not strictly opposed to government redistribution of wealth, they certainly are opposed to redistributing from the middle class and poor to Wall Street. That was the whole principle upon which the movement was founded.

There is no reason that the left should concede the Tea Party movement to conservatives. It is not fundamentally a Republican phenomenon. It is just that the Republicans are the only party that has been able to adapt their rhetoric to what the Tea Party demands to hear. The Tea Party is rediscovering America’s founding principles. However, their perceptions are being skewed toward the conservative founding philosophy that advocated corporate welfare, a large military establishment, and a central bank to provide the necessary capital - plundered from average Americans. They quote Jefferson but are deceived into supporting policies consistent with his political arch-enemy, Hamilton. They need to hear from the left on what they are missing, instead of being vilified by the left as kooks.

The true American philosophy of free enterprise as expressed by the liberal Jefferson was completely opposed to the central bank of the time, recognizing it as incompatible with the free market and wholly a vehicle for big business to plunder the people. These ideas have been dead and buried for an entire century while the Fed has been allowed to wreak its havoc with impunity. They are ripe for rebirth within the Tea Party, which would embrace Jefferson’s ideas about the dangers of central banking as readily as they do his warnings about big government. There is a strong populist undercurrent in the Tea Party. Progressives are ignoring it at their peril.

Never in its existence has the Fed been under such scrutiny in the media as it is now, nor the subject of so much public opposition. It is a grassroots fire smoldering beneath the surface, waiting for someone to strike a match. To liberals and progressives everywhere, don’t let the conservatives snatch this opportunity out from under your noses. Take up your fight against the real robber barons – the Federal Reserve System and all of its beneficiaries.

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

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© Thomas Mullen 2010

The Government Can't Create Jobs (And It Shouldn't Try To)

2010-09-12T22:56:00.011-04:00

As the November elections approach, politicians are doing what politicians do best: making promises. President Obama’s anti-business image, justified or not, will not score points with voters this year as unemployment continues to court 10% on the government’s math and 20% in the real world. With these figures virtually unchanged since he took office, the president has been unable to sell the idea that his economic policies have created any jobs. So, he is doing the best he can with the hand that he has dealt himself and trumpeting the millions of jobs his policies have “created or saved.” In addition, he has rolled out yet another boondoggle from the Keynsian toolbox in the form of a $50 billion infrastructure package designed to stimulate the economy and finally create some actual jobs.

Meanwhile, the Republicans are gearing up for what should amount to shooting fish in a barrel in the coming mid-term elections, getting incredible traction on criticizing Obama policies which largely mirror those of George W. Bush, for which he and the Republicans were tossed out of office just two years ago. They correctly point out that Obama’s policies haven’t created a single job. Americans must put them back into office or face economic Armageddon. Polls show that Americans are largely buying what the Republicans are selling, having apparently forgotten the “jobless recovery” of the early part of the last decade, which occurred while the Republicans controlled the White House and both houses of Congress.

The truth is that neither the Republicans’ “supply-side economics” nor the Democrats “demand-side economics” have ever really created any jobs. Certainly, the housing boom successfully put some people to work in the homebuilding industry for a few years. However, when that bubble popped there was nowhere for those people to go. The Democrats’ success seems to have been limited to the 600,000 or so people that took jobs with the census bureau. Unfortunately, the demand for people counting won’t sustain a census-driven recovery. Obama’s latest act of political desperation isn’t getting much traction with anyone – even liberal talking heads are finding it hard to get behind another supposed “infrastructure” program, especially one that pales in comparison (in terms of dollars) to the American Recovery and Reinvestment Act, which was long on investment and short on recovery.

So, if neither supply-side nor demand-side economics work, if neither the Republicans nor the Democrats have a program that will actually create jobs that will outlast the average car loan, where else can we look for an answer?

Perhaps we should reconsider exactly what it is that we are asking the government to do. People of all political persuasions talk about “creating jobs” as if there were no question that the government should be trying to create them, the only question being what program will create the most jobs, the highest paying jobs, or the longest lasting jobs. This is just another in an endless series of false dichotomies that accompany every election year, when voters are served up a “debate” that is framed to include two undesirable alternatives, with no acknowledgment that there may be a third. On job creation, that third alternative is this: the government can’t create jobs, regardless of whether conservatives or liberals are at the controls, and moreoever, it shouldn’t try to create jobs.

Amidst the noise surrounding an election year, it is easy to forget the obvious. Before deciding what to do about unemployment, let’s answer a few fundamental questions. The first one is, “What is a job?”

A job is an agreement between a buyer and a seller that involves an exchange of private property. The buyer is the employer, the seller, the employee. The two parties reach an agreement wherein the buyer will purchase a specific service from the seller at a mutually agreed upon price. This simple fact does not change whether the employee is selling his services as a brain surgeon or a custodian. In each case, the buyer has a need for the seller’s services and the seller is willing to sell those services to the buyer if the buyer is offering the market price or better. The most important aspect of this transaction is that it occurs with the mutual, voluntary consent of both buyer and seller. This is the only way in which a job can be created.

When people are perfectly free to dispose of their labor as they see fit, including their unconsumed labor in the past (their savings or capital), there is a natural coordination in the labor and capital markets that results in people and resources being used most efficiently to meet the demand of consumers. People are not employed to produce products that consumers don’t want or can’t afford because employers are risking their own money and livelihoods and therefore must invest their capital (savings) in projects that will be profitable. Neither do most employers prefer to invest in temporary projects that will end in six months or a few years, because they would then have to take the risk of starting a whole new business. Neither employers nor employees are ever 100% correct, but for the most part they make the right choices because they stand to gain or lose personally based upon those choices. These natural market forces regulate the market, based entirely upon the voluntary choices of employers, employees, and the consumers who buy their products.

However, when the government attempts to create a job, all of these natural forces are removed. The market has produced no demand for the government-created job. In other words, no buyer has voluntarily agreed to purchase those services, because to do so under current market conditions would be unprofitable. Were it profitable to hire someone to do the government-created job, an employer would have done so voluntarily. So, the government steps in and forces the taxpayer to purchase those services against his will. In additional to violating the taxpayer’s rights, the entire coordination that existed between employer, employee, and consumer is disrupted.

A typical response to this argument from the left would probably revolve around how the profit motive and the greed of employers is what kept the person unemployed. However, this argument begs the question: Why were these greedy employers unable to make a profit from employing this person?

The answer is that the services of the employee were not demanded by employers because the products that would be produced as a result were not demanded by consumers. If consumers were willing and able to buy the products that the employer and employee would have produced together related to this job, then there would be no need for the government to create it. By overriding the choices of consumers and forcing them to purchase those services for the employer, the government not only engages in a theft, but causes vast resources to be devoted to producing products that no one will eventually buy. Thus, when the government “investment” in the job is spent, the job no longer exists. It generates no revenue on its own to allow it continue to exist.

To use one of the favorite buzz words of the progressive left, government-created jobs are unsustainable. They are all doomed to fail by their very nature because they attempt to set aside economic laws that cannot be set aside. Commerce cannot exist without voluntary choice. Government job programs attempt to override the choices of capitalists on what to invest in and the choices of consumers on what to consume. This is what produces millions of empty homes, food shortages born of miracle energy programs, and mass amounts of people unemployed. Worst of all, these programs destroy the capital that otherwise would have created real jobs that were demanded by the market. This is not because private investors are more noble creatures than government bureaucrats, but because their own livelihoods depend upon investing that capital wisely and profitably.

While it is easy to see how this argument applies to the government spending programs that are presently more associated with the Democrats, one should not forget that the Republicans’ ideas are no less wealth redistribution and no less destructive to the economy. Most arguments made by the Republicans involve targeted tax cuts that will either stimulate specific areas of the economy or merely leave more money in the hands of private investors in general. While this sounds like the exact opposite of what the Democrats are proposing, it is really just the same strategy dressed up in “free market clothes.”

In the present paradigm, where the supposedly free market is already distorted by a thousand government interventions and taxes are sky-high for everyone, decreasing taxes for a particular class of people is merely a back-door way to try to override the free choices of investors and consumers. If the cuts are targeted at specific industries, such as the oil industry, then more oil will be produced regardless of the true demand for oil by consumers. If the cuts are general in nature, then whatever that capital is invested in will be investment not by private decision but by government central planning.

One might ask, “How can this be?” Aren’t the investors spending their own money? Not really. The Republican plan never involves a reduction in spending to go along with reductions in taxes for the investor class. In fact, every Republican administration in the past forty years has increased government spending while cutting taxes, leading to large deficits that are funded by debt or inflation. This merely transfers the tax burden of that government spending to other taxpayers. In other words, the jobs “created” through supply-side economics are really funded by taxpayers – by present taxpayers through the loss of their purchasing power due to inflation or future taxpayers through government debt. This explains why the artificial booms accompanying Republican administrations never last either.

The only real answer to the economic malaise is to stop asking the government to create jobs in the first place. Real jobs can only be created by individuals agreeing to exchange their labor and capital by mutual, voluntary consent. The use of force cannot create a job any more than it can create freedom, either here or anywhere else in the world. Furthermore, it represents violation of the very rights that government exists to protect. Instead of voting for candidates that claim that they can create jobs, Americans should demand that government get completely out of the job-creating business in particular and central planning of the economy in general. Only a massive decrease in government spending, leaving capital in the hands of the people who earned it and allowing employers, employees, and consumers to make their own choices can stimulate true job creation. Anything else is just another government program that is destined to fail.

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

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© Thomas Mullen 2010

Remarks to the Punta Gorda Tea Party July 3, 2010

2010-07-05T12:25:00.003-04:00

I would like to thank the organizers of the Punta Gorda Tea Party for giving me the opportunity to come here today and speak to you on this joyous occasion. I say “joyous occasion” because I suspect that everyone of you, like me, has at sometime in the past imagined that he or she was the only person in the world who understood that our liberty was in jeopardy, or who cared enough to do something about it. Yet, today, although the danger has never been greater, there is joy in my heart, as I hope there is in yours, because of what this movement has made plainly obvious: we are not alone! In fact, to paraphrase words attributed to Japanese Admiral Yamamoto after the attack on Pearl Harbor, I believe that those who would dare to attack our liberty have merely awakened a sleeping giant.

I would like to take just a few moments to reflect upon the meaning of that which we fight for, to share a few words from those who established this land of liberty, and to humbly suggest to you an idea to carry forward in this sacred fight. I want to start with the question that I began my first book with, which is, “What is freedom?”

234 years ago, a man named Jefferson answered that question for us. I would like to share a few passages from Mr. Jefferson’s favorite philosopher. This man’s writing was so important to Jefferson that he actually had a resolution passed that said,

“Resolved, that it is the opinion of this Board that as to the general principles of liberty and the rights of man, in nature and in society, the doctrines of Locke, in his 'Essay Concerning the True Original Extent and End of Civil Government,' and of Sidney in his 'Discourses on Government,' may be considered as those generally approved by our fellow citizens of this, and the United States.”

I share this with you not to make some theoretical or academic point, but because the ideas Jefferson refers to have the utmost relevance to the struggle we find ourselves in now. Let me read to you the opening words of the essay by John Locke that Jefferson cites:

“TO understand political power right, and derive it from its original, we must consider, what state all men are naturally in, and that is, a state of perfect freedom to order their actions, and dispose of their possessions and persons, as they think fit, within the bounds of the law of nature, without asking leave, or depending upon the will of any other man.”

“A state also of equality, wherein all the power and jurisdiction is reciprocal, no one having more than another; there being nothing more evident, than that creatures of the same species and rank, promiscuously born to all the same advantages of nature, and the use of the same faculties, should also be equal one amongst another without subordination or subjection…

You no doubt recognize that this was the source of those famous words, “We hold these truths to be self evident – which means that no proof is required, for these truths can be directly observed in nature – that all men are created equal, that they are endowed by their creator with certain unalienable rights.”

I wanted to read those passages from Locke because they contain a very important point. Our natural liberty is not the license to do anything we wish. We must exercise our will “within the bounds of the law of nature.” But what are those bounds? What is the law of nature?

Locke tells us. “The state of nature has a law of nature to govern it, which obliges every one: and reason, which is that law, teaches all mankind, who will but consult it, that being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions.”

So, natural liberty is the right to order our actions AND DISPOSE OF OUR POSSESSIONS as we see fit, as long as we do not harm another person in his life, health, liberty, or possessions. Libertarians today call this “the non-aggression principle,” but it is really the principle of natural liberty itself. It is the fundamental, founding principle of the United States. It is vitally important that the connection between liberty and non-aggression be understood, for it is upon this foundation that the limits on government power rests.

Jefferson confirmed this many times over the course of his life. Whenever he was asked about the role of government in a particular matter, he consistently applied the non-aggression principle. In a letter he wrote in 1816, he said, ““Our legislators are not sufficiently apprised of the rightful limits of their powers; that their true office is to declare and enforce only our natural rights and duties, and to take none of them from us. No man has a natural right to commit aggression on the equal rights of another; and this is all from which the laws ought to restrain him.”

Of religious freedom, Jefferson wrote, “The legitimate powers of government extend to such acts only as are injurious to others. But it does me no injury for my neighbor to say there are twenty gods, or no god. It neither picks my pocket nor breaks my leg.”

On another occasion he wrote, “But rightful liberty is unobstructed action according to our will within limits drawn around us by the equal rights of others. I do not add 'within the limits of the law,' because law is often but the tyrant's will, and always so when it violates the right of an individual."

There are many more quotes just like these that I could read, but the point is made. You may ask yourself, “what does this have to do with Obamacare or any of the countless other present incursions into our liberty?” The answer is this: the reason that Obamacare violates our liberty is because it violates the non-aggression principle, which is liberty.

Now, I want to stop here to draw a crucial distinction. Non-aggression is not pacifism. While the principle of liberty forbids us to initiate force, we have a right and a duty to defend ourselves with force, if necessary, against those who commit aggression against us. And so, in order to secure our rights, we delegate this individual power to government – making government the societal use of force. It is also crucial to remember that all government action is backed by the force of arms. When we make laws, they must be followed or he who breaks the law will encounter that armed force. This power comes from us, from each individual – from our right to use force in self defense. However, we cannot delegate a power to government that we do not possess individually, and so the limit on government power is the same as the limit on individual power: that force may only be used in defense against aggression. When government is kept within this limit, its people are free. When it goes beyond this limit, even if the intentions are good, it is initiating force against its people and we call this tyranny.

When one person steals the property of another, we employ the societal use of force – government – to compel that person to make restitution and to accept punishment for the crime. This is consistent with the non-aggression principle. We call this justice.

When a foreign nation attacks us, we employ our military to defend our lives and liberty with force against that nation. This, too, is consistent with the non-aggression principle.

However, when the government makes a law that says that one person must pay the medical bills of another, or purchase a product that he does not consent to purchase, then it is the government that is the aggressor. It is the government that initiates force against someone who has not committed aggression himself. This is a violation of the non-aggression principle - a violation of liberty - and that is why it cannot be tolerated by a free people. No law written by men can violate the law of nature.

I respectfully suggest to all of you that this be the measuring stick against which you judge all acts of government, from its economic policies, to its criminal law, to its foreign policy. It was the non-aggression principle that our founders used to determine the limits of government power. It is the founding principle of our nation. Once you apply it, you will find that our government has violated our liberty for many decades. This has happened under Republican and Democratic rule. At home, it is characterized by the massive redistribution of wealth, not just for welfare for the poor, but for bankers on Wall Street, for farmers, for scientists, for educators, and for every one of us in programs like Social Security and Medicare – all of these are violations of our liberty that we must begin talking about responsibly phasing out, if we are to regain our freedom.

The violation of our founding principle extends to our foreign policy as well, for we fight wars with nations that have committed no aggression against us. This is a threefold violation: against the people of the nation we attack, against the soldier whose life is risked or sacrificed unnecessarily, and against the taxpayer who is forced to pay for it at the point of the same gun that compels him to pay for Obamacare.

Now, I know that the Tea Party movement strongly supports our troops and so do I. God help us if we ever become a nation that does not honor the men and women who walk in front of bullets to preserve our liberty. However, it is not the soldier that takes us to war. He does not make that decision - not because he is incapable of it - but because for a limited time while he serves, he pledges to follow the orders of his civilian leaders about where he will go and whom he will fight. By doing so, the soldier places a sacred trust in those leaders that they will call upon him to fight only when our lives and liberty are truly in danger.

Now, let me ask you one question: Do you truly believe that those same civilian leaders who have given you Obamacare, the Community Reinvestment Act, Fannie Mae, Amtrak - all of which are failed and bankrupt - were suddenly competent when they made decisions about taking us to war? I will suggest this to you: it is not merely incompetence, but a deliberate violation of our founding principle for the purpose of acquiring power that has informed all of their decisions. Remember that Washington, Adams, and Jefferson spent their entire presidencies trying to keep our country out of foreign wars. As James Madison said, “No nation could preserve its freedom in the midst of continual warfare.”

My friends, we are in a struggle for the greatest idea that the world has ever known: freedom. You, the Tea Party, are being attacked by the established powers with every weapon at their command, and for one reason only: they are afraid of you. They know that their power over you requires your continued consent and you are no longer willing to be governed without it. I ask you to remember the meaning of that great principle of liberty, the non-aggression principle, and apply it objectively to everything that our government does. You will find that most of what it does today violates that principle. In other words, even after we get rid of Obamacare and send this president and Congress job hunting, we will still have a lot of work to do. It will not restore our liberty to vote out those who commit one form of aggression and replace them with people who will merely commit another. We must select representatives from amongst ourselves who will accept the natural limits of their powers or we will be no freer than we are now. But I am joyful today because we the people have that power. We have slumbered for decades, but we slumber no more. The sleeping giant is awake and we are going to win.

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The Government Can't Regulate Safety (And It Shouldn't Try To)

2010-06-27T23:44:00.004-04:00

President Obama has come under heavy criticism for his dictatorial “shakedown” of BP and rightly so. Considering the presidencies of Woodrow Wilson, Franklin D. Roosevelt, Lyndon Johnson, and most recently, George W. Bush, it is no small accomplishment for a president in 2010 to actually commit an unprecedented violation of the U.S. Constitution. I am sure that sooner or later his extortion will be described by his supporters as “bold,” which is the new euphemism for the illegal exercise of arbitrary power.

However, during the June 15 speech* in which he announced this and other planned incursions into what is left of the free market and the rule of law, the president made one very correct observation about the Minerals Management Service (the federal regulatory agency in charge of regulating oil drilling). He said,

"At this agency, industry insiders were put in charge of industry oversight. Oil companies showered regulators with gifts and favors, and were essentially allowed to conduct their own safety inspections and write their own regulations.”

The president correctly recognizes that this is a problem. One cannot reasonably expect that a regulatory agency is going to police an industry if the policemen are all hired directly out of the companies that they are supposed to regulate. However, the president’s statement begs the question, “Who should replace these industry insiders in regulating the safety of deep-water oil drilling?”

The only possible answer is that government-appointed bureaucrats, with no knowledge of or experience with the machinery, equipment, and specific engineering principles associated with deep-water oil drilling should replace them. Of course, logic dictates that if unqualified people start making rules about how equipment and machinery that they don’t understand is operated, there are going to be a lot more accidents. Is there no way out of this dilemma?

There is an important distinction to be made between “laws” and “regulations.” A law is a statute that prohibits conduct that constitutes intentional harm to someone by another person. There are laws against murder, theft, fraud, and other crimes of aggression. A law should always be the exercise of a negative power (the new healthcare bill violates this fundamental principle).

A regulation, on the other hand, has an entirely different purpose. Regulations attempt to prevent economic agents from having the opportunity to harm another person or the environment, whether intentional or not. So, regulations either prohibit actions that do not constitute harm to other people, such as procedures that are considered unsafe by the regulator, or actually compel the regulated person or entity to do certain things that the regulator deems necessary (a positive power). This is why it was necessary for the Minerals Management Service to recruit its regulators out of the oil industry. Who else can tell an oil company how to run an oil well?

However, the president is a bit disingenuous in implying that this agency is unique in being peopled with industry insiders. The practice of hiring insiders to regulate their former employers is the norm in Washington, as is the practice of the regulated companies actually drafting the regulations that they are to be governed by themselves.

If you think that this means that the resulting regulations don’t do a very good job of protecting consumers or the environment, you are correct. Workers aren’t safer since the creation of OSHA, food and drugs aren’t safer since the creation of the FDA, consumers aren’t protected by the Consumer Protection Agency, and as we are now painfully aware, the oceans aren’t safer because of the Minerals Management Service.

However, this “public-private partnership” (formerly known as fascism) does accomplish one thing. It creates massive compliance costs for the companies that are regulated. Combined with the fact that the regulations are written specifically to give an advantage to existing conglomerates, these artificially high start-up costs have the effect of insulating large, established companies from new competition. The result in each regulated industry is a small group of large corporations that have traded their liberty for the high profits resulting from artificially limited competition.

This does not mean that there are not conflicts between government and the corporations. Since the regulations are far too numerous and onerous to be followed, the regulated companies are constantly violating them. When a consumer or environmental issue makes the news, there is an immediate call for more or better regulations to prevent a similar incident from occurring again. The politician uses the incident to seek more power, while the corporation seeks greater protection from competition. The consumer pays higher prices and gets products that are of lower quality and safety than those that would be available in a free market.

This dysfunctional relationship between government, business, and consumers is allowed to persist for only one reason: the widespread misconception that it would be more profitable for unregulated industries to gouge their customers and sacrifice their safety and that of the environment in order to reduce their costs and widen their profit margins. This incorrect assumption flies completely in the face of history.

BP will pay at least $20 billion, not in fines for violating regulations, but in compensation to the people whose lives and properties were damaged by their negligence. There are already widespread rumors that they will be broken up and sold off because of the financial vulnerability resulting from the fall in the price of their stock. Similarly, Enron went bankrupt due to market forces and its officers were prosecuted for breaking the laws against fraud. Both of these outcomes would have been the same without the existence of the regulations and regulatory agencies that governed these companies, because they occurred as the result of the government enforcing property rights, not regulations. When property rights are enforced, the profit motive discourages companies from exposing themselves to liability. Those who do not heed this natural law quickly find themselves out of business.

Thomas Jefferson once wrote, “No man has a natural right to commit aggression on the equal rights of another; and this is all from which the laws ought to restrain him.” He was right. It is a violation of liberty for the government to try to prevent crime or negligence, which it is unable to do anyway. There will always accidents, regardless of regulations that attempt to prevent them. If you want to maximize protection of consumers and the environment, regulations are not the answer.

A truly free market without artificial barriers to new competitors will force companies to constantly improve their products, services, and production processes and limit their exposure to liability. It will also force them to please their customers. The companies that do these things the best will outperform and eventually eliminate those companies that do not. This does not represent “companies regulating themselves,” as President Obama argues, but rather regulation by economic law.

Liberals constantly rail against Big Oil, Big Pharma, and large corporations in general. However, they then call for expansion of the fascist regulatory complex that created them and keeps them big. The cure for the disease is not more of the bacteria that caused it. If you want to see fairness to consumers and protection of the environment, a truly free market is the only answer.

*Transcript of entire speech

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Hooray for Hollywood?

2010-06-21T23:14:00.002-04:00

Libertarians generally cringe at most of what comes out of Hollywood and for good reason. The consistent message from its movies and movie stars is that private property and free enterprise are the scourge of society, that profits are made by exploiting the poor and working classes, and that private industry is the enemy of nature that will eventually destroy the earth.

Given this consistent anti-freedom message, it would be hard to blame anyone for a reflexive roll of the eyes upon hearing that Kevin Costner has come forward regarding the BP oil spill. However, this real-life story has a surprising twist. Costner is not calling for some tax-funded government boondoggle. Nor is he taking the opportunity to lecture the masses about their responsibility to sacrifice their lives and property to save the earth or why they should feel guilty for polluting it merely by being alive. Instead, Costner has provided a solution, born out of his entrepreneurial interest in a new technology, that may be effective in cleaning up the oily gulf.

According to an article in the LA Times, Costner and a business partner acquired Ocean Therapy Industries after the Exxon Valdez oil spill and “has spent 15 years and $24 million of his own money on this technology.” The technology had little commercial potential until the Deepwater Horizons accident, which may also qualify Costner as – gasp – a speculator.

The article goes on to say that, “The machines essentially operate like big, floating vacuum cleaners, which suck up oily water and spin it around at high speed. On one side, it spits out pure oil, which can be recovered. The other side spits out 99% pure water.” Costner and his partner hope to sell the reclaimed oil and donate most of the profits to local parishes which have suffered because of the spill. Presumably, the revenues for selling the machines themselves will constitute a handsome return on investment for Costner and his partner.

Whatever Costner’s political views may be, his actions speak louder than words. He is demonstrating yet again that every innovation that has improved the quality of human life has been the result of entrepreneurs taking risks in the hope of profits. While President Obama is making speeches and looking for asses to kick, private enterprise has stepped forward with a solution that will benefit all parties involved. Like all exchanges in a free market, the customer benefits from a new product that it needs or wants, the entrepreneur is enriched for risking his own money and devoting his own labor and time, and all of humanity benefits from the existence of new technology. There are no “losers” in a voluntary exchange of property.

In all fairness, this technology was originally developed by the U.S. government. However, it took the vision, commitment, and risk tolerance of a private investor to transform the technology into something useful and make it available when the time was right. This is also not without precedent. In the 1980’s, entrepreneur’s saw opportunity in a little-known technology called ARPANET, the result of a partnership between MIT and the Department of Defense. They decided to risk their own money developing this technology into something that would actually be useful to everyday people. They created products and services that billions now benefit from and the entrepreneurs were enriched in the process. Today, we call that technology the Internet.

Hopefully, Costner’s fellow actors, producers, and directors will not vilify Costner for “making money on this environmental tragedy.” I recommend that they look at it that Costner is “making the big, bad oil company pay” for the damage it has done. However, no amount of spin can change the facts. This solution was provided by a private entrepreneur who took a risk in the hope of profits. As far as this crisis is concerned, the score is Market 1, Government 0.

Libertarians don’t get to say this very often, so let me be the first: Hooray for Hollywood! Oh, and Kevin, good luck with your venture. I hope you make a million bucks.

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

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Congressman Ron Paul Endorses A Return to Common Sense!

2010-06-17T21:19:00.003-04:00

“Thomas Mullen is a knowledgeable and passionate libertarian and “A Return to Common Sense” is a valuable addition to the libertarian literature. Those new to the freedom movement will benefit from Tom’s introduction to both the practical and moral arguments for freedom. Long-time activists will benefit from Tom’s explanation of why strict adherence to principle is vital to the future success of the liberty moment.”

- Representative Ron Paul (TX-14)

Get your copy right here!

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The Three Types of Government Spending

2010-06-12T10:29:00.013-04:00

Any objection whatsoever to some new, tax-funded government program elicits a consistent response from liberals or progressives. “You just don’t want to pay your fair share,” or “I guess we won’t see you driving on any of those government roads or calling the government police or fire departments.” The underlying assumption is that taxation is an all or nothing proposition. Either there is nothing that the government can collect taxes for or there is nothing that the government cannot collect taxes for. There are no principles upon which to base an answer to the question, “Is this a legitimate function of government?”

While there are probably thousands of different services that governments spend money on, they can generally be divided into three broad categories: security, public services, and wealth redistribution. Libertarians[1] argue that the only legitimate government spending is on security. Conservatives generally approve of security and some public services with their rhetoric while engaging in all three types of spending when in public office. Liberals generally endorse all three types of spending with both their rhetoric and their actions while in public office.

“Security” includes all government functions which attempt to defend citizens from aggression against their rights by other human beings. These would include the military, various police forces, and the civil and criminal courts. These are the functions of government whose purpose is to secure the individual rights of life, liberty, property, etc.

It is important to remember that even if these are legitimate functions of government, it does not mean that they cannot be abused. For example, a small suburban village in a low-crime area may not need more than the county sheriff for a police force, but may instead bear a tax burden of village, town, county, state, and even federal police forces. However, these debates revolve around how efficiently the services are being provided, not whether they should be provided by the government at all.

“Public services” generally refers to services provided to all members of society. What makes a service a “public service” is that it can be reasonably assumed that every member of the society has an equal opportunity to utilize it. Examples include roads, bridges, public libraries, garbage collection services, and fire departments. Libertarians argue that these are goods and services that the private sector can provide. Their objection to providing them with tax dollars is that those who do not consent to purchase them are still forced to pay. While this is also true of security services, libertarians acquiesce to those on the assumption that it would be impossible to exercise property rights without a government in place to defend them.

