Archive for the ‘Capitalism’ Category

Open Letter to Richard Fitzpatrick, CEO of Magpul Industries

Sunday, February 17th, 2013

Dear Mr. Fitzpatrick:

I have read the announcement made by Magpul Industries on February 15th via Facebook, and I wish to discuss it with you further.  I realize that you do not wish to leave the state of Colorado, and that if the state enacts laws making your products illegal for purchase by customers in your state, as a matter of moral and philosophical consistency, your hand will have been forced, and that you will uproot your company and move it to another state more amenable to your enterprise.  This is a commendable stance, and you are to be credited for taking it, as far too many people in business see only dollar signs but not the underlying principles that support their existence. I hope you are not forced to move Magpul, but if you find that you must, I’d like to offer you a new home where your company and its purpose are welcome.

Recently, my Governor went on a tour of California trying to drum up businesses to move to the Lone Star State, and while it seems he failed to find any takers, let me suggest to you that it is because he was looking in the wrong place.  The problem with his approach was that he looked in a particular geographic location, but I think if Governor Perry had wanted more success, he would have looked to business owners who had arrived in a philosophical place, much like the one in which it seems you have arrived. Amoral and immoral lawmakers of the sort who would impose such legislation on the people of Colorado(or any state) help to create an environment in which men and women of good will are unable to continue in good conscience in their present circumstance.  If such a condition arises anywhere, it constitutes the precise destination to which our Governor(or any Governor) should turn to look for businesses to bring to their states.

On that basis, let me make you an offer your conscience may find difficult to refuse. If the  laws of Colorado are changed so as to make it unsuitable for Magpul Industries, I would very much like to see your company relocate to our state.  More, I would suggest to you that within the vast expanses of Texas, there are particular places that would suit your company more than others, and that would offer the moral climate in which your operation would likely feel at home.  Specifically, I would offer you Central Texas, and most specifically, Bell County.  Bell County is home to Fort Hood, the U.S. Army post that is the home of III Corps, and it offers a variety of advantages to your operation should you be compelled to choose out of sad necessity to relocate your company.

Our largest two cities are Killeen and Temple, respectively, and our County seat is Belton.  Temple and Belton are located directly on the I-35 corridor, while Killeen and Harker Heights, further west in the county, have access to I-35 via US-190, an improved four-lane, divided highway.  Temple is home to a number of companies large and small, and it also feature Scott&White Hospital, as well as a Veterans’ Administration hospital both of which serve this region.  Our climate is necessarily warm, but there are few work stoppages due to winter weather, and we are generally far enough inland from the coast that direct impact from hurricanes is minimized.

More importantly to your operation, we have many qualified prospective employees, many of them veterans skilled in the use of products you manufacture. Because we are home to Fort Hood, we have many veterans who decide to settle here(as I did more than two decades ago,) because Texas is a place of liberty and opportunity.  More, Central Texas is a place that has a deep and abiding understanding of the moral purpose of self-defense, and its residents are quite aware of all the reasons your products are vitally important to a free people.  So many of our residents having served in the Army, or having had loved ones who served, there is a reverence in our community for the Constitution, and for all it implies about limited government.

Taxation is relatively low here, and you would find a locale happy to embrace your business.  Texas has fared better than many states under our current economic conditions, but as you are doubtless aware, no place has been entirely immune to the economic predations of big government except perhaps Washington DC.  Due to this grim reality, there exists here no small number of potential employees who have skills of the sort for which you would be looking should relocation become necessary. We have shipping facilities and probably the sort of facilities you would need in order to set up operations here, and I offer you also this: Texas must be among the larger of your company’s customer states, so that a large share of the products you manufacture would actually be purchased and used by the people in whose state your company would then reside.

Having now shamelessly offered you my home state, and indeed my adopted home county as a new locale for your operations, let me explain to you that it is precisely because I am proud of our little slice of a big state that makes me certain about its inherent suitability to your enterprise.  While you go about the business of giving your customers an “unfair advantage,” I would assert that Central Texas would provide your company a similar competitive advantage in a market segment full of innovators with whom you compete for business.  It is difficult to overestimate the importance of location,  but it is similarly difficult to overstate the importance of a welcoming community that will embrace a company’s philosophy and purpose. I realize that that such a decision would not be taken lightly, so please permit me also to state for the record that I understand a good deal about the torturous struggle you are enduring that would lead you to consider relocating your company.

I realize that you will have been beset by thousands or millions of such offers in the wake of your company’s announcement.  I also realize that relocating is in fact the last thing on Earth you would choose, but for the circumstances that may arise now, well beyond your control.  It is easy for those of us who would be the beneficiary of your prospective relocation to offer our respective areas, but I realize that it is much more a matter of heart-rending consideration for you, who must calculate the costs not only of moving a business entity, but of the dislocation and hardship that would attend those who work for you now, who might well not be able to relocate with you.  I understand what it is to have one’s company undermined by stupid laws, and to have one’s dreams shattered by bureaucrats. I realize that much more is at stake here than simply picking up and moving a company.  You would be moving the site of your great aspirations at the point of lawmakers’ pens.

The truth is that I hope sincerely that your fight in Colorado for rational law is victorious, and that you are able to overwhelm the proponents of bad law so that Colorado can remain the home of Magpul Industries. I also understand why you are making your stand, and why the demands of  logical consistency will demand that you leave Colorado, should the legislature and Governor of your state act with such tempestuous reflexes against objects that are no more the source of violence than a pillow used to suffocate a sleeping victim.  Objects don’t commit murder.  Lawfully manufactured and distributed products do not commit murder.  Only people commit crimes. Those politicians who use objects or products as surrogates for their alleged anger against criminals instead create a whole new class of victims, comprised of legally disarmed people who have not the ability to oppose in force the attackers who do not abide by the very laws that restrain their victims.  I believe we should consider such politicians criminals by proxy.

I wish you well, both in your business, and in your life’s pursuits, and also to all of your employees who have with you provided so many Americans such excellent products.  You should be proud of the company you have built, and all the things you have made that continue to revolutionize your market niche.  I know that wherever you and your company land, you will continue to be leaders in innovation and reliability, and I want to thank you in advance for all you will yet do, not only for your customers, but on behalf of a people who understand the necessity of the right to keep and bear arms, and why taking a stand in favor of that right is essential not only to the future of your company, but indeed, the entire country.

Best Wishes,

Mark America

Proud Texan and Owner of several Magpul Products

The Return of the Wall

Wednesday, December 12th, 2012

Soviet Union Part Deux

After witnessing the fall of the Berlin Wall, and indeed, the collapse of the entire border frontier between East and West firsthand near the end of my military service, I thought those days marked the final death-knell of communism around the world.  In more than two decades since those days of hope, as it seemed the globe might begin to abandon the plots and schemes of the central planners, what I witnessed is that rather than take the hard-learned lessons forward with us from then until now, we’ve forgotten them.  Discredited and defeated, communism should have been dead, but it’s not gone away after all.  In the last several years, it has made a resurgence, as the generational memories of the terror it brought upon the globe fade, and younger generations fall prey to the song of the socialist sirens.  With communism and its more socially acceptable forms, “socialism” and “progressivism” making a comeback, it should be a surprise to read that the French Prime Minister, Jean-Marc Ayrault, announces in spittle-laden bellicosity that the rich fleeing France for Belgium to escape the high taxes should be considered less than patriotic.  Reading the translation of his remarks, one can only wonder how long it will be before France, like the Soviet Union before it, erects walls to prevent its most successful people, or even people seeking simple freedom from leaving.

When one reads of remarks like this, when armed with even a modicum of historical understanding, one must recognize the frightening threat of a return to the darkest days our world has yet known.  How far from Prime Minister Ayrault’s thinking are the gulags and concentration camps?  Certainly, he’s not proposed such a thing…yet.  Still, in the manner of his speaking, one can see the manifestation of the same old demons being raised up, under the same old guise, and with the same ugly motive. Perhaps worst of all, in castigating those wealthy people leaving France, among them notably the famed French actor Gerard Dépardieu, Ayrault’s accusation is that the wealthy who flee are suffering from a lack of generosity.  This is quite obviously a sick attempt at reversing the guilt onto the innocent, but it’s no surprise from a government now headed by President Francois Hollande, who declared infamously that he didn’t “like the rich.”  The reeking pomposity of socialist dictators-in-waiting has never known more hypocrisy.

In our own country, Barack Obama is continuing that same trend, and the long-time leftist slogan “Eat the Rich” seems near to being implemented in full.  At the rate things are progressing toward a complete worker’s paradise here in the United States, it’s only a matter of time before he decides we need a border fence after all, not to keep illegals out, but to make sure that none may leave. As the Europeans continue to build their coming continental concentration camp, from which only the powerful like Hollande and Ayrault will be afforded the chance to flee, Obama is building another right here, and he’s feeding the lap-dog press the same deceptive and hypocritical banter about the rich, as his family enjoys a multi-million dollar holiday in the state of his [alleged] birth. (Like most Marxists, I suspect he was actually hatched.)

How long will it be before we see the return of the barbed wire and fortifications, complete with machine gun nests, not to defend a country, but to keep its enslaved people from leaving?  With the spreading, grotesque mindset of communism once again spreading like black mold on a too-long neglected basement wall, it seems history is poised to once again repeat itself, because while a people may learn a given lesson by living it, they do a poor job of conveying those lessons to their children.  Worse, they pay for their children to be indoctrinated by the very mindset they overcame, and more is the pity and travesty that the education establishment will  have served not as the instrument of our protection, but the weapon by which the communist sappers undermined our cultural and intellectual fortifications.

You might have come to think it is an exaggeration to suggest that those now in power in France could build a wall, but one ought to consider the words of some of their politicians, as quote in the Telegraph:

“Socialist MP Yann Galut called for the actor to be “stripped of his nationality” if he failed to pay his dues in his mother country, saying the law should be changed to enable such a punishment.”

The idea that a politician is seeking to punish people in this way is not a novelty, but it isn’t lost on most conservatives that the underlying meaning is purely tyrannical.  Meanwhile, another government official had this to say:

“Benoît Hamon, the consumption minister, said the move amounted to giving France “the finger” and was “anti-patriotic”.”

Setting aside the fact of this man’s preposterous title, one must wonder at the sheer idiocy of a country that revels in revolution but cannot rise even to defend its own borders.  Being partly of French heritage, I can’t but imagine that my ancestors who came to North America sought the freedoms their countrymen now forsake, and I am mightily grateful that they saw fit to do so, but I am simultaneously disgusted at the fact that so many of their descendants now seem willing to forsake liberty here.  Communism isn’t dead after all, but tempting us to believe it permitted them to make inroads, and I don’t know if they can be stopped.

With darkness and depression enveloping the globe, it is time to remember the wall between East and West, because we may yet see its resurrection on a global scale.  It’s also time to reconsider whether we should have let so much of the wall be destroyed.  Demolishing it meant that the visible scar upon the face of civilization has been removed, and while the wall itself may have gone for a time, the mindset that had built it now thrives around the globe.  If we are to dismantle communism again, it must not be its mere instruments that we remove, but its entire philosophical base. It must be placed and kept on ice like a virus stored as a hedge against the need to redevelop new vaccines in case of a new outbreak.

 

Staring Down the Barrel of a Gun We Loaded

Saturday, September 15th, 2012

We Loaded It...

I’ve written and re-written this piece a number of times, in part because I don’t wish to cause undo angst, but also in part because I don’t wish to cause too little.  You can blame Barack Obama, George W. Bush, Congresses past and present, or Ben Bernanke and his predecessors for all it matters, because in the context and scope of your life, it won’t make much difference.  We are headed for a complete collapse, and the collapse is no longer some vague notion in some nebulous, faraway universe of remote possibilities.  At least one analyst has concluded that by 2014, at the latest, this country is going to enter a period of economic turmoil that will make the Great Depression of the 1930s look like a garden party.  The media won’t tell you this, whether CNN or the New York Times; neither FoxNews nor the Wall Street Journal.  We are staring directly at the muzzle of a colossal gun, and it’s aimed at the heads of every American, but neither the current President nor the current Congress will tell you how bad it has become.  For two generations or more, the hand-writing has been on the wall, but unlike ordinary ink that will fade with the passage of time, this bit of script has become bolder, heavier and finally, indelible.  There will be no avoiding it.  There will be no escape.  This time, we will go down, and we may well never stage a comeback. The gun is aimed at our heads, and we loaded it.

To understand this will take a little time, although regular readers of this site will know most if not all of the gory details.  For a brief primer on what will soon confront us, please take a look at this report on Hyperinflation at John Williams’ Shadow Government Statistics website.  It’s lengthy, but it is information every American should learn and know, because while it is a bit of a reading chore, particularly for those whose eyes glaze over at the first hint of economic and financial terminology, it is nevertheless important information, and Williams does a remarkable job of not allowing the material to become overly dry. His report really doesn’t need any dressing-up or embellishment to be terrifying.

If you’ve been paying attention to the news beyond the international developments of the last few days, you will not have missed the fact that today, the US credit rating was again down-graded again by Egan Jones.  You should expect this trend to continue for some time, but this downgrade, like the last round of them a little more than one year ago, really doesn’t tell us anything we should not have known: Our currency is on the verge of collapse, and our ability to repay debt is becoming more challenged, but the fools in Washington DC don’t tell you about it because they’re afraid if you knew how bad it really is, you might react badly.  In the movies Armageddon and Deep Impact, the governments portrayed did their best to keep their respective impending disasters secret for as long as possible.  The thinking was: If it’s inevitable, such that all we can do is make things worse between now and the impact(s) by disclosing it in advance, we should say nothing until the last possible moment.  Another way of looking at this is the question I once posited:

“The government is spending like there’s no tomorrow. What if there isn’t?”

The fact is that we don’t need Hollywood or the Mayans to provide apocalyptic scenarios to fulfill this role in our immediate future.  Our Federal Reserve(hereafter, simply “the Fed”) in concert with our Federal government have created something nearly as disastrous, and potentially, every bit as deadly.  As Ben Bernanke uses his powers as Chairman of the Fed to undertake another round of quantitative easing.  As you’ll remember from previous rounds of this same tactic, this amounts to money printing, a way to inject more cash into the market in the attempt to stimulate lending and business activity.  The problem is that each time this is done, what actually happens is that the value of the dollar falls versus commodities such as oil, or other energy sources, and the cost of everything increases.  When this happens, it makes it harder for business to operate, harder for consumers to spend such cash as they may have, and otherwise has precisely the exact opposite effect, all while driving us closer to the brink.  Bernanke is trying to drive us away from a deflationary cycle that could result if the economy stalls too steeply, but the problem is that he’s going to cause what will be infinitely worse.

At the same time, our Congress and our President have added to the problem, because each time they borrow money, the Fed is printing it into existence.  In short, both our fiscal and monetary policies are rigged in favor of inflation, and with all the money-printing, it is only a matter of time before the dollar becomes completely worthless in the world market.  Any small displacement in the market could lead to our economic demise.  Williams’ report for 2012 goes so far as to suggest that you concentrate on bare survival strategies, and defending yourself in the face of complete political and social disintegration.

