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Obama Wants “Net Neutrality” Regulations. That’s Why We Should Oppose Them.

November 19, 2014

Here is a video of The President talking about net neutrality.

Sounds like he really wants to protect us, the little guys, from big corporations doesn’t it. Why should we believe the man who pushed a bill titled, “The Affordable Care Act”, which made healthcare less affordable. Is the term “Net Neutrality” any different from “The Affordable Care Act”. You can bet your life that Net Neutrality regulations will make the internet less neutral, less free, and more expensive.

This video is an example of the truth about Obamacare aka The Affordable Care Act. The administrations favorite economist when it came to Obamacare, Jonathan Gruber, is proud of the lies that were told in order to sell Obamacare to the public. When you watch this guy, you are actually watching what the President, his administration, and the Congressmen and Senators who voted for this, think about you.

Obamacare has made individuals less free to choose how they want to pay for their healthcare. Insurance companies were for this law because they thought they would benefit by its passage. With the stroke of the pen, the law created 30 million more costumers for insurance companies. The fact that it expanded Governments power over the individual makes politicians and bureaucrats happy. But who among us wouldn’t want our power expanded?

Net neutrality laws will help the already established tech companies and hurt the upstart competitors who, under normal market conditions, would normally be a check on the big providers. The threat of competitors trying to get market share keeps them in line. This is what Uber is doing to the taxi cartel. Big tech companies will be for this, or at least be tepid in their resistance to it. Once Government regulates the internet, these tech companies will be the protected cartel.

Politicians and bureaucrats will not only be able to tax the internet more easily, they will be able to make rules about content and access. Think of what bureaucrats (Lois Lerner) in the IRS did to stifle liberty minded groups from getting their message out. Politicians and bureaucrats are only in favor of free speech if they agree with what is said, they are never neutral when it comes to losing power.

Politicians and bureaucrats have been trying for years to figure out how to intervene into the internet. The internet is what has allowed our economy to grow in spite of the interventions by the Government and the Fed. Now, for some reason, the President and bureaucrats want to intervene into an area of the economy that has had exponential expansion without the “help” of Government regulations.

Tyrants want to control information because truth is never on their side. Since the internet is the marketplace for truth, even democratically elected tyrants want to have the ability to control and/or propagandize their message.

Even if the President and the FCC succeed in getting regulations, the internet Jeannie is out of the bottle. They will show their true tyrannical colors with these regulations, but the marketplace will find ways to deliver a highly demanded market good outside of these Government regulations. The tighter they squeeze, the more will slip from their hands.

 

Categories: Government and Politics
Tags: Affordable Care Act, Democratically Elected Tyranny, FCC, Government Regulations, Net Neutrality, President Obama

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Gruber Tells The Truth About Obamacare!

November 11, 2014

Jonathan Gruber was the go to guy when it came to lying about the Affordable Care Act. In this video he tells us what the anointed, (politicians, bureaucrats, academics, lawyers, and journalists), actually think about us the benighted masses. The public was sold a bill of goods that was a complete lie. But if you understood economics you knew the Affordable Care Act wouldn’t make healthcare “affordable”. How could adding a layer of bureaucracy to a healthcare system that was already deemed “unaffordable”, make healthcare affordable? It couldn’t.

This article, Jonathan Gruber Failed To Disclose His $392,600 Contracts With HHS, by emptywheel, at firedoglake.com, is another example of people thinking they are above the law, especially when they work for Government. Remember Treasury Secretary Tim Geithner forgot to pay his taxes when he was working for the International Monetary Fund (read here).

This arrogant ass sickens me to my core. Our founders told us not to trust anyone in positions of power. It is our fault we have allowed Governmental power to expand to the degree that it has today. It is our responsibility to try to roll it back. This is going to be a long fight because big Government progressives are entrenched in both parties.

The first article below was written in the fall of 2012, and the other was written in the fall of 2013. I think we nailed it.

Related Article – The Economics Of Healthcare vs. The Right To Healthcare, by austrianaddict.com.

Related Article – The Reality Of Obamacare, by austrianaddict.com.

Categories: Government and Politics
Tags: Affordable Care Act, Bureaucratic Arrogance, Economics of Healthcare, Jonathan Gruber, The Right To Healthcare

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The Fed Has Proved The Lefts “Trickle Down Straw Man” Doesn’t Work.

October 28, 2014

The left always comes up with words or phrases that ridicule the ideas and/or policies of their opponents with the intent of stopping any intelligent debate about the merits. In the 80’s, the policy of lowering tax rates for the purpose of economic growth, was called “trickle down economics” by the left in an attempt to convince shallow thinking people that this idea couldn’t possibly work. The term “trickle down” has been used by the left since the 80’s to torpedo any economic policy, especially tax cuts.

HILLARY: ECONOMIST EXTRAORDINAIRE

Here is Hillary Clinton using this tactic in a speech yesterday (10/24/14) at a campaign rally for Martha Coakly.  At the start of this short video she says, “…don’t let anybody tell you that, you know, it’s corporations and businesses that create jobs.”, which is similar to the President saying, “..if you got a business, you didn’t build that“, in a campaign speech from the 2012. Mrs. Clinton’s statement reveals either her total ignorance about economics, or her great insight into the economic ignorance of the audience. We could write a post answering this statement, but it’s the next line; “You know that old theory, trickle down economics.  That has been tried. That has failed. That has failed rather spectacularly.”, that this post will be about.

THOMAS SOWELL AND WALTER E. WILLIAMS SPEAK ABOUT “TRICKLE DOWN”

Economist Thomas Sowell has challenged anyone to name an economist from any economic school of thought who had actually advocated a “trickle down theory”. In this article from 2001, Capital Gains And Trickle Down, he states that there is no such thing as “trickle down theory”. The left uses the term to attack tax cuts by saying, their opponents want tax cuts that will help the rich first and the money will supposedly trickle down to the masses. So just to be clear they are saying that letting everybody keep more of what they produce by reducing tax rates is a “trickle down theory”. This theory they created is simply a straw man.

Economist Walter E. Williams talks about the fake war that has been fought against the “Trickle Down” straw man in this article, Trickle Down And Tax Cuts. This is a tactic used by all politicians in which they misrepresent (lie about) an opponents idea or policy, setting up a straw man, in order to argue against this false premise instead of debating their opponent head on. In this case the left sets up the “Trickle Down” straw man to try to win the tax cut argument.