Certainly, a bridge between a new suburb and the city may improve commerce for the entire city. However, it is not necessary to protect anyone’s rights. Therefore, libertarians argue that those who want to build the bridge should provide the capital for it themselves and are perfectly within their rights to charge a fee to those who wish to use the bridge. Conservatives have traditionally argued that these services can be funded by the government and provided by private corporations under government contracts. Liberals generally support public services as well, although they sometimes object to them being provided by private firms.

Like security services, public services are prone to abuse and corruption, even if one accepts that they are legitimate functions of government. Public funds are often wasted on services that are not needed or services that are poorly rendered because they are provided by politically-connected government employees or private firms, rather than by the most qualified. Consider the “bridges to nowhere,” the roadwork construction projects that never end, or the multitude of scandals where it was discovered that $500 was spent on a single nail or some other gross abuse of public funds occurred.

The third category of government spending is wealth redistribution. Wealth redistribution collects taxes from one group of people in order to provide services to another group. What makes this type of government spending different from public services is the fact that the goods or services provided do not benefit all members of society equally. For example, health benefits under Medicaid are paid for by all taxpayers but are only available to people whose income is under a defined eligibility level. Thus, those funds are literally taken from one group and redistributed to another. Both libertarians and conservatives argue that this is nothing more than legalized theft, although conservatives have often led or acquiesced to expansion of this type of spending once in office. President Bush’s expansion of Medicare is one of the most recent examples. Liberals and progressives generally support this type of spending, arguing that it is each person’s moral responsibility to “contribute.”

In order to have an informed debate about a new government program, one must identify which category the proposed program belongs in. Too often the distinctions between these categories are blurred by both critics and proponents. Most often, a program that would properly be categorized as wealth redistribution is represented as a public service in an effort to persuade those that must pay for it that it is their civic duty to do so.

For example, if the federal government issues a grant to build a commuter train in Florida, it is really redistributing the wealth of all of those outside of the service area of the train, especially those in other states who were taxed to underwrite the grant. It is certainly not reasonable to assume that citizens of Montana have an equal opportunity to utilize that train, yet they were taxed to fund it. Therefore, a commuter train to benefit Floridians does not fit the definition of a “public service” for the entire nation. Interestingly, it is exactly this type of government spending that the 2010 Census form cites as its primary reason for collecting data (so that your community receives its “fair share” of federal funding).

Similarly, Social Security and Medicare purport to be public services which provide a plan for wage earners to save for their retirement. However, everyone knows that since the beginning of both of those programs, the taxes collected to fund them have gone to pay current beneficiaries, not into some mythical trust fund. In fact, when Social Security did run surpluses in the past (when contributions exceeded the payouts to current beneficiaries), the government spent the excess money and replaced it with its own bonds, which are just promises to pay based upon future taxes! So, Social Security is and has always been a wealth redistribution program. The same is true for Medicare.

Wealth redistribution can even be disguised as security with the right amount of government propaganda. The military is a security function insofar as it defends its citizens against aggression by foreign nations. However, when the military grows beyond what is reasonably necessary for defense of U.S. citizens and into a worldwide institution, surrounded by multi-billion dollar corporations which exist solely to support it, and which both attacks nations that have not committed aggression against the United States and stations troops in over 130 nations, one must ask the question, “Who is benefitting from this tax-funded monstrosity?”

It is hard to make an argument that the security of the United States depends upon the tens of thousands of troops stationed in Germany, Korea, or Japan. U.S. troops arrived in those countries during a war that ended 65 years ago and remained there supposedly because of a Cold War that ended 20 years ago. At this point, the only Americans benefitting from the continuation of the U.S. troop presence around the world are the defense contractors who sell goods and services to the government to support the operations. Is this not wealth redistribution disguised as security?

Often, conservatives will argue that America is protecting her allies by stationing troops in Europe, Asia, and the rest of the world. However, even this argument does not hold up to scrutiny. If the money to support these operations is collected from Americans but really benefits German, Japanese, or other foreign citizens, is this not still wealth redistribution disguised as security? This is one of the main reasons that Washington, Adams, and Jefferson told us not to make those alliances in the first place and spent most of their presidencies trying to keep America out of foreign wars.

Liberals represent the latest government foray into the health care industry as a public service. They claim that this will provide coverage for the 45 million Americans who are not currently covered by some form of health insurance coverage. While this number is widely disputed by opponents as being grossly inflated, it still only represents 15% of the population, even if accurate. It then follows that 85% of the population already has some form of health care coverage. Therefore, how can it be argued that all U.S. citizens will benefit equally from this program?

The program will also provide subsidies to those who cannot afford to buy health insurance coverage on their own, which is mandated for everyone.[2] This aspect of the program is undisguised wealth redistribution, as taxes will be collected from all Americans and used to purchase services only for those who qualify due to their income. There is not even a scheme in place for this program to make it look as if the recipients are funding the benefits, as there is with Medicare or Social Security.

The history of federal government spending in America can be separated into three eras. The first was dominated by the ideas of Jefferson and classical liberals (now called “libertarians) and enshrined in the Declaration of Independence. “To secure these rights, governments are instituted among men.” That document unambiguously limited government’s role to security.

Thirteen years later, Alexander Hamilton and his conservatives succeeded in drastically expanding the role of government with the ratification of the U.S. Constitution. That document does not limit the government’s role to “securing rights,” but also to “promote the general welfare” and “form a more perfect union.” It grants the U.S. government the power to tax for the purposes of “promoting the general welfare.” This expansion of the role of government to include public services was then increasingly exploited by conservatives throughout the next century to institute wealth redistribution programs for the benefit of a wealthy elite, all disguised as public services or security. These included subsidies to corporations to build roads and canals, subsidies to railroads, and the establishment of a large, standing military force.[3]

Once the conservatives succeeded in establishing government as wealth redistributor to the wealthy, liberals abandoned the philosophy of government limited to security and instead began to advocate government as wealth redistributor to the poor and middle classes. This transformation can be traced roughly to the Woodrow Wilson administration, which combined elements of the conservative philosophy with modern liberal ideas of social justice. With the FDR administration, the transformation of liberal philosophy was complete. The liberals now sought to redistribute wealth to the poor and middle classes, while the conservatives continued to redistribute to the wealthy. These are the choices presented to Americans to this day.

There are large grassroots movements forming with one rallying point in common: they are all opposed to a federal government that spends $3.6 trillion dollars a year and shows no sign of slowing down. If the movements are to succeed, their constituents must clearly understand the three types of government spending and which one really costs the most. True security makes up so small a percentage of the federal budget that no income tax, national sales tax, or “value added tax” is necessary to fund it. Truly public services are also insignificant in terms of cost. Even the hapless postal service, for all of its inefficiency and waste, does not make up a significant portion of the federal budget.

No, it is not spending on security or public services that has bankrupted the federal government and destroyed the U.S. economy. The true cause of the problem has been the massive redistribution of wealth, perpetrated by conservatives for the benefit of the wealthy and by liberals for the benefit of everyone else. It is this type of government spending that must be recognized in all of its disguises and eliminated if the United States is to be saved.

[1] I use the term “libertarians” to describe those who advocate limited government. There are also many libertarians who advocate a completely stateless society, with even security functions provided by private firms in a free market.
[2] This is a gross violation of liberty and property rights as well.
[3] See Tom Dilorenzo’s excellent body of work on this, including Hamilton’s Curse, How Capitalism Saved America, and The Real Lincoln.

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What is Limited Government?

2010-06-02T11:05:00.010-04:00

It is certainly encouraging to see a massive grassroots movement demanding that government cease its exponential growth. The Tea Party movement has already flexed its muscles in some high-profile elections, and there is widespread consensus that it will be a factor in the 2010 elections. For the first time in over a century, there is a critical mass of people actually demanding limited government.

However, there is one very important question that must be answered. What is limited government?

The answer supplied by Republicans for the past several decades has been “lower taxes, balanced budgets, and less government spending.” These are all wonderful ideas, although Republicans have hardly put them into practice when given the reins of power. Afterwards, their supporters have chastised them for “not being true conservatives,” although I’m not sure that the conservative movement has ever really been about “small government.” In any case, the fundamental assumption underlying conservative rhetoric is that the limits of government are quantitative. One is led to believe that if the government would only spend less on health care, education, stimulus packages, and other programs (excluding the military, of course), that freedom, peace, and prosperity would be just around the corner.

However, limited government has nothing to do with how much money government spends, but rather what government is allowed to spend money on. Restoring freedom and constitutional government depends not just upon cutting taxes, but redefining what services government can legitimately tax its citizens to underwrite. At one time in America, there was a clear and unambiguous answer to that question: taxation was limited to underwriting the defense of life, liberty, and property.

Politicians have to mince words in order to keep fragile constituencies together, so they rarely make unambiguous statements. When one faction among their supporters opposes a new government health care program, they cannot agree on principle and say that government should have no role in providing health care. This would alienate another faction among their supporters that are currently benefitting from an already well-established government health care program. So, the politician uses words like “sensible” and “market-driven” in order to attack his opponent’s program without acknowledging the principle that it violates whether administered “sensibly” or not.

Truly limited government can only mean one thing: enforcing the non-aggression principle, known to our founders as “the law of nature.” Jefferson said that no man has the right to commit aggression on the equal rights of another, and that is all from which the law ought to restrain him. As government is merely the societal use of force, its limits are no different than the limits on the use of force by an individual. An individual may use force only in defense against aggression and under no other circumstances. He may never initiate force. The words “sensible,” “lower,” and “smaller” do not apply. The limits on government are absolute.

The argument that needs to be made against the current health care program is that it violates the law of nature. By forcing some people to pay for health care services that are provided to others and by forcing everyone to purchase health insurance regardless of their consent, government exceeds the natural limits of its power. It initiates force and thereby commits aggression against every individual in society. The initiation of aggression results in the state of war. It is for this reason that the new health care program should be repealed. Once the argument is diverted to one simply about cost or the practical means to fund the program, the principle of limited government has been abandoned.

While this is a relatively simple answer, as are all answers to questions of justice, it is a double-edged sword for conservatives. Once the true limits of government power are acknowledged, then a large swath of the conservative platform is called into question. Most obviously, garnering support from older Americans in opposing “Obamacare” on the grounds that it will necessitate cuts in Medicare contradicts the principle of limited government. The flimsy distinction between the new health care program and the old has been that Medicare recipients have “paid into the system all of their lives.” While this is undoubtedly true, everyone knows that those payments all went to underwrite previous beneficiaries and not into some magical trust fund. Medicare is no less a redistribution program than Obamacare. It just benefits a different special interest group.

While support for Medicare may merely be a political necessity for conservative politicians, truly limited government is also at odds with what has become the bedrock of modern conservatism: support for the worldwide U.S. military establishment. This is not to say that limited government means no military establishment at all. However, it does mean that the government has no legitimate authority to maintain standing armies overseas, to fight wars to protect one nation from another, or to protect a foreign people from a despotic government. The natural limit of government military action is to defend its own citizens against aggression by a foreign nation. Beyond this, it is initiating force and exceeding that natural limit.

One might argue that every individual has a right and a duty to protect a fellow human being from aggression by a third party, and that therefore the U.S. government’s military interventions around the world are justified. This was the basis for the (second) argument for the Iraq war. Saddam Hussein was oppressing his people and the United States had a duty to protect them from him. However, no individual has a right to force someone else to defend a third party against aggression. Every American had the right to send money to support Hussein’s opponents or even to go and fight in a revolution to overthrow him. However, no American had the right to force his neighbor to do so. The natural limit on military spending is that which is necessary to protect those taxed to support it. Humanitarian aid in any form must be voluntary.

Liberals constantly use the term “fair share” when justifying the egregious taxation and redistribution system that the U.S. government has become. Of course, this begs the question, “What is my fair share of services that I don’t use and that I actively oppose?” The only rational answer to this question is “zero.” However, once you come to this inescapable conclusion, virtually all government social and economic programs must be eliminated, as they are all based upon taxing one person in order to provide benefits to another.

Limited government does require each individual to pay his fair share, which is the cost to protect his own life, liberty, and property and that of his dependents. It is limited to what is necessary to “secure these rights.” While everyone may not have an equal amount of property, everyone has equal rights and thus an equal stake in providing for their defense. An examination of the U.S. government’s budget reveals that the cost of providing this defense of individual rights is orders of magnitude less than what is spent now. A government operating within its natural limits would not require an income tax, a value added tax, or a “fair tax.” American history has already proven this.

While it may be justified in a theoretical sense, America’s massive redistribution state cannot be abolished with the stroke of a pen. Not even the staunchest libertarian really wants to see Social Security, Medicare, or public welfare turned off tomorrow, with the poor and elderly left to fend for themselves. However, to be committed to limited government means to be committed to working towards eliminating these programs, not reforming them. This may take generations to accomplish, but we must first at least acknowledge that they have to go.

What we can do right now is end our worldwide military empire. Unlike the social programs, this would not mean short-term hardship in exchange for long-term gain. Getting our soldiers out of the 130 countries that they are stationed in would provide an immediate benefit both to the United States and the rest of the world. Proponents of the empire would argue that a sudden withdrawal of our troops would “destabilize” the regions that they are stationed in, but this is absurd. The presence of troops does not provide stability. It inspires resentment and provokes the inhabitants to retaliate. Without a troop presence in the Middle East, the motivation for terrorism would quickly fade. It is much easier to recruit suicide bombers when you can show your recruits armed troops in their own neighborhood than it is trying to convince them to give their lives to stop women in some far off land from wearing mini-skirts. Does anyone really believe that this is why they want to kill us?

A little simple arithmetic will demonstrate that even eliminating all military spending would not allow us to pay for our welfare state. The total military budget is around $700 billion, while Social Security and Medicare alone are over $1 trillion, with Medicaid adding $400 billion more. This does not even take into consideration all of the smaller programs for housing, education, medical research, “infrastructure,” energy, agriculture – all of these programs violate the principle of limited government for the same reason that Obamacare does. Added together, the vast majority of non-military federal spending is some type of wealth redistribution. It would seem that there is no equitable way out.

The answer lies in revisiting the “fair share” idea. Unlike taxation, there is no such thing as a fair share of benefits derived from other people’s money. We must recognize that in order to undo the century of damage we have done to our society, some people are going to have to pay out more than they receive in benefits. We could certainly come up with a plan whereby people my age, in their mid-40’s, would only be guaranteed catastrophic coverage through Medicare and reduced payments from Social Security, both payable only with a demonstrated need rather than as an entitlement. This would allow new workers to get out of the system altogether and finally restore limited government and true social justice. Would it be fair? No. Neither is the status quo. However, it would lead to prosperity and justice for our children. The status quo will lead us to our destruction.

This is only one strategy and I am sure that smart people could come up with others. As the old saying goes, the first step in solving our problem is admitting that we have one. If we want limited government, we must recognize that it is far more than Obamacare or welfare for the poor that is violating the law of nature. Let us continue to oppose Obamacare, but let us also acknowledge the vast amount of work to do even after this new incursion into our liberty is vanquished.

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

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The Fed Audit Goes the Way of the Tea Party

2010-05-18T17:15:00.010-04:00

"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!

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Fighting For Our Freedom?

2010-05-03T01:26:00.007-04:00

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!

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The Three P's: Things Government Cannot and Should Not Do

2010-04-13T01:08:00.038-04:00

In this late stage of America’s devolution from constitutional republic to social democracy, one is hard pressed to find meaningful debate anywhere about the role of government. Despite a 24/7 news cycle and endless political commentary on talk radio, most Americans have not once in their lives heard the question posed, “What is the purpose of government?” Certainly, we hear that “the government should do this” or “the government should not do that” in regard to particular issues, but nowhere will you hear a meaningful discussion about the underlying mission of government. Indeed, answering this question might not be all that beneficial to our chattering classes, because once it is answered, there is little need for hours and hours of more talk. Clarifying the role of government makes the answers to most political questions rather simple and unambiguous. It is hard not to suspect that many of our politicians avoid this subject intentionally.

If America is truly the “land of the free,” then there can be only one answer to this question. The purpose of government is to defend its constituents against aggression. Period. Since “liberty” and “the non-aggression principle” are one and the same, it is impossible for government to have any other purpose, or any additional role.

As government is by definition the societal use of force, any action of government other than defense against aggression must itself be aggression.  To induce human action through aggression is coercion. When coercion is practiced by government, it is called tyranny.

Freedom is the ability to exercise one's will in the absence of coercion. Therefore, freedom is impossible once government is allowed to perform any function other than defense. If freedom is exercising one’s will in the absence of coercion, one cannot be free while being coerced. Two plus two cannot equal five.

That leaves a multitude of actions that government must be prohibited from engaging in. They generally fall into three categories, which I like to call “the Three P’s.” The Three P's are to prevent, to promote, and to provide. There is no way for government to engage in any of these three activities without destroying the liberty that it supposedly exists to defend. Yet, this is 99 percent of what government in modern America does.

Most Americans look to government to prevent crime. Once a particularly heinous crime is reported in the media, there are universal outcries about the failure of government to prevent it. Almost no one stops to think about what it really means for government to "prevent crime." By definition, to prevent something is to act before it happens. Since all government action represents the use of force, government can only prevent crime by initiating force against people who have committed no crime. Force must always be initiated by someone. The initiating party is the aggressor. There is no other possibility.

This is not merely a theoretical or academic argument. Think for a moment about the results of government's various "crime prevention" efforts. Gun control disarms the victims of crimes while empowering violent criminals who don't care about gun control laws. Economic regulations which attempt to prevent fraud insulate protected corporations from competition, emboldening them to commit more fraud. Worst of all, the War on Terror, the ultimate government crime prevention program, has harassed millions of American citizens while allowing terrorists to walk onto planes with explosives in their shoes, underwear (and who knows where else), and has laid waste to an entire nation in order to determine that the "weapons of mass destruction" it supposedly possessed did not in fact exist.

In addition to preventing crime (including terrorism), that war also claims to undertake another of the Three P's: to "promote." Once it became clear that there were no weapons of mass destruction in Iraq, a new rationalization was needed for our brutal invasion of that country. That new reason turned out to be our missionary desire to "promote democracy." Without getting into the erroneous perception that "democracy" and "freedom" are synonymous, it should be quite clear after seven years of uninterrupted martial law in Iraq that our government has failed to achieve either democracy or freedom. Only government can be capable of missing the irony of ordering people at gunpoint to be free. While it might play for some good laughs in a Peter Sellers or Monty Python movie, it is really quite horrifying when one considers that our government takes this position in all seriousness.

It is not only in foreign policy that government reaps disastrous results when trying to "promote." Consider its attempts to promote "clean energy." One need look no farther than the ethanol fiasco or "Climategate" to see the results government gets in promoting respect for the environment.

The same underlying reason accounts for the similarity of results when government tries to "promote" or to "prevent." In both cases, force is initiated against individuals who have committed no aggression themselves. In order for government to "promote" anything, it must act. When government acts in the absence of aggression, it commits aggression. By committing aggression against and therefore overriding the decisions of millions of individuals, government causes innumerable unintended consequences. All of them can be traced to the initiation of force.

The third of the Three P's is by far the most destructive when undertaken by government: to provide. The illusion that government can "provide" anything springs from a loss of recognition of what government is.  Government is the use of force, not by an individual, but by all of society. As it is a destructive force, rather than a creative one, it can produce nothing. Therefore, it can only provide something to one citizen that it has forcefully seized from another. This holds true whether it is attempting to provide healthcare, education, housing, or any other form of property.

The fact that human beings spend the majority of their time on earth laboring to fulfill their wants or needs makes this the most costly of the Three P's.  While warfare represents violent aggression against millions of people, government's usurpation of human labor initiates violence against everyone. While the cost of warfare in human lives cannot be expressed in dollars and cents, there is at least a limit to the amount of lives it can affect and the length of time it will go on (despite government's best efforts to make it universal and indefinite). However, once government has claimed a right to the labor of its constituents, no one is spared and the subjugation never ends.

While the active wars in Iraq and Afghanistan amount to less than $200 billion per year (as if those amounts were not staggering themselves), the U.S. government spends trillions of dollars each year attempting to provide its citizens with healthcare, retirement benefits, education, housing, and other necessities. Government's results in all of these areas are the same: disastrous. The healthcare, education, and housing provided by government are more expensive, of lower quality, and in shorter supply than would be the case if government did not attempt to provide them. Aggression cannot create prosperity any more than it can create freedom.

Thomas Paine wrote that "government is at best a necessary evil." He understood clearly what government is: an institution of violence. As individuals, we understand that the need may arise to commit violence against another human being, but only justifiably for one reason: to defend our lives against aggression. Should we be faced with that unfortunate choice, we may be justified in resorting to violence but afterwards regret that the need to do so arose. Most importantly, no sane person claims a right to initiate violence under any other circumstances. As we do not possess this power as individuals, we cannot delegate this power to government. Any legitimate power possessed by government must derive from the individuals who constitute it.

To put it most succinctly, government must always be limited to a negative power. It is the societal extension of the individual right of self defense. As individuals cannot use force to prevent, promote, or provide, government cannot either.  Individuals have no right to force one another to do anything, even if they believe that it is in the victims' best interests.  So, whenever the question arises of whether government should involve itself in some new aspect of its citizens' lives, remember the Three P's. If the new program represents any of them, it is time for each individual to exercise his most basic right in respect to his government: the Fourth P, to prohibit.

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

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The Constitution Does Not Protect Our Property

2010-03-04T22:22:00.006-05:00

The U.S. Constitution is widely believed to have been written to limit the powers of the federal government and protect the rights of its citizens. Inexplicably, this belief is held even by those who acknowledge that the constitutional convention was called for the express purpose of expanding the powers of the federal government, supposedly because the government under the Articles of Confederation was too weak. That this was the purpose of the convention is not a disputed fact. Nevertheless, most people who care at all about the Constitution continue to believe and promote the “Constitution as protector of rights” myth.

To the extent that the Constitution enumerates certain powers for the federal government, with all other powers assumed to be excluded, it does set some limits on government. When one includes the first ten amendments of the Constitution, it also protects certain rights. Indeed, the ninth amendment makes the very important point that the specific protections of certain rights does not in any way deny the existence of others, while the tenth amendment makes explicit the implied limitation to enumerated powers in the Constitution itself. At first glance, the so-called “Bill of Rights” seems to confine government power within an airtight bottle, rendering it incapable of becoming a violator of rights instead of protector of them.

However, this theory does not hold up well under closer examination. To begin with, the Constitution itself does not protect a single right other than habeas corpus, and that comes with a built-in exception. What the Constitution does do is grant powers, and not just to a representative body, as the Articles of Confederation did, but to three separate branches. That leaves it up to the Bill of Rights to serve the purpose of protecting our rights. Generally, those ten amendments protect our rights under extraordinary circumstances, but not under ordinary circumstances. More specifically, the Bill of Rights provides protections for the individual during situations of direct conflict with the federal government, such as when one is accused or convicted of a crime, when one is sued, on the occasion of troops being stationed in residential areas, or when one speaks out against the government or petitions it for redress of grievances.

Make no mistake, these protections are vital and have provided protections for the people against government abuse of power many times in U.S. history. However, they have proven ineffective against the slow, deliberate growth of government power under ordinary circumstances, when the specific conditions described in those amendments do not exist. This is primarily due to the absence of protection, either in the Constitution or in any subsequent amendment, of the most important right of all: property.

By “property,” I do not mean exclusively or even primarily land ownership, although land ownership is one form of property. By “property,” I mean all that an individual rightfully owns, including his mind, body, labor, and the fruits of his labor. It is specifically the right to the fruits of one’s labor that the Constitution fails entirely to protect. In fact, it makes no attempt to do so whatsoever.

In the Constitution itself, the word “property” appears only once, and that is in reference to property owned by the federal government (an inauspicious start). Nowhere does it make any mention of property owned by the citizens.

The document does grant the federal government the power to tax “to pay the Debts and provide for the common defense and the general welfare of the United States.” This is a strikingly unlimited scope for which the federal government may tax its citizens. Arguments that taxes may only be collected to underwrite the subsequently enumerated powers have been struck down. Sadly, those decisions have probably been correct. While the power of the Congress to pass laws is explicitly limited to those “necessary and proper for carrying into Execution the foregoing Powers,” no such language binds the power to tax. The fact that the explicit limitation exists for lawmaking (which Congress ignores anyway) but not for taxation lends further weight to the argument that the Constitution grants Congress unlimited power to tax its citizens.

One can certainly make the argument that in 1789, the term “general welfare” would have been interpreted much differently than it is today. Indeed, one might assume that the term “general welfare” meant the general protection of each individual’s rights. Perhaps that is what many of the founders believed at the convention. However, it is clear that Alexander Hamilton and his Federalists, the driving force behind calling the convention, had far different ideas about what the term “general welfare” meant. Remember that for Hamilton, the purpose of government was not the protection of rights, but the realization of “national greatness.” This could only be achieved at the expense of individual rights, primarily property rights.

So, the Constitution itself grants Congress unlimited power to tax and does not even mention, much less protect, the individual right to keep the fruits of one’s labor. Certainly the Bill of Rights addresses this deficiency, doesn’t it?

It does not. Like the Constitution itself, the Bill of Rights is virtually silent on the central right of property. Out of all ten amendments, the word “property” appears in only one of them:

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

Unlike the congressional power to tax granted in the Constitution, the constitutional protections codified in the Fifth Amendment are severely limited to specific, extraordinary circumstances. The entire Fifth Amendment is set in the context of criminal law, granting certain protections to the accused and/or convicted. The phrase “due process of law” is a specific legal term that refers to those accused of a crime being given notice of the charges, opportunity to face their accusers, call witnesses in their defense, etc. This was obviously the intent of this protection of property, rather than a general protection of property rights against taxation.

Even if one discards the clear intention of this clause of the Fifth Amendment and interprets “due process of law” more broadly, the amendment offers no more protection of property than if one interprets the clause narrowly. Since the power to tax is an enumerated power, Congress would be following due process of law simply by levying the tax in the first place.

The last clause of the Fifth Amendment, regarding property taken “for public use,” is similarly limited to extraordinary circumstances. This clause undoubtedly refers to eminent domain, which is a grievous abuse of property rights, but certainly not one that affects a large percentage of the population. Even here, no right is protected. The clause merely requires the government to give the victim “just compensation.” There is no mention of the primary component of the right of property, consent.

Furthermore, there is no mention of how “just compensation” is to be determined, although history has shown that the government itself determines what compensation is just arbitrarily. In a free society, the value of property is determined by the price at which the owner is willing to exchange it. However, since there is no requirement here of the owner’s consent, no such price determination can occur.

As for the remaining protections of property in the Constitution and Bill of Rights, there are none. These two phrases, protecting property under only the most extraordinary circumstances are the length and breadth of the Constitution’s involvement with this most fundamental right. It is this deficiency that has allowed the federal government to grow into the monster that it is, concerned with virtually nothing but the redistribution of wealth.

If you believe the official myth about the Constitution, this might seem shocking. After all, the document was drafted by the same people that had seceded from their nation and fought a long and bloody war primarily to defend their right to keep the fruits of their labor. How could they draft a document to recreate their government, which they said only existed to secure their rights, and not only fail to secure the most important right, but actually empower their government to violate it with impunity? Certainly this was history’s most colossal error.

However, when you consider the political platform of the Federalists, which included corporate welfare, monetary inflation, deficit spending, government debt, and militarism, all designed to maintain the wealth and power of a privileged elite at the expense of the rest of the citizenry, the unlimited power to tax and lack of protection of property seem less like error and more like deliberate intention.

Whenever the subject of “constitutional rights” (a problematic term itself) comes up, people reflexively refer to the right of free speech. This is an important right, and one defended across the political spectrum. However, free speech, freedom of the press, and the other rights protected by the Bill of Rights, without property rights, are inconsequential – the mere window dressing of liberty. It is property that enables one to determine the course of one’s own life. Without it, the right to life is no right at all, but rather a privilege granted by those who own your labor.

George W. Bush was an enthusiastic supporter of the right of “free speech.” During a town hall meeting, an average American who opposed Bush’s policies rose and began hurling insults at the president, eliciting boos from the Bush-friendly audience. Bush reprimanded the crowd, reminding them that this man had a right to speak his mind, even if they did not like what he had to say. It was not the only time that he stood up for free speech. This was no accident. A government that has the unlimited power to seize the property of its citizens can afford to be magnanimous when it comes to free speech. Yet, for the citizen who no longer owns the fruits of his own labor, the right to complain makes him no less a slave.

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

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© Thomas Mullen 2010

Conservatism Is Not What We Need

2010-02-27T16:47:00.004-05:00

If you are going to listen to Washington politicians at all, it is always best to listen to the party that is currently out of power. After each election, it is the job of the losers to try to attack the winners in any way they can. Often, they inadvertently advocate genuine principles of liberty in the process.

