Yearly Archives: 2015

Removing all doubt

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Poor Bernie, he went and opened his mouth and thusly removed all doubt that he has no grasp of economics. Such ignorance from an internet troll might be expected and can be amusing in the same way that a child’s explanation of something can be so. But when such breathtakingly inane statements emanate from a candidate for President of the United States, well, what can one do but weep for the future. To what perplexing attempt at pontification do I refer? None other than this Dec 26 Tweet from @SenSanders: “You have families out there paying 6, 8, 10 percent on student debt but you can refinance your homes at 3 percent. What sense is that?”

Now most people would probably look at this statement and not find it particularly outrageous. We as a society have been conditioned to accept the notion that interest rates are arbitrarily set from time to time by some talking head in government. The assignment of these rates is apparently disconnected from any external factors. They are like lotto numbers plucked from the ball machine. We assume other lenders (banks, credit cards, etc) set their rates in a similar pattern.

In reality non-government rates are primarily market driven. That is, the relative difference in rates is market driven while the net value rests on the arbitrarily set Fed rates. Interest rates are not arbitrary digits, they are prices. They are the price people are wiling to pay to not wait. Interest rates are a reflection of supply, demand, and risk. The demand for loaned funds is indicative of high time preference, that is, preferring something now rather than later. The supply of loaned funds is indicative of a low time preference, that is, the willingness to forego consumption in the present and defer it into the future – for a price. To understand high time preference, ask yourself, do you prefer to buy that 72” OLED 4k TV today, or in a year after saving the funds yourself? Most of us prefer to have it today so that we can enjoy it immediately. The cost of that sooner than otherwise realized enjoyment is reflected in the interest rate we are willing to pay. If there are a lot of people willing to supply loaned funds, then the interest rate will be lower (supply goes up, price i.e. interest rate, goes down). If there are few people willing to supply loaned funds then the interest rate will be higher (supply goes down, price, i.e. interest rate goes up). It’s really not that complicated.

The only wrinkle with interest rates relative to regular money prices exchanged for tangible goods is that unlike exchanging cash for a hamburger (where both parties have something after the exchange), with the process of loaning/borrowing, only one party has the thing they desire in the beginning. The other party has a promise to deliver the other half of the bargain at some future date. The future is uncertain and there is always risk that someone may not do what they say, either deliberately or for reasons beyond anyone’s control. That uncertainty is also reflected in the interest rate. If there is a high chance the lender won’t get paid back then the interest rate will be quite high. But, if something can be offered to mitigate that risk, something tangible, like say a house or a car, then the lender can feel more assured that at least they will get some portion of the loaned funds back in the worst case. So that brings the rate back down.

Bernie, this is why loans backed by tangible collateral (like a home mortgage or equity line) have a lower interest rate than a student loan which has no collateral. A student loan is no different than credit card debt – it is unsecured. Now, look at the interest rate on your credit card (likely over 20%) and compare to the 6, 8, or 10% figure being cited – doesn’t look so bad now does it? These rates are so much lower than they otherwise would be because of government intervention in the student loan market.

Now some might say the banks should be willing to invest in such human capital, that a college degree will translate into a high paying job that allows them to pay it off. That can be true. That is why years ago before government involvement lenders did give out student loans, but only to the most academically worthy of students, those that clearly would succeed. But even so, possible future income is not collateral, the bank can’t take possession of the student himself and enslave him or her to get their money; they can take a house or car, they can’t take a person.

If Bernie wants to help students he should promote the idea of removing government involvement from higher education. Every sector the government subsidizes (healthcare, housing, education) has seen explosive price inflation. That is no coincidence. The patient can’t heal until you kill the disease.

In a mirror dimly

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For all that is wrong with the Trump candidacy (xenophobic neo-fascist tendencies) the silver lining is that it is forcing us to face the ugly truth about democracy: mob rule is a frightful thing to behold. Trump is one of “us” and his popularity is a reflection of what the “mob” wants. Everyone loves democracy when it is their ideas that are popular but when the mob turns stupid it doesn’t seem like such a good idea anymore. Trump may be the first true “people’s candidate” for president that has an actual chance of winning. His financial independence all but guarantees he is not beholden to any individual, special interest, or political party elite. To the extent any candidate receives some measure of public or private funding, their words and deeds are held to account by the one doling out the money. Trump is accountable to no one but himself and the voters.