These two articles are really great especially the examples they give. Here are some excerpts from Thomas Sowell’s article.

“But free-market economics is not about “distributing” anything to anybody. It is about letting people earn whatever they can from voluntary transactions with other people.”

“Those who imagine that profits first benefit business owners — and that benefits only belatedly trickle down to workers — have the sequence completely backward. When an investment is made, whether to build a railroad or to open a new restaurant, the first money is spent hiring people to do the work. Without that, nothing happens.”

“Money goes out first to pay expenses and then comes back as profits later — if at all. The high rate of failure of new businesses makes painfully clear that there is nothing inevitable about the money coming back.”

” No one who begins publishing a newspaper expects to break even — much less make a profit — during the first year or two. But reporters and other members of the newspaper staff expect to be paid every payday, even while the paper shows only red ink on the bottom line.”

“In short, the sequence of payments is directly the opposite of what is assumed by those who talk about a “trickle-down” theory.”

Here are some excerpts from Walter E. Williams article.

“Trickle down is a nonexistent theory. Those who use it simply argue against a caricature rather than confront an argument actually made.”

“You can bet that the White House has people reading every bit of the news, including this column and Dr. Sowell’s article. You can bet some people in the news media will read it, as well. Despite the facts that Sowell has marshaled, they will continue to use trickle down theory and “tax cuts for the rich” demagoguery, even though they now have hard evidence to the contrary, because they can count on widespread gullibility and inability to do critical thinking.”

THE FEDS MONETARY POLICY, IS THE TRICKLE DOWN STRAW MAN

Getting money in the hands of the rich with the idea that it will trickle down through the rest of the economy is the straw man the left says won’t work. They are correct. The Feds loose money policy since 2000 is proof that it doesn’t work. Instead of letting individuals keep what they produce by lowering taxes, the Fed electronically prints counterfeit money and gives it to the top 1%. The Fed has printed a total of  $7 trillion since 2000 (click here) with $4 trillion of that being printed since 2008. Click here to see what has happened to the real median household income since this counterfeiting started before 2000. It has gone down.

The Fed injects electronically printed counterfeited money into the economy by purchasing mortgage-backed securities, from banks, and treasury bonds, from the Federal Government. The banks and the Federal Government have first access to the counterfeit money. Everyone in the immediate orbit of the banks and the Federal Government benefit secondarily from this printed money, you and I don’t benefit. Look at the charts in this article, Abolish The Engine Of Inequality: The Federal Reserve, by Charles Hugh Smith. They show that the  income and wealth of the people with access to the Feds counterfeit money has grown. And the wealth of the rest of us is stagnant or shrinking. The more the Fed prints the bigger the gap.

CONCLUSION

The Feds experiment of giving their counterfeit money to the people at the top and hoping it will trickle down has been going on since before the tech bubble popped in 2000. The tech bubble lead to the housing bubble that popped in 2008, which lead to the current financial bubble that will eventually liquidate itself at some point. The counterfeiting by the Fed created these bubbles in the first place. In the words of economist extraordinaire Hillary Clinton, “It has failed rather spectacularly“. She is correct. Trickle down economic theory defined by the left, as giving money to the wealthy in the hopes that it will trickle down, doesn’t work. Unless the goal was to make the first receivers of the money wealthier at the expense of the rest of us. But who could possibly be cynical enough to think that?

 

Related Article – Real Savings vs. Counterfeit Savings, by austrianaddict.com.

Related Article – A Tornado vs. The Fed, Which Is More Destructive, by austrianaddict.com.

 

 

 

 

Categories: Econ. 201, Government and Politics
Tags: Electronically Printing Counterfeit Money, Feds Monetary Policy, Financial Bubble, Hillary Clinton, Housing Bubble, Tax Cuts For The Rich, Tax Rate Reductions, Tech Bubble, The Federal Reserve, Thomas Sowell, Trickle Down Economics, Trickle Down Straw Man, Walter E. Williams

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George Will: Faith In Government?

October 19, 2014

George Will was on Fox News Sunday, and here are his comments to the questions, 1)Can we have faith in Government? and 2) Can we trust the Government to do its job?

Here are the highlights from his comments.

“…you asked: ‘can we have faith in Government’? I think we have much more to fear from excessive faith in Government than from to little faith in Government.”

“You asked: ‘can we trust the Government to do its job’? What isn’t it’s job nowadays…this is a government that doesn’t know when to stop.”

“The distilled essence….of progressivism is that Government is benign, that it’s a disinterested force. That’s false,  and b) it is stocked with experts who are really gifted at doing things…..Republicans do this Democrats do this also…a common theme is excessive faith in the skills of Government.”

GOVERNMENT DOESN’T MAKE DECISIONS, INDIVIDUALS IN GOVERNMENT DO.

When we use the word Government we mean individuals in Government. Government doesn’t make policy and decisions, individual politicians and bureaucrats make policy and decisions. The reason these politicians have the power to make and implement certain decisions is because “we the people” set up the frame-work of Government that allows them certain areas in which to legislate. We also elect these politicians to sit in the seat of power. Unfortunately we have allowed them to ignore the boundaries that surround their power, because we don’t hold them accountable once they are elected.

Here are some examples of incompetence at different levels of Government. 1) The Nurse who flew to Akron after being exposed to Ebola, had contacted the Center for Disease Control twice asking them if it was alright to fly, and they said yes (read here). 2) The Parents who called the cops to help with their mentally ill son who locked himself in his room and threatened to harm himself. Eleven shots later their son was dead. The police succeeded in not letting him harm himself (watch here). 3) A 5-year-old girl pointed a crayon at a class mate, and school officials punished her by making her sign a contract that she wouldn’t kill anyone or commit suicide (read here). 4) Need we say more than the Obamacare web site that cost $2 billion (read here). This list is literally endless.

Here is a George Gilder quote about big Government, “The ambitious agenda of contemporary liberalism simply ensures that Government will do nothing well, except to expand itself as an obstacle of growth and innovation. Government best supports the future by refraining as much as possible from trying unduly to shape it.”

It is our fault that we have arrived at this point where Government is this big. We are the only ones who can reel this monster in, because politicians and bureaucrats will never vote to reduce their power.

Related Article – “I’m From The Government And I’m Here To Help“, by austrianaddict.com.