I know that you’ve been reading about a “financial cliff” somewhere in the distant and murky future, but what I’m telling you to do at this point is that the veil of fog is beginning to lift because that future is no longer distant.  Williams’ report explains thoroughly the main causes of our impending doom, and this isn’t some conspiracy nut.  When he published this update earlier this year, his warnings sounded eerily like my own, and also those of a few other people who have been sounding the alarm, including some in talk radio, in conservative media, and notably, Governor Palin.  At the time of the announcement of QE2, Gov. Palin did a rather bold thing:  She announced to the world the dangers and the certain results.  Naturally, since her evaluation was based on sound economic understanding, her conclusions might well have seemed prophetic in light of all that has happened since.  The truth is that she was merely telling you what must be based on the immutable laws of the universe: There are no free lunches…or anything.

I believe this is one of the reasons the Republican leadership in Congress has done nothing to substantially obstruct President Obama’s agenda.  It is true that they would have faced some political consequences, but what’s more the case is that they are every bit as aware of the impending collapse as anybody in the executive branch.  One might view Congress cynically, and suppose they are “getting while the getting’s good,” and there’s no doubt that some of that goes on, but it’s also true that the problem is so gargantuan that they do not see how they can correct it without throwing the country into complete chaos, and since that’s what’s coming anyway, they see no point in hurrying the matter.

Some have concluded that Bernanke is taking this up now in order to try to help Obama’s re-election, and while there may be some truth to it, the fact is that the situation has been and remains much worse than you’re being told by the media.  We have been in a bottom-bouncing depression since at least 2009, and nothing has animated us very far from the floor.  As I have written many times, they stimulate via the printing press and the deficit, and we get a brief improvement, but then the increased costs in the market come home to roost, and we’re set back to a place no better than before as the costs, driven in large measure by the inflationary effects of the stimulus that quickly act as a brake upon the alleged “recovery” that never materializes.

Elsewhere on Williams’ site, you can find a detailed examination of his treatment of unemployment, and the numbers will shock you.  Add to this the tidbits about the deficit and inflation, and you will begin to understand how you’ve been misled, not only by the media and the administration, but also by decades of shoulder-shrugging politicians in both parties.  By Williams’ assessment, it may be impossible to rescue our nation any longer.

Ladies and gentlemen, I have been urging you since the inception of this blog to make preparations to the best of your abilities.  I hope you’ve been diligent.  Check out Williams’ Hyperinflation report, and think it through carefully.  The evidence of your own daily lives has been telling you all of the happy-talk about “economic recovery” had been a farce.  Like the approach of a colossal asteroid, the government’s ability to hide the impending disaster or disguise the seriousness of our worsening situation has begun to fail.  That is really the only significant meaning of the latest downgrade.  They can’t hide it much longer.  The Piper will be paid.

Some are choosing to ignore all of this in the hope that a change of administration might give us one last chance at a way out, but irrespective of the outcome in November, the chances that our currency survives three more years in its current form is probably fewer than one in ten.  The possibility that we will survive as a nation may be somewhat less.  Fixing this problem will require the institution of spending cuts on a scale that may cause complete social collapse.  Do we expect John Boehner to take on such a monumental chore?  Even if the Republicans take the Senate, Mitch McConnell isn’t exactly the picture of courageous and vigorous leadership.

Saving our nation is no longer simply a political problem in the sense of replacing certain politicians.  It’s a cultural and economic crisis as well, and with all that is going on abroad, it may come down to a matter of literal survival.  It’s time that we begin to face up to this, because our politicians aren’t going to address the  problem until it no longer matters, at which point, they’ll do nothing, but we’ll pay the price.  We always do.  People have asked me what we could do to remedy the problem, but when I tell them, they look away, because they don’t want to face the implications that attend the proposed actions.

At present, we have an annual published deficit of around $1.3 Trillion.  As Mr. Williams’ report makes plain, if the government were forced to use GAAP(Generally Accepted Accounting Principles) in their accounting, the actual annual deficit is in the neighborhood of $5 Trillion. The added $3.7 Trillion consists of new future obligations that the government does not pay, but has promised at some future date.  Many refer to these as the “unfunded liabilities” of our government, but they add up to a staggering amount, in the range of $80 to $120 Trillion dollars in promises.  When one makes promises on this scale, it is sure to affect one’s creditworthiness, never mind one’s credit rating.

Consider the fact that our government collects approximately $2.5 Trillion in taxes, fees, and the like throughout the year, but that this is still well short of the $3.8 Trillion it spends, and then propose cuts in response.  Here’s a dirty, ugly secret the DC crowd won’t point out to you: If you cut everything that is not an entitlement program or debt service, you would still have a deficit.  That’s right, if you eliminated every bureaucrat, soldier, judge, roads project, education expenditure, and all of the other things that government does apart from pay interest on its debt or send payments to individuals through entitlement programs, you could not balance the budget.

What this makes clear is that the problem exists not on the “discretionary” line of the ledger, but entirely on the “non-discretionary” lines in the book.  Leftists will argue that the problem is the lack of revenues, but that’s an absurd hoax. Anything done to increase revenues at this point will actually cause them to decline.  Increased tax rates?  People will earn less to avoid the taxes.  Even those who want to earn more won’t be able to because there will be insufficient demand in the marketplace to provide the commerce needed to generate the revenues we have now.

The only answer to this problem is sharp cuts in government spending, combined with a cessation of Quantitative Easing.  The entitlement programs have become such a massive anchor on our economy that it cannot recover, and they have squeezed out all other spending.  This is why people look away when you explain to them the problem.  They know what it implies about all of our sacred cows in the entitlement sector of government.  As with the old lament, everybody is in favor of massive government cuts until we arrive at their favorite Federal program.  At that point, you are given a stack of excuses, complaints, and ultimately: “Never mind.”

I have news for you, and it’s not pleasant:  These programs will end.  Virtually all of them.  None of them will survive in their current form, if at all.  We are like Greece, only worse, and much larger.  The question our elected leaders have not faced is whether to break the news to us now, while there is some small hope of recovery, or whether they shall just “get while the getting’s good,” and make off in the dark of night after the collapse, leaving us to figure it out.  The fact is that I can’t blame them for opting toward the latter, because we will be worse than Greece in every dimension and measure, both in size, but also in degree, and I believe when a responsible politician ever tells this truth, he will be pilloried, at first in media, and then later by mobs.  Paul Ryan has had just the first taste of this.  Sarah Palin was mocked for such warnings to an extent I’ve never seen for simply stating the dangers of QE2 and all the money-printing.  She was right, naturally, as is Paul Ryan on the matter of entitlements.

The problem is now that it may be too late for any sort of remediation.  The problem has become too vast, and it is as late as that.  What we can do as individuals is to grasp the reality laid out before us.  We can prepare ourselves and our families.  We can vote accordingly.  We can make noise about it.  In the end, we may be forced to watch our nation slide back into the pre-industrial, pre-republican muck from which it emerged.  It’s been a long decline, and we’ve mostly done little but to urge it on as a people.  We’re peering down the loaded barrel, and it’s been our finger’s twitch upon which we are waiting.

One false move… A hiccough… One little lurch…

A Teachable Moment For Barack Obama, Courtesy of Bristol Palin

Thursday, July 19th, 2012

Be sure to drop by Bristol Palin’s blog-site today and share with her what you have built, all without government’s help.  She authored a post Thursday in which she brings more needed attention to the obscenely foolish notion put forward by Barack Obama last Friday that if you have a business, and you’ve been successful, “you didn’t build that.”  Says Bristol in response: “I built this, Mr. President.”  Darn right! It’s time more people begin to tell this President that they have built plenty all without his help, and despite his interference.

Bristol has invited her readers to share all the things they have built, all on their own, and I think it’s a great idea to highlight just how misguided Barack Obama really is. Be sure to visit Bristol’s blog to show some support!

Right on, Bristol!

 

 

 

All The President’s Help

Tuesday, July 17th, 2012

Is this man drunk?

Listening to President Jack-Ass, one would think that nobody could create the first thing without the government standing there to help them.  I take offense at the notion, and more, I am willing to demonstrate how the biggest obstacles I have faced have been born of government regulation, idiotic laws, and crony-capitalism powered by criminal thugs like Barack Obama. As many of you will know by now, I am a horseman, in addition to the profession in which I work, and I have a small thoroughbred farm together with my wife. When we began this endeavor, there was no barn, no tractor, no fences, or horses or even running water. There was no electricity, there was no dwelling, and there wasn’t much at all but an empty field alongside a rural highway with a dozen or so trees scattered far and wide upon it. From the outset, there were problems, and almost all of them were induced by government, and our trials and tribulations have been exacerbated by that same entity, though not exclusively the federal ones. With “help” like his, I would think we’d have been better off on our own.

First, I’d like you to consider the words of the jack-ass-in-chief:

 


Apart from the fact that this maniacal leftist clearly views us all as his property, and all as the beneficiaries of his master plans, he also contends that nobody gets success on their own. In his America, that may be increasingly true, as to be successful, it often seems you must grease the palms of an inordinate number of politicians, both in Washington, and in your home state. Let me take you through a brief litany of how all of these dear helpers, these masterminds of distribution, have helped to hold my small farm down.

In 2004, the entirety of Texas began to fall under a drought that lasted and lasted. For those of us dependent upon feeds and hay, the costs were striking. We watched an ordinary round-bale of coastal Bermuda hay go from a price between $30-40 dollars up to over $110. Just when one thought it couldn’t possibly get worse, the government stepped in to “help.” If you happened to be a cattleman, it was fine help. The government was handing out drought relief, but the key qualification is that your crop had to be for food. Horses did not qualify, since their primary use is not down at the burger stand. Some of you might wonder if I’m not complaining merely because I didn’t get the cash, but I tell you that it was a horrible situation, and I didn’t want the cash, but what I really didn’t want was government deciding who would win and who would lose. You see, all of the cattlemen were now flush with cash, and they could go into the market and buy whatever scarce hay was in existence, and import it from other states too. We soon saw the price of a round-bale escalate from around $100 up to a high of over $170. Now, some of you might be asking: “Well, what if the government hadn’t given them the cash, how would they have fed their cows?” The answer is: They wouldn’t. They would have loaded them up and trucked them to the feedlots and sold them while they could get what they could for them. In short, the market would have responded appropriately. The price of beef would have dropped briefly before spiking upwards, and that would have brought higher prices for future beef that would have eased the pressure on the hay side of the market for everybody.

Of course, in 2005, as all of this was happening, I thought this was a temporary condition, and that the drought would end, and people would come to their senses, and I wouldn’t have need of drastic measures like selling my horses for meat. You see, in a market in which fuel prices were also spiking, and the disposable income of many people was suddenly thin, guess what wasn’t such a big seller any longer? That’s right: Horses. Now you would think that with the end of the drought, the troubles might begin to ease, but no, that wasn’t to be. Government had another nasty surprise: They effectively banned the funding of inspections of horses taken for slaughter. As you might well guess, I hadn’t intended to slaughter mine, but that’s hardly the point. Horse meat is a fine source of protein, much leaner than beef from cattle, and has fed people the world over for eons. In point of fact, long before man ever mounted a horse, he ate them. Some relatively small number of horses always went to slaughter, and much of the meat was exported, or fed large cats at the zoo. These animals shared one general characteristic: They were unfit for other uses, by and large.

What resulted when government decided to “help” again was a glut of unwanted horses, competing for and taking up resources that drove up the cost of maintaining every horse, market-wide. Worst of all, it had exactly the opposite effect of what had been advertised: Many horses were being abandoned, under-nourished, and dumped wherever and whenever their hard-pressed owners could dispense with them. Perhaps all the more ironic, a huge number began to be trucked over the Southern border into Mexican slaughter plants, where they don’t give a damn about humane conditions, never mind meat inspections. In many cases, the horses that did go to slaughter met a more gruesome fate than had they merely been slaughtered here. Meanwhile, the prices of horses was plummeting across the industry, as consumers were under all sorts of new pressures, and as the value of their homes and their money fell, buying a horse hit near rock-bottom on the priority list for many who had enjoyed them for decades. It got so bad, that late last year, Congress actually repealed the ban, although I don’t know if any domestic horse slaughter operations are back in business. The damage has been done.

Just these two federal actions might be enough to convince you of the obstacles government has put in the way of my family’s farm, but there is still a good deal to consider even at the state level, particularly here in Texas. You see, our state hasn’t participated in arrangements like its neighboring states. If you go to Louisiana, Oklahoma, Arkansas, or New Mexico, you will find state-bred programs that actually encourage the breeding of horses in those states. Texas has such a program too, though on principle, I do not participate because I see it as a socialistic subsidy. The difference is that in the adjoining states, they have permitted the expansion of gambling to include “video lottery terminals”(that look suspiciously like slot machines) but the deal struck in these states to allow for the enhanced gambling requires that they be placed at racetracks, and that a portion of the revenues be plowed back into purses for qualifying races limited to state-bred horses. Texas has opted to forgo this form of revenue, with pious-sounding legislators pretending they have been swayed by a moral concern over gambling. In truth, like anything in politics, what you must do is follow the money. Various estimates show that as much as $6 Billion leaves Texas for gambling venues in these adjoining states. There are bus-trips you can get on that will take you over to Louisiana from Houston, where you can sample those “video lottery terminals.” Even if the estimate were double the actual amount, it’s still a huge amount of cash that flows out of Texas into our neighboring states.

How much money do you suppose is spent lobbying legislators in this state to continue to uphold their firm “moral” stance against expanded gambling in Texas? That’s right, for all their posturing, many of the legislators in question are merely taking cash in order to vote against something that would provide large revenues to the state that is now merely bleeding out across our borders. Every other year, in our biennial legislative session, somebody brings a bill up, and in short order, it is killed. It’s brought up because it’s like ringing an alarm, to which all the lobbyists respond, and their answer is always in cash. Suddenly, all these legislators concerned about the evils of gambling are able to jump up and make strong statements against expanded gambling, while no small number of them have their palms greased.

Now you might say that because I don’t participate in the State-bred program anyway, it shouldn’t be of concern to me, but it is, and the reason is clear. What has happened is that while the purses in adjoining states have grown in proportion to their VLT revenues, they have stagnated or even shrunk in Texas. At this competitive disadvantage, how do you suppose Texas-bred horses now sell? Even if you were inclined to participate, the ROI isn’t there. Austin has a proposed track license, with the Austin Jockey Club. That license may never be exercised because the industry is suffering so badly in Texas under this scheme. Lone Star Park in Grand Prairie filed for bankruptcy protection. Other tracks are operating on the edge of solvency. The legislators don’t care because they’re getting positive press for their “moral stand” against gambling, while the competing-state lobbyists pile on the dough. That, my friends, is crony capitalism disguised as the moral majority.