Since the advent of political parties we have been led to believe elections are about a democratic process, that we are making a choice and a difference – but – that is a lie, or rather, an illusion. A very apt line from the Matrix movies provides some context, “Choice is an illusion created between those with power and those without.” Those who already have power: the party bosses, the monolithic media outlets, the oligarchical dynasties (Roosevelt’s, Kennedy’s, Bush’s, Clinton’s) – they all understand and work the system to their advantage. That is, they present the illusion of choice so as to keep the masses pacified into believing they are in control of their destinies. But like choosing a white paint chip from an ocean of slightly variable gradations of white, the final choice is still just that: white. But Trump, Trump is lime green. He is a starkly different choice. He, unlike any of us, has the money to buy a seat at the table where they are doling out cards in the high stakes game of poker that is a run for the presidency. Perhaps Trump has touched a populist nerve because deep down we all know there is no choice. His candidacy is not so much support for Trump the man but rather support for NOTA (none of the above).

Trump may be spouting idiotic things, but Trump is no idiot. He is a masterful salesman and knows how to work a room. He, like any good conman or salesman, understands his audience/mark. Give them what they want and they’ll return the favor. Trump reflects America, but dimly. (1 Corinthians 13:12) Is his persona the true man, or merely a reflection of his environment? If elected we shall know fully. Most candidates appeal to the voter’s intellect, Trump appeals to their emotions (and not the good ones, i.e. fear, anxiety). This visceral appeal is a dim reflection of the American psyche. It is also a dangerous one. Emotion acts mindlessly without consideration of the consequences. History repeatedly tells a dark tale about leaders that preyed on the emotions of their subjects.

But Trump is not a solution to the moneyed concentration of power, he is merely a symptom, an immune response if you will – that cough you just can’t get rid of. Although the leftist progressives bleat incessantly on the need for government to hold the evil capitalists at bay lest they gain control of society, they miss the central irony here that their greatest fear (control of society by moneyed interests) has already come to pass not in spite of, but because of, government. Government is not a divine institution that has been corrupted by man. It is a human institution that exudes the very human nature from whence it is derived.

Think of it like this: government is simply another business. The key difference, though, is that what it sells is the ability to legally exert aggression against those that do not do its bidding. Its competitive advantage is that it is a self-declared monopoly within its arbitrarily defined geographical region. So what person, group, or other business would NOT want to tap into exerting some influence over how such a business operates? Is it really such a mystery as to why so many work so hard for so long to access that power and divert it to their advantage?

Some say the answer is to remove money from politics, but given that politics is just another economic transaction, that option is about as doable as converting to a barter economy. No, the solution is not less government, but more. That is, it is time to break up the monopoly and decentralize power to the point where our choices are not constrained but manifold. Power is kept in check when the individual is not compelled as a matter of law to acquiesce to the demands of others but may choose with whom they shall associate by voting with their wallet or, if necessary, with their feet.

No-Rights List

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“There are several steps that Congress should take right away. To begin with, Congress should act to make sure no one on a no-fly list is able to buy a gun. What could possibly be the argument for allowing a terrorist suspect to buy a semiautomatic weapon? This is a matter of national security.”– President Barack Obama

 

If I may Mr. President, Mr. Constitutional Scholar, I’ll take that one. The answer is “Due Process” as in the Fifth amendment to the U.S. Constitution which states, in part, “[N]or shall any person . . . be deprived of life, liberty, or property, without due process of law…”. In other words, the use of this list to deprive the individual of his or her rights is a blatant 100% violation of the constitution, no ifs, ands, or buts – but hey, go right on believing that a piece of paper can protect us from the machinations of the state. This list has put the lie to that fantasy. Those in power can do whatever they wish as long as they have mastered the art of fear manipulation.

There is nothing wrong with compiling such a list (e.g. passive monitoring until suspicion is either allayed or heightened), but it is its preemptive deployment that is problematic. Depriving one of their rights is the equivalent to an arrest insofar as arrestees too lose a number of rights. Therefore, a “listee” and an “arrestee” are legally equivalent and so both must be afforded the same opportunity to respond to their accusers. In other words, if there is to be such a list, its content must be subject to due process, that is, a trial. Even though this should be obvious it bears repeating: due process is not some artificial speed-bump on the road to getting the “bad guys” – it ensures that the innocent, you and me, are not erroneously treated as criminals. To believe such a process is not necessary is to believe in the infallibility of man (a most hubristic and dubious proposition). Government is merely a collection of imperfect, fallible human beings. Due process protects us from those failings.