Related Article – Tyranny Is Hidden Inside The Bureaucratic Maze, by austrianaddict.com.

Related Article – Proof Once Again That Power Corrupts, Will We Have Enough Courage To Believe It This Time, at austrianaddict.com.

 

 

Categories: Government and Politics
Tags: Big Government, Faith In Government, George Gilder, George Will, Incompetent Government, Progressivism

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Are We Losing Economic Freedom?

October 15, 2014

Capitalism 3D sphere Word Cloud Concept with great terms such as economic, private, free and more. - stock photo

The Fraser Institute published a paper titled, Economic Freedom Of The World: 2013 Annual Report, which shows how the US is in the slow lane on the Road to Serfdom, because we as individuals have lost economic freedom over the past 12 years. Economic freedom is nothing more than each individual deciding what to produce, consume, exchange, and save without anyone, especially Government bureaucrats, hampering or intervening in his activities. Individuals are less free today than they were in 2000.

Scroll down to page 148 in the report to see the statistics for the United States in different categories related to freedom, from 1980 to 2011. The report rates 154 countries on economic freedom, with a 10 being the highest rating. It also ranks each country in order of most free to least free. Our freedom rating and rank has dropped since our high in 2000.

CATEGORY     (rate/rank)                    80               90              00               11

UNITED STATES

Summary  (rating/rank)                  7.92/3      8.35/3      8.65/2        7.74/19

Size of Government                           5.08/49    6.71/24   7.03/34    6.83/47

Legal System/Property Rights     8.35/1       8.35/10   9.23/9        6.93/38

Sound Money                                      9.22/5       9.68/7      9.78/2       9.30/36

Freedom Of Trade Inter.                8.77/7       8.77/11    8.78/22    7.92/30

Regulation                                            8.11/4         8.23/4      8.43/2       7.75/17

 

Below is Hong Kong’s summary rating and rank for economic freedom. Go to page 62 to see a more detailed report on Hong Kong.

HONG KONG                                              80                90                00               11

Summary  (rating/rank)                 9.02/1        8.59/1       8.86/1        8.87/1

Hong Kong was under British rule for 156 years until 1997 when it was turned over to China. Hong Kong has had more economic freedom under British colonial rule, and Chinese communism than the US has had under a constitutional republic with leaders elected democratically. People in Hong Kong have been protesting recently because it looks like China is going back out on its promise to allow democratic elections in 2015. The people in Hong Kong should take a look at the US to see what democratic elections have done to our economic freedom, before they go all in for democracy. Democracy is just one possible means for gaining individual freedom, but it is no guarantee of individual freedom. Read, Thomas Sowell Explains How Democracy And Freedom Are Not The Same Thing.

Three of the categories, listed in the above article, that the Fraser Institute rates and ranks countries on their level of economic freedom are; legal system/property rights, regulation, and sound money. The US has decreased in rate and rank in these three categories over the last decade.

REGULATION

The Affordable Care Act (Obamacare) is just one example of  the thousands of pages of regulations, passed by congress and signed into law by the President, that take away economic freedom by imposing  huge costs on businesses. Where does the Government get the power to interfere with an individuals right to make a contract with another party on how he chooses to pay for his healthcare? Nowhere in the constitution do politicians and bureaucrats have a right to do this. They’ve usurped the power from us, and the Supreme Court, which has turned into a nine seat legislature, uphold their lawlessness. Read Regulatory-Industrial Complex, by Lew Rockwell, at mises.org, for more analysis on what regulation does to economic freedom.

SOUND MONEY

We could talk endlessly about how important sound money is for economic freedom, but here is the short version. When the Federal Reserve electronically prints counterfeit money, it is theft. What you produce each day at work is represented in the money your employer gives you in exchange for your labor. You in turn can demand goods and services with the money you are paid. The stable purchasing power of the monetary unit is what sound money guarantees. When the Federal Reserve electronically prints counterfeit money, it is decreasing the purchasing power of each dollar you have, and therefore stealing your production. If you or I counterfeit money it is theft. If the Fed counterfeits, it is still theft, it is simply theft that is sanctioned by the legislative, executive, and judicial branches of Government. Read, Is The Surge In Capital Goods Orders Do To Malinvestment, by Frank Shostak, at mises.org, to understand what happens when the Fed counterfeits.

PROPERTY RIGHTS

Without property rights there is no economic freedom. If an individual has no assurances that what he produces or owns can’t be taken away, then economic freedom is just meaningless rhetoric by politicians. There is the obvious taking of property through eminent domain laws (Kelo vs. New London), civil asset forfeiture laws, federal taxes etc, and then there is the unseen taking of property through the cost of complying with regulations, and out right stealing it by electronically printing counterfeit money. Read “Human Rights As Property Rights, by Murray N. Rothbard, at mises.org, to see how property rights are the foundation of economic freedom.

As F. A. Hayek said, “the battle for freedom must be won over and over again, the socialists of both parties must be persuaded or defeated if they and we are to remain free men.” These words are more true today then when he wrote them.

 

-I found the, Economic Freedom Of The World: 2013 Annual Report, in this article titled, The “Land Of The Free” Ranks 36th In The World In Respecting Property Rights, at zerohedge.com.

 

 

 

 

Categories: Econ. 101, Government and Politics
Tags: Annual Report On Economic Freedom, Federal Reserve Counterfeiting, Fraser Institute, Hong Kong vs The US, Obamacare, Property Rights, Regulations, Regulator - Industrial Complex, Sound Money

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Hillary And Benghazi: Call In The Cleaners!

September 24, 2014

Young caucasian businessman shredding documents - stock photo

A cleaner is a person who gets rid of incriminating evidence at the scene of a crime. A cleaner is usually related to crime fiction novels, but in the case of the Clintons the line between fiction and reality may not be as blurry as you might think.

SHARYL ATTKISSON ARTICLE ABOUT BENGHAZI

I read an article last week by Sharyl Attkisson about former Deputy Assistant Secretary of the State Department, Raymond Maxwell,  alleging that Hillary Clinton cronies cleaned potentially damaging documents, from State Department headquarters, concerning the Benghazi terrorist attacks (read article here). Hillary Clinton’s chief of staff Cheryl Mills was at the cleaning party. I’m not going to go over the whole article, you can read it for yourself.  I’m much more interested in one question: Do you believe these allegations or not?

ISOLATED INCIDENT OR DISCERNIBLE PATTERN OF ACTION?