During the 8-year nightmare that was the Bush administration, it was the Democrats that stumbled upon these principles in their efforts to regain the throne. It was they who pointed out that the government should not be spying on its own citizens, that the president was assuming un-delegated powers through executive order, and that it was neither morally justified nor prudent to invade a third world nation that had committed no acts of aggression against the United States and lacked any reasonable means to do so. Their hysterical mouthpiece, Keith Olbermann, even went so far as to cite a long-forgotten document, the U.S. Constitution.

Of course, it is now abundantly clear that these arguments were made simply out of expediency. With the Democrats in power, it is now the Republicans’ turn to “fight City Hall,” and they have rolled out their usual rhetoric about small government, free markets, and traditional family values. Moreover, they, too, have rolled out the U.S. Constitution and waived it around in opposition to the Democrats' plans to “spread the wealth around.”

Let’s take note that the Republicans are now correct in opposing the main tenets of the Democratic agenda, including expansion of government involvement in health care, “Cap and Trade,” and other wealth redistribution schemes. Amidst all of the usual noise coming from Washington and its media pundit class, it is only the Republicans that are making any sense at all.

Unfortunately, this is shaping up to produce familiar results. There is a growing movement for “change” that promises to “throw the bums out” in the next two elections. However, those who are part of this movement do not stop to consider what the Republicans' true agenda will be once they regain power. As they have for over 100 years now, Americans are dashing to the other side in their perennial political game of “pickle in the middle.” They still haven’t learned that the pickle never wins.

The Republicans are having remarkable success in painting President Obama’s agenda as socialist and their “conservatism” as its antithesis. Most average Americans who identify themselves as conservatives accept this argument. If socialism redistributes wealth through the force of government, then conservatism, being its opposite, must oppose such redistribution of wealth. If socialism means that the economy will be centrally planned by government “experts,” then conservatism, being its opposite, must leave those decisions with private citizens. If socialism results in big government, conservatism, being its opposite, must result in small government. These are the assumptions that inform the political decisions of most conservative American voters.

There is only one problem. None of them are true.

The conservative-liberal dichotomy is as old as politics itself. It was present at the founding of the American republic. However, despite the Republicans’ claim to represent America’s founding principles, America was actually founded upon radically liberal ideas. The secession from the British Empire was in essence a complete rejection of conservatism.

Most Americans today believe that the primary motivation for the American Revolution was a separation from the British government. However, the revolutionaries only acquiesced to the necessity of complete separation as a last resort. Even after Lexington, Concord, and Bunker Hill, the colonists were still making attempts to settle their differences with the British king and remain in the British Empire. The primary objection of the colonists was not the British king being their executive, but the conservative, mercantilist economic system that the British government enforced. The colonists objected to the policies of corporate welfare, protectionist tariffs, a central bank, militarism, and the taxes levied upon them to support these and other aspects of the worldwide British Empire. Had the British not imposed this system upon them, they would have been content to remain British citizens.

As soon as the Revolutionary War was won, the exact same debate erupted within the new American political system. Alexander Hamilton and his Federalists wished to replicate the British mercantilist system under an American government that would closely mirror the constitutional monarchy of Great Britain. The Federalists were the party of big government, national debt, corporate welfare, militarism, and central bank inflation.[1]

They wished to preserve the status quo insofar as the role of government and the nature of civil society was concerned, which benefitted a privileged, wealthy elite. They were the conservatives.

Socially, this party was the less tolerant of dissenters and tended to promote religion as useful in informing public policy. During Adams’ presidency and with the Federalists in control of Congress, the Alien and Sedition Acts were passed, making it illegal to criticize the government. These also are core conservative principles.

Their opponents, Thomas Jefferson and his Democratic-Republicans, promoted exactly the opposite ideas. They wished to radically change the role of government in society to one that was strictly limited to enforcing the non-aggression principle of liberty, most importantly economic liberty. They were opposed to corporate welfare or any other government redistribution of wealth, railed against the dangers and injustice of standing armies and the national debt, and opposed the central bank. Over and over again when asked about the role of government, Jefferson consistently applied the non-aggression principle to arrive at an unambiguous answer. Always his answer supported each individual’s right to do as he pleased as long as he did not violate the rights of others, and to keep the fruits of his labor.

Jefferson and his followers insisted upon a “wall of separation” between church and state and denounced the Alien and Sedition Acts. They advocated free speech, civil liberties, and tolerance. These are core liberal principles.

While the conservatives gained the early lead due to George Washington’s election as president and subsequent appointment of Hamilton as treasury secretary, it was not a decisive victory. Washington, who along with Vice President John Adams was certainly a more moderate Federalist, also appointed Jefferson to his cabinet as secretary of state. This set the stage for an epic battle between the two ideologies after Washington departed from politics. Adams eventually broke with Hamilton and his party, costing him the 1800 election, and resulting in a decisive liberal victory by Jefferson and his Democratic-Republicans. For the next 60 years, it was the liberal ideology of individual liberty, limited government, and economic freedom that dominated federal politics.

During this time, the conservatives constantly fought to establish bigger government, the central bank, and the other tenets of mercantilism that defined American conservatism. After the Federalist Party disbanded, they were replaced by the Whigs, a party made up of the same people and advocating the same principles as the Federalists. By this time, Jefferson’s Democratic-Republicans had also had a split, and had emerged as the Democrats.

The Whigs were never successful in achieving their goals, and eventually disbanded. However, as before, the same people and the same principles of big government were back again in 1860, this time calling themselves “Republicans.” They finally won a decisive victory in electing Abraham Lincoln to the presidency and a majority in Congress. Immediately, the Republicans began implementing their agenda of corporate welfare, protectionist tariffs, and higher taxes. Contrary to conventional wisdom, it was this economic agenda (particularly the tariff) that motivated the southern states’ secession from the Union, not a disagreement over slavery.

It is vital to understand that the Republican Party was born as the party of big government, inheriting traditional, conservative big government principles from its conservative philosophical ancestors, the Whigs and Federalists. For most of its history, it has remained true to these principles, up to and including the Bush II adminstration. Barry Goldwater’s more libertarian platform during the 1960’s was a divisive anomaly in the conservative movement. Its popularity was later exploited by Ronald Reagan’s administration to implement the usual conservative philosophy of bigger government, militarism, and debt.

The problem for Americans today is that there is no longer an opposition party that represents a true antithesis of these principles. By the dawn of the 20th century, the Democrats had completely abandoned their core principles of individual liberty and economic freedom and adopted a socialist, democratic ideology of popular wealth redistribution. Where the Republicans continued to promote a system which plundered the many for the benefit of the privileged few, the Democrats no longer objected to government as an instrument of plunder and now merely fought to divide up the loot differently. They were no longer truly liberal, although they perverted that word in popular culture to mean exactly the opposite of what it really means. Since then, Americans have had to choose between two parties whose ideologies are fundamentally hostile to liberty.

One week ago, Congressman Ron Paul gave a speech at the Conservative Political Action Conference (CPAC) that both mainstream Republicans and Democrats disagree with. Of course they do. It was an eloquent articulation of America’s founding principles of individual liberty and limited government. Like Jefferson, Paul consistently applied the non-aggression principle of liberty to every aspect of government, concluding that we must end our worldwide military empire, end the welfare state (both corporate and popular), and get rid of the plundering Federal Reserve.

Socially, he advocated tolerance, civil liberties, and the right of every American to express his or her opinion, even if those opinions contradicted Paul’s own most preciously-held beliefs. Despite being likely the most truly Christian person in any branch of the federal government, he never once made any allusion to religion during his entire speech, except for a purely philosophical reference to Thomas Aquinas’ principle of the just war (he alluded to this as part of his anti-war argument). Young Americans for Liberty, an affiliate of Paul’s Campaign for Liberty, invited a gay pride group to the conference, invoking a bigoted outburst from one of the younger conservative speakers just before Paul took the stage. Paul’s followers roundly booed him out of the auditorium.

Ron Paul pitched his ideas as “conservative,” but they are not. During one point in the speech, libertarian radio commentator and publisher of Liberty Pulse, Kurt Wallace, turned to me and exclaimed delightedly, “Ron Paul is a radical!” He is. Like Thomas Jefferson, Patrick Henry, and the rest of the most pro-liberty founders of the United States, Ron Paul is a radical liberal (in the true sense of the word “liberal”). He is also an extremist, in the true sense of that word. He refuses to compromise his principles regardless of the political consequences.

Average Americans elect Republicans because they believe that Republicans will give them small government, low taxes, and economic freedom. They are mistaken. What they are yearning for has nothing to do with the Republican Party or the more general ideology called “conservatism.” What they really want is radical change. They demonstrated this in giving Ron Paul a victory in the CPAC straw poll. They also proved once again that they are wiser than the political class in Washington. At this critical juncture in American history, there is only one thing that can bring America back from the brink of social, economic, and political collapse: radical, anti-conservative change from leviathan government to extreme liberty.

[1] Thomas Dilorenzo’s books, Hamilton’s Curse and The Real Lincoln document the true roots and history of American conservatism superbly.

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

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Symbolism Abounds at the Winter Olympics

2010-02-16T00:58:00.009-05:00

Perhaps there are those who will say it is a stretch, but for me the medal presentations last Monday night (Feb. 15) for the men’s moguls competition at the winter Olympics were steeped in symbolism. Most of the media attention was focused on the fact that Alexandre Bilodeau was the first Canadian to win Olympic gold on Canadian soil. He also knocked off the heavily-favored former gold medalist, Dale Begg-Smith, who had turned in one of his best performances. However, the fact that Begg-Smith and Bilodeau finished ahead of American bronze medalist Bryon Smith contained a hidden message that I doubt most Americans caught.

Consider Begg-Smith’s story. As a teenager in Canada, he was not only a skiing phenomenon but a tech entrepreneur. His coaches told him that he was spending too much time on his business and not enough on skiing. Perhaps his coaches were simply skiing purists that insisted on a total commitment to the sport. On the other hand, perhaps they suffered from that epidemic philosophical disease that promotes contempt for all entrepreneurs and vilifies all who seek to profit from voluntary exchange – in other words to accumulate wealth by producing far more for their fellow human beings than they consume themselves. In any case, Begg-Smith and his brother/partner Jason decided to exercise their rights and vote with their feet. They moved to Australia where they could ski on their own terms and pursue their business interests as they saw fit.

It was symbolically appropriate that this man finished ahead of the American, because his life embodied a principle that Americans have forgotten. When the opportunities that he deserved were not made available to him where he was, he voted with his feet. He left his country and emigrated to one where he was free to pursue his happiness in the way that he wished to. This did not cost him victory on the ski slopes. In 2006, he took the gold medal in men’s moguls in Italy, having also become a millionaire from his internet business. Like most of the early Americans, he wasn’t deterred from leaving the country that stifled him by false platitudes about “patriotism.” He was proud of rather than ashamed of his desire to seek his fortune. Like our American ancestors, he was justly rewarded with victory on both fronts.

However, Begg-Smith finished second to an athlete who inadvertently embodied an even more American principle. While most Americans probably think first of government health care when they think of Canada, Alexandre Bilodeau didn’t just come from Canada. He came from Quebec – the French-speaking province that has smoldered for decades with the most American of all ideals: secession. Yes, the Parti Québécois espouses some of the precepts of social democracy that are ultimately hostile to true liberty, but the movement nevertheless recognizes one core American principle that most Americans have forgotten. The state exists solely to serve the individuals who comprise it, and the loyalty of those constituents ends where the state ceases to govern with their consent. Certainly, none of these ideas entered the mind of the talented young man who earned that gold medal, but that didn’t diminish the symbolic significance of a Quebec native besting an American.

Let me take a moment to congratulate Bryon Wilson. He skied magnificently and the difference between him, Begg-Smith, and Bilodeau (literally milliseconds) is too infinitesimal to have any real significance. All three athletes should be deservedly proud of the fact that they have achieved greatness in their discipline. However, I hope that somehow the allegoric message of this competition will burn itself into the hearts of every American. The two athletes that finished ahead of the American represented ideas that Americans have forgotten:

1. Let no nonsense about (false) patriotism keep you from pursuing your happiness.

2. To seek your fortune through trade is to seek to benefit your fellow man more than most other people do by large orders of magnitude. There is no nobler aspiration.

3. You have a right to choose not to vote with your feet, but instead to alter or abolish any government that fails to secure your rights or becomes destructive of that end. In other words, you have a right to secede.

Should Americans rediscover these simple, uniquely American values, who could set bounds to the heights to which they could ascend?

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

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What Do Oranges, Furnaces, and Your IRA Have in Common?

2010-02-14T18:42:00.009-05:00

On Friday, an average American spent the entire day with the federal government without ever leaving his home. No, there was no knock on his door by some plain-clothes Gestapo. Neither was he treated to one of those infamous “no-knock raids” where a small army of thugs with various acronyms spelled out on their backs burst into the homes of the innocent and terrorize whomever happens to cross their paths. Nothing so dramatic happened that day. However, the long arm of the federal government made itself equally palpable nonetheless.

The first thing that he tried to do that day seemed innocuous enough. Being a native of Western New York and now living in Florida, he attempted to schedule a pick-up to ship some freshly-picked Florida oranges to a friend back home. He had purchased the oranges from a local orchard a day earlier, putting aside about two dozen for his friend in the wintry north. Anyone who has eaten oranges fresh from the tree here in Florida can tell you what a difference there is in freshness and taste from those purchased in grocery stores in the north when they are several days or weeks older. There is also a significant difference in price, especially this time of year. Oranges in Florida cost about $.40 per orange, while those same oranges cost about $1.50 each when purchased in Western New York.

For all of these reasons, our average American decided to do something nice and send a couple of dozen freshly picked oranges up north. That’s when he had his first encounter with the federal government. It turns out that what he was attempting to do was extremely dangerous and therefore prohibited by USDA regulations. According to the USDA website,

Under current federal regulations, all shipments of fresh citrus are prohibited from leaving Florida unless they meet certain requirements, including:

• Inspection of the grove within 30 days of harvest;

• Treatment of the fresh fruit with a special decontaminant;

• Issuance of a federal limited permit that must accompany the fruit. The limited permit confirms that the inspection and treatment have been carried out; and

• Clear marking on the packages to indicate the fruit is prohibited from being delivered to other citrus-producing states.

The reason given for these regulations is that they are “designed to prevent the spread of citrus canker to other citrus-producing states while preserving Florida’s fresh fruit citrus market.” Surely the reader is familiar with citrus canker - that pandemic scourge that rivals swine flu in its danger to all of humanity if not for the federal government and its regulations.

There are a few consequences of this legislation that the government would have us believe are purely coincidental. The first is that the federal government is now authorized to collect a tax, which is all the fee for the “limited license” really is. The second is that citrus growers are effectively insulated by law from any out-of-state competition. Ironically, the federal government supposedly derives its authority to impose such a regulation from the commerce clause of the Constitution – which was written to prevent protectionism by the states!

The effect of these regulations is that consumers everywhere – in citrus producing and non-citrus producing states – pay higher prices for oranges. For those states without citrus growers, the licensing costs and higher costs due to limited shipping options are passed on to consumers. This is what explains Western New Yorkers paying $1.50 per orange. Even in citrus producing states, consumers pay a higher price than they otherwise would if their in-state growers had to compete with out-of-state growers freely shipping their products into the market. Of course, the government and its “progressive” supporters would have us believe that these are merely necessary costs of public safety. It couldn’t be that large, corporate citrus producers had anything to do with lobbying for and perhaps even writing these regulations, could it? Surely, the additional profits and insulation from competition are purely coincidental, aren’t they?

Having resigned himself that he could not ship the oranges himself without the federal license, which was not cost-effective for two dozen oranges, our subject acquiesced to send the oranges directly from an orchard licensed to ship out of state (at a premium price) and moved on to his next order of business. He needed a furnace for one of his rental properties. Being a small businessman who owned or managed approximately 100 properties, it was his responsibility to repair or replace any home appliances that ceased functioning. As a furnace is a significant cost for a small business, he consulted a well-known internet resource to see if he could get a deal on purchase and installation. He found several vendors advertising low-cost installations for home furnaces.

The cost of the home furnace that he selected was about $800. The cost to have a licensed HVAC contractor install the appliance was approximately $1,700 (remember this is New York), for a grand total of $2,500. The vendor on the internet worked for one of the established HVAC contractors that sell and install these appliances. He was offering to sell the furnace at the advertised price of $800 and install it for $300. This represented a savings of $1,400 – significant for a small property management company. When the small businessman offered to accept the offer and pay by credit card, the internet vendor educated him on what was going on. The transaction would have to be executed in cash, because it would be in violation of federal regulations. Not wishing to run afoul of the law, the small businessman declined and acquiesced to pay the $2,500.

It should be remembered that the vendor was not offering to sell stolen goods. He was selling the actual furnace at the same price that the HVAC contractor was selling it at. The internet vendor was merely offering to do the installation labor at what amounted to a real market cost of about $300. Why can the HVAC contractor charge $1,700 to send the exact same technician to install the exact same furnace? Only because it belongs to a cartel that is created by federal regulation and licensing requirements. Again, the reason given is public safety. We can’t have just anyone installing HVAC equipment or we would all be blown up within a week. It couldn't be that large, corporate manufacturers and HVAC contractors associations lobby the government to pass these competition-stifling regulations, could it?

What did our average American businessman do next to garner the attention of the federal government? Nothing. Frustrated and having spent an inordinate amount of time on two seemingly simple activities, he decided to call it a day. However, the fact that he was sitting in his home doing nothing does not necessarily mean that he was free from federal intrusion. While reading some personal e-mails, one popped into his inbox from his financial advisor. It concerned his IRA.

A few years earlier, he had decided to take a portion of his retirement savings out of his traditional 401K and put it into an IRA with a company that specialized in foreign stocks. His strategy was to protect his savings from the ongoing depreciation of the U.S. dollar and the structural weakness of the U.S. economy in general, which was and is based almost purely on consumption and borrowing. The firm with which he opened his account invested his retirement money in foreign companies with strong balance sheets that were paying dividends. Overall, the investment strategy was sound and relatively conservative. In any case, it was his money to do with as he saw fit. Or so he thought.

It seems that since “the crisis,” the federal government had taken an interest in him in this respect as well – as always for his “protection.” His broker informed him that a “Client Profile” that he had been required by federal law to fill out upon opening his account had to be filled out again. However, since the company that he opened the IRA with specialized in foreign stocks, he now had to mark “Speculation” on his risk profile. The company had to have this signed affidavit on file in order to legally continue to manage his account. This was all designed to protect him from unscrupulous fund managers who might buy foreign stocks with his retirement money without telling him how risky said foreign investments might be.

Absurdity abounds in this regulation. The stocks in our subject’s portfolio all had strong balance sheets (modest debt-to-equity ratios) and were paying dividends. To invest in these, according to our government, is “speculation.” However, to invest in U.S. Treasury bonds – the bonds of an enterprise that is currently losing $1.6 trillion per year, has over $12 trillion in debt, and over $60 trillion in unfunded liabilities – would qualify as “low risk.” However, there is more to this story than pure government incompetence.

Consider the effects of a regulation such as this. There is some percentage of people who wisely got out of U.S. stocks and U.S. dollar-denominated assets in general over the past several years. However, after the misinformed propaganda campaign by our government against speculators as the cause of the recent financial and economic crises, there are a number of reasons that those people might not want to be labeled as “speculators” themselves. They might erroneously perceive speculation as unpatriotic or even evil, given what they have heard. The less gullible might fear more onerous federal actions against them once they are officially identified as speculators. In any case, this regulation is going to cause some people to close their accounts with companies that deal in foreign stocks or at least shift their assets back to U.S. stocks.

This is going to have the effect of raising the price of those U.S. stocks that these “speculators” decide to buy. That price increase does not represent real market forces at work, because without the regulation, the investors would have left their money in the foreign companies. Again, this is supposedly the unintended consequence of a regulation that is nevertheless necessary to protect the public. Who just happens to benefit? As usual, it is the large corporations whose stock prices will appreciate and who also just happen to fund the campaigns of the people who passed the regulation in the first place. Doesn’t anyone see a pattern here?

None of these regulations actually benefit the public. The citrus and furnace consumers pay exorbitantly higher prices and are certainly no safer from danger because the corporate cartel member filled out a government form and paid a licensing fee. How many people have to die from FDA-approved drugs (or from the unavailability of unapproved drugs) before this is sufficiently clear to average Americans? In the case of the foreign stock investor, he is actually harmed by the regulation if as a result of it he takes his money out of safe, foreign investments in viable companies and puts it into shaky U.S. corporations or soon-to-be-downgraded U.S. Treasury debt.

Progressives supposedly support these regulations in order to protect average Americans from the large corporations that they vilify at every opportunity. As we have seen ever since their hero, FDR, instituted this fascist regulatory structure in the 1930’s, they achieve exactly the opposite result. With each new set of regulations, large corporations grow richer, more influential, and more insulated from competition – all at the expense of the “little guy” that the regulations supposedly protect. To quote another progressive hero from the 1960’s, “When will they ever learn?”

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

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The Who Sing to the Obama Faithful

2010-02-07T23:45:00.004-05:00

I must admit that as soon as I heard that The Who would be the halftime entertainment at the Super Bowl, the timeliness of what would likely be their last song immediately crossed my mind. However, that didn’t lessen the impact of seeing the aging rockers belt out their classic, “Won’t Get Fooled Again,” although this time with more significance for America than at any time since the song was written. The enthusiastic crowd - thousands of whom undoubtedly sport Obama/Biden bumper stickers on their vehicles - joined Townshend and Daltrey in thunderous unison each time the line “We don’t get fooled again” was sung. Ironically, the extent to which the song indicts Obama was probably lost on all, save the venerable old Englishmen themselves, who hail from a bygone era when the left was actually anti-establishment.

Certainly, there has not (yet) been “fighting in the street” here in America, but most of the Obama faithful do believe that the “change” he has promised represents a “new revolution,” whilst opponents certainly object to the “new constitution.” I’m not sure why, since as Jay Leno quipped a few years back, we’re not using the old one anyway. In any case, as Townshend says to begin the second verse, “the change it had to come.” What we are changing from and what we are changing into are questions that Townshend leaves to us to answer.

Fittingly, the word “change” is used five times during the song. However, the real message of the song is summed up in the last verse.

“There’s nothing in the street
Looks any different to me
And the slogans are replaced, bye the bye.
And the parting on the left
Is now parting on the right,
And the beards have all grown longer overnight.”

It is hard to believe that these words were written in the early 1970’s, as well as they describe the Obama campaign and presidency. Certainly, the slogans have been replaced. Obama started his presidential campaign as an anti-war candidate. Upon receiving the Democratic nomination for president, he subtly changed his stance from being anti-war to arguing that America was merely “in the wrong war.” Now, as he escalates the war in Afghanistan, expands that war into Pakistan, and revives his predecessor’s antagonism towards Iran, we find that even Iraq is not such a wrong war that we will not be leaving thirty to fifty thousand troops there after our combat mission officially ends. Haven’t we heard this strategy before?

Regarding “parting on the left now parting on the right,” the neo-conservatives that Obama was supposedly the antithesis of during his campaign couldn’t be cheering his war-mongering any more enthusiastically. While there is obligatory criticism by Republicans towards some of his tactical decisions or supposed hesitation in making them, they do not fail to dutifully commend the emperor for his overall strategic plan: more war, more debt, and – just as in every year of the Bush administration – the largest total DOD budget in American history (counting the actual on-budget Defense budget, the appropriations for the active wars, and the Homeland Security expenditures on the war formerly known as “The War on Terror”).

Domestically, those who hoped that “Change” meant an end to or at least a decrease in corporate welfare have been disappointed as well. In a classic bait-and-switch, it turns out that his signature health care “reform” plan is nothing more than a gift-wrapped half trillion dollars per year presented to corporate health insurance giants, courtesy of American taxpayers who will now have no choice but to buy their insurance. It is hard to imagine how any self-respecting progressive can “smile and grin” at this change, but so far they still do. The hypnotized may never lie, but they also seem completely unable to tell when they are being robbed blind.

Of course, President Obama did at least do something about the Bush administration’s practices of spying on its own citizens, tapping their phones, and reading their e-mails (to keep them safe). He sent a team of lawyers to court to defend all of these abominable practices, hoping to solidify his legal sanction to do exactly the same thing. This shouldn’t have surprised anyone, since while still in the U.S. Senate, Obama voted to grant immunity to telephone companies who complied with the Bush administrations invasions. Perhaps they were expecting Obama himself to “change” on this issue once he became president.

Finally, Obama had promised to go through every one of President Bush’s executive orders and overturn any that “trampled upon liberty.” Having completed his review, the only executive orders overturned or considered relate to stem cell research, oil drilling on federal land, and Bush’s “gag order” on international aid organizations regarding abortion. Conspicuously absent from the list are the infamous orders wherein Bush granted his office vast new powers during a state of emergency, which the hysterical Keith Olbermann quite justifiably wet himself over during several of his anti-Bush diatribes.

To summarize, let us review what liberals/progressives said they hated about the Bush administration. Unless memory fails, it was his immoral and unfunded wars, his preferential treatment of Wall Street and large corporations at the expense of Main Street, his illegal spying on and wiretapping of American citizens in the name of security, and his assumption of dictatorial powers via executive orders and a rubber-stamp Republican Congress. For all of those who voted for Obama to protest and end these atrocities, the last lines of “Won’t Get Fooled Again” couldn’t be more appropriate.

“Meet the new boss. Same as the old boss.”

Indeed he is. We have been fooled again, and if we simply put the neo-conservative Republicans back into office, it won’t be much different the next time, either. Isn’t it time we stopped doing the same thing over and over again and expecting a different result?

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

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The True State of the Union: We Have No Rights Whatsoever

2010-02-02T01:23:00.005-05:00

It has been almost a week since President Obama gave his first State of the Union address, and it has been analyzed from the left, right, center, front, and back. Of course, the speech is really about the performance of the federal government, particularly its wonderful accomplishments under the leadership of the sitting president. This is not peculiar to the Obama presidency. As far back as Jefferson, presidents have used the Constitutionally-mandated stump speech to do a little self-promotion, although what they promote has certainly changed quite dramatically.

However, if the speech is supposed to reflect the accomplishments of the federal government, then we should expect that it will contain specifics about how that government has fulfilled its purpose, which is, as we all know, to secure our rights. At least that’s what our founding document tells us. Therefore, if a president is going to do a little bragging about what a great job he has done, it would be logical to assume that we would hear particulars about the way in which he has secured our rights. Logic, however, has little to do with the machinations of leviathan.

In fairness, President Obama did begin his speech with a few remarks about the actual state of our country - a state of economic devastation and unending war. The fact that both of these afflictions have been caused wholly by our federal government is something that seems to have gone right by him, although he is not unique in that respect, either. Having reminded us about how bad things are, he dutifully lays as much blame as possible on the president that preceded him (another time-honored tradition when succeeding a president of the opposing party). He then moves right into trumpeting his accomplishments.

The president explains how he hit the ground running after taking over during the financial crisis, which began during the last year of the Bush administration. He takes pride in the fact that he supported the bank bailouts over the wishes of the American people, because when he ran for president, he “promised he wouldn’t just do what was popular,” he would do “what was necessary.” I don’t remember that particular campaign promise, although I do remember him promising to “preserve, protect, and defend the Constitution of the United States” or something to that effect. I suppose you can’t expect him to keep them all.

President Obama justifies his first initiative as president as follows:

“And if we had allowed the meltdown of the financial system, unemployment might be double what it is today. More businesses would certainly have closed. More homes would have surely been lost.”

Perhaps the president is correct on this. Perhaps he is not. However, there is one consideration that seems wholly missing from his thought process. Do the people whose money was taken to “stabilize the financial system” have any rights? By what authority was their money confiscated, even if it were for “the good of all?” Majority vote?

The president next goes on to extol the virtues of the first policy that was wholly his own. He says that his administration “extended or increased unemployment benefits for more than 18 million Americans; made health insurance 65 percent cheaper for families who get their coverage through COBRA; and passed 25 different tax cuts... As a result, millions of Americans had more to spend on gas and food and other necessities, all of which helped businesses keep more workers. And we haven't raised income taxes by a single dime on a single person. Not a single dime.”

This seems to be a mixed message. The part about extending unemployment benefits and making health insurance cheaper seems like more wealth redistribution. However, he also mentions tax cuts that saved jobs and let people keep more of their own money. One might have been led to believe that he actually secured the right to property here, at least for some of his constituents. Then came the punch line.