Locally, it’s getting harder and harder for a farm to do business. In addition to the mountains of regulations rolling downhill from the EPA, local water control boards are making life difficult even for long-established farms. Oh well, more palms to be greased, I suppose. Of course, then you have the cities that now annex as much as the law allows every chance they get, and if they keep on at this pace, you will soon be able to remain with the boundaries of some municipality or other all the way from Oklahoma to Laredo.

Barack Obama goes to great pains to say that all of us are the beneficiary of some form of government help. That’s his implication, hidden behind a more acceptable-sounding notion that none of us get anywhere on our own, implying everything from the parents who brought us into this world to the teacher who may or may not have taught us the first thing in school. What my wife and I have experienced is something quite remarkably different, and it is that at every turn, it has been some governmental nonsense impeding us, obstructing us, or otherwise prohibiting us from making a go of it. You would think from listening to him that a brigade of his Obama-bots had accompanied us across the blazing hot pasture in July, driving t-posts into the scorched soil until the point of heat exhaustion, but I don’t remember any help. The wife and I, and our daughter a little bit, doing what Americans had always done: Building something where there had been nothing.

We never asked for any of this infernal “help,” and given its nature, we’d be just as happy if government stopped lending its “helping hands” and simply got the hell out of our way. We know how to choose good breeding stock, and we know all the important aspects of good animal husbandry, and I know my way around farm equipment and all the ordinary construction techniques we employ. I’m fairly certain that wasn’t Michelle Obama I lifted onto the skin of the barn’s roof to screw panels down as they were slid into place. I know for certain it wasn’t Barack who was running that welder. That was me. When we stretched thousands of feet of field fencing tight across all those newly planted posts, neither Secretary Clinton nor Sebelius were anywhere in sight, and neither was Harry Reid nor Nancy Pelosi, and not even a soul who had ever seen their offices.

Of course, when it came time to put up the mailbox, there was the guy from the Highway department to tell us how many feet it must be from the road’s edge, and what sort of super-duper break-away mount it must use, lest some weaving drunkard hit something much too firm alongside the road and do himself unnecessary harm. When we wanted to place our driveway, we were told what sort of culvert we must build, if we could build one at all, and so expensive was it that we simply opted to scatter a smattering of gravel across the ditch, and simply put some new gravel down each season. No culvert? No problem. There was the problem of bringing electricity to our homestead, and all of the government rules the electric company must follow, and how this all determined the siting of our home, rather than logic, and what we damn-well pleased. Yes, I am familiar with all the little helpers we’ve had along the way, and to be quite blunt about it, I hope they’ll all line up to help Barack Obama too. The problem is that it won’t bother him at all, because he doesn’t build anything, and he’s never accomplished anything on his own.

Doctors Consider Quitting Over Obama-Care

Tuesday, July 10th, 2012

Coercion is Next

Every doctor in America who is worth his or her salt should quit.  Apparently, given the impending implementation of Obama-care, they’ve been contemplating it. How many?  Eighty-three percent!  Unfortunately, most of them will not quit, and more is the shame because if we want to defeat Obama-care, that’s the way it could be done.  That, or the statists would need to unmask completely and simply enact in law what they intend:  Health-care professionals, from doctors to nurses to orderlies must now be the slaves of the state.  If you think this is an overstatement, consider the facts.  When you are forbidden from negotiating your wages, and must accept whatever some bureaucrat tells dictates, you are a slave.  You can pretty it up any way you like, but that’s where all of this will lead.  Eventually, those skilled enough, smart enough, and diligent enough to be doctors will realize they would be better off doing something else.  Instead, the ranks of doctors and nurses will begin to be filled with the incompetent, the slothful, and the under-qualified.  This is what always happens under socialized medicine, and every one of these would-be slaves has the same moral right to refuse this servitude, and the sooner they do, the better the chance that they will spawn a movement in opposition.

If you’re not a doctor or nurse, and you’re not a skilled radiologist, and you haven’t the foggiest about how to operate an MRI machine, you might want to hold on a moment before joyfully proclaiming your new “right to medical care” under the Affordable Care Act(a.k.a “Obama-care.”)  Those who foolishly believe they will maintain some form of private health insurance over the longer haul ought to pay attention too.  Let us imagine everybody has insurance, as the Utopian masterminds behind Obama-care promise.  Then what?  It is not only money that can be inflated out of all value.  An insurance to purchase a service that is in shortage isn’t much of an insurance, is it?  Imagine having auto insurance of this sort.  You have your fender-bender, and your insurance company estimates the damages, sending you out in search of a shop to perform the repairs.  What if you can’t find one?  What if you sit there with the check from your insurer, satisfying your claim in full, but there exists no shop to perform the work, or so few, that you will be without your vehicle for weeks or months, or perhaps longer.  How will you maintain your job?  How will you get to the grocery store?

Naturally, if you’re a welfare leech, you’re not much worried about that, but if you’re a working American with bills to pay, you’d better begin to think about it now.  Under Obama-care, slowly, but surely, this will become the inevitable conclusion:  Care will be of poorer quality, more scarce, and since everybody will have their coverage, there will be no advantage by offering more in payment.  How long before a black-market medical system develops?  Do you deny the possibility of all of this?  Are you stuck on the notions of what you have known, rather than what can(and likely will) now come to pass?  What happens when it’s your six-year-old daughter down at the emergency room with a fractured wrist, in a line that stretches up and down the hallways and side corridors, because there exists a severe shortage of medical professionals?  Will your wishes mute your daughter’s agony?

You think doctors and nurses are endless, bottomless pits of human compassion, but they’re not, and no person is, because it’s simply not possible.  More, if you want their compassion, shouldn’t you offer them yours?  Why do you wish to have them work as slaves to your needs?  Isn’t that what this whole corrupt system has become?  Tax-payers must be slaves.  Doctors and nurses and orderlies must be slaves.  Everybody must be slaves but he who has nothing to offer, and no intention of offering it, since he has no intention of obtaining it by his own efforts.

Am I being too crass, and too obnoxiously terse in my appraisal?  Brother, you haven’t seen the half of it yet.  Wait until doctors are unionized, since it will be the only way to protect their diminishing wages, and they look at you and your suffering child, parent, or spouse and say simply: “I’m on break.”  At the ends of their shifts, they will walk away, as carelessly as the country has walked away from them.  What do you think is the meaning about the endless delays in Medicare payments, and the inaction of Congress year after year in adjusting reimbursements to doctors?  Were I a physician, I wouldn’t have a single patient who is in a government system of any sort.  Why would one wish to accept patients whose payment will always be less than it ought to be, while robbing from paying patients in order to subsidize the government-paid accounts?

Imagine running any other enterprise like this for long.  All of your paying customers would abandon you.  You wouldn’t be able to carry off this sort of con-game, because they’d price-shop the matter and move briskly to another provider, whether the product is a widget or the service is the measurement of blood-pressure.  What Obama-care offers, and indeed what all forms of socialized medicine promise is to deliver something many people desperately want without regard to their ability to pay.  That’s it, in a nutshell, and if I were a physician, I’d be looking to set up a clinic somewhere off-shore where I could live out my life unmolested by big government mandates.  Nobody should be compelled to labor.  Neither you, nor I, and certainly not doctors.  We’d better begin to consider if we wish to coerce the people who we expect to save our lives.

Back in 1978, Dr. Milton Friedman discussed all of this at length.  I’ve provided his talk on the matter, in six pieces, here:

Re-Building the Soviet State – One Law at a Time

Thursday, May 17th, 2012

Apparatchik

Senator Charles Schumer(D-NY) should be ejected from office, not merely by his fellow New Yorkers, but by the whole body of the Senate.  The trouble is, we’d need to eject more than “Chuck the Schmuck” in in order to effect such change.  Today, “Schmucky” introduced a law aimed at punishing people who renounce their citizenship in order to avoid taxation, and forbids them from ever returning, even as visitors.  This communist political hack from New York actually believes the problem is that guys like Eduardo Saverin leave the country, but not the fact that the confiscatory levels of taxation levied against Americans in this disastrous Obama economy drives them away.  Saverin renounced his US citizenship and lives in Singapore, and Schumer isn’t happy about it, since it means the government will not collect taxes from people like Saverin on investment income such as the Facebook IPO scheduled for tomorrow.  It’s like living in a time warp.  The law that Senator Schumer and his pal Bob Casey(D-PA) have introduced has precedent, although not in this country.  No, the bodies of law to which you must make reference in order to find a precedent are places like the former Soviet Union.

Schumer is a leftist troll, but he’s more dangerous than his superficial antics reveal.  Schumer is the quintessential NY politician, meaning he is a barely-disguised communist.  How long until this malevolent weasel decides to erect a physical wall, not to keep immigrants out as you might suppose, but instead to prevent people from leaving?  This law is merely the first logical step on that path, and if you don’t recognize it as such, you’ve forgotten history, and what it makes clear:  As communists and their socialist friends (not a dime’s worth of difference, in fact) begin to break a country down, first those with money, and then those with brains and ability, tend to flee.  They ultimately seek to stop the bleeding by such draconian measures, aimed at using the law as a restraint.  It’s their best attempt at keeping such people in the bonds of servitude to their disgusting slave-states.  It isn’t as though this will stop the bleeding, but you see, that fact will become the impetus, the casus belli for the ongoing class warfare they will escalate.  No matter how it starts, it always ends in physical restraints.

I suppose there are those who might ask why it is that I feel any sympathy for Saverin, or those like him, since they are, after all, abandoning the United States.  For those who think this way, I must ask:  Isn’t the United States abandoning them?  This was the nation in which one might have made a fortune and reaped a benefit, but willingly paid one’s taxes, but that time is over.  To be quite frank about it, if you raise my federal income taxes to nearly 40%, I’m going to leave too, and I will change the name of this site to MarkAmericaInExile.com.  The simple fact is that such a level of taxation is obscene and immoral.  There is no moral justification possible for taxing one citizen’s earnings at a different rate than another citizen’s income, and yet this has become the accepted norm since we adopted the progressive income tax early last century.

The progressive income tax is a notion right out of the mind of Karl Marx, and the very idea that Schumer is putting forward is that not only are you forbidden to keep the money you’ve earned, but that if you renounce your citizenship and he can in some way substantiate the fact that you’ve done so to avoid taxes, you must be punished.  I think Chuck Schumer should be punished.  I think if you introduce an openly communist law in the United States Congress, you should be thrown out of that body, placed on an airplane, and sent to live in Havana with that breathing corpse named Fidel.  The problem we have in this country is not that we have too many rich people fleeing the overbearing taxes, but that we have such outrageous taxation at all. I’m not a wealthy guy, by any stretch of the imagination, but I know that excrement rolls down hill, and I also know that there’s somebody with less than I might have, who will look at me with the same malignantly covetous eyes that Schmucky and his gaggle of communist pals leer at Eduardo Saverin.  No matter how poor you might consider yourself to be, there is always somebody in worse condition looking at you as though you’re a “fat-cat.”  Always.

Ladies and gentlemen, there’s no point belaboring the issue.  Chuck Schumer is a disgrace to the United States, and if the people of New York weren’t ruled by a majority of like-minded commies, they would toss him out.  Sadly, we’re stuck with this clown until he has his own twitter moment, or something along those lines, because there is no level of communism the majority of voters in that state will not endorse.  After all, they win, don’t they?  I have serious doubts as to whether this bill will make it over to the House, but if it does, I wonder what it will take for Boehner and the boys over in the House to surrender and go along.  Every last damned American ought to be outraged by this proposal of Schumer’s, but sadly, we now live in a country ripe for demagoguery of the sort Schumer is practicing.  At least he’s fully in the open now, because with this proposal, Schumer has moved from the rabid leftist column directly into the Stalinist column.  This must have been what it was like to live in Russia a century ago, as they agitated against the Tsars and the “merchant class.”  Most of those poor ignorant bastards had no idea with whom they had climbed into bed.

Some things never change.

 

College Loans and Who Should Pay For Them

Saturday, April 28th, 2012

The Choices We Make

If you’re a college student, you may want to pay attention.  With the nationalization of student loans under Obama, you’re going to be slaves to the system if you use their loans.  It’s the ultimate racket.  You pay interest to the government at a higher rate than you would have in the previous system where private banks made loans, and the government guaranteed them, and of course, the government has the IRS to strip your future earnings from you.  I listened to a caller named “Jonathan” on Mark Levin’s show Friday evening, and I was astonished at his sniveling over the interest rates.  He insisted that it is “for the greater good” that he took out a total of $220,000 in student loans.  He’s not upset, he says, about the principal amount, but at an interest rate of more than seven percent, he’s having trouble making ends meet.

Let me save all of you aspiring college students some time and trouble:  Most universities don’t teach you much anyway.  You’ll learn more on your own if you want to do so than any college will ever teach you, and it will be more valuable.  I know, I know… The field into which you’re going requires a college education, maybe an advanced degree, perhaps medicine, or the law.  That’s fine.  Go to a cheap school.  Seriously.  All they’re giving you is a piece of paper.  The rest, you get on your own, and it’s the height of foolishness to go into debt to the tune of more than two-hundred-thousand dollars in order to fatten the higher education establishment.  It’s absurd, and our kids should be steered away from this nonsense.

I went to college.  I was thirty-one years old when I enrolled.  I was thirty-five when I graduated.  My ‘student loan officer’ was a nice gentleman with a crew-cut I met in the recruiting office of the United States Army when I was seventeen.  I loaned the government my backside for seven years, and in exchange, they matched my own contributions to a college fund.  Along the way, they taught me to be a hard-charging ass-kicker, and also some practical skills that I would one day convert to civilian use for the purposes of feeding my family.  It was likely the best deal I ever made.  The truth of the matter is that I learned a good deal more in those seven years than any college could teach you in twenty.   Nevertheless, once I was out of the Army, I used the aforementioned skills to make a living, and before long, only six years later, I was on my way to college.

Now I can almost hear caller Jonathan’s retort to such a proposition: “But, but, but,” he might stammer, “I wanted to go to a top twenty-five law-school.  It’s the only way to get work at some places.”  That sound you may be hearing in the background is the sound of the world’s smallest violin, playing just for Jonathan.   My answer: “Then shut up, and pay the interest you promised to pay when you took out the loan!”  You see, the problem is that Jonathan is finding it hard to make ends meet while paying his obligations, and he’s finding that paying for his debt is causing him to delay some gratification as a young attorney.  Boy-o, that’s what happens when you aren’t “born with a silver spoon in your mouth.”  Get over it.

Honest to goodness, $220,000 is a fantastic sum of money to me even now.  When I was that age, if somebody had lent me that kind of money, I’d either be a billionaire, or be locked away in debtor’s prison by now.  Or not.  The point is that to take out loans totaling $220K and then complain about having to pay the interest is a farce. Sure, it will probably take poor Jonathan a decade or more to pay off those loans, but what of it?  Was he making an investment in his future or not? No, you see, that’s not enough for young Jonathan: “For the greater good,” we should all be investors in his future.  Sorry, but I’m not interested in that sort of ‘investment.’