If you look at this incident in isolation your first question would be: is the reporter credible? Sharyl Attkisson was a CBS news investigative journalist for 20 years before she resigned in March 2014 (read why she resigned here). She has main stream media credibility, until such time that the mainstream media decides to undercut her credibility for writing this article. In isolation this incident comes down to who you believe, Sharyl Attkisson”s reporting and the credibility of Raymond Maxwell, or a State Department spokesman who called the allegations that documents were withheld, “totally without merit”.

The question really isn’t who do you believe? The question should be: is this an isolated incident or is this part of a discernible pattern of action? Lets see if we can find a discernible pattern.

SANDY BERGER CLEANS EVIDENCE

Remember Sandy Berger former National Security Adviser Under Bill Clinton. He was convicted of stealing  classified documents from the National Archives, concerning Clinton’s efforts to thwart terrorist threats. He did this before the 9/11 commission could get these documents. His actions suggest he was cleaning documents to protect the Clintons from looking weak on terrorism. These documents were never recovered. Read this article, Berger Thefts Still Weigh On Archives Agents, if you need your memory refreshed.

CLEANERS TAKE CARE OF ROSE LAW FIRM RECORDS

In the summer of 1992, before the election, and in December of 1992, after the election, Couriers of the Rose Law Firm, which Hillary worked at in Little Rock Arkansas, said Hillary called them to the Governor’s Mansion giving them her and law partners  Foster,  Hubble, and Kennedy’s records to have them shredded at the Rose Law Firms Offices. When special counsel began to investigate in early 1994, Rose Law Firm partners admitted they shredded more files but stated these were unrelated to Whitewater. When Deputy White House Counsel Vince Foster committed suicide on July 20, 1993, White House aides entered his office that evening and the next day. The fact that Foster was in possession of Whitewater files was not mentioned (read Shredding Foster’s Files here). On July 22, White House Counsel Bernard Nussbaum gives the box of Whitewater files to Hillary’s chief of staff Margaret Williams who took the files to the White House living quarters on the third floor and locked them in a closet, after talking to Hillary. These files were discovered on Janruary 4th, 1996 by Special Assistant to the President Ms. Carolyn Huber, and delivered to the Whitewater Committee the next day by Clintons lawyer David Kendall (read Rose Law Firm Billing Records here).

The firing of Billy Dale from the travel office, and finding out who hired cleaner Craig Livingstone, are two more examples of similar conduct.

CONCLUSION

There is a clear pattern of cleaners being used by the Clintons. The question now becomes: Is this enough of a pattern of action to help you make up your mind about the most recent cleaning of records pertaining to Benghazi? Remember human action is purposeful behaviour used to reach a particular end. The end aimed at is believed to be a better state of affairs than what exists at the moment of the action. The preferred end can be revealed by looking at the action taken. At the very least we can say the Clintons don’t want us to know about their previous actions. I think we can take a guess as to why the cleaning took place.

 

 

 

 

 

 

 

 

 

Categories: Government and Politics
Tags: Benghazi, Call In The Cleaners, Discernible Pattern, Hillary Clinton, National Archives, Raymond Maxwell, Rose Law Firm Records, Sandy Berger, Sharyl Attkisson, Shredding Documents, Vince Foster's Files

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The Break Down Of The Rule Of Law

September 18, 2014

Law book library - stock photo

The rule of law is defined as, 1) general rules, 2) known in advance, 3) applying to the rulers as well as the ruled. How does the break down of the rule of law happen? Because there are too many rules to even count, the “general rules” part of the definition of the rule of law doesn’t exist. The increasing amount of rules makes it impossible to know them in advance. But the third part of the definition, applying to the rulers as well as the ruled, is the part that is starting to bother people. Abuses of power and corruption by individuals who are protected by their positions of power in Government are starting to result in a push back by the public.

Here are a couple of examples of Government agents abusing power.

1) TSA Officer Tries To Search Passenger After He Lands At Denver Airport.

This guy did a great job and could have walked away a minute before he did.

 

2) A Lesson In Police Escalation (here), at economicpolicyjournal.com.

If the cop was an NFL player and did this, he would be out of a job.

The result of what we see happening in the above clips will be a natural push back by the average citizen. The passenger walking away in the video above is an example of push back. We should all start peaceful non compliance because if we don’t, it will escalate into what you will see in these videos below. Both sides have to dial it back, because the cost of settling our differences through mob (thug) rule, on both sides, will be greater than if we settle our differences before we get to mob rule.

3) Angry Mob Throws Ukrainian Politician In Dumpster.

I can’t say I didn’t get a chuckle out of this video.

 

4) Airline Passengers Throw Elitist Politicians Off Plane, (here), at economicpolicyjournal.com.

A planes departure time was delayed for two hours as the crew waited for two Pakistani politicians to arrive. The passengers were so upset, they forced the politicians off the plane. I got a kick out of this one too.

These videos show each group using force against the other. The police side uses the sanctioned force of government, to enforce non general rules, that are not know in advance, and don’t apply to the rulers but must be obeyed by the ruled. The citizenry uses the perceived power of a larger group of people who are not going to back down. How far will this escalate before Government gives up a huge portion of it’s power?

Related Article – The Ruling Aristocracy Doesn’t Abide By The Rules They Impose On The Serfs, by austrianaddict.com.

Related Article – The Result Of The Break Down Of The Rule Of Law, by austrianaddict.com.

 

 

 

 

Categories: Government and Politics
Tags: BART Officer Over Reaction, Break Down Of The Rule Of Law, General Rules, Mob Rule, TSA Officer Over Reach, Ukrainian Politician In Dumpster

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Why Has Classical Capitalism Devolved Into Crony-Capitalism, by Charles Hugh Smith

September 16, 2014

In this article, Why Has Classical Capitalism Devolved Into Crony-Capitalism, Charles Hugh Smith, (oftowminds.com) makes the point that the Elites, consisting of ; people in Government and central bankers, lesser institutions that are closest in orbit around Government and central banks, and organizations and individuals who are orbiting these lesser institutions, think the economy will eventually “heal itself” even after all they have stolen through zero percent interest rates, electronically printed counterfeit money, and Government debt. These three legs of theft are, quoting CHS, “…crippling the market’s self-healing immune system: Price discovery. Thanks to ceaseless interventions by central banks, the price discovery mechanism has been shattered: want to know the price of risk? It’s near-zero. Yield on sovereign bonds? Near-zero. And so on. Prices have been so distorted (the ultimate goal of Central Planning everywhere, from China to the EU to Japan to the U.S.) that the illusion of stability is impossible without more intervention.”