As it stands today, if you are on this list (often people merely with names similar to those of suspected terrorist sympathizers, including small children, active military personnel and even Senator Ted Kennedy!) there is no procedure whatsoever to challenge the inclusion in order to have your name removed. The rationale for inclusion is not divulged due to reasons of “national security”, attempts to demonstrate ones innocence are not allowed due to reasons of “national security”. Do you see a dark pattern here? The government may target anyone for any reason at any time citing the circular tautology of “national security” as justification.

With Obama’s attempt to re-purposes this list into the “one list to rule them all” of unlimited state power a most sinister precedent is being set. One right, two rights, three rights – oh my, soon we are no longer free! There is nothing to stop them from adding a whole litany of rights that one could plausibly argue help terrorists achieve their goals: obtain credit, hold a job, own a business, rent a home, buy or rent a car, open a bank account and so on. Now imagine you have been erroneously placed on this list (like thousands of others) and the nightmare your life instantly transforms into as all your rights are instantly stripped away because of either a clerical error or someone’s hunch. But of course you don’t know it is a clerical error or someone’s hunch, because no one will even tell you why you are on the list..

Once the precedent of rights denial for the “listed” is in place, then the really dangerous component can be activated: arbitrary inclusion. Superficially only “terrorists” are to be included, but here’s the rub: what is the definition of “terrorist”? Most assume it means ISIS types, but as far as the state is concerned it encompasses anyone that it deems a potential challenge to its authority. In other words, whoever is in power will deem whomever is out of power as a threat. This is not hyperbole, it has already happened. Various federal and state agencies have issued reports where they expressed the opinion that anyone expressing “right wing” views such as support for the constitution, opposing the federal reserve or taxation, or showing support for Ron Paul could be potential terrorists. Masterful! Political challengers getting you down? Why simply classify them as “terrorists” and wipe away all their rights – that will shut them up pretty quick!

If private airlines want to compile their own list and bar entry aboard their planes, that is perfectly within their rights to do so. It is their property and they may do with it as they see fit. You are free to fly another airline. In a private system the number of false positives would be nearly non-existent (e.g. no kids would be on the list) since the airlines have an incentive to sell tickets and not bar perfectly safe passengers from handing them money. Various other free-market based systems that can’t legally exist in the current public system would ensure even those few false positives were rectified. The compilers of a public list bear no consequences to any mistakes they make, the compilers of a private list do and thus act accordingly. The lack of accountability in a public system necessitates due process, i.e. a method by which accountability can occur. Interaction with private entities is voluntary whereas interaction with public entities is not. This more than anything necessitates a different set of rules for public entities to ensure that absolute power is not abused.

Low Hanging Fruit

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With the recent shooting in San Bernardino national attention has again returned to that eternal yin-yang conflict between the gun banners and the gun lovers. Or should I say those who promote “sensible gun laws” and those that do not believe their rights should be curtailed because of the actions of others. Truth be told the former believes “sensible” = “total ban”– because, obviously, making things illegal always eliminates the problem (cough, drug war, cough, prohibition). Banning all guns because of the senseless acts of a few crazed lunatics makes about as much sense as castrating all men because some have raped. The ban-wishers realize that a total ban is not feasible, so they couch their rhetoric in innocuous sounding terms like “sensible” and “common sense” when referring to proposed legislation. The only problem with these proposed laws (if you can actually manage to get any of them to divulge exactly what they might entail) is that not a single one of them would have stopped any of the mass shooting rampages in recent memory. Not. A. Single. One. Calls for background checks to include the presence of psychological issues don’t help if one has never done anything crazy before. Barring felons from obtaining a weapon don’t help if one has never been convicted of a crime. Waiting periods don’t help if one has owned a weapon for years and then commits an atrocity or simply “borrows” it from a family member. In short it is a human problem, not a gun problem. Humans can do anything at any time and as much as we might all wish it to be true (oh, please let there be a Santa Claus!) it is metaphysically impossible to predict the behavior of any one person so as to shut them down pre-crime style.