Don’t get me wrong: I’m sure young Jonathan is a fine man, and he’ll probably make a great slip-and-fall lawyer one day, but in the mean time, he’d better pay up with a big fat smile on his face.  You see, I actually had this very conversation with a young person recently, who was looking at the costs of attending the school from which he hopes one day to receive a degree, and I offered the other options open to him, and even offered my story about my own ‘loan officer.’  He replied in a matter-of-fact tone that “Well, you made your choices, and you took the path you did.”  His intent had been to dismiss my story, and yet as I the grin widened on my face, he looked confused at first, and then it hit him: “Okay, yes, I guess I see your point.”

It was somewhat amusing to hear his laments about how he’s now “over a barrel.” He can either continue his education, accruing more debt along the way, or he can quit, and begin repaying the loans immediately.  As I explained to him, “life has us all over a barrel.”  Of course, I understand how the government is going to financially wreck so many of these youngsters.  Now that the government is the sole source for guaranteed student loans, the government is going to wreck as many youngsters as they can hook into this system.  Naturally, the education establishment is only too happy to continue to increase tuition, because I can guarantee you that the faculty lounge won’t suffer.  This is the inevitable result of letting government intrude where the private sector should exist.  They created the government-guaranteed student loan program in order to entice lenders into loaning money to students for college, since they had been such an historically awful risk.  Once the government guaranteed the loans, it was inevitable that some Marxist would nationalize the program.

I am fairly certain that was the intention from the beginning.  After all, you can’t walk away from federally guaranteed(and now issued) student loans through bankruptcy, much like income tax debt, and everybody beyond the age of thirty understands that socialists love captive markets.  If we did that with healthcare, we wouldn’t have the insurance problems we do, but that also wouldn’t enable government to grow larger and reach into another market, ultimately nationalizing it, as they intend with seemingly everything.  At some point, this country is going to be faced with a choice about whether we wish to fix all of these things permanently, or simply implode and become a full-bore communist state.  I’ve seen the latter up close, and I’m afraid that’s where we’ve been heading, but young Jonathan doesn’t know that, and his professors aren’t likely to have told him.  Instead, they’ve probably filled his head with notions of how “the greater good” is the sole consideration, but what they’ve never told him is who will be determining what constitutes the greater good, or the public interest.  He believes he will have some say in the matter.

At every level now, the Federal government reaches into everything, but the simple truth of the matter is that this can generally happen only because people invite it in.  Too many people suffer under the delusion that the government is able to fix anything and everything, and that since there’s no immediate and obvious cost to them, they are quite happy to have the “help.”  All of this ignores the tendency of government to resemble a mob loan-shark, or a gang of mobsters in general.  Once you accept the help, there’s no ridding yourselves of them.  More, it’s a bit like the drug pusher, who gets people hooked on “free samples” but once addicted, the new junkie would kill his family to obtain another fix.  In other words, it’s about us.  Just as the pusher can gain no ground so long as you tell him “no,” so too is it the case that if we begin to tell the government “no,” it will lose its power.  That means doing something most people are tested to do:  Say no to themselves.  Young attorney and Levin caller Jonathan could have told himself “no.” That would have been difficult, with a degree from a “top 25 law-school” dangled before his ambitious eyes.  Now that it turns out his eyes may have been a little larger than his belly, he’s not happy about it, but I’m sure there was no dissuading him at the time.  Somebody needs to tell him “no.”  Waive the interest?  No.  Delay payments?  No.  Forgive the debt?  Hell no!

“No” is the most effective word on Earth against socialism, but it’s the word too many in this country are now afraid to utter, to their children, their neighbors, fellow citizens, but most particularly, themselves.  Until we learn to say it and mean it, poor kids like Jonathan will never understand its power.  Government bureaucrats will never understand their limits.  Politicians will never cease in their abuses.  We will never be happy.  Learn to say “No” and stand by it.  Refusing your consent is the one thing that cannot be taken from you.  Jonathan could have said “No” to the interest he’ll now pay, simply by refusing the loans.  Having taken them, he has found that he now has no right to refuse.  Do I feel sorry for Jonathan? Do you?

No…

Running on Empty: Petrol Panic in UK

Monday, April 2nd, 2012

Could We Face the Same?

I recommend my readers check out this piece over the UK Telegraphon what is going on with our friends across the pond.  They’re experiencing a fuels shortage to the extent that the government is being urged to begin an emergency program of rationing.  The issue began when a union of truck drivers who deliver fuels threatened to go on strike, and a government official, Francis Maude, a Cabinet Officer advised people to fill up their tanks and store fuel in storage containers.  Quite naturally, the people responded by doing just that, emptying filling stations everywhere.  While telling the people not to panic, the British government incited a panic, and the resultant run on fuels, in a shortage so severe that first responders there are having difficulty finding fuel to run their ambulances.   What we should learn from all of this are at least two important lessons, and I hope my readers will take note:  Governments cause panics by their actions, but more importantly, our fuel supply is more vulnerable than most people think, because of the structure of the supply chain.

If you drive to your favorite filling station, most days there will be no problem.  You’ll simply dispense the fuel, pay and depart, and there’s no fuss about any of it.  What most people don’t realize is that the amount of fuel out at filling stations is based on the expected, ordinary quantity demanded, and while there may be some small amount in surplus, it’s really not much more than a day or two extra under ordinary conditions.  Fuels are dangerous to store in large quantities, and EPA regulations have made the job harder, but most important is the notion of just-in-time inventory management which means retailers don’t keep more on hand than they will immediately sell under normal conditions.

The reason this matters to consumers is that it means that any small fluctuation upward in quantity demanded can quickly lead to a shortage. As we should have learned in the aftermath of hurricanes Katrina and Rita, anything that causes a shortage at the margins in one locale can quickly spread to others.  If there’s a run on fuels in just a few key locations locally, it can spread like a wildfire as displaced customers shift their demand to other locations, driving those to shortage, and thus pushing the shortage around.  As the shortages spread, panic takes hold, so that people descend on every location for fuel they can find.

This tells us a little bit about the psychology of the market and why such shortages can materialize for no apparent good reason, looking at the matter on a macro scale:  Is there enough fuel for immediate demands? Had people simply gone on with their ordinary purchasing patterns, would there have been a serious market-wide shortage?  No.  The problem lies in the fact that people can be moved by fear and uncertainty regarding the immediate future.  The notion that some days in the future, tanker drivers in the UK might be on strike, and might cause a shortage, was enough to cause a government official to make remarks that started a panic.  Even if the strike never materializes, it will take days or even weeks for the UK to restore things to the normal flow.

What this also should remind us is that on-hand supplies at retail outlets is never nearly what the whole market might demand at once.  At any one time, the capacity of every filling station is just a small fraction of the total capacity of every vehicle’s tank.  When everybody goes to fill up at the same time, the situation is made evident, because the on-hand retail supply can in no way match the condensed time frame of such a move by consumers to tank-up.  In the UK, they’re openly talking about rationing now as a way to restore the normal flow.

The more interesting part about this problem is the human psychology implied: When faced with potential shortages, we tend to horde in response, and this can clearly add to the problems.In the US, where we are much more dependent on fuels to maintain the course of our daily lives, commute and travel distances being so much greater, we’re especially vulnerable to panics generated by short-run, geographically-limited marginal shortages. For this reason, the US can be subject to very small-scale shortages turning into regional or even nationwide problems.  It doesn’t take much.  If a few gas stations over a metropolitan area run short, it can ripple outward and spread like a virus. People begin panic-buying almost as soon as they hear that there is a shortage somewhere nearby.

This is why our current situation is actually so precarious.  It doesn’t take much but a day or two of delayed replenishing in distribution to cause a serious problem.  This is also another reason we should seek to increase not only the amount of oil we produce domestically, but also to increase our refining capacity. The situation underway in the UK  is small compared to the impact such a panic could cause here, primarily because the geographical expanse of our country means that public mass transit isn’t economically viable in most areas.  In short, we need our fuel, and our lives have evolved to depend upon it.  It’s bad enough when governments do idiotic things like start a panic, but what’s worse is when they’re so utterly unprepared when they happen without government prompting.

The American people should be made aware that panic hoarding only worsens the problem and increases the span of time before a situation driven by natural disasters is resolved.  The goal in such a situation should be to delay purchase as long as possible, but that’s so counter to our nature that I don’t expect many people to react in perfectly rational ways.  The other problem we face is political, in that too few Americans understand just how fragile this system has become, and with it, all the dependencies upon which it relies.  If more Americans understood just how reliant they really are on an energy supply to maintain their standard of living, they might bring more pressure on politicians to get out of the way.

This is 1860, and Obama Isn’t Lincoln

Thursday, March 22nd, 2012

Who We Need

Our country is in crisis, but at present, we have no leader emerging to save the union, and it seems there will be no Abraham Lincoln to save the nation.  Barack Obama is more like his long-ago predecessor, James Buchanan, who was put in place by his party, the Democrats, to protect the institution of slavery.  Obama is in that position, as his job has been to protect and grow the welfare state, and in much the same way as Buchanan, it may be a case before the Supreme Court that defines his presidency.  If Barack Obama and the Democrats have their way, the Supreme Court will uphold the Affordable Care Act(Obama-care) thus defining the character and inevitable course of the nation, much as in 1857, Justice Taney’s ruling upholding slavery in the Dred Scott case set the nation on a course to civil war. The difference was that in 1857, the court held that federalism applied, and in 2012, Barack Obama’s justice department is demanding that the 10th Amendment and the entire notion of States’ rights be ignored. There may only be one way in which this issue is finally settled, and it may require war.

In 1860, the budding Republican party sought to set the question on slavery right, the abolitionists in the North propelling Abraham Lincoln to the presidency.  Lincoln had the distinction of overseeing the abolition of slavery, but to do so he would need to fight a war.  In much the same way, if Republicans are to begin abolishing the soft slavery of the welfare state, beginning with Obama-care, they will need to elect a leader prepared to wage war in defense of a principle.  After all, in 1860, the South was entrenched in the notion of keeping the institution of legal slavery, but the abolitionists knew that could not be permitted to stand.  In 2012, faced with a Supreme Court case that may well decide the future of the country, we wait to see if the court will act to save the country, or fail to defend the principles enshrined in the constitution as they did in the Dred Scott case one-hundred-fifty-five years ago.

People have falsely compared Obama to Lincoln, thinking his stance on the supremacy of the central government over the states is the most pressing comparison, but this simply isn’t the case.  What will save our republic now is not more government but less, and not fewer freedoms but more, and in this sense, Barack Obama has nothing in common with Abraham Lincoln.  Lincoln thought that it was impossible to better the lives of some men by subjecting other men to ruin:

“Property is the fruit of labor…property is desirable…is a positive good in the world. That some should be rich shows that others may become rich, and hence is just encouragement to industry and enterprise. Let not him who is houseless pull down the house of another; but let him labor diligently and build one for himself, thus by example assuring that his own shall be safe from violence when built.” The Collected Works of Abraham Lincoln edited by Roy P. Basler, Volume VII, “Reply to New York Workingmen’s Democratic Republican Association” (March 21, 1864), pp. 259-260.

Clearly, Lincoln was not interested in Obama’s updated form of enslavement, and yet that is the central crisis that will confront this nation in the 2012 elections, and for some years to come.  Nobody can say with certainty what will be the final tipping point, but if this nation continues apace, it will plunge into anarchy and civil war, but this time, the government is likely to be on the side of the slavers.

There is something fundamentally flawed in the thinking of those who argue that this is just the natural progression of nations, because what they argue is that Americans are neither wise enough, nor even capable of sufficient self-control to attempt to restrain intemperate desires for wealth derived from naked expropriation, but I submit this is not true, at least not yet, and that we must not permit it to become true.  Once we cross that invisible plane, the ramifications will be known with little delay, as the country you had known and loved and labored to propel disappears into the fog of a war from which only savagery may emerge.

Let us not pretend that we can’t imagine what will happen in such a scenario, but let us not delude ourselves into the beautiful lie that tells us it will somehow resolve by other, less painful means.  Von Clauswitz said that war is politics by another means, and I am here to tell you that politics is just the precursor to war  in such a context as the one in which our nation now persists.  All of the political rancor we now experience would be replaced by open warfare, at least for a time, in the scenario I am describing.  That our slate of Republican candidates might not see this is disturbing enough, but that our front-runner intentionally avoids seeing it is frankly inexcusable.  Of those now in the nomination fight, I think Gingrich is most apt to understand what’s at stake, because his knowledge of history may permit him to see the warning signs with a clarity the others are neither inclined nor perhaps able to see.

Gingrich has a fine understanding of the Civil War, and he certainly knows the history of the period, and how the nation arrived in that predicament.  I think Gingrich also understands that our current predicament is in some ways worse, because whereas in 1861, Lincoln put the government in service of the proposition that all men were created equal, we now have a government committed to the notion that it is the job of government to compel an equality of results.

This is the nature of the grave danger we now face, and it is every bit as dangerous as 1860, but perhaps with the added danger that we now have  a president who is part of the problem.  Put another way, imagine that in 1861, it had been a President from the South who instead caused t he Northern delegations to Congress to walk out, and had engaged in a brutal war to compel Northern states to the “peculiar institution” that had been slavery.  That’s what we now face, as Barack Obama seeks to impose his own form of slavery on the American people.

This is why I insist that this election year is not like 1980, or even 1932.  This election is most like 1860, and if we don’t find a candidate with the common sense and righteous aims of Lincoln, it may have been in vain that we exercised our vote.  If we are to preserve this republic, we will need leaders who are willing to wage even war in defense of individual liberty.  That certainly won’t be Barack Obama, and it surely won’t be Mitt Romney, leaving us to ponder whether it is even possible to save our union once more.

Mark Levin Searches for a Word

Friday, March 16th, 2012

The Word The Left Already Knows

Listening to Mark Levin on the radio on Thursday, he was discussing the Obama administration’s predations upon our country, and all of the policies Obama has established that intentionally undermine the United States.  He wanted a new word to describe what Obama is doing, but he settled on an old one, and it’s close, but it isn’t quite right:  De-Industrialization.  Far be it from me to quibble over terminology with the brilliant and accomplished  Mark Levin, who has an audience that spans the nation, and with the Internet, really the entire English-speaking world.  He’s so frequently right, and so unfailingly prescient that I hesitate to offer him a ‘correction,’ but in this case, it’s so important that I believe I must, because as Sarah Palin pointed out Thursday in a Facebook note, Dr. Levin has done more to enlighten more people on the roots of our national disorder than any other person in our culture at present.

I feel it is important enough to risk his ire, and those of his many fans, and followers, some of whom also read this blog.  What Barack Obama is doing is much more fundamental to our national survival than  “de-Industrialization” might indicate.  If it were that, we could recover in a generation, but what Obama is doing threatens to undermine our nation for all times, and as Dr. Levin suspected, the word he seeks already exists, and it’s much more dire than you might imagine: Barack Obama is De-Capitalizing the United States.  It’s been the solitary goal of the left for a long time, and it’s Barack Obama’s method of culturally, financially, and materially destroying America.