“The plan that has made all of this possible, from the tax cuts to the jobs, is the Recovery Act. That's right -– the Recovery Act, also known as the stimulus bill. Economists on the left and the right say this bill has helped save jobs and avert disaster. But you don't have to take their word for it. Talk to the small business in Phoenix that will triple its workforce because of the Recovery Act. Talk to the window manufacturer in Philadelphia who said he used to be skeptical about the Recovery Act, until he had to add two more work shifts just because of the business it created. Talk to the single teacher raising two kids who was told by her principal in the last week of school that because of the Recovery Act, she wouldn't be laid off after all.”

It is ironic that one of the examples that the president cites is a window manufacturer. Those few lucid economists who are not among those “on the left and the right” who agree wholeheartedly with the stimulus bill certainly would have been unable to avoid recalling Frederic Bastiat’s “broken window fallacy.” It is the absurd reasoning that Bastiat exposes in his famous essay, “What is Seen and What is Not Seen,” that underlies the entire “stimulus” strategy. Occasionally, this has been pointed out in public debates over these programs. However, there is one question that has not even been asked by President Obama’s most vitriolic Republican opponents. Do the people who were forced to fund the Recovery Act have rights?

President Obama implies that his wonderful largesse was accomplished without taxing anyone, but this is absurd. It may be true that he has not had a tax increase passed in the Congress, but the funding for the Recovery Act can only come from one place. For the portion that was borrowed by the U.S. government from other nations, that money will eventually have to be paid back. The government only has one official source of revenue – taxation. The fact that those who will pay the taxes to underwrite the Recovery Act may not be born yet (although I don’t personally believe that Washington has that much time left) doesn’t change the fact that they will be forced to pay it back.

There is also an “unofficial” source of revenue for the government, and that is inflation. For the portion of the Recovery Act debt that the Federal Reserve merely monetizes, it is no less taxation than is an appropriation from the Treasury. It is merely a more insidious form of taxation, one that does not look its victim in the eye, but rather steals from him silently through depreciation of a currency that he is forced to use by the government. Whether by official or unofficial means, there are individuals whose money will be confiscated by the government so that others may keep their jobs. Again, I ask, do those individuals have rights?

It should not go without mention exactly who these people are whose jobs have been saved by the Recovery Act. According to the president, “there are about two million Americans working right now who would otherwise be unemployed. Two hundred thousand work in construction and clean energy; 300,000 are teachers and other education workers. Tens of thousands are cops, firefighters, correctional officers, first responders. And we're on track to add another one and a half million jobs to this total by the end of the year.”

Is there anyone among these two million that are not government employees? Perhaps the construction workers, although I’d bet they are working solely on government contracts. In any case, they are all on the receiving end of the taxation, necessitating that others must be taken from in order for them to receive.

The whole concept of the government “saving or creating jobs” is one whose injustice seems to elude everyone. That is probably because a century of “progressive” ideas has completely befuddled us about what a job really is. A job is a contract between a buyer and a seller. The employee is the seller, who sells his services to an employer for a mutually agreed upon price – his wages. This contract is one that both parties enter into voluntarily. The employer purchases the services because he is willing and able to do so. The employee sells for precisely the same reasons. Each has a right not to enter into the agreement, or to terminate it anytime he wishes.

However, when the government “saves or creates jobs,” it completely overrides the voluntary nature of this arrangement. If an employer is no longer willing or able to continue to purchase the services of an employee, the government has only one means at its disposal to change that outcome: brute force. It uses this force to confiscate the property of other people and thereby force them to purchase the services of the employee, since the employer is no longer willing or able to do so himself. The government claims it has saved a job, but it certainly has not secured any rights. In fact, it has acted counter to its purpose. It has destroyed the rights that it exists to protect.

It is the same evil at work in the president’s call for “health care reform.” As part of his plans to “improve the system,” the government will not only annihilate the right of property but liberty as well. While taxing some in order to pay the doctor bills of others, the federal government will ensure that no one can even conscientiously object. Every American will be required to purchase insurance from one of the government’s pet corporations, regardless of whether they want to or not. This amounts to a mandatory fee paid to the government merely for the privilege of being alive. Once the right to property is destroyed, the rights to liberty and even to life are destroyed with them.

Without repeating the analysis for every program that the president described, they all rest upon the same logic. There is some mysterious entity called “society” whose needs outweigh the rights of every individual that comprises it. In fact, it is apparent from the president’s speech (and those of most of his predecessors) that the federal government recognizes no rights of any individual whatsoever. Sadly, there are not many among the citizenry who think any differently. So long as representatives have been democratically elected, their power knows no bounds and recognizes no rights.

America was founded upon exactly the opposite idea. The reason that the U.S Constitution guarantees every American “a Republican form of government,” rather than a democratic one, is precisely because its framers believed that individual rights cannot be voted away. We cannot vote ourselves a right to other people’s property, not even to save millions of jobs (although it is really not possible to do so anyway). We cannot vote away another’s liberty, not even to lower health care costs for those who cannot afford it (although this will not work either). This was the central principle upon which our nation was founded – that we are endowed by our creator with unalienable rights. A pure democracy does not recognize these rights.

Progressives promote the idea that “taxation without representation” was the chief injustice that led to the American Revolution. This is convenient to their agenda, because they go on to justify any tax levied by a democratically-elected body on the grounds that those being taxed were represented in that body.

Of course, this begs the question, "Why did the founders specifically instruct Benjamin Franklin not to under any circumstances accept an offer of representation for the colonies in the British parliament?” Perhaps we should be so wise. Secession anyone?

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

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© Thomas Mullen 2010

Central Banking Doesn't Work - Just Ask the Fed!

2010-01-26T23:36:00.010-05:00

It is still a tiny minority who understand that central banking is a collectivist institution that is completely hostile to liberty. It is, by definition, an instrument of theft that purports to stabilize economic conditions for the collective by controlling the supply of money and credit. The fact that its only means to do so is to steal from savers to finance well-connected borrowers is a seldom-mentioned detail. That people only use the central bank’s currency because they are forced to do so by legal tender laws is spoken of even less. In this late stage of the Age of Government, the rights to liberty and property are expendable as our rulers “get the work of the American people done.”

Hopefully, the question of whether there should be a Federal Reserve will be on the table soon. However, once one concedes the existence of the Fed, there is a further question to ask: Can it do what it purports to do?

According to the Federal Reserve’s website, its mission is as follows:

Today, the Federal Reserve's duties fall into four general areas:

• conducting the nation's monetary policy by influencing the monetary and credit conditions in the economy in pursuit of maximum employment, stable prices, and moderate long-term interest rates

• supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect the credit rights of consumers

• maintaining the stability of the financial system and containing systemic risk that may arise in financial markets

• providing financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system[1]

Of these four stated goals, the first is the most expansive in its scope. Let us leave it until last. The second, to ensure the soundness of the banking system, seems to have been answered by history. Since the Fed’s launch in 1914, the nation has suffered banking crises in every generation that have dwarfed the Panic of 1907 or any of its predecessors. In addressing the Great Depression, the Savings and Loan Crisis, and the 2008 Meltdown, the Federal Reserve’s only answer has been, “Without the Fed, it would have been much worse.” History is not on the Fed’s side. Only a general ignorance of the facts allows the Fed to keep fooling most of the people most of the time.

Refuting the third stated goal is so easy it’s almost embarrassing. For those not trying to regain their seats after falling on the floor laughing, I need only to point out 30-1 leveraging, $60 trillion (or more?) in derivatives [2], or the subprime mortgage disaster. I believe that to go any farther would be, to borrow a football analogy, "piling on."

In fact, Alan Greesnpan's now famous (or infamous) mea culpa on the "flaw" in his beliefs about the self-regulating nature of financial markets effectively amounts to the Fed admitting that it has failed in goals two and three. If the "Maestro" himself doesn't speak for the Federal Reserve, then who does?

Regarding that fourth goal, one is tempted to give this one to the Fed. The important objection would be of the "should they" rather than of the "can they" variety. The fact that the Fed provides these services with an exclusive monopoly and claims only that it will play a “major role," rather than a positive one, makes this the least significant of the four.

That leaves the first goal, which is stable prices, full employment, and moderate long term interest rates. There can be no doubt that the promises of stable prices and full employment in particular are now the principle justifications for the existence of the Federal Reserve. Almost exclusively, when the subject of the Fed comes up, these two goals are discussed. Even the Fed chairmen themselves, when testifying before Congress, often state these two goals exclusively in describing the Fed's overall mission.

It should not be forgotten that until the late 1970's, full employment was not part of the Fed's mandate. Even using the logic of central banking proponents, these two goals are mutually exclusive of one another. Since the only means the Fed has at its disposal to try to achieve full employment is expansion of the supply of money and credit, which puts upward pressure on prices, the Fed must balance these two goals to try to find the optimum level of money and credit where everyone is employed but prices remain stable.

Ironically, the best source of information on the Fed's performance in terms of its principle goal for the first sixty years of its existence (price stability) is the Fed itself. Among the collections of historical data on the Federal Reserve of Minneapolis website, there can be found a table documenting price inflation rates for every year since 1800 (Appendix A of this article). There, one can see for oneself whether or not the Fed provided price stability during any period in its existence.

The first fact that jumps off of the page is the stark difference in the trends before and after the creation of the Fed. For the period from 1800-1913, the general price level (a statistic that Austrian economists object to) was cut almost in half. In other words, products that on average cost $100.00 in 1800 would only cost $58.10 in 1913 (Appendix A). While there were some years where prices rose, prices generally fell overall during the entire 19th century.

This would probably be a startling revelation to most modern Americans. There isn't an American alive whose parents or grandparents haven't remarked at current price levels and gone on to say, "When I was your age, I only paid a dime for that." As unbelievable as it might seem, that conversation would have been exactly the opposite in 1890. Grandpa would instead be saying, "When I was your age, I had to pay a lot more for that." Today, Americans resign themselves to constantly rising prices as a fact of life. However, that is a phenomenon that has only occurred since the creation of the Fed.

In contrast to the century preceding the Fed, the century following has seen exactly the opposite result. Those same products whose average price had fallen from $100.00 in 1800 to $58.10 in 1913 rose to $1,265.14 in 2008. That is an increase of over 2,000%!

Without addressing the subject of which result is "better for society," inflation or deflation, the data speak directly to the question of "price stability." From 1800-1913, the average annual fluctuation in price was 3.4%. From 1914-2008, the average annual fluctuation in price was 4.5%, a 33% increase over the previous period. In fact, the numbers for the Fed would be far worse if the same methods used to calculate the price inflation rate were used for the entire period from 1914-2008. In the 1990’s, several changes were made to the methodology used to calculate the Consumer Price Index. They all have the effect of lowering the price inflation rate given a particular set of price data.

Regarding the goal of "full employment," the Fed's results are also poor. Similar to that of the CPI, the methodology for calculating the unemployment rate was also changed in the 1990's. These changes in methodology, which include no longer counting "discouraged workers," lower the unemployment rate from what it would be for the same data if calculated using the old methodology. Despite this handicap, the Fed still fails to achieve positive results. The average annual unemployment rate in the U.S. between 1948 and 1978 was 5.1% (see Appendix B). Even without compensating for the changes in methodology during the 1990’s, the average annual unemployment rate in the U.S. between 1979 and 2009 was 6.1%. So, unemployment was almost 20% higher during the period that the Fed actively tried to manage it than it was during the prior 30 years.

Once you undo the methodological changes in calculating price inflation and unemployment that were put in place in the 1990’s, the Fed’s results on price stability and unemployment get much uglier. Nevertheless, even after the Fed fudges its own numbers it still comes out a failure. Everyone can remember the ne’er-do-well from school that cheated on tests and still couldn’t pass. Would we want that kid managing the entire economy?

The arguments that the Fed makes to justify its existence are fraught with false assumptions. One is that “stable prices” are a good thing. Remember, the industrial revolution occurred amidst steadily falling prices. It was this period of steady deflation (gasp!) that saw the common people become the prime market for society’s output - for the first time in human history. It was this period that saw the United States transform itself in a matter of decades from an indebted hodgepodge of former colonies to a world economic power. The natural result of economic progress and increased productivity is falling prices. That is what raises the standard of living for the great majority of society.

However, the most absurd assumption underlying the arguments for the Fed is one common to all collectivist arguments: that there is some strange entity called “society” whose needs outweigh the rights of every individual that comprises it. Every citizen surrenders his right to liberty to legal tender laws because being forced to use the Fed’s worthless notes as currency supposedly benefits “society.” He surrenders his right to property in letting the Fed steal his savings through inflation for the same reason. In the end, however, the Fed fails to achieve its “societal” goals of full employment and stable prices, so he gives up his rights for nothing. Isn’t time he took them back? There is a way: End the Fed.

Appendix A - Price Inflation Rates 1800-2008 (Federal Reserve Bank of Minneapolis)

Appendix B - Unemployment Rate (Monthly) 1948-2009 (Bureau of Labor Statistics)

[1] http://www.federalreserve.gov/aboutthefed/mission.htm

[2] http://www.newsweek.com/id/164591

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

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The Government Bubble Heads for a Blow-Off Top

2010-01-19T22:09:00.008-05:00

I have a friend that tends to express his ideas about everything in the jargon of a securities trader. Of course, this is probably because he has been a very successful trader, both in bull and bear markets, for many years. “Every trend in history, even liberty, can be charted like a stock,” he has often observed. I tend to agree.

As any trader will tell you, bull markets do not go straight up and bear markets do not go straight down. Rather, they tend to meander in the direction that they are headed. During a long-term bull market, a trend will have major pull-backs and long periods of consolidation. It is the experienced trader that knows how to “buy low and sell high,” taking advantage of the back and forth action of a stock or a sector on its journey. However, even wiser is the investor that can spot the trend at the beginning and keep buying lows without having to attempt to time the market and sell at all. The legendary Jim Rogers has often said that he is “the world’s worst short-term trader.” He would rather buy something that he can own forever than buy with the intention of having to sell.

Gold has been the most spectacular bull market over the past decade. Like all trends, it had periods of dramatic rise, followed by sharp pullbacks that gave back a portion of the gains, and then long periods of consolidation. Once a consolidation was over, another dramatic rise in price followed. The first run began at the beginning of the decade, with gold selling under $300 per ounce. It ran up to over $700 per ounce in 2006 before pulling back sharply under $600. The price then consolidated there for an entire year before the next leg up began. That second leg ran all of the way over $1,000 per ounce before pulling back to the low $700’s. Again, there was a long consolidation before this latest run, which will take gold we know not where.

All of the movements in the price have explainable reasons. When the fundamentals are stronger than the actual price of the security or commodity, investors begin buying. Once the price starts to move up, traders begin wading in to make profits on the movement of the price, both up and down. At any given time, there are those who are long and those who are short. Contrary to the nonsense you hear from government officials and their kept economists, short sellers play a vital role in keeping the market healthy. When a stock, commodity, or sector beings to fall in price, short sellers help stabilize that price because they have to buy the stock that they sold short to cover their short sales.

You will often hear the wisest of investors say that a trend is about to reverse when there is no longer any disagreement about it. When everyone is positive on a stock or a bull market, it is about to go down. When everyone is negative, it is about to make a run up. When all of society agreed that the NASDAQ would never go down – when every conversation in every coffee shop, supermarket, or dinner party revolved around the wonderful opportunities in technology stocks, wise investors knew it was time to get out.

Of course, this is not some sort of market magic or voodoo. It is simple cause and effect. When there are few sellers in a market and many buyers, the price is going to be inflated far beyond its value. From an opposite standpoint, when short sellers are forced out of the market in a “short squeeze,” there is now nothing to stop the price from falling precipitously once it starts to fall. With no short sellers covering their shorts, the price falls like a stone. Thus, at the end of long bull market, a bubble usually develops, characterized by a final, parabolic “blow off top,” followed by an equally dramatic drop in price.

The past 100 years has been a bull market for government. While the seeds of the run were sown in the mid-19th century, the bull market in government really began at the turn of the 20th century. The first signs of the bull could be spotted as early as the (Teddy) Roosevelt administration, but the real advances came under Woodrow Wilson. The income tax, the Federal Reserve, and the 17th Amendment were advances in government that made gold’s move from $275 to $700 look tame.

There was then a period of consolidation during the so-called Roaring Twenties. It was not so much a pull-back of government as a slow-down in the pace of its growth. Under three Republican presidents, the government bull market consolidated as Americans convinced themselves that they had restored a free market (because the Republicans said they did, despite their actual support of big government fundamentals).

The next big move came during the Great Depression. While the stock market and the real economy went south, government went on another tear as FDR fully instituted the modern welfare state, the fascist regulatory structure, and took America to war. After 16 years of absolute misery, even the most enthusiastic government bull must have thought it was time for a pullback. It was brief, but it came.

Americans again elected a Republican president in the 1950’s and convinced themselves that they had restored the American system and rejected the big government philosophy of FDR and his liberals. However, this, too, was only another consolidation. In actuality, it was Eisenhower that paved the way for LBJ’s Great Society by creating the Department of Health, Education, and Welfare (now the Department of Health and Human Services). The 1950’s are fondly remembered as a period of (mostly) peace and prosperity for America. It was only another consolidation period for government’s century-long bull run.

The next great move came during the 1960’s, when LBJ again lead a tremendous run up for government. Medicare and Medicaid, the other two entitlement monsters that will eventually combine with Social Security to bankrupt the United States, were born during this fabulous period for big government. The move ran right through a two-term Republican presidency (counting Ford’s mop-up after Nixon’s resignation) and into the Carter administration.

Most bull markets have two legs. Some have three, but usually no more than that. It seemed like that axiom would hold true for government as Ronald Reagan gave his first inaugural address. “In this crisis,” he told us, “government is not the solution to our problems – government is the problem.” It was the greatest inaugural speech of the 20th century. The government bull market was over. Or so we thought.

We now know that government didn’t get smaller during the Reagan years, but much bigger. However, there was at least a feeling of negativity about government during the Reagan-Bush years that even forced Bill Clinton to pass himself off as a free-market friendly centrist. It was another consolidation period, with a seemingly impossible fourth leg to follow.

We are in the midst of that fourth leg now, as government makes a more precipitous run up than at any time in history. In a few short years, the government will have nationalized the banking, auto, and health care industries. There are no more government bears to be found anywhere, either among Republican or Democratic politicians or (let’s face it) among 99% of the citizenry. Outside of a tiny constituency of libertarians, paleo-conservatives, and anarchists, there are absolutely no non-believers in government left. The rise is accelerating too fast for any protest or community organizing to stop. It’s a short squeeze as the government bull stampedes.

While this might be a terrifying period for anyone remotely interested in living his own life, there is much reason to be hopeful. As most bull markets eventually do, government is experiencing a blow-off top. The curve has bent straight up, with nary a short to be found in any political party or in any bowling alley or church social. Americans have convinced themselves that government either “should” or “must” do something about absolutely everything. We should expect the run to pick up speed, as government invades every aspect of our lives. Never before – not even in the most barbarous ages – has government made such enormous claims upon the life, liberty, or property of its subjects. Medieval serfs were taxed less. Ancient slaves were freer. Not even the brutal Romans killed with such efficiency and on such a scale.

For all of these reasons, it is about to end. With almost uncontested faith in government, its role has expanded so far beyond what it is actually able to deliver that soon we will see a fall that will make the real estate meltdown look like a mild pullback. Having rode the last leg of the move and squeezed out the last of the shorts, government is about to remind everyone that it not only should not be providing what it is attempting to provide, but that it cannot provide it.

At the moment that the whole world has accepted that government will centrally plan all of the economy, take care of its citizens from cradle to grave, and rule a worldwide military empire –all with money that comes from nowhere - at that very moment the age of government will end. The end is going to come fast, too, just like the end of the bull markets in technology stocks and real estate. Ben Bernanke will still be telling government bulls that there is nothing to worry about long past the moment when his time is up. That’s how fast it’s going to be. As in any market, the moment when every bear is gone is the moment that the bull run is over.

This will not be a pleasant experience. No correction ever is. Fortunes will be lost (albeit mostly fortunes dishonestly made), but innocent people will be hurt, too. All of society will come to the realization that government really can’t provide anything, beyond the brute force that is only justified in self defense. It may take a generation to repair the damage. It’s going to be rough.

However, we should remember one thing. When a bubble deflates, the capital that is not destroyed seeks another refuge. When the NASDAQ melted down and the U.S. dollar began to implode, the smart money fled to gold. It will be no different during the bursting of the government bubble. With a precipitous fall in government, there is an equally dramatic rise in its opposite – liberty.

Americans will have to forego the ill-gotten gains provided by government and do with less while they rebuild. That is unavoidable. While the NASDAQ bubble actually started on a real foundation, the fundamentals of the government bubble were never real. It was all an illusion and it is five minutes from ending.

It’s going to be great.

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

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© Thomas Mullen 2010

How Can Conservatives Support Sanctions Against Iran?

2009-12-23T18:36:00.002-05:00

Many have decried the fact that the so-called “liberal left” has abandoned its anti-war stance and thrown its support behind President Obama’s intent to impose sanctions upon Iran. However, given that the reason for the sanctions is Iran’s supposed pursuit of nuclear weapons, the left actually remains more consistent with their traditional philosophy than the right. Liberals have always attacked the natural right of self defense, usually as it manifests itself in the right of the individual to keep and bear arms. They have also traditionally supported large-scale warfare, as long as the war was started by a member of their party. Remember that U.S. involvement in WWI, WWII, the Korean War, and Viet Nam was initiated in each case by a liberal Democratic president with the support of a Democratic majority in Congress. There is nothing out-of-character about liberals supporting President Obama’s war agenda with Iran.

What is harder to understand is how conservatives can defend the 2nd Amendment and still support these sanctions, given the stated reason for their imposition. As a sovereign nation, Iran could make all of the same arguments regarding their right to develop nuclear weapons as conservatives make regarding the individual right to keep and bear arms. Iran lives in a world in which many of its neighbors possess nuclear weapons. In the event of a nuclear attack against Iran, there is nothing the “international community” can do until it is too late, just as there is nothing the police can do for an individual at the moment he is attacked by an aggressor. Like any potential mugging victim, Iran is much safer armed with a deterrent than at the mercy of those who wish her harm.

Liberals often argue for gun controls or bans based upon what an armed civilian might do with a weapon. Conservatives correctly argue that the principle of liberty doesn’t allow us to use government force against people because of “what they might do.” Until an individual actually commits some form of aggression against another human being, conservatives would argue that it is no one’s right to infringe upon another’s right to keep and bear arms. This principle certainly applies equally to nations in relation to one another. How can conservatives deny this right to Iran?

Liberals make the argument that the world is safer without handguns and so oppose them indiscriminately for everyone except government employees. Conservatives correctly argue that an armed citizenry is much safer against criminals than an unarmed one. They point out that every known statistic shows that neighborhoods under stricter gun controls have a higher incidence of violent crime, because the criminals still have guns and they know that the law abiding citizens are helpless. Conservatives understand this dynamic implicitly in terms of individuals, but it completely eludes them when applied to the relationships between nations. They also fail to recognize that history supports this argument: the only nuclear attack in human history was perpetrated by a nuclear-armed nation against a nation that did not possess nuclear weapons.

Conservatives make the argument that to deny Iran the right to develop nuclear weapons is not the same as disarming them. They would still be “allowed” to retain a conventional military force. How ironic this argument would be coming from conservatives, who become red in the face when liberals argue that they are not violating the 2nd amendment by limiting the types of firearms that civilians can carry or by banning “assault weapons (is there another kind?).” Conservatives recognize that the word “allow” has no place in the same conversation when discussing a right – including the right to keep and bear arms.

From a more pragmatic perspective, denying one individual or group the right to keep weapons relatively equal to those possessed by their peers nullifies their ability to effectively defend themselves. Conservatives make this argument in terms of law abiding citizens needing weapons of comparable fire power to the average gang-banger. Otherwise, the poorly armed citizen is still at a disadvantage against the well-armed criminal. Their reasoning is sound on this point. However, why does it not apply to Iran? For all intents and purposes, to deny Iran’s right to possess weaponry equal to that of any other sovereign nation – especially those that habitually threaten her - is to deny their right to provide for their own defense.

Conservatives make the argument that Iran is a “rogue nation” and therefore cannot be trusted with nuclear weapons. This is nothing more than cultural bias which is flatly refuted by objective reality. During the past 50 years, Iran has never invaded another country or initiated military force against anyone. Beyond the 1979 hostage crisis, they have burned a few U.S. flags and said some very nasty things about the U.S. and Israel. Other than that, they have been content to screw up their own country and leave the rest of the world alone.

In contrast, the United States has invaded countless nations in the past 50 years and has committed direct acts of war against Iran, including overthrowing their democratically-elected government and installing an American puppet in its place. When Iran responded by deposing the Shah and taking U.S. hostages, the U.S. waged a decade-long proxy war against Iran through another of its puppets (at the time), Saddam Hussein.

I do not mean to condone Iran’s seizure of civilian hostages in 1979. Violence against civilians is never justified. However, given that the hostages were returned relatively unharmed just over a year after their capture, the U.S. government’s conduct at Guantanamo Bay, Abu Ghraib, and secret prisons throughout the world seems to overshadow Iran’s “rogueness” in this area rather considerably. Using the “rogue nation” standard, there is a long list of nations that should be sanctioned ahead of Iran, starting with our own.

Conservatives correctly recognize that the right of self defense is the foundation of freedom and equality. They understand that if all men are created equal, there is no justification for one person to deny to another the right to defend themselves, nor to deny another person the right to determine for themselves what weapons are necessary to that end. In order to defend themselves against aggression by other nations, individuals delegate that aspect of self defense to their government’s military force. This is as much their right as the individual right to keep and bear arms. As in the case of individuals, no nation has a right to decide for another what weapons it will keep for that purpose.

The people of Iran as a sovereign nation have all of the same rights that the people of the United States do. It is not for the United States to decide what weapons Iran possesses any more than it is Iran’s place to decide what weapons the United States possesses. One would have to employ the most convoluted logic imaginable to arrive at any other conclusion.

The United States was born defending the right to keep and bear arms. That fact is glossed over when American history is taught in public schools. Despite the “intolerable” taxes, quartering of troops, monetary manipulation, and a host of other offenses by their government, the American colonists did not fire upon their own troops until those troops attempted to disarm them (that was the reason that the British marched to Concord). The colonists recognized that if they were disarmed they were no longer free. Why would Iran think any differently?

The United States claims to be promoting freedom in the Middle East. These sanctions demonstrate how much we have forgotten about the true meaning of freedom. In order for Iraq, Iran, or any other Middle Eastern nation to truly be free, they must be recognized as equals by the other nations of the world, with all of the same rights that equals claim. The most important right is the right of self preservation, at one time known as the “first law of nature.” Until we recognize Iran in this way, we will be in a perpetual state of war with her, with nothing to gain and so much to lose. It is time to stop playing emperor with Iran and start practicing what we preach. Liberals have always been confused about the relationship between self defense and freedom, but conservatives should know better than to deny Iran’s right to keep and bear arms.

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The U.S. Constitution: The 18th Century Patriot Act

2009-12-10T19:00:00.007-05:00

At some point in the past, the American ethos was centered on suspicion of government –whether liberal, conservative, or otherwise. For most of America’s first two centuries, Americans were taxed less, regulated less, and left more alone by their government than any other people in the world. These conditions resulted in an explosion of innovation, wealth, and culture unsurpassed at any time in human history.

As that trend seems to have reversed, Americans look to their past to try to establish where we have gone wrong and what we can do to solve our problems. Increasingly, some Americans point to the U.S. Constitution and our abandonment of its “limits on government” as the reason for our downfall. It is generally argued by “strict constitutionalists” that the purpose of the U.S. Constitution was to limit the power of the government. Nothing could be further from the truth.

Don’t get me wrong. If our government were limited to the powers granted it in that document, the United States of America would be far freer, far more prosperous, and likely not facing any of the monumental problems that it is facing now. However, that does not change the facts about why the Constitutional Convention was called or why the Constitution itself was created. If you are astounded that any Republican can still claim that George Bush was “pro-freedom” or that any Democrat can claim that Barack Obama is “anti-war,” you should be equally surprised that anyone can claim that the U.S. Constitution limited the powers of the central government.

Remember that there was already a federal government of the United States prior to the U.S. Constitution. It was defined in a document called the Articles of Confederation and had been in existence since 1778. Under the Articles, the young nation had defeated the mightiest military empire in human history to win its independence. Acknowledging the true meaning of the words “federation” and “federal,” the document defined the relationship between the states as “a firm league of friendship with each other.” There was no implication that the United States was one nation and the several states merely subdivisions within it. There was no president to usurp power. There was no Supreme Court to legally sanction tyranny. There was no IRS. While the federal government would pay for any war fought by the federation out of a common treasury, the Articles left the actual act of taxation to the States.