Now some may object at this point and point to a number of “peer” countries with draconian gun laws who have lower homicide rates than the US. What this simpleminded analysis leaves out is manifold. First of all the use of the arbitrary distinction “peer” is simply a ploy to omit countries with lower gun ownership than the US but with much higher gun deaths. One prominent example is Mexico.  “Oh but that is left out because of the violence stemming from the drug war,” they will say. Oh really? That is interesting, because the US is currently involved in a massive drug war as well, so I suppose to be fair we should subtract those numbers out in the same way they deem it valid to leave Mexico out of the comparison. When you make that adjustment the estimates are that the US homicide rate drops precipitously from 4 per 100,000 down to as low as 1 per 100,000  – the same as all these other “peer” nations with their draconian laws. The other part of the analysis left out is a lot of these “peer” nations are extremely small, culturally homogeneous groups (e.g. Japan or Norway). If one were slice up the US the same way and break it down by state or city rather than as whole you find even without drug war adjustments the regional numbers are on par or lower than those very same “peer” nations. In other words 1% of US cities are responsible for the overwhelming majority of gun violence.

If those that want to “do something” about gun violence are serious then they would be well advised to examine what factors are driving the violence in these cities. They are the low hanging fruit as it were since most gun deaths occur within their borders. Since most (Chicago, Detroit, etc) already have strict gun control laws, that is obviously not going to be a solution. To solve the problem one must understand the source of the problem. That source is overwhelmingly the drug war. It is not simply mere shoots out between gangs that factor in here but all the other social and economic factors that drive one toward violence when a prohibition is placed on some arbitrary article of commerce. Like a cancer the prohibition infects the community and destroys it from within. But it all starts with the prohibition. Remove the drain stopper that is prohibition and all the other violence inducing factors will drain away as well. Will this solve all instances of gun violence? No, but wouldn’t solving 75% or more be a glorious first step?

The constitution says we have a right to keep and bear arms. Changing that fact would be incredibly difficult if not impossible. The constitution does not say drugs are illegal. Its implementation was unconstitutional, thus its termination would likewise be constitutional. We can end the drug war tomorrow with the stroke of a pen. Why not take that easier path and achieve the greatest good? Or is it more about ideology than about actually saving human lives? Prohibition never solved anything.

Entangling Alliances

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The recent downing of a Russian military jet by Turkey should serve as a reminder of the sage advice of Thomas Jefferson during his inaugural address, “Peace, commerce, and honest friendship with all nations-entangling alliances with none.” It is that last bit – “entangling alliances with none” that is most apropos. Turkey is a member of NATO, as is the US and virtually all other Western European countries. For anyone mindful of the deadly domino effect that plunged Europe into World War I (the assassination of a single man), this recent series of events should be a wake up call to de-escalate this situation as quickly as possible.

Fortunately, so far it seems Russia has shown an incredible level of restraint; one can only imagine the outpouring of jingoistic bellicosity had a US jet be downed by a close Russian ally. This may be simply that Russia is formulating a strategically crippling blow to Turkey or that it plans to milk this event diplomatically for all it is worth considering that Russian presently occupies the catbird seat of moral authority. The Russian jet was shot down and its pilots assassinated mid-air after entering Turkish airspace for a mere 17 seconds. Although Turkey insists the plane was warned for approximately 10 minutes to veer away lest it enter Turkish airspace, the standard course of action is to fire warning shots or to “escort” the plane back to the border. Yes, if Russia violated the airspace Turkey had a right to respond – proportionately. Mere flight is not in and of itself provocative enough to warrant instantaneous death, particularly when geographically it is the equivalent of flying over Key West and claiming a gross violation of the airspace of the US mainland. What Turkey did is akin to shooting the neighbor’s dog because it urinated on the edge of your lawn.

The magnitude of the overreaction by Turkey suggests something more is going on here. As it turns out this trivial border violation was but a pretext for Turkey to do what it has long wanted to do: directly provide military support for the Turkmen rebels in northern Syria who are fighting against Assad. The “airspace” violation merely provided cover to tactically engage with Russia without fully committing itself to an all out war with Russia over Syria. In other words, this was a sucker punch against a stronger opponent. Sometimes that tactic makes your opponent angry, but sometimes it stuns them into retreat. The outcome remains to be seen here.

So why attack that particular plane? It was on a well-known route that would end in it bombing regions of Syria where Turkmen reside. Russia has been bombing not only ISIS forces but also all those that oppose Assad, and this includes the Turkmen rebels fighting with the Free Syrian Army in the north. Sure enough, after the plane was shot down those Turkmen rebels shot and killed both airmen and destroyed a Russian rescue helicopter – with U.S.-made and supplied TOW rockets no less. The Turkmen (as one could have guessed) are ethnically Turkish but who happen to live on the wrong side of the arbitrarily drawn borders following the western led partitioning of the former Ottoman empire after World War I. Those arbitrary borders resulted in the Turkmen being inside what is today known as Syria. Turkey has long had an interest in aiding their ethnic siblings. Assad is no saint and has long suppressed the Turkmen minority (through attempts to Arabicize them, land seizures, and the banning of Turkish language). So to be sure there is plenty of blame to go around; there are no “good guys” in this Syrian conflict – not even the US, who in an attempt to undermine Assad (in furtherance of aiding our ally Turkey) gave arms to “Syrian rebels” who eventually morphed into ISIS and now threaten the stability of the entire region.