How important is capital to a capitalist country?   It is everything we need, not merely to recover our economy, but to fuel it for generations, perhaps in perpetuity.  Capital helps establish even our moral basis, and undermining that basis leaves us to lie in supine servitude to whatever demagogue happens along.  Stealing America’s capital will crush the country, and remove from it the ability to recover, not only in the next decade or generation, but possibly ever.  Most people think of capital as money, and money is capital, but it’s not the only form, and not all money is capital in the most important sense.  Depending on how money is used, it can be capital, and that is surely an important part of the story you must understand to see not only why my term is the correct one, but also in order to see why Barack Obama is far worse, and far more dangerous than any of you may have imagined.

While others have been focused almost solely on the Republican horse-race, I have been covering the twists and turns of our dire national financial circumstances, and I have done so for a reason:  You must know what is being done, and how, if you’re to understand the threat we now face.  Our capital is being strip-mined from this nation in systematic fashion, and that which remains is being systematically devalued.  Let me explain how this is being done, starting with how our cash is being devalued.

First, you must understand our monetary system, and you must know that in order to devalue our money, all you need to do is create more of it than growth in our Gross Domestic Product(GDP) justifies.  Ben Bernanke has been complying with that plan, by creating more money out of nothing in order to lend it to many institutions, including primarily the US Treasury, but also to all of those banks that were “too big to fail” as well as Europe’s ailing financial sector in order to temporarily prop them up.  Governor Palin warned us about this in late 2010, as the Federal Reserve instituted QE2(Quantitative Easing round 2) that is really just a fancy title for more old-fashioned money-printing, now carried out primarily in digital form.

The more the Federal Reserve lends out of thin air, the less all previous dollars are worth, provided there’s no corresponding growth in production and wealth in the total system.  If production and wealth grows by some minor amount, but the printing(or digitizing) of money exceeds that amount, each additional dollar devalues all the rest.  Put another way, if you imagine the wealth of the nation as a giant pie, each time we print more money without growing the pie, what happens is the same as re-dividing the pie by the additional number of dollars.  What this means is that each slice shrinks, but since we’re talking about money, the medium by which we exchange goods and services, what it means is that each slice – each dollar – falls in value versus those goods and services.  You can buy less with the same number of dollars, or put another way, it takes more of your dollars to buy the same goods.  As Sarah Palin predicted nearly eighteen months ago, we have seen the prices of energy and food skyrocket.

You might say that this is all well and good, but Ben Bernanke – not Barack Obama – runs the Federal Reserve.  I agree, but let me tell you that Obama’s fiscal policies are the impetus for much of the money-printing.  Put another way, Barack Obama’s outrageous spending has accounted for four trillion dollars or more of all this money-printing madness.  This is because money isn’t printed and set on a shelf.  Instead, it is loaned into existence.  Once you realize this, you understand that without corresponding economic growth, this is merely funny money that is tantamount to counterfeiting.  Each time they devalue our currency by this procedure, your existing wealth is being stolen by some incremental amount.  That’s the real picture, but sadly, it doesn’t stop there.

Are you paying more for fuel?  To quote my favorite politician, “You betcha!”  Food? “Ditto!”  In fact, prices of almost everything is creeping  slowly upward.  Part of this is due to the re-division of the pie, as described above, but it’s also a result of something else:  The United States Federal government is spending more on redistributive programs than ever in history, and it now spends monies equivalent to 25% of the GDP.  Those dollars, poured into these redistributive programs, are now competing with your hard-earned dollars in the marketplace for goods and services.  When more people arrive in the market with dollars with which to demand more of a thing, but you’re not producing substantially more of it, either the prices will rise in response to the quantity demanded, or somebody else will need to supply the goods from some other place.

This results in an out-flow of cash.  It’s devalued cash, but it’s still landing in China and India, and anywhere else with which we do substantial commerce.  Some of that cash comes back in trade, but some of it does not.  While in ordinary times, I am not so concerned about the balance of trade, under this system at present, we are bleeding wealth and redistributing it globally.  For what?  The latest cellphone?  Produced where?  The latest television?  Produced where?  The simple fact is that while I support free trade, what I don’t support is free trade augmented by redistributive domestic programs.  What this means is that when you go to work, you’re going to produce wealth, some of which will be stolen in the next round of money-printing, and redistributed to some who do not work, to be spent on merchandise you would not buy, and without which the purchasers could easily live, all while pouring your wealth in a chain from your pocket to government to your government-supported neighbor to some state venture in the Republic of China, mostly for transient, non-durable merchandise that only detracts from available capital.

At the same time all of this goes on, productive enterprises have less money from which to draw.  Are you thinking of putting an addition on your home?  First, you might have to borrow the money, and if you do, you’ll find you’re in tougher competition for those dollars, and since fewer contractors are now in existence, you’ll pay a premium for any work you hire out.  Your money won’t go as far, because in construction, fuel is an important component from the production and transportation of raw materials, to the paychecks of workers who will now need more cash to make it to the job-site.  As all of this happens, you may have found that you needed a home equity loan to pay for the new construction, but alas, this too will be more difficult, since the value of your home and property has likely fallen.

Add to this the insane policy of permitting JP Morgan Chase and Bank of America, among others, to move risky European derivatives into coverage by the FDIC.  When the Euro-zone goes belly up, and don’t kid yourself, it will, you will be stuck with that bill too, and it may even collapse your currency altogether.  You might have heard that Wall Street is doing well, but that’s an illusion too.  Much of the growth on Wall Street has been financed with more loans from the Federal Reserve.  Meanwhile, you’re struggling to fill your fuel-tank, and while you do, the foreign powers who control much of the globe’s oil supply are getting wealthy while Barack Obama denies pipelines and drilling all over the United States.  He’s closing down coal-fired plants.  He’s using the EPA to regulate energy producers out of existence.  Slowly, we are being starved of the capital equipment with which we might hope to someday extract ourselves from this condition.   When he closed down Gulf drilling in the wake of the Deepwater Horizon incident, and refused to reopen it despite a federal court ruling, those drilling rigs and platforms left American waters on their way to places they can drill, like Brazil, where he sent billions of dollars to fund their oil industry, including Petrobras, in which his pal George Soros was a big investor.  Those platforms and rigs won’t be back.  You’ll need to raise the capital to build new ones.

Is your paycheck growing? A few may be, but most are not.  In fact, with skyrocketing costs as your money is devalued, even those who’ve managed to scratch out minimal raises are finding their increases are in no way covering their expenses.  With all this newly digitized and printed money, you’re not seeing anything but diminished value in your purchasing power.   You have little money to save or invest, because it’s all going up in smoke to support your basic energy and food expenses.  Any margin of error you may have had is now gone, and to do anything constructive, you’re having to borrow in some form.  You might sooth yourself with the idea that at least you’re contributing to a 401K, or other retirement program at work, but how much of the value of those investments is based on the bubble-building all on the back of these borrowed bucks.  They have the use of your slim capital at present, all on the promise that it’s a shelter.  It could also be a trap.

What all of this does, taken together as a vast picture of our national despair, is to deprive the country of capital from the most fundamental level to the top of the financial food-chain.  When, I repeat, when the Euro crashes, your dollar will follow along behind in short order.  Your financial institutions will be wrecked, and you will find out that there is no such thing as “too big to fail.”  When we are naked, starving, and unable to raise enough capital to fund the production of a pack of bubble-gum, you will see why this is more than mere de-industrialization.  Barack Obama is hard about the chore of de-capitalizing America, undercutting its wealth, and its ability to produce more wealth, on which our lives all depend.  The old saying is that “it takes money to make money,” and Barack Obama and his band of anti-capitalists know that this is true.  To destroy America, and to destroy the capitalism that has powered it through generations of ever-growing government, one must take away that seed that lays its foundations anew in each successive generation: Capital.

Of course, not all capital is about money.  Some economists count “human capital,” and here too, Obama is squandering a generation.  Our schools have become mosh-pits of leftist indoctrination, and our colleges and universities are populated by students many of whom believe it is proper to lobby for free contraception.  You see, capitalism requires a respect for what capital is in its naked essence:  It is the motive power of all new wealth, but what they now teach the nation’s children is that “stuff” is just material that is owned as a matter of legalized oppression of those with less money.  This undercuts the moral basis too, so that your human capital, your financial capital, and your moral capital are all being destroyed.

Barack Obama is literally an anti-capitalist, all the way to his core, and what he and his friends like George Soros do and have done in previous instances is to de-capitalize nations, and reduce them to stagnant, increasingly destitute corpses.  America had been the greatest and freest nation on the planet, because for a long time, it came closest to the capitalist ideal.  Slowly, for a century or more, we have been bleeding it dry.  Republicans and Democrats have participated, and all of them under the label of  “progressivism.”  Mitt Romney would do little different, except perhaps to better manage the collapse.  That won’t save us, and it can’t restore our country to its exceptional promise of years past.  We now stand on a societal precipice and Barack Obama has arrived at just the right time in our history to oversee the commencement of the final de-capitalization of America, shoving us over into an abyss from which the nation may not emerge.

Dr. Levin, respectfully, that is the word you were seeking.  The Left has known it and is practicing it with ardent fervor.

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Occupiers: No “True Democracy” While Capitalism Continues – They’re Right!

Wednesday, March 7th, 2012

Anti-Capitalist Stephen Lerner

Andrew Breitbart managed to get his hands on some video of an Occupy strategy session, and in this video, SEIU skunk Stephen Lerner says that there can be no co-existence of Capitalism and “True Democracy.” Here’s the problem, and it’s one patriotic Americans need to grasp: Occupy is right. Now, before you go off the deep end to suggest that I’m losing my mind, because in this case, I agree with Occupy Wall Street, I would like you to watch the video. It’s important to understand what they’re saying so I can explain to you why they are right.

Here’s the video:

The problem we have is that most Americans have been mis-educated to believe that the United States is a democracy. It’s not. It never has been, and it was never supposed to be a democracy. Democracy is merely organized mob-rule under color of law. The United States was constituted as a representative republic, as demonstrated by the words of our own founding document, the US Constitution, in Article IV, Section 1:

“The United States shall guarantee to every State in this Union a Republican Form of Government“(emphasis added)

This is a part of our constitution that is often ignored, and one that is often side-stepped by leftists because they cannot tolerate the notion that we have a republican form of government by design, and by the intentions of our framers. They understood that democracy was a horrid wrecking machine that destroys individual liberty, and is ever the precursor to tyranny. What a democracy ultimately permits, but what a representative republic is structured to forbid is the voting away of rights of some minority, including the smallest minority that is an individual. The whole purpose of the strong requirements on amending the constitution, or replacing it via a constitutional convention is specifically to make the destruction of individual rights exceedingly difficult.

What we have seen over the last century is a concerted effort to turn the US into a democracy of sorts. Capitalism cannot operate where there are not strong protections of individual rights, including the right to property, or one’s sovereignty in the marketplace. What Stephen Lerner and the rest of the Occupy Wall Street crowd understand is that there can be no “true democracy” while capitalism still lives. In short, it’s a recognition of the fact that the mob-rule that is implicit in democracy is prohibited in order to make capitalism possible.

What makes capitalism work is that you have the right to your property, exclusively, with no valid claim upon it by society at large. That’s why the income tax was pawned off on the American people with the 16th Amendment almost a century ago: The idea was to wreck your legitimate hold over your own property. In order to redistribute your wealth, they first needed the legal authority to take it, and that was the entire purpose of the 16th Amendment. Once they had a method by which to steal your wealth, they needed the ability to make it easier to redistribute it, and so the 17th Amendment was passed, providing for direct election of Senators, turning them into a more democratic institution. From that moment on, the character of American government began changing from a representative republic into a democracy as a precursor to a police-state.

What Lerner and the other Occupiers in this clip have understood is that in order to have the police and welfare state they want, they must first destroy your liberties, and that one of the reasons you will fight them is because you know that without them, capitalism, the means of your existence, cannot last. Last fall, I received a number of comments here from Occupy-sympathetic posters who assured me that OWS is not anti-capitalist. Guess again. This video proves it, and it does so very easily.

These are people who have a clear understanding of what they are after, and frankly, I think too many Americans have been intentionally mis-educated as to the proper form and function of our government precisely in order to permit these people to make such statements.  You see, they’re right, and while it may seem shocking to some who think there’s no difference, this is why Americans must begin to arm themselves with the truth.  These people are out to make us into a democracy, but that is not the form in which we were constituted.  Our nation is a constitutional, federal, representative republic.  Capitalism is only possible here because we adopted that form. This  has led to our great wealth and prosperity, but if we wish to grow it or even keep it, we will need to retain our constitutional form of government.  Occupy Wall Street understands the distinction, but if you wish to keep your country, you had better learn it, and fight for it too.

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Will Inexpensive Gasoline Ever Return?

Friday, February 24th, 2012

Can Gingrich Deliver?

This is a question leftists are now asking in response to the fact that Barack Obama’s policies have resulted in the most expensive February gasoline prices we’ve ever known. Rather than treating it as an economic question, they tend to discuss it as a matter of politics, and mostly as a matter of damage control. Newt Gingrich is promising that if he is elected, he will work to reduce the price of gasoline to less than $2.50 per gallon, but what the liberals contend is that such a reduction isn’t possible, but more importantly, even if it were feasible, it’s not desirable. Let me make it perfectly clear for those of you who have questions about this issue, because it’s something we should examine in looking at the potential nominees: Newt Gingrich’s intention to reduce fuel prices to sustainably lower levels is an important national initiative in which government can play a role, and it offers a chance to boost the US economy in a way that nothing Obama has done will ever accomplish.

In previous articles, I’ve discussed with readers the important relationship between economic growth and the price of energy. By taking note of this fact, and addressing the issue in his campaign, Gingrich has signaled that he’s more in touch with the economic problem with which our nation is now confronted. Over the last dozen years, nothing has had a greater influence on economic prospects than the cost of fuels. Not financial market collapses. Not terrorist attacks. Not government spending. If you want to view the track of economic growth, all of those things have had short-run effects, but nothing undermines the economy more thoroughly than increases in the cost of energy. The reasons should be obvious under even superficial examination.

Everything humans do requires energy. Recognizing this fact is critical to economics, because as energy costs increase, there is a direct effect on the cost of all other commodities, and all other services.  There are no exceptions to this fundamental, structural fact of life.  More, since some items require much more energy to produce, and consume more energy along the entire chain from raw material to distribution, any increase in energy costs quickly ripples through the market.  As such, this creates a drag on production, but also consumption, since energy needs tend to come first in one’s priorities. If you’re an employee, you must travel to and from work.  This is something most employees share as an expense from which there are few option in relief.

For that employee, his or her pay is not likely to react to his or her costs.  This fact means that at energy prices increase, the people who will feel it hardest are those who must engage in commerce, but whose compensation is least elastic with respect to the costs they must absorb.  Most businesses can react by adjusting prices, although the competition they face places pressure on them to  delay passing along costs to customers as long as possible.  This was evident in the trucking industry and more broadly throughout the transportation sector when fuel prices first exceeded the three dollar mark a few years ago.  This gave rise to a new phenomenon called the “fuel surcharge,” and it was intended to show that they weren’t simply jacking up prices without justification, but instead that their costs had dramatically increased. The point of all this is that there is no way to avoid the fact that for most people, and most businesses, you can’t easily augment your income simply because your costs have risen.