“The taxes for paying that proportion shall be laid and levied by the authority and direction of the legislatures of the several States within the time agreed upon by the United States in Congress assembled."[1]

Compared to the overtaxed, overregulated society that is America today, the America of the 19th century was one of astounding liberty and prosperity. However, even America after 1787 had much more government than America in its first decade. We are taught that this was a grave problem and that the Constitution was necessary to avoid imminent destruction from any number of horrors, including invasion by a foreign power, civil war, or economic upheaval as a result of protectionism by the states. We accept these assertions as facts because of the reverence we hold for the founders of our country. However, how different was the atmosphere surrounding the Constitutional Convention from that surrounding the Patriot Act, the TARP bailout, or the current efforts to expand government power in the name of environmentalism? Despite the pure heresy of the idea, there was really no difference at all.

By 1787, there were two dominant parties in America. Unlike the two dominant parties today, the Federalists and what would later become the Democratic-Republicans of that time really were diametrically opposed on fundamental issues. Led by Alexander Hamilton, the Federalists sought a much more powerful central government with a central bank, a standing army, and an alliance with big business that would control the economy. In opposition to them were Thomas Jefferson, Patrick Henry, and their followers that believed that the central government’s powers should be limited, and that power should be concentrated locally (and mistrusted generally). They opposed a central bank and a standing army and supported a truly free market.

It was not Thomas Jefferson or Patrick Henry that led the effort to call the Constitutional Convention, which neither even attended. It was Hamilton and his Federalists that wanted it. As superbly documented in his book, Hamilton’s Curse, Thomas Dilorenzo reminds us that Hamilton actually wanted even more power for the central government than he eventually got into the Constitution.

“At the convention, Hamilton proposed a permanent president and senate, with all political power in the national government, as far away as possible from the people, and centered in the executive. He also wanted “all laws of the particular states, contrary to the constitution or the laws of the United States [government], to be utterly void,” and he proposed that “the governor…of each state shall be appointed by the general government, and shall have a negative [i.e., a veto] upon the laws about to be passed in the state of which he is governor.”[2]

Hamilton did not succeed in getting all of the power he wanted for the central government, but he succeeded in increasing that power quite a bit. This too should seem familiar. At every point in American history that interested parties have tried to expand the power of government, they have attempted at expansive powers and settled for something less than they sought but more than they previously had. With each “compromise,” Americans have lost a little more of their liberty.

When viewed objectively, the very words of the Constitution reveal its true purpose. Constitutionalists often cite Article I Section 8 as proof of the limits on the powers granted to the federal government, but let’s not forget what that section actually says. It begins,

“The Congress shall have the power to…”

What follows is a long list of powers that the central government did not previously have. Each subsequent section of the Constitution invests power in the one of the three branches of government. Nowhere in the document are these powers limited, except for the short (but nevertheless important) list of exceptions contained in Section 9.

Of course, supporters of the Constitution would point out that the first ten amendments to the Constitution are actually a list of specific limits on government. Indeed they are. However, most people miss the point of those precious amendments. They represent the compromise, the attempt to limit the damage that was already done by the original document. Although several states tried to hold out for a bill of rights before ratifying the Constitution, those ten amendments weren’t actually ratified until 1791 – two years after the Constitution was ratified. They do not change the intent or nature of the Constitution itself – the massive expansion of the power of the central government.

Like the Patriot Act, the TARP bill, and the coming Climate Treaty, The U.S Constitution was conceived and drafted in an atmosphere of panic that was created by proponents of big government for the express purpose of using fear to win support for a massive expansion of government power. Also like TARP or the Patriot Act, it was debated in secret by a convention of delegates that were told that unspeakable horrors awaited America if they did not pass it immediately. Like most expansions of government power, its proponents did not get everything that they hoped for, but they got a lot more power than they had. Most importantly, the next debate over the size and scope of government started from there. The seeds of America’s multi-trillion dollar welfare-warfare state really lie in this seminal expansion of government power.

The U.S. Constitution does not embody the American spirit. It is a document that grants power to government. The document that truly embodies the American spirit is the Declaration of Independence, which was written expressly to remove all power from the existing government. If Americans are truly interested in reclaiming their liberty, they should look to this revolutionary document as the source of their inspiration. After such a long train of abuses, it is past time that we instituted new guards for our future security.

[1] Article VIII, Articles of Confederation

[2] Dilorenzo, Thomas Hamilton’s Curse Crown Publishing Group (Random House) New York, NY 2008 Pg. 16

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Make Obama Watch Ghostbusters

2009-12-05T16:14:00.004-05:00

It should be abundantly clear by now that the clear facts of economics and history are not sufficient to prevent our government from embarking on another expensive, disastrous program. While the debate on government destruction of the health care industry continues in the senate, President Obama prepares to make a trip to Copenhagen. There, he and other elite “experts” will cook up a new assault on private enterprise in general – under the tired pretense of “saving the environment.” Since intellectual, scholarly attempts to convince our rulers of the error of their ways have failed, I humbly suggest a simpler solution: make President Obama and the U.S. Senate watch the 80’s classic, Ghostbusters. Everything they need to know about government’s role in the environment is there. It is also presented simply enough that even a career politician can understand it.

The Ghostbusters story begins with three university professors who decide to try their hand in the commercial sector. They start a going concern with their own money to investigate paranormal activity. They face hard times early on, spending “the last of the petty cash” on Chinese food. They have a dearth of customers and face the fate of the majority of new businesses in their first year: bankruptcy. There is no suggestion that the government will bail them out. The market has seemingly determined that there was not sufficient need for their services and they will have to figure out some other product to offer to their fellow human beings in order to make a living.

However, at that moment, a disturbance occurs in a local hotel and their first paying customer places an order. The Ghostbusters successfully capture the offending spirit and collect their fee. The incident results in some publicity for the young firm and business booms. Soon, the Ghostbusters are running their own commercials and have more business than they can handle. They bring on a fourth Ghostbuster to keep up with the demand.

So far, the story has been a happy one for all parties concerned. The Ghostbusters have achieved success and have become enriched. Why? They have earned their money by making New York City safer (more “ghost-free”) and have created jobs in the process. Most importantly, all of this has occurred through private, voluntary exchange. The Ghostbusters’ customers pay their fees happily because the Ghostbusters offer them a service that they deem worthy of the price.

However, a story without a major conflict is no story at all. Ghostbusters is a superior story in that it correctly recognizes the source of all human conflict: government. Instead of the rather mundane epilogue that the story would have had at this point, where competing firms enter the ghostbusting market, prices fall, and soon all of society can afford to have a paranormal housecleaning, government instead rears its ugly head. A representative of the EPA knocks on the Ghostbusters’ door. What happens next couldn’t be more analogous to the real world.

The EPA agent Walter Peck is played to perfection by vastly underrated William Atherton. What is abundantly clear from his limited time onscreen is that, as a low-level federal agent, his primary motivation is not protecting the environment but rather lording it over any individual or business that fails to immediately submit to his absolute authority within his petty fiefdom. Under the pretense of protecting the environment, he attacks a private enterprise that has harmed no one, has helped the community, and has created jobs.

Having obtained legal authority to invade the Ghostbusters’ facility, despite the lack of evidence of any crime, Peck discovers what he deems to be a threat to the environment in the Ghostbusters’ ghost storage equipment. Of course, sophisticated equipment that could pose a threat to the environment is ubiquitous in a developed, industrial nation. However, thus far in the story, the Ghostbusters have managed their equipment safely and responsibly. They have done so both out of respect for their own safety and the safety of others and because their livelihood would be jeopardized if the ghosts they had captured were to escape and return to re-haunt the premises of their customers.

Despite pleas from the Ghostbusters, the EPA agent shuts off their ghost storage machine and chaos ensues. Remember that up until this point in the story, no environmental disaster has occurred related to the Ghostbusters’ supposedly dangerous equipment. However, by violating the liberty and property rights of the Ghostbusters under the pretense of a false threat to the environment, the government has created a real environmental disaster that now threatens everyone’s lives. In fact, the entire world is now actually threatened because of this one government intervention.

Consider how closely this story recreates the real world, ghosts and goblins notwithstanding. The government’s record on protecting the environment has followed this pattern without exception since the moment that activists got the idea that government force could save the world. Among the sparkling achievements of government environmentalism has been the banning of DDT, a safe and effective insecticide that was vilified and ultimately banned because of its supposed threat to the environment. Subsequently, farmers were forced to employ less effective insecticides that really do harm the environment, while a later study showed that DDT could actually be eaten by humans over an extended period of time with no adverse health effects.

In another historic blunder, the government decided to employ its ability to override private decisions via the threat of violence in order to encourage the production and distribution of ethanol, the fuel additive made from corn. This had the unintended consequence of causing food shortages and skyrocketing prices while failing to significantly affect America’s dependence on fossil fuels. The crowning achievement of this boondoggle was the revelation that the production of ethanol actually consumes more fossil fuel than it produces and is a net positive in carbon emissions. Had property rights been protected instead of destroyed by the government, none of this would have happened.

Most recently, the government decided that it would address two problems at once by “stimulating the economy” with its Cash for Clunkers program. Not only would this supposedly help the economy, but because those trading in their clunkers would have to buy “greener” cars (with other people’s money), it would also help the environment. Of course, the result was that perfectly good used cars were destroyed while their owners took out loans for new ones, resulting in a decrease in wealth and an increase in debt for society as whole. In addition, it turned out that the owners of the clunkers had previously been limiting their driving due to either concerns about breakdowns or the general lack of pleasure inherent in driving their clunkers. Once provided with new cars by the government, they began driving far more than they previously had, producing more exhaust and consuming more fossil fuels. Another government disaster funded by legal plunder.

As in the movie, every attempt by government to use its coercive power to protect the environment not only fails, but actually creates the very problems it purports to try to solve. In most cases, the problem does not even exist until the government undertakes to solve it. What is government’s solution? Always it is to attack private property and free enterprise.

It never ceases to amaze me that the American public at large exhibits absolutely no skepticism towards the politically-connected segment of the environmental movement. For 100 years, members of a certain political movement claimed that private property and free enterprise would destroy society. The 20th century proved them absolutely wrong. Those societies that did away with private property and free enterprise were destroyed themselves, while those that (for the most part) retained property rights flourished. Subsequently, the members of this same political movement suddenly became activists for the environment, studied the problem, and concluded that there was only one way to save the earth from environmental disaster: by abolishing private property and free enterprise. Does no one find this conclusion - by these people - an odd coincidence? Does no one even suspect their motives? Are we a nation of fools?

President Obama, please watch the movie. Appoint a “Ghostbusters Czar” to ensure that every legislator in the federal government watches it as well. When you have had time to reflect upon its profound message, please declare the environmental war on private property over. If you are looking for wise stewards of the land, you will not find them within the ten square miles you presently inhabit. However, there are some 300 million people that can do a better job just outside of town.

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The Democrats Privatize Wealth Redistribution

2009-11-08T17:40:00.007-05:00

George W. Bush redistributed more wealth during his presidency than any president had since Lyndon Johnson. Republicans really have never had any problem with redistributing wealth as long as the proceeds go to the right people. Since Medicare benefits senior citizens, a constituency that no election can be won without in the baby boomer retirement era, Republicans had no problem using the force of government to take money from one individual and use it to buy “healthcare” for another – as they did with their Medicare prescription drug benefit. Neither do they hesitate to redistribute to bankers, under the cover of “saving the financial system.” God help us if there is ever a constituency of senior citizen bankers.

In fact, if one looks at the federal budget as it existed before the massive bailouts started – pre-TARP – at least 80% of the almost $3 trillion budget amounted to wealth redistribution. Always there was some rationalization for why this or that group must receive federal funds “for the good of all.” The farmers must be subsidized because there is absolutely no way to sustain farming in a market economy. If large farming corporations weren’t subsidized, we would all starve. Medical research must be subsidized because we will eventually all die of cancer, AIDS, and other horrific diseases if the government doesn’t subsidize medical research. Corporations in general must be subsidized because if one were to go out of business, everyone would be unemployed.

The Democrats typically attempt to characterize the Republicans as racist or elitist because the Republicans have traditionally resisted wealth redistribution for the poor or minorities. However, the reality is that Republicans do this for the same reasons that Democrats resist redistribution to bankers and corporations (or at least they used to). The poor and minorities don’t vote Republican. That is the only reason that Republicans attempt to leave them out.

No one in America seems to know any American history. Following the American Civil War, when black voters universally supported the Republicans due to their perception that the “party of Lincoln” had set them free, it was the Republicans who promised “40 acres and a mule” to blacks and the Democrats who proclaimed themselves “the party of white men.” Enslaved by their former ruling class and now used as pawns in a political power game by the new one, the freed black voters of post-Civil War America serve as a perfect metaphor for the supposed “beneficiaries” of all government redistribution schemes. Whether it is elderly people trying to scrape by on a Social Security Check, poor people trying not to starve on public welfare, or Iraqi citizens enjoying their newly provided “freedom,” the so-called beneficiaries of government wealth redistribution are never the winners. It takes an alarming lack of skepticism not to ask who the real winners are.

As this new century has “progressed” (pun intended), even the blurry lines separating the two parties have begun to melt away. Remember that George Bush’s redistribution schemes also included stimulus “tax refunds” to everyone, whether they actually paid taxes in the first place or not. “Compassionate conservatism” was nothing more than a euphemism for attempting to blend traditional Republican rhetoric about “free markets” and “limited government” with thinly-veiled redistribution schemes. By doing so, Bush’s Republicans hoped to hold onto their own base while chipping away at the Democratic voting blocks by promising them other people’s money, just as the Democrats do.

Throughout the 20th century, the two parties employed this strategy of “borrowing a page from the other’s playbook” over and over, always hoping to win voters away from the opposition while retaining the loyalty of their own traditional supporters. It was this that caused many liberals to criticize Bill Clinton for being “too much like a Republican.” Why George Bush has managed to hold on to his image as an “extreme conservative” defies explanation.

Until now, there has always been at least one thing to say in favor of the Democrats. They have been honest about their intentions. They have come right out and said that their intention was to redistribute wealth in order to achieve “equality” or “social justice” or some other utopian goal. Certainly, no lucid American can deny that the Democratic platform has been a socialist one for at least the last century. It has been the Republicans who have deceived their followers to a much greater extent by promising them liberty and property rights and then redistributing almost as egregiously as the Democrats.

One hallmark redistribution strategy used by the Republicans was “privatization.” Somehow, they managed to successfully characterize forcibly extracting money in taxes from their citizens and redistributing it to private corporations as “free enterprise,” as if “private” and “free” were synonymous. Alexander Hamilton must have smiled in his grave.

However, the Democrats have truly broken new ground during this presidential administration. Not only have they managed to outspend the voracious Bush administration in just ten short months, but they have taken a page from the Republican playbook and actually privatized wealth redistribution. Formerly, however transparent the scheme, the money at least made it into the federal treasury for a moment before being paid out to the special interest that had bought it with votes. However, H.R. 3962, the so-called “Affordable Health Care for America Act,” dispenses with this formality. Now, using the coercive power of government, private citizens will be forced to pay their money directly to government supported health insurers whether they wish to or not. The veneer that this is “public money” being spent for the “public good” has been completely stripped away. There is now simply a government pointing a gun at its citizens and forcing them to pay directly to the special interest that has successfully lobbied for their money. Even King John of the Robin Hood tales did not extort for his friends this overtly.

A more perverse merger of left and right political corruption is unimaginable. Using the government’s numbers, this will provided coverage for 36 million uninsured Americans at a minimum of $15,000 per covered life. Assuming these numbers to be at least “in the ball park,” President Obama and his so-called liberals have just handed over a half a trillion dollars a year to corporate America (the health insurance companies). What true progressive could possibly support this?

The price of this corporate welfare, of course, is that any remaining vestiges of voluntary contracts between insurer and insured that health insurance still retained has been eliminated. Insurers are no longer allowed to determine rates demographically and based upon a real risk model. They are no longer allowed to offer diverse coverage packages to compete with one another for different customer groups. They now must offer low rates and uniform benefits to everyone as entitlements. Like individual welfare recipients, they have surrendered all of their liberty and property rights in return for other people’s money. They are now just one more arm of the state bureaucracy.

The worst aspect of this great fraud is the implications it has for the liberty of every American. The closest parallel to this heretofore has been automobile insurance. Americans have been forced to buy auto insurance directly from an auto insurer in order to exercise the “privilege” of driving on the government’s roads. This was of course enacted for the public good, to ensure that poor drivers could not bankrupt the innocent by demolishing their cars or saddling them with exorbitant hospital bills. However, as hostile to liberty as these laws are, they still leave the driver a choice. He can choose not to drive, however impractical or unrealistic that choice might be.

However, with this new bill, even that smattering of liberty is ripped away. Americans are now forced to purchase insurance from a government-protected and subsidized health insurance company merely because they are alive. Worse yet, they are not merely forced to make a single payment of tribute to satisfy their “individual responsibility.” They must go on paying, year in and year out, for as long as they live. They cannot decline. They cannot conscientiously object. There is no escape from this tyranny save one: death. For those individuals that can demonstrate that they are completely incapable of paying, someone else will be forced to pay for them. No matter what, the government’s corporation will be paid. Even life is no longer a right, but a privilege that the government extends to its subjects for a fee.

From 2001-2006, the Republicans controlled all branches of government. It was an horrific period of utter destruction of American liberty. The Democrats have now been given their chance and in ten short months they have far outdone the Bush Republicans for this dubious distinction. Make no mistake. If the Republicans regain power, they will be worse still. Americans should understand that they will affect no “change” in their government by electing either of these two parties. The federal government is a monster that has taken on a life of its own. Both parties are now its minions and are indistinguishable from one another.

Our Declaration of Independence says that “mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.”

Are we there yet?

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A Familiar Strategy?

2009-11-05T15:49:00.005-05:00

Where the people fear the government you have tyranny. Where the government fears the people you have liberty. [1]

- John Basil Barnhill (1914)

Americans should be experiencing “déjà vu all over again” as Congress prepares for another weekend incursion into their rights via another two-thousand page bill that must be voted on before anyone has had a chance to read it. This time, it is H.R. 3962 “To provide affordable, quality health care for all Americans and reduce the growth in health care spending, and for other purposes.” The next law that should be passed is that legislators and bureaucrats shall not be allowed to work on weekends.

That working Americans will rise early on Monday to begin another week with less protections of their rights and more of their property stolen is not all that should seem familiar. If anyone can remember as far back as the Bush administration (this new regime has been so bad that I am afraid people have forgotten most of the outrages of the last), a very similar dynamic played out. The very first bailout – of the banking industry – met with resistance similar to that against the proposed government takeover of the health care industry. The first attempt to pass the TARP bill failed.

For those watching the statements made by their representatives while opposing that bill, one thing should have been obvious. Those representatives feared their constituents. It was in their eyes and in their voices as they explained their opposition. I do not mean that they feared violence. They feared for their jobs and they feared whatever other consequences there might have been if they deliberately defied the wishes of those thousands of voters who had angrily called their offices. For a moment, our government worked as it was designed to work. The people spoke and their representatives heeded their wishes, however reluctantly.

Then, the uproar died down. President Bush emerged from his long, unnatural silence during the financial crisis and gave a speech designed to put that fear back into the hearts of the citizens, where our government prefers that it permanently reside. If the banking bailout wasn’t passed, Americans could lose their homes, their jobs, or their retirement savings. Financial Armageddon awaited if the bankers were not saved - for it is really the bankers that provide those things to everyone. Henry Paulson and Ben Bernanke joined the chorus to help paint the terrifying picture of unspeakable horrors that awaited us if we did not give almost $800 billion to the Treasury Secretary to be redistributed to his friends on Wall Street.

It is unclear if Americans really believed the government or if they just ran out of energy to protest. Either way, the bill passed the second time it came up for a vote. Those same representatives who only days before were too afraid to pass it were now somehow emboldened and it sailed through with barely a whimper from the victims. What was different the second time around?

Hopefully, Americans took notice of the fact that their representatives do not possess the courage to pass a bill that they actively oppose, even if that opposition amounts to nothing more than angry phone calls. It is difficult to ascertain what reassured those congressmen enough to vote for the bill the second time. Perhaps the calls to their offices changed after the government’s scare campaign intensified. Perhaps some of the people who had called before the first vote called back and told those congressmen that they had changed their minds.

However, there is another possibility that is infinitely more disturbing. Perhaps by the time of the second vote, the pressure had died down out of sheer inertia. After all, there is probably some limit to just how long Americans can make calls, march in protests, or write letters while trying to do their jobs, raise their families, and live their lives. If I were trying to develop a strategy to pass a bill that most Americans oppose, I would consciously plan for exactly what happened during the banking bailout bill in 2008. I would let them scream, let them march, let them carry signs and write letters, and even let the bill fail to pass. And once the citizenry was sufficiently exhausted or had turned their attention to something else, I would put it up for another vote.

Personally, I would be surprised if this were truly a conscious strategy by most of our representatives, although I am sure that the dynamic has not escaped the notice of the most devious of the professional political crowd. However, whether intentional or not, this is exactly what happened with the banking bailout and it is exactly what is about to happen with so-called “health care reform.” All summer long, Americans called their representatives, marched in the streets, and even showed up in the capitol city itself in numbers far too large to support the claim that it was some sort of Republican PR campaign. At one point, the idea of a government-run public option was all but pronounced dead on non-arrival by media outlets, whether conservative or liberal in their bias. It has found new life.

The American Revolutiony War was by no means encouraging for the Americans for the great majority of the time that it was being fought. The Americans lost almost every battle, constantly outclassed by the greatest military force in the history of the world at that time. However, there was one advantage that the Americans had over the British – they were relentless. No matter how many battles they lost (and they lost most of them), the American army would not go away. After being repeatedly schooled by superior British generals at New York, Brandywine, and elsewhere, Washington showed up at Monmouth and fought the British to a standstill. In the end, it was he and the Americans that emerged as the victors.

This weekend, the British are back. However, this time they are not wearing red coats but instead masquerading as representatives of the people. They are bringing with them the same tyranny that they did in the 18th century – unjust taxes, illegitimate government power, and violations of the rights of every individual American. It is imperative that Americans once again refuse to go away. Millions have sacrificed time, money that they could ill afford to spend, and days, weeks, and months of their lives to write, call, march, and shout with all of their might against the destruction of our liberty that this government has accelerated with increasing brazenness over the past few years (under presidents from both major parties). It all goes for naught if our representatives learn that they need only wait for us to exhaust our energy before ignoring our wishes and trampling upon our rights as they please.

There is a disturbing sound in the air – silence. There is a feeling that the outrage has subsided and that the coast is clear for another weekend theft of our liberty and property. Let us not let last summer’s tremendous demonstration of the American spirit go to waste. If you opposed this bill the first time, if you traveled to Washington, spent money you didn’t have, took time away from your job or family to be sure that your voice was heard, it will have all been for nothing if they pass this bill this weekend.

Now is the time for Americans to be relentless. Call your representatives and let them know that what happened in New Jersey and Virginia a few days ago has nothing to do with Republicans or Democrats – it is the fate of all incumbent politicians, from any party, that abandon their duty to protect the rights of the people. From now until Saturday evening, we must shout louder, march longer, and get angrier than we have ever been before. Do not underestimate the power that you wield and do not let this government monster outlast you. As we said over two hundred years ago to a government that had marched against our liberty, let us shout to our representatives as loudly and for as long as it takes – this far shall you go and no farther.

[1] Barnhill, John Basil (1914). "Indictment of Socialism No. 3" (PDF). Barnhill-Tichenor Debate on Socialism. Saint Louis, Missouri: National Rip-Saw Publishing. pp. p. 34. Retrieved on 2008-10-16.

Michael Moore Wants to End the Fed (He Just Doesn't Realize It)

2009-10-03T20:58:00.004-04:00

“You keep on using that word. I do not think it means what you think it means.”

- Mandy Patinkin as Inigo Montoya in The Princess Bride (1987)

It is ironic that Michael Moore’s latest movie, Capitalism: A Love Story features two appearances by writer and comedic actor Wallace Shawn. There is even a clip of Shawn exclaiming “Inconceivable!” in his hilarious turn as Vezzini in The Princess Bride. However, the most appropriate clip from that movie would have been Inigo Montoya uttering the words quoted in the prologue of this article. Using one of Moore’s staple filmmaking techniques, he could have cut to the clip immediately after one of his own pronouncements about capitalism. For although Moore says the word over and over throughout the movie, it is apparent that it “doesn’t mean what he thinks it means.”

The closest thing to a definition of capitalism that Moore provides to his audience comes early on when he remarks, “Capitalism: a system of giving and taking – mostly taking.” He goes on to show a half dozen or so clips of people extolling capitalism for providing “the freedom to succeed and to fail” or hailing the virtues of competition. However, the common mistake made by both Moore when attacking capitalism and the Republican politicians he depicts defending it is their mutual failure to recognize the central tenet of capitalism: property rights.

True capitalism is based upon one simple principle: that all exchanges of property are made with the voluntary consent of all parties. Private ownership of property and competition – the other two components of capitalism in most traditional definitions – are actually results of this foundational principle. As all governments are institutions of coercion, there is no way for them to acquire property through voluntary exchange. Further, with all exchanges being voluntary, sellers must by definition compete with one another in order to sell their products. So, the foundation of “capitalism” is really the non-aggression principle applied to property. Capitalism requires that no one’s property can be taken from them without their consent.

However, Moore’s film does not examine anything close to that system, which Adam Smith called “a system of natural liberty” (the word “capitalism” was not coined until nearly a century later). There is a good reason for that – it doesn’t exist. What Moore mistakes for capitalism is really the soft fascism that has been increasing in intensity in the United States since the Federal Reserve and income tax were created and property rights were destroyed. He makes the same mistake that Republican voters make when they vote Republican politicians into office. They believe the politicians when they say that they support “free markets,” despite the fact that they go on to govern in exactly the opposite way.

The injustices that Moore depicts in his film are without exception caused by government. Not one can be traced to people voluntarily exchanging their goods and services with one another. What Moore represents as “capitalism” is really what Thomas Dilorenzo described as “Hamilton’s Curse” in his 2008 book of the same name. Without attempting to reduce Dilorenzo’s treatise to a few sentences, he generally describes the economic system whereby the government allies itself with the wealthiest segment of society in order to plunder the wealth of everyone else in pursuit of “national greatness” or “the common good.” The hallmarks of the system are corporate welfare, deficit spending by government, protectionist tariffs, and most importantly, a central bank with a government-granted monopoly on the creation of money.

This system purports to benefit society by encouraging the growth of domestic industry and thereby increasing the power and standing of the nation as a whole, as well as providing employment for the working class. However, like socialism, it must achieve “societal goals” by violating the fundamental principle of capitalism. It must violate the non-aggression principle by taking property away from people without their consent and redistributing that property to others. Some of this is accomplished through taxation. A much greater part is accomplished through monetary inflation.

It is astounding that most people are able to ignore the fact that the central bank is an instrument of theft and thereby completely antagonistic to capitalism. It takes an incredible dearth of healthy skepticism not to question the reason for legal tender laws, which force people to use the central bank’s currency. There is only one reason for these laws: without them no one would choose to accept an un-backed paper currency in exchange for their real goods or services. People are forced to use Federal Reserve Notes so that the government and its corporate allies can use inflation (expansion of the money supply) to transfer wealth from everyone in society to the privileged few who benefit from the transfer. The beneficiaries include corporate defense contractors, large farming corporations, Wall Street banks, and other “pillars of the economy.” It is inflation more than anything else that widens the gap between rich and poor. It is the chief vehicle for what Bastiat described as “the few plunder the many.”

However, Michael Moore does not recognize the right to the fruits of one’s labor and so he is completely blind to the difference between capitalism and the system promoted by Republican politicians (in deed if not in word). He fails to see that every aspect of our financial meltdown was caused by some violation of property rights, representing a departure from capitalism.

The money needed to extend all of those “deceptive mortgages” was created by the Federal Reserve out of thin air, thus diluting the value of all existing U.S. dollars. This was a theft from the holders of those existing dollars. Most of the loans themselves were guaranteed by Fannie and Freddie Mac, which uses the coercive power of government to force taxpayers to put up their money as collateral for people who would either not receive those loans or who would pay a much higher interest rate without it. Again, this is not capitalist voluntary exchange but instead wealth redistribution and a distortion of the free market. Similarly, the hundreds of billions paid out to defense contractors and other beneficiaries of President Bush’s wars in the Middle East were also funded by inflation, which the Republicans overtly flaunted by cutting taxes while skyrocketing government spending.