So in other words, our “entangling alliance” with Turkey, a moderate Islamic ally no doubt, resulted in the US directly playing a role in the creation of the most radical Islamic regime this world has even seen: ISIS. If the US is not careful, our entangling alliance with NATO and the requirement we come to the aid of NATO members who come under attack (i.e. Russian attacking Turkey in retaliation) may very well plunge us into World War III with a nuclear capable rival. Be afraid, be very afraid.

The Rise of Radicalism

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In my prior article I made the argument that the real reason the terrorists target the US and other Western countries is not because they “hate us for our freedom” but rather that they hate us for interfering in their lives. The US and other Western nations (such as France) have a long and sordid history of interfering in the internal affairs of other countries, be it either operative-fomented coup d’états or outright military actions. There is a willfully selective blindness in the west that allows us to only see where we are but not how we arrived. But, my point is not to rehash my prior thesis but to respond to one of the stronger objections to it. It has been pointed out that this sort of argument ignores the fact that radical Islam truly wants all non-believers to die, that it is akin to Nazism and must be wiped out – those making that argument are correct, but not in the way they presume. Yes, indeed there are some adherents of Islam that believe these sorts of things. They are called radicals. Within any group of humans that subscribes to some ideological concept there are those who lie on the fringe and have their own unique interpretation of the group’s ideas. These ideas, by virtue of being “fringe,” are in the minority; the rest of the group quietly ignores such types lest mere acknowledgement of their ideas imply tacit acceptance.

For example, there are fringe groups who use the Bible as justification for their belief that the earth is flat, that “kinds” should be separated and thus racism is a “Godly” viewpoint, or that firebombing abortion clinics and murdering the abortionists is legitimate. Now of course all of us in the majority disagree with these viewpoints and claim their interpretation is obviously faulty, but nevertheless they still make the claim. So maybe, just maybe, radical Islamists fall into the same category of distorted interpretation. I imagine for every cherry picked outrageous phrase from the Koran one can find an equally outrageous cherry picked line from the Bible. Are we to honestly believe that ALL of Islam 100% agrees on the violent and hateful interpretations of such cherry picked lines? Christianity alone is proof of man’s inability to agree on anything. For something that is supposed to be the absolute word of God (the Bible) there sure are an awful lot of denominations with differing viewpoints on various aspects of scripture. Yet somehow we are supposed to believe that there is absolute solidarity among Muslims with regards to their scriptural interpretation.

The truth of the matter is that yes there are indeed radical Islamists that do believe we should all die, but it is the ignorant and ham-fisted actions of the west in the Middle East (primarily since the end of World War II) that have given their crazy viewpoint more credence and expanded their sphere of influence among fellow Muslims. When the radicals preach that the non-believers are devils who will come to kill them and destroy their way of life and then an endless onslaught of non-believers comes in and does exactly as they predicted year after year that tends to strengthen, not weaken, the position of those making the prediction. So the more any country occupies, bombs, and overthrows ruling regimes in Muslim countries the more they play right into the narrative the radicals are selling. This bolsters their authority and makes it that much easier for them to win more recruits and adherents. More bombs feed the flame of radicalism, they do not extinguish it.

Think of it like this: the majority of people view white supremacists as radicals, but now imagine what would happen if there were a massive and organized movement wherein all non-whites started killing white people en masse. Do you not believe this would have more and more people listening to what these white supremacists had to say? The longer such attacks continued the more and more people would turn to their ideas and do whatever they said in order to protect themselves. Then, one day they would no longer be a “radical” group but instead would represent the mainstream. This is what nearly 70 years of open and clandestine interference in the Middle east has wrought: turning the followers of a small and obscure sect of Islam into a growing force that will someday soon become the dominant authority. Apropos the Hitler reference: the only reason we had to fight Hitler is because the American government (by virtue of Wilson’s desire to plunge us into WWI) had a hand in creating the onerous Treaty of Versailles that primed Germans to welcome his radical rhetoric and ensured his rise to mainstream power.