This being the case, there will be choices to be made, and all of those involved will need to decide which of their ordinary expenditures may have to be curtailed.  New projects and investments are delayed, and necessary repairs or upgrades are put off indefinitely.  What this means is that economic activity is curtailed, and therefore, fewer jobs are created, and thus unemployment rises.  As this happens, it feeds back on itself because  when unemployment is high, the average employee’s negotiating power on wages diminishes, and this makes the average person even less able to spend money on all of those things that create increased economic growth.

After a time, if this continues, the quantity of fuels demanded will begin to contract, and this will lead to the prices falling again, but there is a lag until economic activity recovers.  Clearly, if this is the cycle, then what we should see is precisely what we have seen over the last few years: An economy that fails to launch because just as it begins to heat up, the corresponding increase in energy prices causes a clear diminution of the economic growth.  The only way to combat this is to increase our energy resources, and to make safe such resources as we already enjoy.

Back in the 1990s, one of the things from which the American economy benefited was the reliability of OPEC members to undercut one another on production quotas.  The quotas were intended to maintain a higher price point, but as prices went upward, one or more member nations would get greedy and cheat on the quotas.  This increased the supply in the market, and the prices would inevitably fall.  This was in an era when China’s demand in the market was relatively negligible, but since then, their bite out of the production pie has done nothing but increase proportionally to all others.  It was also an era when OPEC was more fractious, and most of their members couldn’t coordinate on much of anything for long.

What Gingrich recognizes is that our economy cannot function properly, and in a healthy way without the energy we need at a price we can afford while still building economic activity, buttressing the points made by former Alaska Governor Sarah Palin.  His stated goal of seeing a reduction in gasoline prices is the right thing to do, and he recognizes that it’s not just a matter of reducing the price to that point for a day or a week, but in making that the effective ceiling even as the economy roars back to health.  That will require that we develop new sources of energy, and not just empty promises of “green energy.”  President Obama can mock “Drill baby, drill” if he likes, but the truth is that developing domestic oil resources is critical to getting this economy moving in a sustained way.  In short, we can’t merely increase the temporary supply on a short term basis, but must increase it in a structural sense: We need more wells, we need more oil-fields in production, and we need to develop other alternatives simultaneously.

This flies in the face of what leftists want and believe.  They believe the ultimate goal should be to reduce consumption, but the only way to do this without eliminating people is to substantially reduce their standard of living.  In short, their plans demand we return to a pre-industrial state where most people do not consume much energy.  Wave goodbye to your electronics, your hobbies, and your lifestyles if these lunatics get their way.  There’s no way to have what they seem to promise, and they know it. There is no rational way to grow or even sustain an economy while cutting the use of energy in any dramatic fashion.  Can efficiencies be found?  Absolutely!  Can they be created by dictate or order?  Absolutely not!

This is the difference in the position between Barack Obama and somebody like Newt Gingrich who actually recognizes that wishes are not the same as facts, and that nature is not to be cheated.  You cannot build a modern, technologically advanced culture with prosperous people and a growth-based ethos when governmental policies are mandating a reduction of energy consumption.  Nature doesn’t respond to arbitrary wishes, and yet that is the stance of the leftist, who thinks a government mandate can overwhelm the forces of nature and the rules of physics.  The disparity in the two positions demonstrates their relative fitness to the presidency, and by no measure is Obama suitable to his office.  Whether Gingrich is qualified remains a question to be answered, but on the matter of his understanding of the critical importance of energy, it’s clear he passes the test. We can have inexpensive fuel again, but it will require a comprehensive effort by the President and Congress to remove obstructions to the growth of the energy sector that is so vital to our future.

Tea Party Vs. Occupy Wall Street

Monday, February 20th, 2012

The Undeniable Truth

It’s impossible to argue with a straight face that there’s any real similarities between the Tea Party and Occupy Wall Street, and yet that is the contention of some who allege that both are protest movements aimed at reform.  If that’s the extent of their similarity, those who claim this as the basis for a relationship between the two are stuck in superficial characteristic that permit one to claim that an orange and a basketball are nearly the same.  The Tea Party is predicated on the idea that the best government is that which governs least, while the Occupiers, to the degree you can discern any central agenda, are concerned only with tearing portions of the private sector down.

It doesn’t take a genius to see the dissimilarities far outweigh superficial observations, yet this is the argument you get from leftist shills.  Other superficial differences include that the majority of both groups is Caucasian, and male, but in demographic terms, this is the end of similarities.  The Tea Party folks are somewhat older, and somewhat more settled in life, and have already engaged in productive activities for most of their lives, while it seems Occupiers seem to be those who haven’t quite yet figured out what they want to be when they finish growing up.  If that seems a bit condescending, I will confess that  I’m caught, but only because that is my own observation.

The key distinction between the two groups stems from this:  The Tea Party has a generic ideological and philosophical basis that its numbers understand, whereas the Occupiers seem to have a scatter-shot approach to issues, and if you examine any of them in isolation from the others, there’s no guarantee that you’ll be able to learn anything about the beliefs of the group, except perhaps that they all think they deserve something, somehow provided by others. They want their student loans forgiven, or they want banks closed down, or they want capitalism brought to heel under the boot of statism.  They abhor globalization, but simultaneously say they’re in favor of free trade.  They say they want opportunities, but they have squandered many by their own admissions.

In short, while it’s quite easy to make out what the Tea Party wants, it’s no so easy to understand anything about the Occupiers’ demands, because theirs are a moving target, and they seem to modify them daily.  They have no electoral agenda, except perhaps that they generically favor Obama, but none of them can tell you why with any sort of conviction.  In all, I find it odd that anybody would take serious such a comparison, until you understand how thoroughly the Occupiers failed.  They were ginned up to be the left’s answer to the Tea Party, but as the record shows, their behavior in public and private spaces brought them no shortage of negative coverage.  It’s so bad that they don’t even bother pretending there is a degree of moral superiority as occurred at the outset, but instead seek to improve their position by the comparison, attaching themselves to Tea Party by way of false claims of similar purpose.

Of course, now that they’ve seen how badly they’ve been received by the American people, a number of Occupiers are now, belatedly joining in on the anti-Obama bandwagon.  As Yahoo reported, Obama has brought the two groups together, but only because increasingly, both are now opposing him.  Even in this, however, they’re not really together, as the demands of Occupiers seems to be for the President to move even further left.  Clearly, that’s not a message the Tea Party will endorse.  It’s simply not true to say that the two groups are similar, and even the Yahoo article goes on to admit that this is the case.  Still, it’s interesting to watch the purveyors of leftwing propaganda try to paint the Occupy Wall Street movement as a younger, grungier Tea Party, but until its members learn how to find jobs and pay their own bills, never mind bath, it’s going to remain a hard sell.

On Health-Care Rationing

Friday, January 27th, 2012

Including Death Panels

As a fellow who is a student of economics, one  of my pet peeves is the confusion that often arises when economic concepts are misused out of context to justify political ends.  In the discussion and debate leading up to the passage of Obama-care, it was famously noted by Sarah Palin that “death panels” are a feature of that plan.  In short, the death panels would make “ethical decisions” based not on what was ethical with respect to individuals, but with respect to what was ethical in choosing on behalf of society at large, i.e, the government. The supporters of the Obama-care program maintained that “there were already death panels” imposed by insurers, and that in any event, rationing would always take place as a matter of economics.  In this last point, they were correct in the strictest terms, but they were wrong to compare government actions to the actions of individuals and private businesses in the free market.  This is one example of the abuse of economics by politicians, so let us examine it more closely.

In economics, everything is rationed, because it is assumed that there is a basic unlimited demand for all goods and services.  Since there exists no infinite supply of anything, it is necessarily true that all things are rationed in some fashion.  Gasoline is rationed.  It’s happening right this moment.  Food is rationed.  Housing is rationed.  There is no good or service that isn’t rationed, and the primary instrument for determining the allocation of the limited supply in a free market is money.  The smaller the supply of a thing, relative to the quantity demanded by the market, the greater will be the price.  This is the manner in which everything is rationed:  There is a only so much money, and he who possesses enough of it can tap into the limited supply.  This form of rationing is natural, or free market-based, meaning that this happens organically with or without formal rules, and always has, even before the notion of money as a medium of exchange had occurred to primitive cultures and barter systems still dominated commerce and trade.  Strictly speaking, in economic terms, it is true to say that all things are rationed somehow. This is how we reconcile the basic premise underlying modern economics as the study of an unlimited wishes in pursuit of finite supplies.

The question then arises whether natural allocation(or rationing) is “fair.”  Since fairness is a wholly subjective term, it cannot be answered in the realm of economics, but instead becomes a matter of politics.  This is where the trouble begins, because what politicians most frequently do is to apply their own subjective notions of what is fair in place of the much more objective standard of a natural market.   They concoct these notions to satisfy political constituencies, but the twist and turn in order to define the question as a matter of economics.  Inevitably, they do so by reducing the question to the subjective grounds of a particular individual, or group, and ask whether it is “fair” that so-and-so cannot afford such-and-such.  In this sense, the economics they are discussing are applicable to small groups, but not to the whole market.

What government schemers for socialized medicine have done is to insert government coercion into the place of the natural market allocation.  If you say to me, “It is sad that Johnny cannot get his surgery because he has not the money,” if my answer is based on the free market, I must say “it may be sad, but it is fair because he could have obtained the money by previous work, insurance, charity, or even credit.”  The fact that Johnny hadn’t the money for the surgery is not a justification to disclaim the objective fairness of the free market system, but sadly, that is how it is used by politicians.  Enter the statist, and he will proclaim that he can reintroduce “human fairness” or “social justice” or some such enfeebling concept by virtue of government coercion.  If Johnny hasn’t the money, the politician will take it from somebody else at gunpoint to pay for Johnny’s surgery, provided Johnny meets any requirements they may have enacted.

Perhaps the surgery Johnny needs is a kidney transplant, but rather than expend the resources, since Johnny is also a wheelchair-bound, elderly man, the government may say “You’re not worth saving.”  Worse, if the government denies Johnny the ability to obtain his own health-care by his own means outside the government system, what the government is doing is to pronounce a sentence of death on Johnny.  If Johnny happens to be a recent college graduate in his twenties, in otherwise good health, the government will view it as a good investment in many cases since he will pay much more in taxes over his expected lifetime than the surgery may cost.  Notice that the decision criteria is entirely social, and based on the economics of government expenditures, which actually means: Political considerations.  It is also the reason that every system of socialized medicine ultimately leads to many more people dying prematurely as they are denied treatments of which they would have availed themselves in an open market. If this were not true, we would not see so many from around the socialized world flocking here to pay cash for treatments they cannot obtain by any means in their home countries.

You might contend, as the leftists do, that this is done by private insurers routinely.  There is some truth to this, but it is also substantially dishonest.  As a participant in a free market system, you are free to choose an insurer and pay such premiums as you are willing and able, to cover everything to some gargantuan limit, or you may choose a policy less expensive, but also less thorough.  In this manner, the rationing occurs because you have enough money, or you don’t, but that is up to your own resourcefulness and diligence and all the factors that frequently make the difference between relative poverty and relative affluence.  You might decide at this point to take me back to the argument of the “unfairness of money,” but as I’ve already explained, in a free market, fairness is measured differently than in your subjective wishes.

If it was my choice as to which system I would endure, I would prefer to take my chances in the free market system, because I believe I can manage to afford the coverage I might need, but in a government system, no matter how diligent and efficacious had been my own labors, I might be told “sorry, you’re outside the limits established for this procedure,” and be denied treatment irrespective of my ability to pay.  I would always choose this latter option, because it affords me the greater measure of freedom, and if it winds up that I was unable to provide the coverage I actually wound up needing, at least I will have nobody else to blame. That’s where the politicians come in, again.

PIPA and SOPA: What’s The Problem?

Tuesday, January 24th, 2012

Intellectual Dishonesty?

I know a fair number of people are upset with the proposed Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Propery Act(PIPA) and Stop Online Piracy Act(SOPA) that have been under consideration in Congress, and I recognize there are reasons to stop this legislation, but I also know that there is good reason to believe that steps must be taken to arrest piracy of intellectual property.  It’s easy to get caught up in the public outcry, but it’s a different matter to admit the scope of the problem.  This has been an issue going back to the file-sharing sites that became popular in the late 1990s.  There can be no right to the intellectual property of others, and we have a generation composed of many young people who think they ought to be able to have whatever they want without paying for it.  It’s a mistake to indulge thieves, and to the degree people of this description are part of the outcry, I reject the idea that nothing should be done.  PIPA and SOPA  are probably not the correct legislative answers, but it remains essential that we enforce the law with respect to intellectual property rights.

Let me state from the outset that as a professional in the field of networks and network management, I am opposed to the idea of any authority being given to government to disrupt domain name resolution.  I don’t think that’s anything more than a band-aid, and I don’t suspect it will be effective once file-sharing services begin to change how they link material.  I don’t think the only effective way to deal with this is to find those whose sites are effectively clearing houses for what are stolen intellectual properties, issue cease and desist orders, and prosecute them under existing law.  We know this can be done already, as has been demonstrated by the case of MegaUpload.  The FBI went after this outfit because they were effectively trafficking in copyrighted materials, to the tune of a one-half billion dollars or more, and making a tidy haul of nearly two-hundred million.

There are those who have come to believe that this is fine, and that because they’ve now been deprived of a source for illegally copied materials, they have every right to whine, but I think the federal government should do something else in such cases: In addition to going after the file-sharing site, they should back-track via the ISPs every person who downloaded materials and prosecute them too.  This entire thing grew out of hand in the late 1990s when kids (and no small number of adults) began downloading illegal copies of music in the popular MP3 format from file-sharing sites all over the Internet, ignoring the entire concept of the property rights of the artists and publishers and all the others who would ordinarily gain their rightful profits from selling their property.  As available bandwidth has soared in many areas(but sadly, not in mine,) the same thing has happened with movies and videos and even operating systems.

I would like to talk about this aspect, because I want to remove any ambiguity from the discussion: What we’re discussing here is theft. We’re talking about aiding and abetting theft. We’re talking about scofflaws involved in the wholesale theft of the ideas, musical works, published and copyrighted material, and all manner of things by people who prefer not to pay for their own entertainment.  The fact that PIPA and SOPA may well go too far in the pursuit of this, or give the government an inappropriately excessive level of control and authority beyond what many think is already too much control is a good reason to write better laws, but this is not an excuse to simply ignore the issue to the extensive detriment of every creator of original materials on the planet, whether individual or corporate.