Since he fails to recognize that it was violation of property rights that truly caused our economic meltdown, he doesn’t recommend the restoration of property rights as the solution. Moore blindly accepts the traditional “progressive” fallacy that free market participants can only benefit at someone else’s expense, instead of recognizing that people who exchange voluntarily do so to their mutual benefit. As a result, he accepts government’s role as plunderer of property and merely suggests dividing up the loot differently. He promotes the bogus idea that the government can grant rights to people, and suggests that the coercive power of government no longer be used to redistribute to the wealthy, but instead be used to redistribute to everyone else. He objects to a system wherein the few plunder the many, but suggests it be replaced with a system where “everybody plunders everybody.”

Moore asserts that FDR had the answer when he proposed a “Second Bill of Rights,” granting Americans the right to a reasonable wage, health care, a pension, and other entitlements. Again, as the concept of property rights is foreign to him, Moore is able to ignore the fact that granting a right to these things means that those who provide them have no rights. He extols the “justice” of labor unions, but ignores the fact that it was the unions that destroyed the U.S. automakers by claiming exactly these rights. It was actually an alliance between government and these unions – identical in principle to the alliance between government and Wall Street - that turned his beloved Flint into a ghost town. He suggests that we should set these forces loose upon all of society. His ability to ignore reality is, to quote Mr. Shawn, “inconceivable.”

Like all of his movies, Capitalism: A Love Story is very well made. Moore is exceptionally good at what he does, bringing wit, comedic timing, and emotional power to the screen. Also like all of his movies, he identifies real injustices and expresses appropriate outrage at them. However, throughout his distinguished career he has made the classic mistake of misidentifying the cause of the problems he depicts so poignantly on the screen.

He compares the United States to Rome and points to the similarities between our problems and theirs. He correctly identifies half of the cause of Rome’s decline and ours: the government’s unholy alliance with a landed aristocracy that plunders the wealth of the people for redistribution to the privileged few. However, he fails to recognize his solution as the other half of the cause of both Rome’s decline and ours: the rest of society attempting to share in the plunder by means of majority vote (democracy). It was both of these forces acting together which destroyed Rome’s currency and led to her eventual collapse. Like Rome, we are also afflicted with both of these ills.

The only real solution to our predicament is to implement a system that supports Bastiat’s third alternative – “where nobody plunders anybody.” It is only by following this principle that justice can truly prevail. The most significant step in achieving such a system would be to eliminate the Federal Reserve System. Neither the Republican system of plunder for the wealthy nor the Democratic system of plunder for everybody is possible without monetary inflation. There is no way that government could ever achieve either through direct taxation.

I believe that Michael Moore’s intentions are good. At the end of his film, he asks Americans to join him. I have an alternative proposition for him. If he truly wants to see justice restored in America, along with equal opportunity for all Americans to pursue their happiness, he should call off his misguided attack on capitalism and join us to End the Fed.

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

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© Thomas Mullen 2009

Letter to Congressman Adam Putnam Regarding Iran

2009-09-30T16:18:00.002-04:00

I just sent this letter to my congressman after receiving an e-mail from him indicating that he would be supporting sanctions against Iran. Please feel free to use this text for your own letters to representatives and senators. I will be sending a similar letter to Senators Bill Nelson and George LeMieux, respectively.

Mr. Putnam,

I received your e-mail regarding your intention to support sanctions against Iran for its supposed "secret" nuclear weapons facility. I am writing to express my extreme dissatisfaction with your position on this issue, as well as that of the US government in general.

I have read the news accounts, your report, and several different analyses on this supposedly new revelation. I find the statements made by various government officials and the press extremely misleading and often self-contradictory. I have concluded that Iran never intended to keep the Qom facility secret from the IAEA, but was merely waiting to make it public at a moment that would serve its political-diplomatic objectives.

In any case, Iran is a sovereign nation and while I certainly would not want to live there, they have every right to "keep and bear arms" just as any individual or other sovereign entity, treaties they have signed notwithstanding. More importantly, they represent no danger to the United States of America and I object to one dollar of my tax money - already looted beyond comprehension - to be allocated toward defending people in other countries.

Furthermore, I object on moral grounds to our brave U.S. soldiers and citizens, both here and abroad, being put at risk due to acts of aggression by our civilian leaders.

I remind you that your sole purpose in Washington is to defend the Constitution of the United States and thereby to secure my unalienable rights. If you would concentrate on that and leave the affairs of the Middle East to the people who live there, we would be far richer and in much less danger from terrorists.

Please vote against any sanction, military action, or show of force to further provoke Iran. Due to the colossal mistakes you and our other representatives have made regarding domestic economic policy, it is safe to say that you have plenty to do repealing those unjust interventions. Thank you for your time and consideration of this matter.

Best regards,

Tom Mullen

The Myth of the "Christian Nation" Divides Us

2009-09-27T15:54:00.002-04:00

While our politicians get on with the work of plundering our wealth, planning our lives, and preparing their next war of aggression, they remain comfortably insulated from criticism of any of these substantive actions because they have successfully distracted average Americans with issues that should not involve government at all. There is none more divisive than religion.

The left reads into the First Amendment of the Constitution an active role for government in prohibiting the acknowledgment of religion or God in any public setting. The right reads into our Declaration of Independence a requirement of belief not only in God, but in the Christian God, in order for one to claim the unalienable rights that are “endowed by our Creator.” Neither position is correct.

If there was one thing that our founders made clear, it was their belief that each person’s inner life belonged wholly to him or her. They referred to this as the “right of conscience,” and they revered it above all other rights. They believed that each human being had the right to answer for himself the questions of whether there is a God and what the nature and will of God might be. They believed that reason was the means for man to do so. Regardless of the conclusions that any individual might reach, he was still entitled to all of the same unalienable rights. This is the true meaning of “religious freedom.”

Among the growing minority that has recognized our loss of liberty and the importance of regaining it, there are many who mistakenly say that the United States was “founded as a Christian nation,” and that only returning to Christian principles will solve our problems. Others may not require that one believe in Christ, but do insist that belief in God is necessary in order to give authority to the law of nature and the natural rights. These positions not only alienate atheists, who are admittedly a small minority, but also a large contingency of Christians and other believers in God who do not want government – which is an institution of force – to play any role in their inner lives. This is an unnecessary division among people who might otherwise unite to fight for their liberty.

It is long past time to answer some fundamental questions about our history once and for all. Did the founders of the United States believe in God? Was the United States founded as a “Christian nation?” Was the Constitution based upon Christian or Judeo-Christian laws as found in their scriptures? Did the founders believe that belief in God was necessary to claim the unalienable rights?

The answer to the first question is a resounding “yes.” Even Jefferson, arguably the most “liberal” of the founding fathers, believed in a supreme being, despite the accusations of atheism made against him by political rivals. He also revered Christianity as the greatest religion in human history, as did his “conservative” counterpart, John Adams. However, neither Adams nor Jefferson believed that Jesus Christ was the son of God or even a divine being. Most people are familiar with Jefferson’s bible, which he cut apart and reorganized to eliminate all of the miracles. However, John Adams, a Unitarian, was even more ambivalent about the idea that Jesus Christ was God. In a letter to Jefferson, he wrote,

“They all believe that great Principle which has produced this boundless universe, Newton’s universe and Hershell’s universe, came down to this little ball, to be spit upon by Jews. And until this awful blasphemy is got rid of, there never will be any liberal science in the world.”[1]

Neither Adams, Jefferson, Washington, nor Franklin believed that Jesus was literally the son of God or otherwise a divine being in any way. Rather, they admired most of the moral principles of Christianity, although not all of them. For instance, they disagreed with Jesus’ doctrine to “turn the other cheek.” They believed that self defense of one’s life, liberty, and property was not only a right, but a duty. However, it was the Christian principles of love and non-aggression that are espoused in virtually all religions that inspired John Adams to say, “Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”[2] This will become even more apparent shortly.

In any case, the answer to the first question is “yes.” Most of the founders believed in God. They revered the moral teachings of Christianity, although most of the philosophical leaders among them did not believe in the divinity of Jesus Christ.

Our second question is, “Was the United States founded as a Christian nation?” In 1796, the United States signed a treaty with Tripoli, promising a monetary gift in return for a cessation of hostilities. That treaty was unanimously ratified by the senate and signed by President John Adams. Among its articles resides the answer to our second question.

"Art. 11. As the Government of the United States of America is not, in any sense, founded on the Christian religion; as it has in itself no character of enmity against the laws, religion, or tranquillity, of Mussulmen; and, as the said States never entered into any war, or act of hostility against any Mahometan nation, it is declared by the parties, that no pretext arising from religious opinions, shall ever produce an interruption of the harmony existing between the two countries."[3] [emphasis added]

Thomas Jefferson confirmed this statement in his autobiography when commenting on a Virginia bill to establish religious freedom.

“Where the preamble declares, that coercion is a departure from the plan of the holy author of our religion, an amendment was proposed by inserting "Jesus Christ," so that it would read "A departure from the plan of Jesus Christ, the holy author of our religion;" the insertion was rejected by the great majority, in proof that they meant to comprehend, within the mantle of its protection, the Jew and the Gentile, the Christian and Mohammedan, the Hindoo and Infidel of every denomination.”[4]

Next, there is the question of the philosophical basis for the Declaration of Independence, Constitution, and original system of laws of the United States. According to Thomas Jefferson, that philosophical basis was most directly the enlightenment philosophers, specifically John Locke and Algernon Sydney. In 1825, Jefferson actually got a resolution passed by the Board of the University of Virginia to make this point clear.

"Resolved, that it is the opinion of this Board that as to the general principles of liberty and the rights of man, in nature and in society, the doctrines of Locke, in his 'Essay concerning the true original extent and end of civil government,' and of Sidney in his 'Discourses on Government,' may be considered as those generally approved by our fellow citizens of this, and the United States."[5]

Despite this and other unqualified statements by the founders regarding the philosophical basis for our founding principles, there are many that claim that the founders drew their philosophy from Judeo-Christian scriptures or teachings. While there is much common ground between these teachings and the enlightenment philosophers, the founders were clear that where scripture or dogma conflicted with the enlightenment philosophy of liberty, it was the non-aggression philosophy of liberty that prevailed. Regarding the scriptures, Jefferson wrote,

The whole history of these books is so defective and doubtful that it seems vain to attempt minute enquiry into it: and such tricks have been played with their text, and with the texts of other books relating to them, that we have a right, from that cause, to entertain much doubt what parts of them are genuine. In the New Testament there is internal evidence that parts of it have proceeded from an extraordinary man; and that other parts are of the fabric of very inferior minds. It is as easy to separate those parts, as to pick out diamonds from dunghills.[6]

The founder’s skepticism about man’s knowledge of the will of God was not confined to the scriptures themselves. John Adams makes clear that at least he recognized that human beings had no ability to definitively determine the will of God.

“That there is an active principle of power in the universe, is apparent; but in what substance that active principle resides, is past our investigation. The faculties of our understanding are not adequate to penetrate the universe.”[7]

Finally, there is the most important question. Did the founders assert that belief in God was necessary to claim the unalienable rights? As with the other questions, they answered this one quite unambiguously. In a letter to Peter Carr, Thomas Jefferson advised his young friend,

“Question with boldness even the existence of a god; because if there be one he must approve of the homage of reason more than that of blindfolded fear.”[8]

“Do not be frightened from this enquiry by any fear of its consequences. If it ends in a belief that there is no god, you will find incitements to virtue in the comforts & pleasantness you feel in its exercise, and the love of others which it will procure you. If you find reason to believe there is a god, a consciousness that you are acting under his eye, & that he approves you, will be a vast additional incitement; if that there be a future state, the hope of a happy existence in that increases the appetite to deserve it; if that Jesus was also a god, you will be comforted by a belief of his aid and love. In fine, I repeat that you must lay aside all prejudice on both sides, & neither believe nor reject anything because any other persons, or description of persons have rejected or believed it.” Your own reason is the only oracle given you by heaven, and you are answerable not for the rightness but uprightness of the decision.”[9] [emphasis added]

There are those who argue that without God, there is no authority to base the natural rights upon. This was not the assertion of our founders and it directly contradicts our Declaration of Independence, which reads,

“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…” [emphasis added]

While the founders believe that our rights came from our Creator (whomever or whatever the Creator might be), they explicitly said that these truths are self evident. They are truths that can be observed directly. This is directly inspired by Locke’s empiricism. While he, too, believed in God, he based his philosophy only upon what he could directly observe in nature or reasonably conclude from those observations. Therefore, his philosophy recognized the existence of God but did not depend upon it for its validity.

Consider a useful analogy. If a priest and an atheist were both to consider a rock lying upon the ground, both would agree that the rock exists. They could see it, touch it, and hear its sound if they picked it up and then dropped it from their hand. The priest would say that the rock was created by God. The atheist would explain its existence with scientific theories. They may disagree vehemently on this point, but no third party would have to decide who is correct. All can see that the rock exists, for its existence is self evident. The same is true of our natural rights. Our Declaration of Independence says so explicitly.

The only authority that the founders recognized as the basis for our laws was the non-aggression principle, which they recognized as the fundamental law of nature. The beauty of this idea is that it transcends religion and thus welcomes members of all religions, as well as those with no religious beliefs at all. The non-aggression principle allows each individual to use his reason to answer the most important philosophical questions of life for himself, without being forced to assent to any beliefs that he does not hold. It allows people to believe in God voluntarily, or to not believe, as their reason dictates. The only restriction upon them is that they commit no aggression against anyone else, regardless of their beliefs. Jefferson expressed this beautifully when he wrote,

“The legitimate powers of government extend to such acts only as are injurious to others. But it does me no injury for my neighbor to say there are twenty gods, or no god. It neither picks my pocket nor breaks my leg.[10]

If all of America’s founding principles, including freedom of religion, could be summed up in two sentences, no better than these could be found anywhere. If we could agree to live by this one statement alone, the number of people no longer divided along partisan lines would be staggering. Our politicians are wasting trillions of our dollars and assuming un-delegated powers over us that apply to believers and non-believers alike. We must grant each other the ability to exercise the right of conscience freely within the boundary of non-aggression. Only then will we see clearly where the true source of our crisis lies – in a government whose every act contradicts the reason for its existence and perpetuates a state of war with its people. We must unite together to eliminate this earthly threat in order to resume the pursuit of our happiness, both in this world and the next.

[1] Adams, John Letter to Thomas Jefferson January 22, 1825 from The Works of John Adams Second President of the United States Vol. X Charles C. Little and James Brown Boston, MA 1851Pg. 415

[2] Adams, John To the Officers of the First Brigade of the Third Division of the Militia of Massachussetts 11 October 1798 from The Works of John Adams Second President of the United States Vol. IX Charles C. Little and James Brown Boston, MA 1851Pg. 229

[3] Treaty of Peace and Friendship between the United States and the Bey and Subjects of Tripoli of Barbary June 17, 1797 from The Avalon Project Yale Law School Lillian Goldman Library http://avalon.law.yale.edu/18th_century/bar1796t.asp. There has been some debate on whether the language in Article 11 was translated correctly from the original Arabic in which the treaty was written. However, this is irrelevant. It was the English translation containing these exact words that the Senate reviewed and ratified, making the question of translation irrelevant on this point.

[4] Jefferson, Thomas Autobiography from Jefferson Writings edited by Merrill D. Peterson, Literary Classics of the United States, New York, NY 1984 pg. 40

[5] Thomas Jefferson, Writings, ed. Merrill Peterson (New York, N.Y.: Library of America, 1984), p. 479

[6] Jefferson, Thomas from The Writings of Thomas Jefferson, Vol. 14 edited by Albert Ellery Bergh and Andrew A. Lipscomb The Thomas Jefferson Memorial Association 1904 pgs. 71-2

[7] Adams, John Letter to Thomas Jefferson January 22, 1825 from The Works of John Adams Second President of the United States Vol. X Charles C. Little and James Brown Boston, MA 1851Pg. 414

[8] Jefferson, Thomas Letter to Peter Carr August 10, 1787 from Jefferson Writings edited by Merrill D. Peterson, Literary Classics of the United States, New York, NY 1984 pg. 902

[9] Jefferson, Thomas Letter to Peter Carr August 10, 1787 from Jefferson Writings edited by Merrill D. Peterson, Literary Classics of the United States, New York, NY 1984 pg. 903-4

[10] Jefferson, Thomas Notes on Virginia from Jefferson Writings edited by Merrill D. Peterson, Literary Classics of the United States, New York, NY 1984 pg. 285

© Thomas Mullen 2009

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

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Next They'll Have Us Salivating

2009-09-18T00:26:00.004-04:00

“Raymond Shaw is the kindest, bravest, warmest, most wonderful human being I’ve ever known in my life.”

- Frank Sinatra as Major Bennett Marco in The Manchurian Candidate (1962)

For anyone who has seen the film classic, The Manchurian Candidate, the quote in the prologue should bring back the subtle horror of the premise of the film. Using experimental methods of operant and classical conditioning, the villains of the film – the intelligence community from the eastern communist bloc – were not only able to control the actions of their subjects, but their thoughts and feelings as well. While the most horrific moments in the film are the scenes in which Raymond Shaw is forced to kill people he loves or respects while in a hypnotic trance, the control exerted over the other members of Shaw’s unit is equally disturbing and much more relevant to our political discourse today.

For those who have not had the opportunity to see the film, Marco and the several other characters who repeat the adoring words about Raymond Shaw only do so because they are conditioned to do so for the purpose of covering up the massive plot that constitutes the storyline of the movie. Marco later says, “It’s not that Raymond Shaw is hard to like. He’s impossible to like!” He tells his superior officer that while praising Shaw he really believed what he was saying, even though deep down he knew it wasn’t true. He had been trained to respond emotionally in a way that contradicted his reason. A more appropriate metaphor for American politics is hard to imagine.

The United States of America was born during the Age of Reason. Its founders believed that reason was the law of nature itself, and that the inalienable rights to life, liberty, and the pursuit of happiness were logical conclusions based upon observable facts. Further, they believed that reason was a duty and a prerequisite of those rights – one could only be entitled to liberty if one followed the law of nature, which requires non-aggression in return for the natural right to do as one pleases. This is why children do not have a natural right to liberty. They must first develop their reason sufficiently to be able to responsibly claim that right. As Locke said,

“The power, then, that parents have over their children, arises from that duty which is incumbent on them, to take care of their off-spring, during the imperfect state of childhood. To inform the mind, and govern the actions of their yet ignorant nonage, till reason shall take its place, and ease them of that trouble, is what the children want, and the parents are bound to: for God having given man an understanding to direct his actions, has allowed him a freedom of will, and liberty of acting, as properly belonging thereunto, within the bounds of that law he is under. But whilst he is in an estate, wherein he has not understanding of his own to direct his will, he is not to have any will of his own to follow: he that understands for him, must will for him too; he must prescribe to his will, and regulate his actions; but when he comes to the estate that made his father a freeman, the son is a freeman too.”[1]

So, it is not surprising that an absence of reason has accompanied our loss of liberty, for in fact it is only the former that can make possible the latter. No one would logically conclude that they would benefit by placing their life, liberty, or property under the arbitrary power of anyone else, for to do so is profoundly illogical. Yet, every generation, Americans have surrendered more of their rights to a government that has grown into the most pervasive institution of power that has ever existed in human history. They have done so for the most part because they have allowed their passions to replace their reason. Until we recognize this, every “change” we make is going to be for the worse.

Third parties and other tiny constituencies aside, American political discourse is dominated by our two major political parties. Their primary goal in any debate is not to reach the truth, but to enlarge their voting base. Having discovered long ago that appealing to the voters’ feelings is more effective than appealing to their reason, there is little more to most political dialogue coming out of politicians and activists than ad hominem attacks against their opponents and empty jingoism that similarly appeals to conditioned emotional responses rather than any rational position or argument (and once in a while, they cry). Perhaps this has always been true in politics; perhaps it will never change.

However, what is truly frightening is how successfully these parties have been able to train average Americans to think and act as they do, and ultimately to cast their votes likewise. For anyone that has given their allegiance to either of the major parties, no dissent or even discussion of that party’s platform is permissible.

If you are talking with someone who identifies him or herself as a Republican or a “conservative,” the mere suggestion that the United States government should consider decreasing military spending or changing their nation-building foreign policy results in a vitriolic, ad hominem assault of the most vicious nature. Often, the response will reference positions that you not only did not take but were not remotely related to the discussion you were having before you questioned party dogma. You may criticize the war in Iraq and find yourself attacked as “godless” or an atheist or even a traitor, while your subject goes on to tell you why you are so wrong about supporting amnesty for illegal aliens, regardless of the fact that the subject of illegal aliens was never heretofore mentioned and you happen to oppose amnesty for illegal aliens.

Similarly, when talking with someone who identifies him or herself as a Democrat or a “liberal,” any mention of support for a free market will elicit a similar attack. You may be called a racist, a fascist, selfish, or greedy amidst a blustering diatribe about the importance of the separation of church and state and religious tolerance, which are likewise subjects that heretofore were not part of your conversation and which you may well agree with wholeheartedly.

One must recognize at this point that you are not engaged in a debate. The person you are talking to is no longer reasoning, but instead giving conditioned responses to words he or she has been trained to react to with abhorrence and intolerance. In most cases, you can expect no chance to redirect the person back to the discussion you were having nor any chance to make a further point, as your opponent will likely continue to cut you off and ultimately withdraw from the conversation, having heard nothing beyond the trigger word(s) that set the absurd reaction in motion.

If the whole encounter seems bizarre, consider the associations that were likely revealed during it. Anti-war equals godlessness (is God pro-war?). Free market equals racism. Property equals greed. Neither Orwell nor Burgess could have imagined a victory over reason so complete. Soon, like the iconic Dr. Pavlov, our masters will need to do no more than ring a bell to direct our thoughts, feelings, and actions.

Without reason, there can be no liberty. Reason - the law of nature - is what allows us to discover the natural, non-aggression limit to human action. It is what defines liberty and distinguishes it from the state of war. It is doubtful that any one of us has not been guilty of abandoning reason at one time or another, although there are some that are certainly guiltier than others. It is also clear that there are those who would go on exhorting our passions in order to cloud our reason and therefore rob us of our liberty, for their own gain at our expense.

There is only one way that we can regain our freedom. We must “pull out the wires,” as Major Marco said to Raymond Shaw. We must break the links that we have allowed others to implant within our minds and begin to listen to one another again, even when we disagree. Pacifism is not communism, freedom is not racism, and property is not greed. These associations are as insane as “War is peace, freedom is slavery, ignorance is strength.”[2] We should be disgusted with our political class for manipulating us this way and ashamed of ourselves for allowing them to train us like dogs.

Until we break free from this irrational partisanship, we are like the children that Locke describes above, without the understanding that qualifies us for liberty. There are plenty in our political class that prefer us this way, so that they may “will for us” in regard to every aspect of our lives. However, unlike wise and loving parents, they have demonstrated throughout all of history that they will teach us nothing but nonsense and guide us nowhere but to war and economic destruction. Even a small child will stop touching the stove after he has burned his hand a time or two. Are we not even as intelligent as this?

There are a few simple things to keep in mind as you attempt to fight the good fight. If you are conscientiously arguing a position that you believe in but find yourself being called a racist, a satanist, a right-wing extremist, or a traitor, keep doing what you are doing. You are very likely winning. On the other hand, if it is you that is resorting to calling your opponent names, ask yourself, “Why am I attacking my opponent? Am I unable to refute his argument?” Maybe it is time to consider the other side.

If you find yourself saying anything that you heard a politician or any of the politicians' lapdog media hounds say, think very carefully about whether you really agree with it or not. It is likely that further thought will change your mind.

Finally, if you hear a bell ring and find your mouth starting to fill up with water, be aware that there is something very, very wrong.

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[1] Locke, John Second Treatise of Government Hackett Publishing Co. Indianapolis, IN (1980) pg. 32

[2] Orwell, George 1984 New American Library (Penguin Group) New York, NY (1961) pg. 4

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© Thomas Mullen 2009

The Natural Law Provides the Answers

2009-09-08T08:05:00.005-04:00

There are many well-intentioned people that invoke the Constitution of the United States when looking for the solutions to what they believe (or are led to believe) are “dilemmas” confronting America today. This results in spirited debates about what the framers of the Constitution might have intended when writing it, in spite of the fact that there are hundreds of essays by our founders that explain what they intended beyond any reasonable doubt.[1] However, establishing the specific meaning of each article or phrase in the Constitution cannot supply the answers to the questions confronting us now. The Constitution is not a philosophical document. It is a legal one. As such, it does not express the philosophy upon which our nation was founded. In other words, it does not answer the question, “What will our government attempt to do?” but rather, “How will our government attempt to do it?”[2]

The answer to the former question, “What will our government do?” or, more precisely, “What should our government do?” is answered by the other of our founding documents, The Declaration of Independence. Some mistakenly dismiss the Declaration because “it does not have the force of law,” which it does not. This completely misses the point. The law is merely the attempt to codify the underlying principles of justice - to put the philosophy into practice. However, it is the Declaration that articulates that philosophy. Like the Constitution, the statements made in this document are clear and unambiguous. While often mistaken for platitudes that are left open to subjective interpretation, each statement in the Declaration of Independence actually has a specific, objective meaning that must be known in order for the whole to be understood.

The very first sentence of the Declaration contains one of its most important philosophical concepts: the laws of nature and of nature’s God. Before one proceeds any farther, it is vital to determine exactly what the law of nature is, for it is the foundation for all that follows. The law of nature is clearly defined in John Locke’s Essay Concerning the True Original Extent and End of Civil Government.

“The state of nature has a law of nature to govern it, which obliges every one: and reason, which is that law, teaches all mankind, who will but consult it, that being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions…”[3]

Reason is the law of nature that the Declaration refers to. It was reason that allowed Locke and our founders to observe the self-evident fact that all men are created equal, to conclude based upon that observation that they are endowed with certain unalienable rights, and to further conclude that the sole purpose of government is to secure these rights. These were not articles of faith, but reasoned conclusions based upon empirical evidence.

That it was Locke’s philosophy that our founders adopted is also clear. They did not conclude, as Hobbes did, that man should give up his natural rights upon entering society in return for the security that an absolute monarch could provide. Neither did they conclude that man must subordinate his rights to the “general will,” as Rousseau thought necessary for civil society. Rather, they clearly stated, as Locke did, that the purpose of government was to secure our rights.

There are further conclusions that proceed directly from this. First, we do not have “Constitutional rights.” Our rights are neither granted by the U.S. Constitution nor by its first ten amendments, commonly referred to as the “Bill of Rights.” Our natural rights precede the government and the Constitution. The so-called Bill of Rights does not grant rights but rather prohibits certain violations of our rights by the government.[4] The Constitution is a means toward an end: the end of securing our rights. To the extent that it does so it is a useful instrument. To the extent that it fails to do so it is not.

Similarly, we must also conclude that we cannot lose our inalienable rights. The very meaning of the word “inalienable” means that they cannot be taken away, not even by majority vote. Regardless of any Supreme Court decision or new legislation, our rights will not and cannot ever change. No Constitutional Amendment can revoke our rights or grant us new ones. Those rights may be violated by unjust laws, rulings, or Constitutional amendments, but they remain our rights nevertheless. It is appropriate for us to demand that they be respected and it is our duty to defend them, for the exercise of our natural rights is the essence of being human.

Finally, our Declaration answers the question that is ultimately asked whenever our present difficulties are truly understood. “What can I do?”

Our Declaration also answers this question.

“That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”

This also comes from Locke, who wrote,

“…whenever the legislators endeavour to take away, and destroy the property of the people, or to reduce them to slavery under arbitrary power, they put themselves into a state of war with the people, who are thereupon absolved from any farther obedience, and are left to the common refuge, which God hath provided for all men, against force and violence. Whensoever therefore the legislative shall transgress this fundamental rule of society; and either by ambition, fear, folly or corruption, endeavour to grasp themselves, or put into the hands of any other, an absolute power over the lives, liberties, and estates of the people; by this breach of trust they forfeit the power the people had put into their hands for quite contrary ends, and it devolves to the people, who have a right to resume their original liberty, and, by the establishment of a new legislative, (such as they shall think fit) provide for their own safety and security, which is the end for which they are in society.”[5]

Based upon these passages, one might be tempted to conclude that we have no alternative but armed rebellion. To be sure, it is the right of every individual to defend himself by force when his natural rights are violated, for violation of those rights is the definition of the state of war. However, before loading our weapons, we should stop to consider whether our government has truly acted against the will of the people or not. Has it truly acted against our will in establishing massive redistribution programs that violate each individual’s right to property and bankrupts us as a whole? If so, then what of the tens of thousands cheering President Obama as he promised universal health care and the tens of millions who voted him into office? Has our government truly acted against our will in creating and expanding our military empire and tyrannical security/police state? If so, then what of the tens of thousands cheering President Bush and the tens of millions who voted him into office?