Here are his six factors of how, “...free market capitalism becomes state-cartel crony-capitalism, a Ponzi scheme of epic proportion...”

1. “Those who control most of the wealth are willing to risk systemic collapse to retain their privileges and wealth. Due to humanity’s virtuosity with rationalization, those at the top always find ways to justify policies that maintain their dominance and downplay the distortions the policies generate. This as true in China as it is in the U.S.”

2. “Short-term thinking: if we fudge the numbers, lower interest rates, etc. today, we (politicians, policy-makers, money managers, etc.) will avoid being sacked tomorrow. The longer term consequences of these politically expedient policies are ignored.”

3. “Legitimate capital accumulation has become more difficult and risky than buying political favors. Global competition and the exhaustion of developed-world consumers has made it difficult to reap outsized profits from legitimate enterprise. In terms of return-on-investment (ROI), buying political favors is far lower risk and generates much higher returns than expanding production or risking investment in R&D.”

4. “The centralization of state/central bank power has increased the leverage of political contributions/lobbying. The greater the concentration of power, the more attractive it is to sociopaths and those seeking to buy state subsidies, sweetheart contracts, protection from competition, etc.”

5. “Any legitimate reform will require dismantling crony-capitalist/state-cartel arrangements. Since that would hurt those at the top of the wealth/power pyramid, reform is politically impossible.”

6. “Understood in this light, it’s clear that central bank monetary policy—zero-interest rates, asset purchases, cheap credit to banks and financiers, QE, etc.—is designed to paper over the structural problems that require real reform.”

 

CHARLES HUGH SMITH INTERVIEW

If you want to hear an interesting and in-depth explanation about the rise of crony capitalism, listening to Charles Hugh Smith’s interview with Gordon T. Long would be well worth your time ( it also has some great graphs and diagrams).

Related Article – Central Bank Monetary Policy Enables Us To Put Off Real Reforms, by Charles Hugh Smith, at oftwominds.com.

Related Article – Is There Capitalism After Cronyism?, by Charles Hugh Smith, at oftwominds.com.

 

Categories: Econ. 201, Government and Politics
Tags: Central Planning, Charles Hugh Smith, Electronically Printing Counterfeit Money, Free Market Capitalism, Gordon T. Long, Macro Analytics, Price Discovery, State-Cartel Crony-Capitalism, Zero Interest Rate Policy

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What Creates Wealth? Freedom

September 10, 2014

Front Cover

George Gilder talks about what creates wealth in this short video below from Prager University. He talks about knowledge and innovation leading to economic growth. But the most important point he makes in this video is that freedom is the foundation on which knowledge and innovation is expanded and used productively to create economic growth. Here are some excerpts from the video.

“If freedom promotes knowledge and innovation, which leads to economic growth; why don’t all people and Governments embrace it? Innovation is a surprise, it’s unpredictable. This unpredictability makes many people uncomfortable. Their goal is to eliminate surprise. One finds this in all utopian vision, from communism, to socialism, ….in Europe with its failing welfare states and more and more in the US. We see their desire to eliminate surprise in the ever-expanding role played by Government, bigger bureaucracies, more rules, and more regulations. Every new crisis, real or imagined, brings ever more laws….Ironically the ones that benefit from all these regulations are big corporations and their teams of lawyers, lobbyists, and accountants. They’re the only ones who have the resources to untangle the mess and survive it. This drift away from freedom can be reversed, and quickly within a matte of a few years….Because it’s an economy of mind, the future can change as fast as minds can change. The opportunity for dynamic growth exists not only in the US, but all over the world if we’re only courageous enough and free enough to seize it.”

WHAT CREATES WEALTH?

Here are some related quotes by George Gilder from his books  Wealth and Poverty and Knowledge and Power.

“Socialist and totalitarian Governments are doomed to support the past, because creativity is unpredictable, it is also uncontrollable. If the politicians want to have central planning and command, they cannot have dynamism and life. A managed economy is almost by definition a barren one. “

“Knowledge is about the past; Entrepreneurship is about the future regulations are rules based on past experience. Regulators are political appointees responsive to their bosses and to the rules. Only entrepreneurial owners taken their cues from the subtle signals on the crests of creation.”

“Under capitalism, economic power flows not to the intellectual, who manipulates ideas and basks in their light, but to men who gives himself to his ideas and tests them with his own wealth and work.”

“The real issue is between the rule of law and the rule of leveler egalitarianism, between creative excellence and covetous “fairness”, between admiration of achievement versus envy and resentment of it.”

“The leading enemy and obstacle for accomplishment throughout the ages is the philosophy of victimization and socialist redistribution.”

In my opinion Wealth and Poverty is a must read, not only because it will expand your mind, but also because his writing style will be pleasing to your ear buds.

Related Article – Unleash The Mind, by George Gilder, at austrianaddict.com.

Related Article – Capitalism vs. Crony Capitalism, at austrianaddict.com.

 

Categories: Econ. 101, Government and Politics
Tags: Economic growth, Freedom, George Gilder, Knowledge and Power, Prager University, Wealth and Poverty, What Creats Wealth

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New (Old) Information About Benghazi: “What Difference…Does It Make?”

September 9, 2014

The release of the new book, 13 Hours: The Inside Account Of What Really Happened In Benghazi, a first hand account by the security operators who were on the ground fighting in Benghazi, tells us they were given an order to stand down and not go help at the State Department Compound that was under attack on 9/11/12. They don’t know how far up the chain of command the order came from. They disobeyed and went anyway after they were delayed. I saw these three men interviewed on Fox News (here).

I watched this interview thinking only of the comment that Secretary of State Hillary Clinton made at the Senate hearings about Benghazi in January of 2013, “…the fact is we have four dead Americans. Was it because of a protest, or was it because it was guys out for a walk one night who decided to go kill some Americans. What difference, at this point, does it make?”

I think this question by Secretary of State Clinton is “the” question that we should be thinking about. Mrs. Clinton, you are correct, “at this point”, in January 2013, the question of how this truly happened “doesn’t make a difference” from a political standpoint. The truth about Benghaze only had major political significance if would have been told before the November election in 2012, and quite possibly it “could have made a difference”. And that’s the whole point. Gaining, or remaining in, the seat of Government power, through the political process, is the most important thing to politicians. And everything, including the lives of individuals, is to be sacrificed at the alter of politics.