I realize that we have now a generation that has expectations of instant(and free) gratification of their entertainment desires, but the truth is that they too need to grow up.  There is every reason to believe that an unrestrained traffic in pirated materials will ultimately harm the creation of more, because after all, nobody can be expected to produce for free those things that in former generations you would otherwise have had to purchase.  Property rights is a concept that is the cornerstone of our free market, and while PIPA and SOPA may be the wrong vehicles for addressing this issue, it is nevertheless true that it must be addressed.  Pouting like spoiled brats because we could not get our free downloads of some pirated movies or music merely suggests that the problem lies with us.

Get Ready For More Inflation

Saturday, January 14th, 2012

What Will It Buy You?

There’s a new report by CNBC that the Federal Reserve is considering some more “quantitative easing,” also known as “firing up the printing presses.” They’re going to make money cheaper again, and when it’s cheaper, it’s necessarily worth less.  For those of you who don’t really follow how all of this works, let me remind you of a few things I’m sure you’ve heard, but which you may not pay much ongoing attention.  The idea is to try to stimulate the economic activity by putting more cash into circulation, theoretically making it easier for banks to loan money for new home construction, businesses, and all manner of things.  The notion is that with more cash flowing, more economic activity will result, and more jobs will be created.  That’s the theory, and it sounds simple enough until you recognize some complicating factors.

First, every time the Federal Reserve follows this procedure, what’s really happening is that for all intents and purposes, they’re flooding the economy with new money.  There’s really no new value being added to the system, so what this effectively accomplishes is to devalue all existing money by some amount.  What this causes in turn is a diminution of your money’s purchasing power.  A loaf of bread costs $1.20 instead of $1.10, or a gallon of gasoline goes from $3.50 up to $4.00, or a 2″x4″ down at the home improvement store goes up in price, but the total effect is that money is less valuable.

Back when QE2(Quantitative Easing, Round 2) was announced, back in late 2010, Sarah Palin came out and warned against it, and was scoffed at by the geniuses who push this inflationary policy upon us. Of course, with predictable regularity, she was right about it, as we who pay attention knew would be the case, so now the Federal Reserve is considering more of the same. As with last time, most of the inflation has been hidden by the fact that amazingly, energy and food are not counted in the CPI(Consumer Price Index) but of course, that’s an absurdity since it’s where much of our spending is concentrated.  This helps the politicians and the Federal Reserve shield from your eyes the true cost of their stimulus, but what you should know is that it amounts only to a delaying tactic.  What they’re hoping is to buy time until the economy can somehow catch up, but the problem is that the policy they’ve undertaken ultimately leverages against that end, since it will take ever more dollars for you to fund your energy and food costs, and those aren’t things on which you can really do substantial trimming if you intend to go to work each day.

The whole thing is a colossal fraud, and it’s one of the reasons I agree with Ron Paul that we need to re-examine the role of the Federal Reserve.  It’s become obvious that they’re just as willing as most politicians to lie to you about the end result of their policies.

GOP Commits Political Suicide By Mitt

Saturday, January 14th, 2012

2012: GOP Commits Political Suicide?

Most of you will be familiar with the concept of “Suicide by Cop,” the practice by which somebody who is unwilling to do the deed themselves, instead puts themselves a position to be threatening, thereby drawing fire from police.  In the same way, the Republican Party now seems poised to commit political suicide by nominating Mitt Romney.  It really wouldn’t take a great deal of explanation were all of my countrymen versed in the principles of capitalism.  Sadly, they are not, so let us make them plain:  Mitt Romney is not a capitalist, but he will be attacked as one.  Just like his false conservatism will lead to attacks on our philosophy, so  too will capitalism come under attack even though neither he nor we any longer practices it.

Many people have defended Mitt Romney over the last several days when he was attacked by Gingrich and Perry on the basis that his work at Bain harmed workers and destroyed jobs.  Others were quick to point out that this sounded very much like an attack on capitalism, in almost the same manner that the left attacks it.  For my part, I pointed out that Romney has enough baggage that you could easily assail his record without seeming to attack capitalism, and I offered up a few specifics.  The problem is that much of this is complicated information, and most people simply don’t have the time or patience to sort through all the details.  I find that frustrating, because we cannot render just opinions on the matter of Romney’s qualifications for the office of President if we’re not willing to chase this all the way into the weeds.

One of the concerns about Bain Capital that hasn’t been mentioned much is how it has relied upon corporate welfare to improve its profitability.  Consider the case of Steel Dynamics, which was provided various incentives and breaks in order to locate in DeKalb, Indiana, a company in which Bain was the largest domestic equity holder.  The state and county provided $37 million in incentives, and even levied a new county income tax in order to get the plant located there.  While this sort of thing isn’t all that uncommon, what it reveals is how thoroughly involved in wringing money out of tax-payers Bain’s operations had really been.

From the same LA Times article:

“This is corporate welfare,” said Tad DeHaven, a budget analyst with the Washington-based Cato Institute, which encourages free-market economic policies. DeHaven, who is familiar with corporate tax subsidies in Indiana and other states, called the incentives Steel Dynamics received “an example of the government stepping into the marketplace, picking winners and losers, providing profits to business owners and leaving taxpayers stuck with the bill.”

That’s a shocking disclosure about a man who has claimed to work in “free enterprise.”  The people of DeKalb County aren’t free, as they’re undoubtedly still paying off the debt they incurred as a result.  Some will point out that this isn’t uncommon, and I agree, but I’m not sure that’s a valid argument for doing it.  Still, the larger point in all of this is that Romney and his company were the beneficiaries of this, and that it wasn’t all “free market.”

Of course, Steel Dynamics was one of the companies that went into the total of his preposterous claim of 100,000 net jobs created, and of course we now know that this too had been smoke and mirrors.  Of course, this is just a sample of his private sector experience, but what you come to learn about Romney during his term as Massachusetts Governor is much more frightening.  While having a president with private sector experience would certainly be useful, Romney’s really not the sort of private sector person we need.  We need a person who understands Main Street, and knows what it is to make a payroll in a business with a few doen employees.  Those are the kinds of enterprises that aren’t being established in this economy, and they’re the sorts hardest hit by the ridiculous big government regulatory regime under which the economy now suffers.

Small businesses are the ones that don’t get tax breaks, and they’re the sort on which we have depended for most job creation over the last fifty years.  They’re also the kind of endeavor that provide slim profit margins, are often held together on a wing and a prayer, and are completely devastated by programs like Romneycare.

What the GOP establishment doesn’t understand is that by going along with Mitt Romney, what will be accomplished is to institutionalize the very sort of government that will destroy the economic growth we so desperately need to climb out of the gargantuan debt pit into which Obama has heaved our nation.  At Bain Capital, Romney could turn to a bankruptcy court for a company that didn’t make it, and at the state level, he could turn to the federal government for grants and similar when Romneycare ran the state short of funds, but as the President of the United States, to whom can you turn?  The Chinese? Even they have had enough of our easy-money policies.

A Romney nomination threatens to destroy the GOP, because if he fails to defeat Obama, or perhaps worse, defeats him but then goes on to govern the nation like he did the State of Massachusetts, there will be no coming back from it.   We haven’t been practicing capitalism for some time, but instead muddling through what is known as a “mixed economy,” meaning one that is neither fully dominated by the state, nor by the free market.  What we allow with Romney is the continuation of the lie that we are a capitalist nation, and yet it will be for all the flaws of statism that capitalism will take the blame. It’s little different from the phenomenon by which George Bush claimed to be a “compassionate conservative” while practicing his own nuanced form of statism.  It had been these government programs and initiatives where government failed worst under Bush, and it was in these that conservatism took the blame.

Conservatives would not implement socialist prescription drug programs.  Conservatives would not further empower a federal education establishment.  Conservatives would not resort to a government takeover of airport security on a permanent basis, and then extend that security to all manner of places as has happened with the TSA.  A Conservative would not have borrowed and spent as George Bush did for the two terms he held office, and certainly wouldn’t have closed out that administration with a program like TARP(which Romney approves.)   All of these things were done by an allegedly conservative president, so are you surprised that by 2006, conservatism was taking the blame?

Terms like “conservative” or “capitalist” are only good as short-cuts to understanding when we deny their use from labeling the things they are not.  In permitting George Bush to stand before us claiming to be both a capitalist, and a conservative, we damned both when he turned out to be neither, in fact.  Labeling McCain with these labels was ineffective because for the party’s base, they clearly weren’t true, and the labels now held a negative connotation in much of the electorate because they had been associated falsely.  It’s the reason McCain had to bring in Sarah Palin, because he had to restore credibility to the terms.  Mitt Romney will fare no better than McCain, and perhaps worse, because Obama will be able to blame conservatism and capitalism for the failings of his own ideology.  Again.  If Republicans permit this to happen again, they’re foolish, and there’s to be no going back.  Even on the slim chance that Romney is elected, he won’t save the country because his solutions are merely a slower implementation of the same statist ideas. It will throw the GOP into a banishment that may turn out to be permanent.  If the Republican party wants to commit political suicide, Mitt Romney is 2012′s perfect and perhaps final solution.

A Few Words About a Word: Greed

Thursday, January 12th, 2012

Caricature or Fact?

I think of all the words in the English language, the one we should live without for a while is the word “greed.” This word has so many vastly different meanings to so many people that it can mean anything and nothing, simultaneously.  It’s become much like the overuse of the term “Nazi” to describe anything and everything with which one might disagree in a moment of heated vehemence, and what it really serves to accomplish is to inject hyperbole and undue emotion into any argument.  Since there is no way to ban the use of a word(at least not in the US, yet,) I decided I might just as well give you my definition, so that on the rare occasion I toss it about, you will understand my usage.   Many consider the brand of “greed” as good as the mark of the beast, and properly defined, it might well be apt to view it in such light, but all too frequently, the word is used to smear something else, and frankly, I’m tired of it.

Greed is most commonly invoked at the thought of lust for money and wealth, but I submit to you that real greed is hardly confined to the gain of material riches.  I also submit to you that it is not merely the desire for riches that constitutes greed, but instead the desire for wealth in material or prestige to which one has no natural entitlement.   If you own a thing, and you came to own it by your own efforts, these are the fruits of your labors, and it was neither greed that gave them to you, nor greed that permits you to hold it.  It is your natural right to  your property that justifies your ownership, and no warrant of greed may be logically attached.

On the other hand, if you gain wealth by fraud or deception, or by theft most commonly of all, this along with your desire to keep it constitute actual greed.  A thief or an embezzler or a cheat is motivated by greed.  A person who demands the labors of others go to support him is motivated by greed.  In a civil society, this sort of greed is generally punished as crime, but no form of greed is greater than a society that collectively employs greed against a minority, however constituted.  Socialism, and indeed any form of statism is the greediest sort of system of all.  The notion that one is entitled to the fruits of a neighbor’s labors is abominable, and that there are laws to enforce it is the stuff of true greed.

Greed is commonly associated with the rich, but I tell you it is the manner in which wealth is gotten that answers the question as to whether there had been greed.  Was there coercion?  Was there monopoly or oligopoly?  Or was there merely the productive efforts of minds equal to the task of satisfying the wants of many people?

All too often, the word “greed” is substituted in place of another concept, precious to capitalism, called “rational self-interest.”  This is the motive power of capitalism, and it’s the reason most of you rise to work each day, toiling to earn your daily bread.  You do not work as a matter of charity to others.  You do not tote that barge or lift that bale in order to fill the bellies of your neighbors’ children, but your own.  The worst and most greedy amongst us are those who find one excuse after the other to lighten the burden of your wallet at the point of a gun in the interests of combating greed, and yet the truth is that none are greedier than these alleged agents of anti-greed.

You might well ask me what I had meant about those who seek an unearned prestige.  I will explain to you that these are the most dangerous of the lot, and none are more greedy than these parasites on human spirit.  These are the grand Utopians who claim not to want any reward for themselves, but instead seek your wealth as a matter of enriching their reputations as the doers of vast public good. If you wish to see a crowd of these in action, you need only tune in to C-SPAN when Congress is in session.  There, you will witness a freak-show of the greediest people on the planet, who hold in their hands the power to strip you of your wealth, all the while claiming the justification of some alleged “public interest.” Worst of all, as has recently come to light in such texts as “Throw Them All Out,” by Peter Schweizer, while they posture as the protectors of the downtrodden, they use the force of their legislation, and their inside knowledge about what it will do to markets in order to make profits they could not have made by any other means.  Who among you believes that most of these people so-engaged could make a fat nickel without the power over your purses and wallets, and the laws that govern your enterprises and corporations besides?

Of course, there are those who seek no immediate financial compensation for such efforts, but instead seek other forms of wealth, in the form of an undeserved prestige.  How many buildings, post offices, and lamp-posts in West Virginia bear the name of Robert Byrd?  He will have been in his grave one-hundred years, and still his name will curse the landscape of that state like a plague.  Sadly, some larger number of the people of that state afford him this prestige, because what he did to gain it was to redistribute money from others to their purposes and support.  Just as you can buy a good deal of welfare or votes, so too can you buy prestige in bulk with other peoples’ money.  The desire for that prestige is an insatiable greed that may stretch to the boundaries of one’s imagination, and more evil has been birthed by those seeking to build monuments to themselves in this fashion than by any pursuit of material wealth.

When people use the term “greed,” I listen carefully for the context, and the reason is simple: All too often, the term “greed” is thrown about with casual indifference to the actual meaning of the word.  When I see a businessman who has made his money by honest pursuit, the fact that he wishes to keep it or earn more does not describe greed, but when I see a petty shop-lifter who stuffs a pack of gum into his pocket at the check-out line, I know I am seeing the material form of greed in progress.   When I see a woman enjoying her retirement by spending some of her life-long savings and investments into something purely for her own pleasure or amusement, I do not see greed.  When I see men demanding a benefit to which they have no natural entitlement, I know I am seeing greed on a vast scale. When I see politicians offering the wealth of some to the pockets of others, in the name of some benevolent purpose he claims will be in the interests of all the people, I look at the ruined lives of the people from whom they will take the necessary cash, and know that I have witnessed a greedy monster.

When you hear the word “greed” you would do well to listen intently to discover the context and meaning of the speaker, so that you can discern his actual intent.  If what is being offered is really nothing more than a thinly veiled attack on property rights, you should run for the hills.  Statists love to use the word greed, because while many people have a sense of the word, few have spent much time considering its meaning.  A statist will argue that if you will not surrender your whole wealth and property and person to the state, it is because you are greedy, and the more wealth you obtain by natural rights, the louder their denouncements of your greed will become. Nobody is greedier than these, and the motive of their attack is to convince you to submit to their claims on your person.  These parasites know the difference between greed and rational self-interest, but they hope you do not.

Hannity Asks Palin About “Vulture Capitalism”

Wednesday, January 11th, 2012

Dumbfound by Michelle Obama?

Unfortunately, I missed this interview as it first aired, but aa reader forwarded me a link to the Youtube video, and I belatedly viewed it with great interest.  Sarah Palin was on Sean Hannity’s show on Wednesday night to discuss a range of issues revolving around the Republican nomination fight, and some of the issues that have been raised in the recent criticisms of Romney’s record at Bain, among other things.  I was interested to see what Governor Palin would say with respect to the questions about all of these things.