In truth, reason should force us to recognize that our government has not become the monster that it is by acting contrary to our will, but by giving us exactly what we have asked it for. As a people, we now openly refer to government as a “provider of services” rather than a “securer of rights.” We have elevated Democracy to an ideal, allowing the majority to grant the government power to violate the very rights that it exists to protect, most consistently property, which is the means of both life and liberty. This was anticipated by our founders, who warned us specifically against the dangers of democracy.

“Wherever the real power in a Government lies, there is the danger of oppression. In our Government, the real power lies in the majority of the Community, and the invasion of private rights is chiefly to be apprehended, not from acts of government contrary to the sense of its constituents, but from acts in which the Government is the mere instrument of the major number of Constituents.”[6]

We have forgotten that the “checks and balances” written into our Constitution were put there to protect us from democracy. We no longer have any concept of what our natural rights are, much less how best to secure them or even that we should be trying to secure them. If anything, we have come to believe that man in civil society has what Hobbes mistakenly believed he possessed in the state of nature – a right to everything, which is why he equated the state of nature with the state of war. Our society now exists in that state of war of “everyone against everyone” that Hobbes described in his state of nature, for most of us believe that we have a right to everything and that we can bring the force of government to bear against our neighbors to secure that right. To engage in armed defense of what we think are our rights amidst such confusion would result in a bloodbath of unprecedented proportions, which is no small statement considering the wars of the last century. As important as rediscovering our true natural rights is the understanding of what we do not have a right to – namely the life, liberty, or property of any other human being.

It is not the majority that determines what our rights are, but it is the majority that makes the laws that are supposed to protect them. We must rediscover our founding philosophy and persuade our fellow Americans to again accept it as our creed, with a written Constitution as its supporting code.[7] For any one of us to regain our freedom, we must “educate and inform the whole mass of the people.[8]” While they are ignorant of the law of nature, they are a force of tyranny that cannot be overcome, no matter how just the cause or how committed the patriot. Once reacquainted with this most fundamental of laws, they are equally irresistible as the “only sure reliance for the preservation of our liberty.[9]” When the inhabitants of America are again guided by reason to reclaim their natural rights and to defend those rights for everyone, we can institute new Government without firing a shot. What could be more progressive than that?

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[1] These are, of course, the Federalist Papers and the rebuttals to them called the Anti-Federalist Papers.

[2] Even the preamble, which states “in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense…,” is really a list of objectives, rather than a statement of the ultimate goal.

[3] John Locke Second Treatise on Civil Government Ch. 2 Sec. 6

[4] Neither are the rights specifically protected in those amendments an exhaustive list of our rights. To ensure that there would be no confusion on this matter, the Ninth Amendment clearly states that the “enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.”

[5] Locke, Second Treatise Ch. 19 Sec. 222

[6] Madison, James to Thomas Jefferson October 17, 1788

[7] This wonderful characterization of the Declaration of Independence as our American Creed and the Constitution as its corresponding Code was suggested to me by my friend and respected colleague, David R. Gillie.

[8] Jefferson, Thomas Letter to James Madison December 20, 1787 Memoirs, Correspondence, and Private Papers of Thomas Jefferson: Late President of the United States Vol. 2 edited by Thomas Jefferson Randolph Henry Colburn and Richard Bentley New Burlington Street London 1829 Pg. 277

[9] Ibid.

© Thomas Mullen 2009

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What Is This Free Market We Keep Hearing About? Part II

2009-08-21T00:27:00.005-04:00

Previously, I wrote an article entitled “What Is This Free Market We Keep Hearing About?” In it I attempted to demonstrate that a free market is the only economic system compatible with liberty, in addition to being the system that will yield the best results for society. The dissenting views were familiar ones, which I will attempt to answer.

The first category of dissenting opinions came from those that somehow misunderstood the article to have argued that a free market exists right now, or has existed in the recent past (perhaps under the Republican regime that has thankfully gone the way of the hula hoop). For the record, we have not had any semblance of a free market since at least the New Deal, and probably not since the institution of the Federal Reserve and the income tax in 1913. If anything, we have had markets that have been “progressively” less free in each succeeding decade, the trend accelerating markedly during a few notable periods, including the 1910’s, the 1930’s, the 1960’s, and the present devastation of our liberty that is occurring before our very eyes. As I have argued more extensively before, the Bush years did not represent free markets.

The next broad category of comments could generally be grouped as those which implied that a truly free market system would amount to no government or restrictions at all and therefore necessitate that market participants would have to be trusted to “do the right thing” at the expense of their own profits. Those making this argument went on to say that history shows that “the corporations” or other wealthy market participants will always choose profit over the good of society.

This is a complete misunderstanding of the concept of free markets presented in the article and of the non-aggression principle of liberty in general. “Non-aggression” does not mean the absence of the use of force (government) under any circumstances. In a free market, there is a very necessary role for government to play, just as in nature there is an appropriate time for the use of force. Specifically, the government brings force to bear against those who have committed or are committing aggression against another’s rights. In a truly free market, the government prevents any party from using coercion or fraud to secure an exchange of property. If a company lies on its financial statements to attract investors or credit, it is the government’s job to prosecute those responsible for fraud. If a company employs violence or the threat of violence in trying to eliminate its competition, it is the government’s responsibility to prosecute the aggressor in defense of the victims.

However, if the company participates in exchanges of property whereby all participants voluntarily consent to the terms and all information pertaining to the transactions are represented truthfully, then that activity is beyond the reach of government, just as speech, religion, and conscience are beyond the reach of government because they do not represent acts of aggression against anyone else’s rights.

With the natural boundary of non-aggression enforced, the market requires no consideration for any participant other than the pursuit of profit. With truly free markets, it is never true that society is threatened unless firms sacrifice their profits to benefit society. Rather, firms can and should pursue only profit so long as they commit no aggression against another’s rights. The law should never be a positive force – it should never compel anyone to do anything. It should only prohibit certain actions, namely those that amount to aggression (fraud being aggression against the rights to property). It is this principle that is consistently violated by our modern brand of “regulation.”

This brings us to a third category of objections, namely that insufficiently regulated markets have resulted in the massive consolidations that have occurred over the past quarter century, decreasing competition and creating overly influential corporations that dominate markets and our government. This argument is rooted in the same misconception as the first – that we have had free markets at some point in our recent past. However, even if one argues that some “deregulation” has taken place and that is the reason for the consolidation, the position still begs one question. Why are new competitors not entering the market to compete with these overly dominant corporations?

There are only two possibilities. One is that the corporations in question have achieved natural monopolies. A natural monopoly is a good thing. It means that one firm is producing products of such high quality and such low price that no other firm is able to compete with it. A natural monopoly can only be sustained as long as the monopolist continues to offer products that consumers prefer over all others based upon their own voluntary decisions. Natural monopolies harm no one.

The only other explanation for a dearth of competition is that there are artificial forces at work that are keeping competition out. This means that market participants are not acting voluntarily, but make their choices under some type of coercion. There is only one entity that can legally coerce participants in any market – government. In fact, it has been the ocean of rules and regulations itself – in violation of every market participant’s natural rights – that has led to the dearth of competition in our supposedly free markets. This conclusion is intuitive. If the corporations are not natural monopolies then their competition must have been eliminated unnaturally or artificially, i.e, by the government.

It is abundantly clear that our labyrinthine regulatory structure is an artificial barrier to new competition, particularly since the regulations are now written by the very corporations they are supposed to govern. However, the root of the problem is not bad regulations or corruption. It is the fact that any barriers to human action exist at all beyond those that prevent aggression. Even without back door deals and outright corruption, these artificial barriers necessarily favor entrenched market players over new firms trying to enter the market, as compliance with regulation drives up start up and compliance costs beyond what all but the largest firms can afford.

The so-called “deregulation” in many of our markets did nothing to dismantle this quagmire of regulation, but merely eliminated barriers to consolidation while continuing to insulate established players from new competition. The results were predictable but certainly not the results of natural market forces. The proper solution to this problem is not to violate the rights to liberty and property by prohibiting one company from buying another, but rather to remove the further violations of those rights that our massive regulatory structure represents.

On this point there were some thoughtful comments attempting to determine whether corporations have rights or whether only people have rights. I would argue that the rights in question when discussing corporations are those of the shareholders, who retain all of the same rights to life, liberty, and property as any other market participant. Some argued further that the shareholders obtain certain privileges granted by government, particularly in limiting liability, that justify taxes or restrictions that would not be justified on individuals.

However, this argument ignores the fact that corporations are required to register and therefore declare to all of society their corporate status. As the decisions to form a corporation, buy its stock, lend it money, or purchase its products are all made voluntarily and with full knowledge of its corporate status, there is no justification for government to impose special restrictions upon a corporation outside of those disclosure requirements necessary to inform the public that it is a corporation.

Finally, there were those that argued that unfettered free markets result in corporations achieving too much “power,” rather than merely too much wealth. Corporate “power” is a misnomer. Power is the ability to use force. Only government has power. It is government’s sacred duty to wield that power only in defense of each individual’s rights. No matter how much wealth a corporation obtains, it exercises no power, unless it literally spends its capital to raise an army and engage in open rebellion. Clearly, this has not been the case. However, it is also clear that corporate or other wealthy interests have used their wealth to buy political favors and to induce politicians to pervert the laws themselves, leading directly to the quasi-fascist economy that we find ourselves confronted with today.

This has been a failure of government, not the free market. It is certainly not admirable when an individual or group uses its wealth to achieve injustice. Nor are interested parties participating in a free market when trying to bring government force to bear upon competitors or other market participants. However, it is ultimately government that is entrusted to preserve justice. The members of government are never compelled to allow wealthy interests to persuade them to abandon their duty. It is the government’s job to say “no,” and when they fail to do so they are destroying the free market, not licensing it.

This brief article certainly does not answer every specific argument made against free markets, but it does illustrate something common to all of them: all objections against free markets result from a misunderstanding of what a free market is. A free market is one in which no one’s rights are violated, resulting in all transactions occurring by mutual, voluntary consent. Participants in a free market practice the non-aggression principle. This does not require unrealistic virtue from market participants, because it is government’s duty to enforce the non-aggression principle. Every economic problem plaguing American society today stems from some departure from the free market, which is some violation of the rights of market participants. Justice is the protection of those rights. Social justice can only be achieved when absolutely free markets exist. Properly understood, freedom and free markets are one and the same.

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What is This Free Market We Keep Hearing About?

2009-08-06T11:49:00.006-04:00

“…every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interests his own way and to bring both his industry and capital into competition with those of other men.”

– Adam Smith (1776)[1]

As President Obama and his pet Congress continue their crusade to expand the reach of government into our lives, “conventional wisdom” continues to tell us that socialized medicine, rampant wealth redistribution, and government control over one industry after another is “necessary” because of the supposed failure of the free market to adequately address the needs of society. The way the “free market” is characterized by politicians and media pundits, it is not surprising that most Americans seem to regard it as some sort of special interest group (Mr. Undersecretary, the gentlemen from the free market are here to see you). Doubtless, when most Americans hear the words “free market,” they picture the CEO’s of Detroit automakers flying in on corporate jets or Wall Street financiers busy mastering the universe. This mischaracterization of the free market is ironic, seeing as both of these groups have recently sought and obtained capital from people who were not free to refuse (taxpayers).

So, before trying to ascertain whether or not the free market has failed society, it is necessary to define exactly what it is. This is not so much difficult as it is inconvenient for those who either wish to exert control over our lives or who wish to be controlled by those that they believe can offer them security in exchange for their liberty - even if it means destroying liberty for everyone. For both of these groups, the “free market” is something that must be characterized as something that it is not. To recognize it for what it is would both threaten their own ability to justify their positions and concede to their victims that what they advocate is in fact abject slavery. Neither result is palatable to opponents of the free market, so gibberish is necessary for them from both a moral and practical perspective.

So, let us say here what it seems that no one anywhere wants to come out and say: the free market is simply all members of society exercising their inalienable rights. It is nothing more and nothing less. Any other system, by definition, violates some or all of these rights.

Every individual has a natural right to labor and to keep the fruits of his labor (his property). This is his only means of pursuing his happiness. There is only one role for government in this area: to defend the property of each individual against theft by another person or group. A truly free market limits government’s role in regards to property to this natural boundary – for any further role constitutes government committing the very crime it exists to prohibit.

Every individual has a natural right to liberty – to do as he pleases as long as he does not commit aggression against the equal rights of another. In a free market, there can be no “regulation” (as we incorrectly understand the term today). The laws that restrict human action must be limited to those few necessary to ensure that no individual is forced or defrauded while paticipating in an exchange of property nor forced to accept any terms that he does not freely consent to. As the quote from Adam Smith illustrates, one cannot talk about “free markets” without at the same time incorporating the Non-Aggression Principle of Liberty. While Smith is generally regarded as the “father of capitalism,” he never actually called his economic system by that name. Instead, he referred to it as “a system of natural liberty.” Given the confusion that now accompanies the word “capitalism,” it might be better to revert to Smith’s terminology.

Since a free market is by definition the only system that allows individuals to exercise their rights, to say that an unfettered free market does not work is to say that society will not work unless those rights are systematically violated and that those violations must be protected by the law. A greater perversion of justice is unimaginable. Yet, the majority of our elected officials champion exactly this. Sadly, the majority of their constituents blindly parrot their horrific slogans.

In response to this argument, the more cunning opponents of liberty will say that we have given the free market a chance to work and it has failed. False prophet of freedom Alan Greenspan is notable among this gang of vipers. However, any lucid analysis of the difficulties that we find ourselves in now can indisputably be traced to the aspects of our society that prevent free markets. Bad mortgage loans were made because government committed the fraud of monetary inflation combined with the theft of guaranteeing loans with taxpayer money. The skyrocketing cost of health care is a result of government committing the theft of taking money from one individual and using it to buy health care for another, suspending the natural law of supply and demand with artificial demand. Contrary to the idea that individual rights must be balanced with societal needs, it is the violation of individual rights that causes all of our societal problems, most pervasively our economic problems.

As it is merely the economic application of the Non-Aggression Principle of Liberty, the free market is the only system that allows individuals the ability to exercise their right to pursue their happiness. By doing so, they naturally seek to profit from their labor and compete with each other without committing aggression against each other’s rights. History shows that individuals acting in this manner produce enormous benefits for their fellow human beings. The steam engine, the automobile, the airplane, the telephone, and virtually every other technological advance that provides a tangible improvement in the quality of human life have been the result of human beings peacefully competing with each other for profit.

Conversely, the atomic bomb, the concentration camp, and every other technology which serves the purpose of death, destruction, and enslavement have been the result of governments forcefully confiscating property from their citizens which would otherwise have been put to productive use.[2] It has only been by violating the individual, inalienable rights to life, liberty, and property that any of these horrors were able to come to fruition.

The free market has not failed. The free market is Freedom itself, and while it has only occurred for brief moments throughout history, it has never, will never, and can never fail. When we are confronted with gibberish about the failure of free markets and the need for government to “play a role in the economy,” or for a “public-private partnership,” let us not let ourselves be led into a carefully framed argument about what might provide more health care, produce more automobiles, or save more jobs. Let us recognize these arguments for what they are: a declaration of war upon our inalienable rights.

As our Declaration of Independence states, government’s purpose is to secure our rights, including our inalienable right to a free market within which to exchange our property. Whenever any Form of Government becomes destructive of this end, it is our right and our duty to alter or abolish it. Not only must we resist further government expansion into our economy, we must begin dismantling the institutions of tyranny that government has already established over the past century. Our representatives must hear this from us every day until they call off their attack upon our rights or until they can be removed from office. There is nothing in any of our lives that is more important than this right now.

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[1] Smith, Adam An Inquiry into the Wealth of Nations from An Inquiry into the Wealth of Nations: Selections edited by Laurance Winant Dickey Hackett Publishing Indianapolis, IN 1993 pg. 165
[2] The reader should avoid confusing private companies developing weapons for the government with “the free market.” The fact that the companies are privately owned does not mean that they are operating in a free market. Quite the contrary. Since the buyers of their products do so involuntarily (taxes), the development of new weapons and subsequent sale of them to the government has nothing to do with a free market.

Collectivist Republicans Losing Their Fight

2009-07-19T01:12:00.010-04:00

For eight years, the only reasonable commentary on government policy came from the left. While George W. Bush was president, supporters of the Democratic Party correctly protested the evil war of aggression in Iraq, the abominable use of torture by our military and intelligence agencies, and the sinister aspect of our own government listening to our phone calls, reading our e-mails, and infiltrating our peaceful clubs and organizations as part of the tyrannical War on Terror. Regardless of their motivation, all of these criticisms from the left were valid. The Bush administration, especially while enjoying the support of a Republican majority in Congress, was one of the most damaging administrations to our liberty of any in recent memory.

Of course, these persistent attacks by the Democrats were not really motivated out of a love of liberty. They simply represented a rival gang appealing to the American public’s dissatisfaction with the Bush administration for their own political ends. If anyone doubts this, simply put your ear to the ground and listen for a moment. While the Obama administration marches forward in expanding the War on Terror, fights in court to solidify the government’s right to spy on its own citizens, and has actually confirmed the government’s right to torture under the guise of prohibiting it (as long as said torture is called by another name), all protests from the left against these abominable practices have stopped (kudos to Rachel Maddow and Glen Greenwald who are both notable exceptions).

Since it is apparent that the Democrats are not going to reverse any of these Bush-era incursions against liberty, we can see what President Obama really meant by “change.” While breaking every promise he made to his supporters regarding war, torture, and domestic spying, he has launched an all-out assault on what is left in America of the individual rights to property and free enterprise. His American Recovery and Reinvestment Act handout to existing welfare programs instead of to the “shovel-ready projects” that he claimed the bill would fund, his health care “reform” initiative that will merely attempt to implement programs that have already failed in Europe and Canada, and his destruction of contract law in stiffing secured creditors in the GM bankruptcy are only the beginning.

While all of this might seem gloomy, it should at least represent a political opportunity for the Republicans. Finally, the Republicans have a chance to start making sense and appealing to the natural sense of justice inside each American that was the reason for their political demise in the first place. However, while it might appear on the surface that they are taking advantage of this opportunity, they are not. While railing against what they call Obama’s socialism, they fail to recognize the reason that they will fail in opposing him: their arguments are as collectivist as Obama’s.

Consider their arguments against “Obamacare.” They argue that a government-run program would be inefficient, would eliminate competition through artificially low prices subsidized by tax revenues, and would result in lower quality care and rationing. All of these things are true.

Regarding the government’s takeover of the automobile industry, they argue that the government doesn’t know how to make cars, that forcing the American manufacturers to try to make “greener cars” will only raise their costs and make them less competitive, and that without eliminating the labor union contracts that brought down the American automakers in the first place, they can never compete with foreign automakers, not even those operating in the United States. All of this is true as well.

As just one more example, the Republicans criticize President Obama’s call to expand public works projects, including adding 275,000 jobs under Americorps. They argue that these are not “real jobs,” that once the projects are completed the jobs will go away, and that government cannot create real, sustainable economic growth. Only the private sector can create jobs that last. Again, all true.

While all of these arguments are valid, they are share the same flaw: they are all made based upon what they believe will achieve the best aggregate economic results. Their arguments amount to “the beehive will make more money under our system than theirs.” Like the Democrats, their positions all proceed from the belief that the “needs of society” or the “greater good” outweigh the rights of the individual. If anyone doubts this, then they should take a few moments to read a transcript of John McCain’s acceptance speech upon receiving the Republican nomination for president last year.

The correct argument against all of President Obama’s programs is that they violate the individual rights that government is supposed to protect. Government is an institution of justice, not economics. It exists solely to protect the life, liberty, and property of its constituents. The minute that government attempts to achieve anything beyond this, it must necessarily destroy those rights in the process. As Thomas Jefferson said,

“To take from one because it is thought that his own industry and that of his father's has acquired too much, in order to spare to others, who, or whose fathers have not exercised equal industry and skill, is to violate arbitrarily the first principle of association--'the guarantee to every one of a free exercise of his industry and the fruits acquired by it.”[1]

When government protects life, liberty, and property, enforces the sanctity of contracts, and punishes only violence or fraud, the “free market” that results does produce higher economic productivity and a more equitable distribution of wealth. The beehive does in fact make more honey when the individual rights of the bees are respected. However, when those rights are violated in an attempt to manage the results, the wealth-generating mechanism is destroyed. There is no conflict between individual rights and the needs of society. Securing the rights of every member of society is society’s greatest need.

These are supposed to be the central principles of the Republican Party. Their name itself should be an enormous public relations advantage for them over the Democrats, as our Constitution guarantees us a republican form of government - not a democratic one. Yet what word did we hear from George Bush to describe our nation and its philosophy for all eight years of his presidency? “Democracy.” There is a good reason for that.

Despite their talk about free markets, capitalism, and smaller government, the Republicans have rarely practiced these principles over the past century. The closest they came to fielding a presidential candidate that intended to govern by them was Barry Goldwater, and we the people handed him the most one-sided defeat in American history. After that, Republicans have decided to “talk like libertarians but govern like European social democrats,” as Thomas Dilorenzo so eloquently put it.

After giving the greatest inaugural address of the 20th century (and yes, I am counting John Kennedy’s), Ronald Reagan went on to save Social Security. He had his chance to make a stand and point out that nothing with the word “social” in it was likely to work, besides it being abhorrent to liberty, yet he contradicted everything he said in that wonderful first speech and raised taxes to perpetuate American socialism for another generation. He also ran deficits that exploded the national debt, started the Rex 84 program (the dreaded FEMA camps), and launched the War on Drugs. So much for the “Goldwater Republican.”

George Bush similarly came into office talking about “smaller government,” and “free markets (not to mention his “humble foreign policy”), yet he expanded federal entitlements more than any president since LBJ and cheered on Clinton’s “ownership society,” whereby people who couldn’t afford houses got loans for them anyway because they got to use other people’s money as collateral. Like so many of his Republican predecessors, George Bush’s idea of “free markets” was merely that his friends on Wall Street and in corporate America made as much money as possible, regardless of the fact that they did so because of artificial market conditions created by the Federal Reserve, Fannie Mae/Freddie Mac, and the spider web of regulations that are now written by the very corporations that they are supposed to govern. All of these institutions represent government interference with the free market, fundamentally violating property rights and insulating government-favored corporations from competition. If that is “capitalism,” then Stalin and Mussolini were history’s greatest capitalists.

That brings us to newcomer Sarah Palin. Somehow, she seems to have acquired immunity from criticism of her economic policies despite being the most overt Republican socialist alive. As governor, she put a windfall tax on oil companies operating in Alaska and redistributed their profits to Alaskan citizens. She says that the oil in the ground under Alaska belongs to “the people of Alaska,” instead of to those who risk and spend their own capital to drill for it. When Hugo Chavez did that, it was socialism. When a Republican governor did it, it was “standing up to big oil.”

So, the Republicans are out for now and the Democrats are presently in a position of unchecked power. The minute that they gained the advantage, they began proposing monstrous programs that could truly destroy the last vestiges of our republic. As a result, it is tempting for many to think that the Republicans can be “reformed” or “infiltrated.” Perhaps their decisive defeat has “scared them straight” and will force them to adhere to their supposed principles. One might say to oneself, “At least their rhetoric invokes some of our founding principles. If only we could redirect them while they are rudderless, perhaps we could use their political infrastructure to champion liberty.”

The Democrats have never tried to hide what they are about, least of all during this past election cycle. They sold us socialism and they are going to deliver. We may have to learn the hard way how evil and destructive that system is.

On the other hand, the Republicans have continually sold us free markets, smaller government, individual liberty, and then delivered…socialism. One could make a compelling argument that the misconception that capitalism causes the problems in our mixed economy while socialism provides the solutions is due in large part to people mistaking the economic policies of the Republican Party as “capitalism.” It is not. It is corporatism at best, and fascism at worst - if indeed there is a difference between the two. They combine that with at least as much support for the mammoth entitlement programs as the Democrats. Reagan said that FDR was the U.S. president that he admired most. That really says it all.

The prospect of the present Democratic regime left unchallenged should horrify every sane person with any desire at all to live his own life and have any control over his future. For over a century, our conditioned response in times like these has been to run from one gang of thieves to the other. The Republicans are now on deck, warming up with the familiar big government program of military deficit spending, “compassionate conservative” welfarism, and their hypocritical pandering to the “Chrisitan Coalition.” Four years of misery under the Democrats may be just enough to allow 51 percent of Americans to forget how bad the Bush years really were.

What if this time it were different? Instead of doing the same thing over again and expecting a different result, what if we let the Republicans die? They are gasping for air now, without a viable candidate for president and without a prayer of making up ground in the Congress. Their demise would be nothing unprecedented – political parties have come and gone in America for most of our history. The Federalists, the Whigs, the Democratic-Republicans – all of these put presidents into office but eventually went away. The demise of a political party in the United States is long overdue. Imagine if the libertarian wing of the Republican Party abandoned it, making it impossible for them to gain either the White House or a majority in Congress for the foreseeable future? That would spell the beginning of the end of the bipartisan tyranny that we have lived under for the past century.

There is no danger of an indefinite Democratic reign within our government. President Obama and his Democrats are not just going to fail. They are going to fail spectacularly. Hopefully that will be apparent by the next presidential election. If not, then certainly by 2014 or 2016 it will be obvious to the whole world that Obama’s brand of socialism not only should not continue, but cannot continue. Socialism is unsustainable and America has practiced it for far too long. Its inevitable self-destruction is at hand. The present Democratic platform merely steps on the gas pedal as the vehicle approaches the cliff. We are going over the edge sooner than most people think.

When that happens, there is going to be a political backlash against the Democrats that will make the last Republican defeat look like a split decision. What if at that time there was no Republican Party left to bring in more of the same? Imagine the coalition that might be formed to fill that void. Libertarian Republicans, disenfranchised Democrats who truly supported Obama’s anti-war, anti-torture, anti-spying head fake, and all of those independents that presently vote for the “lesser of two evils” could come together. Who knows who else might come out of the woodwork and vote if there truly were something different on the table?

Only when at least one of these criminal gangs is dismembered will there ever be any “change” in Washington. With the Republicans out of the way and the Democrats completely discredited, the chance for a true revolution in Washington couldn’t be better. You may say I’m a dreamer, but life without Republicans should at least be considered. With the taste of Bush and Cheney fresh on our tongues, what do we have to lose?

[1] Jefferson, Thomas Letter to Joseph Milligan April 6, 1816 (regarding Destutt de Tracy‘s Treatise on Political Economy) from The Writings of Thomas Jefferson, Vol. 14 edited by Albert Ellery Bergh and Andrew A. Lipscomb The Thomas Jefferson Memorial Association 1904 pg. 466

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Liberty Is An Absolute

2009-07-08T00:19:00.013-04:00

"Our legislators are not sufficiently apprised of the rightful limits of their powers; that their true office is to declare and enforce only our natural rights and duties, and to take none of them from us. No man has a natural right to commit aggression on the equal rights of another; and this is all from which the laws ought to restrain him.”

– Thomas Jefferson (1816)[1]

Over the past week I’ve made two round trip flights by air, which means I have had the distinct pleasure of passing through airport security four times in seven days. It may be my imagination, but I believe that our friendly neighborhood TSA officers are getting more authoritarian. While the officer at the podium still exhibits call center courtesy, those charged with seeing that people make their way through the canvass rope maze and show up with their license and boarding pass ready have taken to shouting orders as if managing a chain gang. Of course, this characterization isn’t far from the truth. However, I don’t really blame the officers personally that much. Their job is to get people to act in a completely unnatural manner – partially disrobing in a crowded room full of strangers just for starters – and with the exception of frequent travelers they are never going to do it right.

So, as the days go by and thousands of new travelers shuffle in and forget to have their licenses ready, forget to take their suntan lotion out of their carry on, try to go through the metal detector with their jackets on, and do a thousand other things that innocent people would never think twice about doing, the frustration must build with these foot soldiers in the War on Terror. “I just told you yesterday that you can’t bring liquids through security!” they must think, forgetting that the little old lady they are snarling at is not the same little old lady from yesterday or the day before or the day before that…

However, my sympathy does not go so far as to let me forget what is happening each time I remove my shoes and render my person, papers, and effects insecure against unreasonable searches. Regardless of the chirpy greeting by the uniformed agent with the infrared flashlight or the bizarre signs attempting to characterize this shakedown as some type of customer service (Rather be molested in private? Just ask…), I always remember what is really going on: I am being investigated for a crime.