HUMAN ACTION EXPLAINS POLITICAL ACTION

I wrote an article titled, Mises’ “Human Action” Explains Lies About Lybia, that sums up the thinking of politicians. Here are some excerpts from the article that are even more true today than when I wrote them in October 25th 2012. Here are excerpts from the article.

“Here is how “Human Action” by Ludwig von Mises helps us analyze the Libyan situation. Human action is purposeful behavior. Action is not simply a verbal preference, it is the individual choosing and acting to reach a particular end. Action is a tangible thing and cannot be confused with wishes, hopes, or after the fact quarterbacking. Men act to substitute what they think will be a more satisfactory state of affairs for a less satisfactory state. We wouldn’t want to change our existing state of affairs if we didn’t think the result would be better. Our action reveals the correctness of our thinking. When a baseball manager makes a decision during a game he does it because he thinks it will help his team win the game. After the fact we can judge if his decision was correct or incorrect in attaining his goal, but that doesn’t mean we would have made a different or better decision than he did, because we cannot recreate that point in history exactly as it was. The science of human action is called praxeology it studies the action itself. Psychology studies the internal events that result in action. It studies the forces pushing a man toward a particular action. Psychology is where Monday morning quarterbacking takes place. Praxeology is where we can analyze success and failure. Lets look at Libya through these lenses.”

“Every Administration has the right to make its own policy about how heavy of a security footprint it will have at any one embassy. You can argue about which policy will achieve the particular goal an administration wants to achieve. What that particular goal is, may be misunderstood. For some administrations the goal is the safety of the people in the Embassy. For others the goal is what the people in a particular country will think if too much power is shown. There are obviously many degrees of security between completely locking down an embassy with every asset you can bring to bear, and simply allowing the people at the embassy to carry a sidearm. There are many foreign policy goals each administration is trying to attain, and security for their people may be sacrificed for these goals. The choice the administration makes is up for discussion and debate before anything happens. After the decision proves to be incorrect, we can say it didn’t work to achieve the end sought,  assuming we knew the true goal of the administration beforehand. The end sought may not have been the security of the people. We can say the Obama Administration’s decision in Benghazi didn’t work from a security standpoint, just as we can say the Reagan Administration’s decision in Beirut didn’t work from a security standpoint. But we don’t really know if security was the primary goal in either situation.”

“What we know is that all politicians are self-interested individuals, and remaining in power is their main goal. This is the over-riding goal of every decision they make. They hire advisers to specifically look at everything they do and determine how it will affect them politically. If it is not the over-riding factor in decision-making, it certainly has a major influence in all decisions. This is my problem with the deaths in Libya. From the standpoint of security it was a failure, fine admit it and adjust. When you know what was going on within an hour of the start of the attack, and you put forth a story that’s untrue, and stick with it for weeks even as the truth starts to leak out, it tells me you have no other interests above yourself. You denigrate the lives of the fallen, you insult our intelligence, and you erode whatever trust remains, which is probably a good thing for liberty.”

“Every action that has been taken since the attacks began, is purposeful action toward the attainment of a more satisfactory state of affairs. Every lie told and photo-op taken was an attempt to reach a particular end, this is the science of human action. Since the situation was and is constantly changing, each day’s purposeful actions seemingly contradict the previous day’s purposeful actions. This contradiction only makes sense if we know the true ends sought. The end sought is to hold on to power through any means necessary. The administration believes their purposeful actions will result in them holding on to their power. We will find out in two weeks if their purposeful actions are correct or incorrect.

POLITICAL SPIN, AKA. LYING.

Parents of the fallen have said that Hillary Clinton told them, a video was responsible for the attacks, and she vowed to have the film maker arrested and prosecuted, read here. She told them this at a ceremony the day the bodies arrived at Andrews Air Force Base. If she lied in a situation where there were dead bodies and grieving families, wouldn’t she, and all politicians, lie to protect their own political power in every situation? They probably lie about trivial things in order to keep their skills sharp for the big things like Benghazi.

This is why I hate politics. The incentive to gain power or to remain in power overrides everything from a political perspective. Politics interferes with everything, and I mean everything, concerning our daily lives. We are being spun, or lied to, everyday. We can be inoculated from the spin, or lies, if we understand the concept of Human Action, and see all things through its lens.

Related Article – Human Action Reveals The Reality About Political Decisions, by austrianaddict.com.

Categories: Government and Politics
Tags: 13 Hours Inside Benghazi, Benghazi Attacks, Mises Human Action, November Elections, Political Spin, Praxeology, Purpouseful Behavior, Secretary of State Clinton, Security Footprint, State Department Compound

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F. A. HAYEK

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"THERE IS NO SUBTLER, NO SURER MEANS OF OVERTURNING THE EXISTING BASIS OF SOCIETY THAN TO DEBAUCH THE CURRENCY. THE PROCESS ENGAGES ALL THE HIDDEN FORCES OF ECONOMIC LAW ON THE SIDE OF DESTRUCTION, AND DOES IT IN A MANNER WHICH NOT ONE MAN IN A MILLION IS ABLE TO DIAGNOSE."

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F.A. Hayek - "Since the value of freedom rests on the opportunity it provides for unforseen and unpredictable actions, we will rarely know what we lose through a particular restriction of freedom."

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Matthew McCaffrey - "Building a freer society means winning the battle of ideas, not the empty contests put on by the central Government every four years. Freedom is never obtained by endorsing the least offensive applicant for the position of chief villain."

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Ludwig von Mises - "The middle system of property that is hampered, guided, and regulated by government is in itself contradictory and illogical. Any attempt to introduce it in earnest must lead to a crisis from which either Socialism or Capitalism alone can emerge."

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F. A. Hayek - "While it may not be difficult to destroy the spontaneous formations which are the indispensable bases of a free civilization. It may be beyond our power deliberately to reconstruct such a civilization once these foundations are destroyed."

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Murray Rothbard - "The market promotes and rewards the skills of production and voluntary cooperation. The Government enterprise promotes the skills of mass coercion and bureaucratic submission...and those who get to the top will be those with the most skill in that particular task."