She was careful to draw a distinction between attacks on capitalism and capitalistic endeavors, and instances of such things as bail-outs to companies with which Romney is or was involved.  When Hannity pressed her on Perry’s characterizations of “vulture capitalism,” she redirected the question toward the larger subject of free market capitalism:

“I would hope that Governor Perry and the other candidates would shift gears a little bit and start talking about how important it is that we do embrace free market capitalism and fight against crony capitalism that is a problem in Washington DC, and kind of focus along those lines.”

Watch the whole interview here:

Palin also mentioned two unresolved issues with Romney that we need to consider is the release of Romney’s tax returns, and also the issue of his claims of 100,000 jobs created.  It’s a hard thing to take Romney seriously as he continues to withhold information that will be a bludgeon against him if he should be nominated.  She also mentioned that a portion of all of this was inoculation against future attacks, and that’s an accurate assessment.  By playing up these issues now, they’ll be “old news” later.

One of the funniest moments of this interview was when Hannity asked Governor Palin for her impression on Michelle Obama’s statement.  Her reaction was probably much like that experienced by many Americans who heard this, because it hints at just how thoroughly out of touch those in the Obama inner circle really are.

I think what I will take from this interview is that Palin’s focus on the importance of free market capitalism in drawing the distinction between Barack Obama and the eventual GOP nominee is going to be critical, and contrary to conventional wisdom, this may not automatically redound to the benefit of Mitt Romney as some may have assumed.  As I’ve noted, the fact that he was a businessman doesn’t necessarily make of him a capitalist, and the evidence is mixed, particularly considering his record as governor of Massachusetts.

A Flawed Understanding of Capitalism

Wednesday, January 11th, 2012

Who's The Real Capitalist?

In listening to the argument between those who say Romney’s actions at Bain represent the so-called “excesses” of capitalism, and those who argue Romney had been nothing but a capitalist, and that there’s nothing wrong here, I find both sides of the dispute to be guilty of playing on bad definitions, poorly informed public sentiments, and worst of all, pure political hyperbole that may advance this candidate or that one for a short period of time, but will not accrue to the benefit on the right side of the aisle.  Rather than all this bomb-throwing, I’d prefer to sort this out, step by step, and weigh out the results as it is, rather than how any particular party wants it to be.  It’s time to untangle this so we can move on.

The parties representing the various points of view in this discussion to which I will confine my remarks are these:  Gingrich, Romney, and the media(left, right, and stooge.)  The first I will address is the view advanced by Newt Gingrich that Mitt Romney’s profits at Bain were excessive in light of closing down companies to do so.  First of all, let’s be honest enough to admit that there is nothing fundamentally wrong with profit from selling one’s labor, one’s property, or one’s investments.  This argument is so thoroughly flawed that as Limbaugh suggested Tuesday, it is more akin to the argument of Elizabeth Warren than a Republican seeking the nomination for President.  In justice, however, let us admit also that with 98% of all SuperPac advertising in Iowa and New Hampshire being used to assail Newt Gingrich, he was probably a little bit angry and lashing out.  I expect this wasn’t Gingrich’s strongest argument, and if  he had to do it again, I suspect he might change his approach.

In reviewing media defenses of Gingrich, I have read arguments that are roughly like this:  “Well, capitalism is all well and good, but you still have to temper it with morality.”  I want those purveyors of this opinion to pay closest attention to me, as I tell them that they’re shoveling manure.  Capitalism reflects a system of morality, and if you don’t share it, fine, but do not pretend that it means something else.  Do not take “capitalism” and twist the label to fit what is merely modified socialism.  There is nothing wrong with profits, whether large or small, nor any size in between, provided only this:  Those making profits do so by their own efforts and with their own wealth and property.  That’s the morality of capitalism.  It’s a morality I endorse entirely, and unreservedly.  Do not offer to me that capitalism must be “tempered” by something.  To temper a thing is to alter its fundamental structure.  In this case, “temper” is merely happy talk for “rigging the outcomes we prefer in spite of the market.”

You might claim “but to tear down a company in order to liquidate it and thereby turn a profit, when they didn’t build it is to be a vulture.”  True, but in capitalism as in nature, vultures perform a vital role, and while we may not regard the vulture with much sympathy, the truth is that he’s cleaning  up messes and putting to use that which would otherwise go to waste.  Then there are those who argue that if Bain hadn’t liquidated such companies as Smith Corona, they might still be in existence, and that their employees might still have jobs.  Let’s get something straight, right here, and right now:  There is no entitlement to a job.  There is no guarantee of work.  When a person accepts a job working for others, he is taking a risk that is subject to all the same vagaries of the market as those who invest in it.  This notion that capital must be the risk-taker, while labor must never shoulder the burdens of risk is absurd.  As long as a person works for others, that employee is accepting as one of the inherent risks of such an arrangement that the job could end for any reason, tomorrow. To make the petulantly childish argument that employment should be without risk is a tired attempt to subvert capitalism with collectivist ethics, and I will be no party to that.

On the other side of this ledger, we have Mitt Romney who argues that what Bain Capital did was perfectly legal, ethical, and within the description of capitalism.  When it comes to this “vulture” function others have derided, he’s correct, and even in his statement that he likes to be able to fire people, he is committing no breach.  The truth is that I like to be able to fire people, and if you’ve ever worked in an environment wherein getting rid of incompetent employees is institutionally difficult, you’d understand why.  Nothing saps the strength of any company more than the incompetent, the slackers, or those simply not up to the job for which they were hired.  With all of this in mind then, let us make clear where Romney falls off the tracks and plummets into the abyss, if this isn’t it.

Romney’s problems with capitalism are birthed less of his actions while at Bain than while in the Governor’s office in Massachusetts.  Romney-care, the completely socialist Massachusetts program that is the logical forerunner of Obamacare, is as anti-capitalist as it gets, complete with an insurance mandate.  This may be the shortest argument in this article, but it’s the most important:  Any health-care mandate, and any redistributionism is flatly anti-capitalistic.  Romney can parade around with his faulty excuses for this program on the basis of federalism, but it doesn’t wash.   This program forces people to buy insurance, and that is a tyrannical, anti-free market, anti-capitalist assault on the rights of individuals.

Another problem with Romney is that he implemented other socialistic programs while Governor, including “Welfare Wheels.”  It’s impossible for Romney to claim that Romney-care was a one-off or some sort of aberration in an otherwise capitalistic record.  More, he favored TARP, and this by itself is as anti-capitalistic as can be described, and I really don’t understand how the defenders of Romney on this issue can avoid addressing this, because it has been one of the staggering expenses absorbed by tax-payers, and if Romney’s support of TARP is any indication of how he will govern as President, he is a walking disaster for all Americans, and for capitalism in general.  There’s also some indication that while at Bain Capital, he was one of several beneficiaries of a bail-out when the parent company, Bain Company, sought and received forgiveness of some $10million in debt from the FDIC.

One of the things that demonstrates the point is a statement Romney made during a CBS interview on Wednesday, via TheHill:

“In the general election I’ll be pointing out that the president took the reins at General Motors and Chrysler – closed factories, closed dealerships laid off thousands and thousands of workers – he did it to try to save the business.”

Romney is now holding forth Obama’s GM bail-out as an example?  This isn’t the view of a capitalist, and I want you to understand that when Romney holds forth this view, he’s become a statist. The truth may be closer to this, and it’s what Mark Levin said in the first hour of his show last night:  Mitt Romney may be less a capitalist, and more of a corporatist.

Understanding this vital distinction is to enlighten the difference at stake in this nomination fight.  Capitalism is a distinctly classically liberal ideology inasmuch as it requires a strict observance of individual liberties, and almost complete sovereignty for actors within the free market.  Corporatism is illiberal, meaning it relies on coercion of individuals on behalf of corporate entities.  In that sense, it can be accurately stated that corporatism is a non-monarchical development of feudalism.  In corporatism, dynasties are favored, and the ruling class may not exercise direct power, but instead command economic decisions through their influence over the state.  In effect, it’s another manifestation of what you know as “crony capitalism,” a concept recently revived by Sarah Palin and other critics, who have accurately pointed out how thoroughly corrupting such a system can be.  What is critical to know about corporatism is that in order to operate, there must be a strong and thorough collusion with state authority and intervention into the market.  It often co-exists with socialism, and in fact, this has been the operative condition of the United States since approximately the time of Teddy Roosevelt.

Progressives of both parties are those who have sought to unite the worst features of corporatism with the worst actions of socialism.  This is the true nature of Mitt Romney, and of his general governing demeanor.  This is why I cannot support him, in point of fact, but it is also why such critics of Romney as Gingrich and Perry have a difficult time engaging in credible criticisms of him: In various ways, they too have been guilty of the same basic flaws, to degrees greater or lesser.  The media that is defending Romney is a part of the corporatist front, and it’s clear when you view Fox News that in the main, that is the nature of their advocacy.  Many have noted in the last several months that Fox News seems less and less conservative, while becoming increasingly friendly to establishment Republicans.  Bill O’Reilly is the perfect example, but the continuous presence of Karl Rove is another.  Rove is merely a political strategist and public relations master for the progressive, corporatist front.

The truth is that we must defeat not merely socialism, but also corporatism, and the problem is that while Gingrich runs around making arguments from the point of view of a socialist, he does so in grotesquely erroneous  identification of Romney’s worst actions as those of a capitalist.   Gingrich dare not assail Romney as a corporatist, of course, because Newt has had his dalliances with corporatism too.  Clearly, Perry and Santorum also avoid this, and for precisely the same reason.

So it is that at the moment, in the GOP you have a battle among progressive corporatists and a single libertarian, but no true capitalists.

A Challenge to Gingrich, Perry, Romney

Tuesday, January 10th, 2012

Attacking or Governing Like Libs

A number of Republican candidates have begun to assail Mitt Romney on the basis of his time with Bain Capital, notably Newt Gingrich and Rick Perry, but the criticisms they level miss the mark in most respects, and worse, play upon the very worst arguments of leftists who say capitalism is inherently evil because it seeks profit and will occasionally lead to short-term job losses.  I have no problem criticizing Mitt Romney when it’s deserved, as these pages witness, but I have definite problems with this approach to attacking Romney.  It’s not that he’s immune to attack, and as I have covered, not everything ever done under the banner of Bain is beyond reproach, but this idea that buying companies, and subsequently liquidating them to turn a profit is a bad thing is quite obviously not one of them.

I have some pointed advice for former Speaker Newt Gingrich, and my own Governor, Rick Perry of Texas:  If you want to criticize Mitt Romney, stick to those parts of his record where he actually did something wrong.  Don’t berate him with the same things Obama will use to appeal to  his base, but instead concentrate on those things that appeal to the conservative base.  In short, focus on how Mitt Romney governed.

It’s amazing when even Ron Paul defends Romney on this point, while Gingrich and Perry attack.  None but the ignorant who live in a capitalist nation should have a problem with the aspects of capitalism that seek profit, sometimes by liquidating assets.  That’s not altogether unlike you having a garage sale and getting rid of things you aren’t using, or that are not up to snuff any longer, trying to recover some of their value before they become effectively worthless.  The money you re-capture by such a sale certainly helps you to pay other bills, or buy new items that more fully suit one’s purposes.  You can take the cash and invest it in a completely new venture.  This is an important function in any market, including in business, and to besmirch it as somehow wrong is a terrible disservice to the entire notion of capitalism.

I can name a number of things that Mitt Romney has done while governor of Massachusetts that deserve more than a little derision.  The problem is that neither Gingrich nor Perry are apt to say much about them, since they’ve advocated or  implemented similar.   Gingrich formerly favored healthcare mandates, and while he’s reversed his position on that, it’s hard for him to take pot-shots at Romney on this basis without somebody pulling out the label “hypocrite.”  Perry pushed for his Gardasil vaccine, and that too is a mandate, though of a different character and scale, but both speak to the same basic problem Romney has, and it’s worthwhile to note that where Gingrich and Romney differ on the healthcare insurance mandate is this:  Only Mitt ever actually imposed one.

I have addressed Romney’s imposition of health-care mandates and the various other programs of a socialist nature he imposed while governor of Massachusetts, and it’s true that in terms of what he has actually enacted, he is certainly the most socialistic big-government-inclined politician of the bunch.  He is definitely the candidate the media will attack most vigorously for both his vices and his virtues, but it is disappointing to see Gingrich and Perry attack on this basis.  If they’re smart, they’ll stop it, but part of the problem is that they’re falling into a well-laid trap set by the mainstream media:  The media is left-biased in the extreme, so what Gingrich and Perry are doing is to pick up the criticisms that will travel farthest in the media.  The media loves these attacks, and will revisit them many times over if Romney gets the nomination, but the attacks conservative Republicans should be aiming at Mitt Romney are not things the overwhelmingly liberal media wants to attack.

Falling for this is a terrible mistake, because it will not be the liberal media that chooses the Republicans’ nominee.  Gingrich is right to point out that Romney’s Massachusetts healthcare plan is a terrible leftist disaster, and that Obamacare had been largely modeled after it.  Perry would be right to raise Mitt’s “Welfare Wheels” program, or any of the other big government ideas that advanced while Romney was governor there.  Either would make perfect sense explaining how Romney was a friend of Teddy Kennedy’s legislative agenda, or how Romney was the beneficiary of crony capitalism on a few occasions.  Nobody on the conservative side would be offended by that.  The problem is that both of them are vulnerable on similar issues, and while perhaps to lesser degrees, they still have some explaining to do.  The problem is that it’s all the easier to simply attack Romney from a point of view more appealing to leftists in part because the media will transmit that message more willingly, but also in part because they believe they will get away with it.

I’d issue this challenge to Governor Perry and Speaker Gingrich:  Tell us the things about Mitt Romney’s record that condemn him as a big-government statist, and those things that mitigate the timber in your own eyes on these issues, and we’ll get along famously.  I’d issue a further challenged to Governor Romney:  Be prepared to explain in some sensible terms why tyranny imposed at the Federal level is bad, but at the state level, it’s no problem at all.  His pathetic “federalism” excuse for  Romney-care doesn’t cut it, and never has.   Governor Romney can impress the hell out of me by explaining to the American people why capitalism is good, but then he’s going to need to explain why he undertook so many programs and laws as the governor of Massachusetts that did nothing but undermine it.

This has been the sick irony of this insufficient field. It’s why 58% of Republicans don’t really like any of these candidates.  Gingrich and Perry had better drop the politically expedient attacks that are merely anti-capitalist rants, and instead hammer on Romney for those things that were egregiously offensive to liberty, and they’d better prepare when questions are raised about their own big-government reflexes.  Otherwise, voters just might get wise to this whole sad game, and walk away from the party this fall. After all, what is worse?  A nominee like Romney who would effectively govern like Obama, or a nominee who relies upon Obama’s tired class-warfare and anti-capitalist rhetoric?  Neither do I want a nominee who subverts capitalism in governing, nor do I want one who assails it in the press.  We need a president who will undertake to restore capitalism, and I don’t see much evidence that any of these three will do so.