There is no probable cause, no writs, no warrants sworn by oath or affidavit. In fact, for the 90-year-old gentlemen in front of me who just put his cane through the x-ray machine and is now holding onto the glass wall as he tries to stumble through the metal detector without it, there is no scenario that any reasonable person could imagine where he would or could harm anyone. Yet he is a suspect, too.

Most sane people who observe spectacles like this immediately conclude that law enforcement is going too far. Surely, there must be a better balance than this between liberty and security. However, in thinking this they have already made an error. When it comes to liberty, there can be no balance. Liberty abides no compromise. Liberty is an absolute.

For generations, Americans have been conditioned to believe that there are no absolutes. The truth is always the synthesis of the extremes and compromise is the supreme virtue. These ideas proceed from the “intellectual class” that dominates our education system – a breed that long ago abandoned Reason for the Hegelian confusion that allowed them to embrace communism. It is from this quarter that the spurious arguments against liberty proceed. “Absolute liberty is anarchy” or “you must balance liberty with the needs of society” or Bill Clinton’s infamous “When personal freedom's being abused, you have to move to limit it.” All of these arguments are groundless, and those who make them do so because they do not know what liberty is.

Today, what we used to call “liberty” has been given a sterile, quasi-clinical 20th century name. We now call it “the Non-Aggression Principle.” This is by no means an inaccurate name, but hardly as poetic or stirring to the soul as Liberty. While it is useful in making arguments (I do so myself all of the time), I often wonder if this name allows the great majority of people to relegate this most sacred of rights to the small libertarian and objectivist constituencies who champion it. It is much easier to say “there are more important things than the Non-Aggression Principle” than it is to say “there are more important things than Liberty.” However, Liberty and the Non-Aggression Principle are one and the same.

The passage from Jefferson is not meant to suggest that it originated with him or our founders. They got it from Locke, who developed his ideas from ancient sources. As Locke said, men are naturally in “a state of perfect freedom to order their actions, and dispose of their possessions and persons, as they think fit, within the bounds of the law of nature.”[2] The natural right to liberty is absolute within a natural limit: the law of nature. What is this law? The law of nature is Reason, which “teaches all mankind, who will but consult it, that being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions.”[3]

Thus, a state of absolute liberty “is not a state of license.”[4] People exercising their right to liberty do not have an unqualified right to do whatever they wish, regardless of the consequences. There is a clear and unambiguous limit to even what a person in an absolute state of liberty may do. He may do anything that he wishes as long as he does not harm another in aggression, which he absolutely may not do.

Therefore, it is just more politicians talking gibberish when we hear arguments for more or less liberty or balancing liberty with security or other priorities. Liberty does not conflict with any proper functions of government. When there is conflict between government and liberty, it is always government that is in the wrong. Most importantly, as our founding document clearly states and Reason demands, liberty is a right. It is for no one to limit, regulate, or balance with anything. The minute that any limit on human action is put in place beyond “the bounds of the law of nature,” liberty has ceased to exist. One is either free or not free. You cannot enslave someone a little.

Once liberty is properly understood, there are a few conclusions that one can draw about the purpose of government. First, government cannot at the same time secure the right to liberty and prevent crime. The minute that it acts before a crime has been committed, it has destroyed liberty in the process. Since they have committed no aggression, those restrained by the government crime prevention policy should be free to do whatever they choose, but they are not.

In order to preserve liberty, government may only prosecute and punish crimes after they are committed, except in those rare instances when a law enforcement officer happens to be at the scene of a crime as it is taking place. Even military action is something that our founders understood was only justified when a state of war already existed, which I wrote about in more detail in an article last year. That is why they granted Congress the power to declare war. By definition, to declare something presupposes that it already exists.

An understandable first reaction to this idea is that non-aggression must mean that in order to be free we must offer ourselves up as sitting ducks to criminals and foreign armies, only able to take action once the damage has been done. This is refuted by the second conclusion one must draw from an understanding of Liberty: that each individual has not only a right but a responsibility to defend himself. While this may sound frightening at first, it is not. If the truth be told, this is really the only choice that you have whether you live in a free society or not. In all but the rarest of cases, the government simply is not there at the moment that you are attacked. You must defend yourself the best that you can and try to survive. It is only after the fact that the law can come to your aid. This is only one reason that liberty and the right to bear arms are inseparable from one another.

Finally, you must conclude that in addition to destroying your liberty in the process, crime prevention will always fail. A just law is one that prohibits aggression, such as the law against murder. However, once an aggressor has decided to violate this just and natural law, he is certainly not going to be dissuaded by some societal rule of conduct that attempts to prevent him from having the opportunity to commit the real crime. He will simply break that law, too, as so many murderers do when they use “illegal” firearms to commit murder. Only the innocent are punished by attempts to prevent crime. They either follow the unjust law and surrender their liberty or are unjustly punished when they break the law while committing no aggression.

This inevitable failure gives rise to the most ominous aspect of government’s misguided attempt at crime prevention: its equally inevitable expansion. With each new failure, the preventative measures must be increased in intensity to prevent further failure. The actions of all must be more and more limited until all opportunity to commit a crime is eliminated, which even under martial law can never be achieved. So, it is a steady march onward, with a police state as the only logical end. Each new failure in the war on drugs or the war on terror takes us another step down that road.

Life in a state of liberty is not perfect. It makes no guarantees other than the opportunity to pursue your happiness. You may prosper or you may be poor. You may be safe or you may come to harm. Chance will certainly have some effect on your life – we all deal with unexpected circumstances that we cannot control, both good and bad. However, liberty gives you the ability to act upon those things in life that you can control in the way that you believe will be the best for you and those you care about. Without liberty, you can control nothing, and it is only a fool who believes that any government can guarantee that he will never be poor or will never come to any harm. There is only one thing that life without liberty does guarantee: you will never truly be able to pursue your happiness. Robbed of that, why live at all?

© Thomas Mullen 2009

[1] Jefferson, Thomas Letter to Francis Walker Gilmer June 7, 1816
[2] Locke, John Second Treatise of Government Hackett Publishing Company, Inc. Indianapolis, IN (1980) Pg. 8
[3] Locke, John Second Treatise of Government Hackett Publishing Company, Inc. Indianapolis, IN (1980) Pg. 9
[4] Ibid

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Life, Liberty, and Property Are Inseparable

2009-06-23T18:10:00.005-04:00

The reason why men enter into society, is the preservation of their property; and the end why they chuse and authorize a legislative, is, that there may be laws made, and rules set, as guards and fences to the properties of all the members of the society, to limit the power, and moderate the dominion, of every part and member of the society: for since it can never be supposed to be the will of the society, that the legislative should have a power to destroy that which every one designs to secure, by entering into society, and for which the people submitted themselves to legislators of their own making; whenever the legislators endeavour to take away, and destroy the property of the people, or to reduce them to slavery under arbitrary power, they put themselves into a state of war with the people, who are thereupon absolved from any farther obedience, and are left to the common refuge, which God hath provided for all men, against force and violence.

- John Locke[1]

Life, liberty, and property were the central, inalienable rights that formed the foundation of the great experiment in self government called the United States of America. The founders of our country never broke apart this sacred triumvirate, because each one of these rights is inextricably bound to the other. No one of these three can exist without the other. Moreover, when all three are secured, it is almost impossible for injustice to exist. Wherever one does find injustice, one invariably finds a violation of one of these three basic rights at its root.

While it is certainly true that today the rights to life and liberty are grossly violated in innumerable ways, they are nevertheless at least spoken of by our politicians. However hypocritically, they at least say that they value life and liberty, even as they pervert those sacred rights as justification for their wars and plunder.

Yet, they never even hypocritically evoke the right to property. No journalist ever challenges them based upon it, and honestly, most average Americans don’t talk about it either. As a principle, property has vanished from our consciousness. However, as all of the great philosophers throughout history have understood, there is no right to life or liberty without property. In fact, property is part and parcel of life itself.

What is property? It is that which an individual rightfully owns. Included among every human being’s property are his mind, his body, his conscience, and his actions. Every act of mind and body undeniably belongs to the actor, including that act which he engages in more than any other: his labor. To deny someone’s right to ownership of his mind, body, or labor is to make him a slave.

It is labor that allows each individual to sustain his existence and pursue his happiness. All consumption must be preceded by production. Production can only be achieved through human labor. In fact, there is no way for an individual to pursue any goal, whether material, intellectual, or spiritual, without exertion. Even the search for God requires an intellectual and spiritual effort – it cannot commence without labor.

For most of us, the bulk of our labor is devoted to providing the basic necessities of life for ourselves and our children. Some portion of it also provides the extras – the toys, the vacations, or the dining out that enriches our lives and adds to our happiness. A further portion is devoted to study, prayer, or just simple reflection – the quest for meaning and purpose in our lives. None of these things are possible without labor; our labor provides them all. Every item in every store is the product of someone’s labor. Every phone call you make is made possible by someone’s labor. Healthcare is someone’s labor, as is education.

However, the actual effort of mind and body is not the most precious aspect of labor. If human beings were immortal, we could afford to spend our labor and its fruits indiscriminately, consuming as much as we wished and providing anything to anyone who asked it of us. If a shoemaker were able to make shoes for the rest of eternity, then certainly there would not be a bare foot on the face of the earth. If the land developer were immortal, we would all live in a mansion.

However, we are not immortal, and it is this fact that places such a premium on our labor. Our labor is not just composed of the exertion of mind and body that is necessary to produce some good or service. That exertion happens over time, the hours or days of the laborer’s life. Every hour of our labor is an hour of our life from a limited supply which cannot be replenished. Whatever we have produced with our labor now contains that portion of our life which we have sacrificed to produce it.

So, when human beings trade their goods or services with one another, they are really trading pieces of their lives. If they have exchanged their labor for money with an employer or customer, that money now contains some part of their lives – a part that can never be reclaimed. That is why the same verb is used for both money and time – both are “spent” in exchange for some benefit. Both also represent each individual’s means of self determination.

Therefore, it is impossible to call a person free if he does not own his labor and all the product of his labor. It is only through his labor that he can provide better food, clothing and shelter for himself and his family, send his children to better schools, or realize the leisure time necessary to grow intellectually and spiritually. His labor is his means to determine the course of his life. Without self determination, there is no liberty.

Furthermore, to deny a human being ownership of his labor is also to deny his right to life itself. Since his labor is his means of sustaining his existence, once his right to ownership of his labor is denied he lives only at the arbitrary whim of whoever has claimed ownership of it. For such a person, life is now a privilege granted by someone else, rather than a right.

To the founders of the United States of America, all of this was self evident. When one reads the writings of Samuel and John Adams, Jefferson, Madison, or Locke, one finds one word that is used many times more often even than liberty: property. Recognizing property as nothing more than the individual’s labor and/or the product of his labor, the founders placed the protection of property as the very highest priority of government. In fact, they often stated that it was the only priority of government. While no high school history book or Hollywood biopic even hints at this fact, merely reading the words of the founders for oneself puts any debate on this point to rest.

Let us apply this concept to a contemporary issue. The unambiguous statements in the Declaration of Independence that all human beings have unalienable rights and that government’s sole purpose is to secure them should absolutely beg at least one timely question from most Americans today. Why did the founders not provide for the right to health care? Why did they not establish Medicare or Medicaid? Given a whole system of government whose purpose was to secure individual rights, why was this right so glaringly overlooked?

Of course, the answer to that question is that the founders recognized that health care was not a right. Health care, like every other good or service, is someone’s labor. No one but the laborer can have a right to it. To say that people have a right to health care is really to deny the health care provider a right to his own life, for it is impossible for both he and his patient to have a right to ownership of his labor. It is no less a crime to forcefully rob the health care provider’s fee from a third party (the taxpayer), for that simply denies the taxpayer’s right to his own life. In either case – whether the health care provider is forced to treat the patient for free or a third party is forced to pay the bill – someone’s labor, some part of someone’s life, is being stolen from him. This is the specific crime that government exists to defend its citizens against. By instead committing this crime, government becomes the most grotesque absurdity imaginable.

This is not to imply that we are at some sort of crossroads because President Obama and his pet Congress are closing in on expanding government healthcare. We came to that crossroads decades ago and quite undeniably took the wrong road. Until our philosophy changes and we recognize that retirement benefits, health care, research grants, corporate subsidies, investment in alternative energy – all money, goods, and services – are really pieces of someone’s life that cannot be seized from them without their consent (not even by majority vote), we will never restore the liberty that we have lost. Instead, we will continue to be the most pitiable form of slave, not bound to one master, but to everyone.

When a fellow human being offers to buy your product or hire you for your services, he has paid you the highest compliment imaginable. That person has offered a piece of his life to you in exchange for something that you have to offer, which is itself a piece of your own life. He is saying that you have value and that what you offer is worth hours or days of his life that he can never reclaim. This consensual interaction between free people is the most beautiful aspect of civil society and has been responsible for every improvement in the quality of human life that has ever occurred throughout history.

Conversely, when a fellow human being points a gun at you and demands that you provide him with some good or service, he commits the most egregious crime imaginable, short of pulling the trigger and ending your life at that moment. For in reality, he is really stealing a piece of your life that you can likewise never reclaim. He may be committing this crime because he wishes to increase his wealth without earning it, or he may desperately need whatever he takes from you, but it is the same crime nonetheless. This interaction is the most evil aspect of civil society and has been responsible for every war and human misery that has ever occurred throughout history.

Government can only be organized to fulfill one of two purposes: to protect your property or to take it from you - for whatever purpose government or its constituents deem fit. There is no third choice. To organize society around competing groups stealing from one another is to create a society whose citizens exist in a perpetual state of war with one another – for the use of force to obtain another’s property without his consent is the definition of the state of war.

Such a society cannot endure indefinitely. Ours has come to the beginning of its inevitable end. Countless empires throughout history – some much more preeminent in their worlds than we are in ours – have disintegrated for exactly the same reason. We can still choose justice over injustice but our philosophy must change. We must again institute a government that secures our rights, rather than annihilates them in the attempt to provide us with the property of others.

This will not happen by any act of government itself. Whether we elect a liberal or a conservative, we will never achieve different results by continually electing different people or parties but asking them to do the same thing – provide us with the property of others. It must be the people who change their philosophy and then demand that government assume its appropriate role according to that philosophy. Our government ultimately gives us what we ask for. For the past century, we have increasingly asked it to make us slaves, seduced by the siren’s song of comfort and security without responsibility. This can only be provided to each of us at another’s expense and can only be provided to others at ours. Once we reject the idea that we can claim a right to another human being’s life, the chains that bind us will be broken. Then, it will matter not who makes our laws.

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[1] Locke, John Second Treatise of Government Hackett Publishing Company, Inc. Indianapolis, IN (1980) Pg. 111

Politicians Talking Gibberish About Health Care

2009-06-18T13:54:00.010-04:00

Every minute of every day, Americans are subjected to politicians and media pundits talking gibberish. There really is no other word for it, whether the particular subject is economics, foreign policy, or even climatology. However, the gibberish that is getting the most attention right now concerns health care “reform.” President Obama is leading the Democrats with the familiar socialist model that has failed in every industrialized nation in which it has been tried. The Republicans are answering with gibberish of their own. You have to especially admire the Republicans, because they are not only fomenting nonsense from a discredited, minority position, but are actually trying to suck up to voters by selling their version of government-run, loot-funded health care as a “free market solution.” Only the party of George W. Bush could be capable of gibberish like this.

To truly appreciate how bizarre the arguments are, let’s break down what our ruling class is really saying. Sometimes the music bed, the interruptions by the self-absorbed interviewer, or even the graphics leading into next segment can obscure the gibberishness of some of their assertions.

Let us start by examining the position of the Democrats. They assert that every human being has a right to health care, and that it is the government’s job to provide for those who cannot afford it. There are three key terms here: right, health care, and provide. Let’s define the first two.

Right: that which an individual is entitled to without the consent of or compensation to anyone else. For example, people have a right to life. That is, they do not need anyone’s permission, nor are they obligated to compensate anyone in order to live. It is appropriate for an individual to demand, rather than ask for, their right to life to be respected.

Health care: a service which primarily consists of the labor of health care providers. For example, a physician exerts his mind and body, utilizing his education and experience, to attempt to diagnose and treat a patient’s illness or injury. That physician’s labor is “health care.”

Let us now restate the argument made by the Democrats, using these definitions in place of the terms themselves.

“Every individual is entitled to the labor of health care providers without compensating them or obtaining their consent. It is appropriate for individuals to demand, rather than ask, that health care providers treat them for free.”

Gibberish.

To be fair, although the Democrats repeat their slogan about the “right to healthcare” ad infinitum, they do not actually propose that the government defend this “right” directly. Instead, they use their own peculiar definition of the third term previously cited, “provide.” Americans continue to be bewildered by this parlor trick, whether because they are easily confused or because it is more convenient to be fooled than not. In any case, “provide” to the government means that they will employ the method described by William Graham Sumner where A & B get together to pass a law requiring C to do something for X. So as not to miss the opportunity to describe this plainly, this really means that they are going to use the brute force of government to force some people to pay for health care for others. That is all it is, when you peel away the doubletalk, jingoism, and spin.

Moreover, it is not just your property that the government will take in order to run its program. It will also require another huge portion of your liberty as well. In a recent speech about his health care reform plans, President Obama suggested that “we” must begin encouraging healthier lifestyles, including getting our children away from computer games and back to playing outside. “We” means “the government.” Of course, when it is the government’s responsibility to pay for the health care of other people, the government now claims a right on behalf of taxpayers to see that those people keep themselves as healthy as they can in order to limit the cost. There are already government-imposed exercise programs in Japan. Americans should be aware that the same rules will apply here. One can almost hear the government “instructress” from Orwell’s 1984 screaming from the telescreen.

“Smith W.! Yes, you! Bend lower, please! You can do better than that. You're not trying. Lower, please! That's better, comrade.”[1]

Political gibberish often conceals rather horrifying ideas. Thankfully, we have an opposition party that is opposing these heinous proposals, correct? As the people from Hertz say, “Not exactly.”

It is true that Republicans oppose a government-run health care plan. As reported in the Wall Street Journal, the Republican summary of their “Patient’s Choice Act” argues that “ The government would run a health plan "with the compassion of the IRS, the efficiency of the post office, and the incompetence of Katrina.”[2] All true, but of course the so-called party of individual liberty and free markets fails to argue the main point: the government – we the people – do not have the right to forcibly take money from one person and give it to another, not even for the purposes of paying for their health care. Nowhere in any report made public nor in any interview with a spokesperson for this “opposition party” will you hear this argument. There is a good reason for that.

Of course, the Republicans will argue that their plan works through the tax system and actually let’s families “keep more of their own money” to spend on health care, but a careful read of the WSJ article reveals that the same redistribution scheme is hidden within the stale “free market” rhetoric. First, the Republican plan would eliminate the tax exemption for employers when they provide health insurance benefits to their employees. This amounts to a tax increase on employers, whether they continue to provide the benefits or whether they eliminate them and merely pay taxes on the extra net income. What would the government do with this new revenue?

“Instead, it would give an annual tax credit of $2,300 to each individual and $5,700 to each family that they could use to offset the cost of their health insurance. Low-income families would get extra money to buy into private insurance plans.” [emphasis added]

So, in an effort to appear to be protecting the property rights of their more affluent base but at the same time buy the votes of those who cannot afford health care, the Republicans will simply tax those whom they think they can get away with taxing and call their own version of wealth redistribution a “tax cut,” much like George Bush’s “tax refunds” of the past decade. Of course, there is only one word for the suggestion that you can “cut” or “refund” taxes for people who are not paying taxes.

Gibberish.

As usual, the American public is served up a carefully framed debate that attempts to appear to have two sides but doesn’t. In either case, we are getting “reform” of the health care system in the only way that any government can “provide” anything. They are going to forcibly take away the property (taxes) of one group of people and use it to provide property (health care) to another group. Lest anyone mistakes this brutal practice as “the wrong means to a compassionate end,” let us remember the only reason that politicians from either party suggest this: to buy the votes of those who believe that they will benefit from it. Since there are more who would receive benefits in the voting base of the Democratic Party, they are more open about what they are really doing. Since there are more of those who will be forced to pay in the base of the Republican Party, they try to spin their redistribution scheme as a “free market solution.” However, it is dressed up, it amounts to one thing; stealing.

In addition to ignoring the fundamental violation of rights that is part and parcel of any government provided service, both the Republicans and Democrats seem completely unaware of the root cause of the problem: health care is only so expensive because government already provides so much of it. This is the other elephant sitting in the corner whenever politicians from either party start talking about health care reform.

Last year, total health care spending in the United States amounted to roughly $2.4 trillion dollars. Medicare and Medicaid alone accounted for over $800 billion, or 33% of that. Add the Veteran’s Administration and other smaller government health care programs, and government is directly providing almost half of all health care delivered in this country. What does this have to do with the price? Any first-year economics student can tell you.

Price is determined by the intersection of supply and demand. Demand has two components: the desire to buy a good or service and the ability to buy that good or service. Let us assume that the desire for health care services is unlimited, as it is for many other goods or services. In that case, the only factor that can limit demand for health care services is ability to pay. This is the factor that most influences the price of every other good or service provided in the marketplace, including food, clothing, and shelter, which are even more vital to human life than health care. It is the finite amount of money that the buyers have to spend which keeps the price down and makes most goods affordable to those on limited budgets.

However, when government makes something an entitlement, demand suddenly becomes unlimited. Since the government now must provide the benefit and they have the option of taxing or printing what money they need to provide it, there is no longer anything holding down the price. This is the reason that we have seen health care prices skyrocket in recent decades. They will continue to rise until all resources are consumed trying to provide them.

State and local governments have already been experiencing this for years because of the exploding cost of their shares of the Medicaid programs (half of Medicaid benefits are paid by the states, some of which require their local governments to pay a percentage as well). They cannot print their own money, so they have instead cut their police forces and other legitimate functions of government in order to divert money to the insatiable Medicaid beast. In one local county in upstate New York, 100% of the property taxes collected in that county and $40 million dollars of sales tax revenue – the county’s only other revenue source – went to pay that county’s share of the Medicaid bill for their recipients. Now, it has been reported that the majority of the TARP funds that were supposed to go to “shovel-ready infrastructure projects” are instead being earmarked for “existing state social programs.” An audit of these payments would undoubtedly reveal that the bulk will go to Medicaid.

Economic laws are like the forces of nature. They can be held off, as a levy holds off a flood, but they will eventually overwhelm any attempt to violate them. The most fundamental economic law is this: you cannot consume more than you produce without taking the difference from someone else. Government produces nothing. Therefore, any health care benefit that government provides must be funded with money taken by force from someone else. There is no political theory, mathematical equation, or black magic incantation that can change this.

However, even if we are able to put aside the moral repugnancy of this practice, we cannot do so forever. Once voluntary exchange is abolished, market forces are suspended and the price of providing health care will rise until the government is no longer able even to steal enough to pay for it. That day was only a few decades away for the existing government health care programs before the economic crisis we find ourselves in now (which was similarly caused by government for all of the same reasons). If government attempts to provide everyone with health care, the end will come much sooner.

This sheds light on a fundamental misconception that underlies all of the societal problems that American society faces today: the belief that there is a conflict between individual rights and the “needs of society.” This conflict doesn’t exist. Protecting the rights of every individual serves the needs of society. Violating those rights, for whatever purpose, destroys society. In fact, it is by violating the individual rights of its constituents that government causes nearly every societal problem we face. The high price of health care is just one example.

There is only one moral and practical answer to the high cost of health care: we must get government out of the health care business entirely. That includes rejecting new programs proposed by either major party and figuring out a humane way to get our children out of the existing entitlement system without cutting off those presently dependent upon the benefits. The only lucid argument I’ve heard so far has been put forth by former presidential candidate, Congressman Ron Paul. He suggests that we dismantle our $1 trillion per year overseas military empire and use that money to pay Medicare and Social Security benefits while our children are allowed to enter the workforce without enrolling in the system themselves.

What do you know? A politician moved his lips and something besides gibberish came out.

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

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[1] Orwell, George 1984 Part I Ch. 3
[2] Adamy, Janet “Republicans Offer Health-Care Plan” The Wall Street Journal May 21, 2009

How Do We Defeat Racism and Discrimination Once and For All?

2009-06-05T09:50:00.008-04:00

....Why, Capitalism, Of Course!

We haven’t heard a lot lately about discrimination in the job market. Perhaps the economic crisis has pushed it into the background. “Progressives” may be too busy promoting their economic gibberish (Keynesianism) to fall back on this tried and true “divide and conquer” issue. However, as surely as night follows day, there will come a time when our friends in Congress will again need a different reason to try to tell people how to conduct their business, and nothing garners more support than railing against discrimination. When that shoe finally drops, I have a suggestion. Let’s not go back down the road of affirmative action, quotas, or any other idiotic idea that our retro-liberal Congress is likely to resurrect. There is only one remedy for discrimination in the workplace: free market capitalism.

I can speak from personal experience that this is true. I have interviewed thousands of people for jobs over the course of my life. The candidates were black, white, Hispanic, male, female, young, and old. How did I decide who to hire? I chose the same way every time. I picked the candidate that I believed would make me the most money. When I chose a black candidate or a woman, I did not do so because I wanted to promote diversity or equality. I did not do it out of altruism or for women’s rights. When I made those decisions, I had one thing and one thing only on my mind – profit.

Sometimes, I chose a white male over a black female and didn’t give it a moment’s thought. Sometimes, exactly the opposite was true. Nonetheless, in each case I chose based purely on my own self-interest (or that of my employers). I did not hire people to help them and they did not come to work for me to further some missionary cause (or even because of my sparkling personality, believe it or not). They came to work for me because the opportunity I offered them would benefit them personally more than any other available to them at the time.

The people that have worked for me in the past and who work for me now are my equals. They have skills and services to sell and I am their customer. We deal with one another in the same way that people deal with one another when buying or selling a house. I am looking to get the highest quality work that I can for the best price. They demand the highest price that they can get for their services. They choose to sell those services to me because I am willing to meet their price. If they call me “Mr.” or “Sir,” it is not out of subservience any more than the owner of an exclusive restaurant is subservient when he calls you “Sir” or “Madam” while you are paying him $150 per plate. When someone buys your product, you show gratitude for the high compliment they have paid you. They have chosen what you have to offer over all other alternatives.

Were I to make hiring decisions based upon anything other than the profit motive –based upon racial discrimination for example - the market would punish me. It would reward my competitor with a more talented employee and an advantage in the market. If I were to do this habitually, my competitors would soon have more talented employees throughout their organizations and I would be forced out of business. Anyone who has run a business knows that one cannot afford to discriminate based upon anything but profit. The market forces me to ignore race, creed, or sex for my economic survival. Only politicians remind me that I should consider demographics.

The plain fact that no politician in history has ever understood is that the market requires no altruism for everyone to benefit. Competition for employees creates higher wages and better benefits. If competition for jobs drives wages down, then the cost of production drops with wages and real wages rise despite the nominal decrease. There is no need to “balance” profit and social justice. The profit motive creates social justice. People exchanging their goods or services with one another by mutual, voluntary consent is social justice. It is only coercion that is unjust.

When people are left to themselves to deal with one another by mutual, voluntary consent, the profit motive will trump racism and discrimination every time. Show me a firm that passes on superior talent because of race or sex and I will show you a firm that is not going to be around for very long. Show me an entire industry that has put the best talent on the sidelines due to race, sex, or age, and I will be open for business in that industry the very next day. Within six months, I will be that industry’s next billionaire. The company with the most talented employees wins - every time.

This relationship between employer and employee – between buyer and seller of services – is one based upon all parties acting in their own self interest. My employees do not need my help or my altruism – they need my business, just as I need the business of my customers. They strive to perform at the absolute highest level that they can so that they can demand even more money from me for those services. I happily pay it when their improved performance increases my sales or my profits. I offer less when I can get the same performance at a lower price.

The beneficiaries of all of this are our customers. I am constantly trying to lower my costs and raise the quality of my products. I do this to gain market share and increase profits. My employees continually improve their service to our customers so that they can make more money for themselves. Higher performance from my employees is what raises the quality of my products.

Neither I nor my employees bother to stop and take note of the color of anyone’s skin or whether they are a man or a woman. We cannot afford to and, quite frankly, we just don’t have the time. This is the way the real world works. Just ask anyone who has to make a living in it. Only politicians and the people they are able to confuse see it any differently.

So, the next time your politicians bring up discrimination in the workplace, try to explain all of this to them. Tell them to put away their pamphlets and spend some time with you - working for a living. Six months spent actually earning a living rather than living off taxes collected at gunpoint would make capitalists of them all. You may say I’m a dreamer, but just imagine the freedom and prosperity that would result.

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

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