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John Adams - "Government is instituted for the common good: for the protection, safety, prosperity, and happiness of the people. And not for profit, honor, or private interest of any one man, family, or class of men..."

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Milton Friedman - "Underlying most arguments against the free market is a lack of belief in freedom itself."

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Chris Rossini - "The state is a monster that destroys. Those who gain control of the levers, choose the targets."

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Murray Rothbard -"It is no crime to be ignorant of economics...but it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance."

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Murray Rothbard -"Democracy can be only a possible route toward a free society rather than an attribute of it. In a purely free society there would be nothing for democratic electors to vote about."

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Robert Bradley Jr. - "When Government tries to pick winners and losers, it typically picks losers. Why? Because the Free market consumers pick winners to leave the losers for Government."

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Benito Mussolini - "Fascism should more appropriately be called corporatism because it is a merger of state and corporate power."

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Ludwig von Mises - "Men must choose between the market economy and socialism....some agency must determine what should be produced. If it is not the consumer by means of demand and supply on the market, it must be the Government by compulsion."

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Henry Hazlitt - "The question is not whether we wish to see everybody as well off as possible....the real question concerns the proper means of achieving it. And in trying to answer this we must never lose sight of a few elementary truisms. We cannot distribute more wealth than is created. We cannot in the long run pay labor as a whole more than it produces."

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Murray Rothbard - "Whether or not man lives at the level of poverty or abundance depends upon the success that he and his ancestors have had in grappling with nature and in transforming naturally given resources into capital goods and consumers goods.... Free markets tend to lead to abundance for all of its participants.... violent intervention in the market and a hegemonic society tend to lead to general poverty."

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Ludwig von Mises - "Inflation and credit expansion are the means to obfuscate the fact that there prevails a nature-given scarcity of the material things on which the satisfaction of human wants depends. The main concern of capitalists private enterprise it to remove this scarcity as much as possible and to provide a continuously improving standard of living for an increasing population.....but however remarkable these improvements may be, there will always be a strict limit to the amount that can be consumed without reducing the capital available for the continuation and, even more, the expansion of production."

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Ludwig von Mises - " It is impossible to grasp the meaning of the idea of sound money if one does not realize that it was devised as an instrument for the protection of civil liberties against despotic inroads on the part of Governments. Ideologically, it belongs in the same class with political constitutions and bills of rights."

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Murray Rothbard - "To reduce the working population while the consuming population remains undiminished is to lower the standard of living."

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Murray Rothbard - "Increasing the money supply confers no social benefit. It relieves no economic scarcity. It simply benefits some at the expense of others."

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Ludwig von Mises - "Political ideas that have dominated the public mind for decades cannot be refuted through rational arguments, they must run their course in life and cannot collapse otherwise than in great catastrophe."

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Milton Friedman - "A society that puts equality- in the sense of equality of outcome- ahead of freedom will end up with neither equality nor freedom. The use of force to achieve equality will destroy freedom, and the force introduced for good purposes, will end up in the hands of people who use it to promote their own interests."

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F. A. Hayek - "It has already been suggested that it is not necessary, for the working of this free market capitalist system, that anybody should understand it. But people are not likely to let it work if they do not understand it."

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C. S. Lewis - "Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber barons cruelty may sometimes sleep, his cupidity may at some point be satiated; But those who torment us for our own good will torment us without end for they do so with the approval of their own conscience."

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Ludwig von Mises - "For the naive mind there is something miraculous in the issuance of fiat money. A magic word spoken by the Government creates out of nothing a thing which can be exchanged against any merchandize a man would like to get."

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Ludwig von Mises - "Many think that governments are free to achieve all they aim at without being restrained by an inexorable regularity in the sequence of economic phenomena....they maintain that the state is God."

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George Gilder - "Under capitalism, economic power flows not to the intellectual, who manipulates ideas and basks in their light, but to men who gives himself to his ideas and tests them with his own wealth and work."

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Thomas Sowell - "Perhaps the greatest achievement of market economies is in economizing on the amount of knowledge needed to produce a given economic result. That is also their greatest political vulnerability."

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Ludwig von Mises - "Anti capitalistic policies sabotage the operation of the capitalist system of the market economy. The failure of interventionism does not demonstrate the necessity of adopting socialism. It merely exposes the futility of interventionism. All those evils which the self-styled "progressives" interpret as evidence of the failure off capitalism are the outcome of their allegedly beneficial interference with the market."

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F.A. Hayek - "The battle for freedom must be won over and over again, the socialists of all parties must be persuaded or defeated if they and we are to remain free men."

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F. A. Hayek - "Planning, or central direction of economic activity, presupposes the existence of common ideals and common values; and the degree to which planning can be carried is limited to the extent to which agreement on such a common scale of values can be obtained or enforced."

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Thomas Sowell - " Taxing away what other people have earned, in order to finance one's own moral adventures via social programs, is often depicted as a humanitarian endeavor, while allowing others the same freedom and dignity as oneself, so that they can make their own choices with their own earnings is considered pandering to greed. Greed for power is no less dangerous than greed for money, and has historically shed far more blood in the process."

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Peter Earle - "In a world of infinate desires and limited means, choices must be made; a study of history and economics reveals that, while markets make no promises, they never lie. The only choice is whether distribution, or redistribution as the case may be, is to be accomplished by the organic, apportioning hand of the price system, or by the corrupt, spoilative claw of states."

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Thomas Jefferson - "....To preserve our independence, we must not let our rulers load us with public debt....we must make our choice between economy and liberty or confusion and servitude....if we run into such debts, we must be taxed in our meat and drink, in our necessities and comforts, in our labor and in our amusements.... if we can prevent the Government from wasting the labor of the people under the pretense of caring for them, they will be happy."

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F. A. Hayek - "The democratic statesman who sets out to plan economic life will soon be confronted with the alternative of either assuming dictatorial powers or abandoning his plans."

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Jean Baptiste Say - "...The encouragement of mere consumption is no benefit to commerce, for the difficulty lies in supplying the means, not in stimulating the desire of consumption; and we have seen that production alone, furnishes those means. Thus, it is the aim of Good Government to stimulate production, of bad Government to encourage consumption."

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Thomas Sowell - "What is politically defined as economic planning is the forcible superseding of other people's plans by Government officials."

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Thomas Sowell - "The market is simply the freedom to choose among many existing or still to be created possibilities. The Government establishes an army or a post office as the answer to a given problem.... The diversity of personal tastes insures that no given institution will become the answer to a human problem in the market."

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Thomas Sowell - "Just as a poetic discussion of the weather is not meteorology, so an issuance of moral pronouncements or political creeds about the economy is not economics."

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Paul Craig Roberts - "We should all be thankful to the Soviets, because they have proved conclusively that socialism doesn't work. No one can say they didn't have enough power or enough bureaucracy or enough planners or they didn't go far enough."

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Alexis de Tocqueville - "Democracy extends the sphere of individual freedom, socialism restricts it. Democracy attaches all possible value to each man, socialism makes each man a mere agent, a mere number. Democracy and socialism have nothing in common but one word: equality, but notice the difference: while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude."

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George Gilder - "The Real Issue is between the rule of law and the rule of leveler egalitarianism, between creative excellence and covetous "fairness", between admiration of achievement versus envy and resentment of it'.

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Thomas Jefferson - "The issue today is the same as it has been throughout all history, whether man shall be allowed to govern himself or be ruled by a small elite."

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Judge Leonard Hand - "Liberty lies in the hearts of men and women; if it dies there, no constitution, no law, no court can save it."

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Ludwig von Mises - "Modern civilization is a product of the philosophy of laissez faire, it cannot be preserved under the ideology of Government omnipotence."

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Ludwig von Mises - "The issue is always the same: the government or the market. There is no third solution."

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H.L. Menken - "Government is a broker in pillage, and every election is an advance auction on the sale of stolen goods"

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F.A. Hayek - "Perhaps the fact that we have seen millions voting themselves into complete dependence on a tyrant has made our generation understand that to choose one's Government is not necessarily to secure freedom."

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Detlev Schlichter - "Economics is the science of how we use social institutions such as private property and voluntary exchange on free markets to make the best use of scarce resources. The printing press tries to do away with scarcity."

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Thomas Sowell - "The God like approach to social policy ignores the diversity of values and the cost of agreement among human beings."

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Henry Hazlitt - "Whenever men are allowed liberty, and freedom of choice, they will make mistakes. Liberty is not a guarantee of omniscience. But neither are the mistakes of free men a valid excuse to take away their liberty, and impose Government controls in its stead, on the ground that all wisdom and disinterestedness resides in the people who are going to do the controlling."

Quote

Thomas Sowell - "Nothing is easier than to confuse broader powers with deeper insight. But almost by definition, those with the broadest powers are the most remote from the specific knowledge needed for either deciding, or for knowing, the actual consequences of their decisions."

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Ludwig von Mises - "Credit expansion is the Government's foremost tool in their struggle against the market economy. In their hands it is the magic wand designed to conjure away the scarcity of capital goods, to lower the rate of interest or to abolish it altogether to finance lavish Government spending."

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Ludwig von Mises - "Economic history is a long record of Government policies that failed because they were designed with a bold disregard for the laws of economics."

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Chaderov - "Since the State thrives on what it expropriates, the general decline in production that it induces by it's avarice foretells its own doom. Its source of income dries up. Thus in pulling society down it pulls itself down."

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Thomas Sowell - "If an informed citizenry is the foundation of democratic Government, than an uninformed citizenry is a danger."

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Thomas Sowell - "The free market works best when there is a level playing field but politicians win more votes by tilting the playing field to favor particular groups."

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Thomas Sowell - "However dramatic or attractive a particular vision may be, ultimately everyone must live in the world of reality. To the extent that reality has been filtered to fit a vision, this filtered information is a misleading guide to making decisions in an unforgiving reality, to which we must all adjust because it is not going to adjust to us."

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Thomas Sowell - "Envy was once considered to be one of the seven deadly sins before it became one of the most admired virtues under its new name "Social Justice"."

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Murray Rothbard - "Bureaucracy incompetent enough to plan a stationary system, is vastly more incompetent at planning a progressing one."

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Ludwig von Mises - "Freedom is incompatible with equality of wealth and income. Men are born unequal and it is precisely their inequality that generates social cooperation and civilization."

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Murray Rothbard - "Government subsidy systems promote inefficiency in production and efficiency in coercion and subservience, while penalizing efficiency in production and inefficiency in predation (plundering)."

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Francisco Capella - "The right of property is a negative right of noninterference. Humans do not have natural positive rights that imply that others must do something for them, and there is no natural duties towards others (present and future). Positive rights and duties arise by means of contracts."

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Victor Davis Hanson - "Social justice sees the Government's proper moral obligation not as ensuring equality out of the starting gate, but as guaranteeing that we will all reach the finish line at the same exact moment."

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F.A. Hayek - "A claim for equality of material position can be met only by a Government with totalitarian powers."

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Thomas Sowell - "People who are very aware that they have more knowledge than the average person are often very unaware that they do not have one tenth of the knowledge of all of the average persons put together. In this situation, for the intelligentsia to impose their notions on ordinary people is essentially to impose ignorance on knowledge." "Credentialed ignorance is still ignorance."

Quote

Thomas Sowell - "People have to be aware of the dangers in letting economic decisions be made through political processes."

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Winston Churchill - "Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery."

Quote

George Gilder - "Socialist and totalitarian Governments are doomed to support the past, because creativity is unpredictable, it is also uncontrollable. If the politicians want to have central planning and command, they can not have dynamism and life. A managed economy is almost by definition a barren one.

Quote

George Gilder - "The ambitious agenda of contemporary liberalism simply ensures that Government will do nothing well, except to expand itself as an obstacle of growth and innovation. Government best supports the future by refraining as much as possible from trying unduly to shape it."

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Francisco Capella - "Markets are never perfect because human beings are limited in their abilities; proposing state fixes to alleged problems that individuals cannot solve freely seems to forget that the state is also made up of humans; and perhaps not the best ones. ( Bureaucrats are not disinterested angels, and the worst might get to the top.)"

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George Washington - "Government is not reason, it is not eloquence, it is force, like fire it is a dangerous servant, and a fearful master."

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Thomas Jefferson -- "I think we have more machinery of Government than is necessary, to many parasites living on the labor of the industrious."

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Thomas Jefferson -- "I sincerely believe with you that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, it's but swindling futurity on a large scale."

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Thomas Jefferson -- "The two enemies of the people are criminals and Government, so let us tie the second down with the chains of the constitution so the second will not become the legalized version of the first."

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