If a drug company invented both a disease and the drug to cure it there would be outrage, yet when the state creates our enemies that only it can now slay we welcome it with open arms and applause.

Games without Frontiers

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As the horrific events unfolded last Friday in Paris before a world stage, we, the audience, sat in stunned silence as waves of helplessness washed over us. If only we could protect those in harms way and end the madness. This sense of helpless resignation caused me to reflect on a line from Peter Gabriel’s song “Games with Frontiers” – ‘In games without frontiers, war without tears.’ Indeed this would seem contradictory, as this was a time for tears; however, for those in control of the game, there are no tears. This ‘war on terror’ is a boundless chess match in which the ‘leaders’ on all sides are utterly lacking in remorse when a few of us pawns get knocked over. They may wear their heart on their sleeve when addressing the masses, but when the cameras are off the mask of empathy is stripped away. Were this not true they would endeavor to engage in peaceful dialogues or simply withdraw rather than doubling down on the violence (which as I write this France has already done). As each side lobs their bombs at each other, we pawns become haplessly caught in the crossfire (the 9/11 attacks, Malaysia Air 17, Pan Am 103, Iran Air 655, Bali bombings, Russian Metrojet 9268, London bombings, countless others, and now, Paris). When will it end? If our ‘leaders’ have their way, never. All leaders have an agenda. Agendas require power to execute. Leaders derive their power from others willingly giving it to them. So like the con artist, they use deception to trick their target into willingly giving them what they want. When we feel unsafe we turn to those who claim they will restore what we desire. Problem is, those who promise that are the ones who precipitated the events that we now fear. But like Charlie Brown trying to kick the football, we fall for it every time.

This pattern of misdirection to reinforce one’s power position is not unique to the West. All conflict involves two parties fighting over some real or imagined initial injury. But human pride is such that neither side will ever back down. You attack me, I attack you, ad infinitum. At some point all conflicts distill down to the point that no one even remembers what started the conflict, only that they must strike back to get back for the prior strike upon them. This is where we are today. Feuds going back dozens, hundreds, or thousands of years drive just about every conflict in the world today. The leaders justify continued attacks by dehumanizing the opponent and his motivations into an absurd caricature that allows us all to feel justified in mass murder. Both sides do it, but the irony is we laugh at the ludicrousness of others being angry at the US because they think we are the “devil” but take with deadly seriousness being told we are attacked because we are free. To see the lie in that statement all we need to do is witness the words and deeds of these so called haters of freedom. Osama bin Laden put that one to rest over 10 years ago when he stated “If Bush says we hate freedom, let him tell us why we didn’t attack Sweden”. Then even more usefully he tells us how we can end their motivation to attack us, “the best way to avoid another Manhattan is to not threaten the security of Muslim nations, such as Palestine and Lebanon”.

If we truly wish to “do something” to prevent future attacks then please channel some of the energy you used in changing your Facebook profile to demonstrate solidarity with France into the more useful endeavor of supporting leaders that promise to withdraw our military and political presence from foreign soils where we have no business. If we withdraw from and ignore those who hate us we defuse the ability of their leaders to demonstrate how “bad” we are to their would be fighters. Few want to fight an enemy that has done nothing to them in ten years. Let’s start that clock now.

Consider how angry and upset we are over these attacks in Paris and then reflect on the fact that similar attacks occur on an almost monthly basis by drone and yet we hear nothing about it. Innocents murdered in cold blood and yet from the media all we hear are crickets. Those affected are just as upset as we are now and such actions only serve to keep the feud alive.

If a drone destroyed your child’s school or a mall where your loved ones were shopping (or even a hospital) would you not feel a sense of overwhelming rage and a desire to “get back” at whoever sent that drone? I am not suggesting such actions motivated by revenge are justified, but rather simply pointing out that this desire for revenge is a natural, primal human response. So given this knowledge, why do we keep throwing rocks at the hornet’s nest if we know the hornets will without fail sting us?

Fun stereotype

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Sometimes stereotypes are just fun… 🙂

 

In Heaven…
The mechanics are German
The chefs are French
The police are British
The lovers are Italian
And everything is organised by the Swiss.

In Hell…
The mechanics are French
The police are German
The chefs are British
The lovers are Swiss
And everything is organised by the Italians.

Do no harm?

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A recent conversation with a friend highlighted the fact that even among conservatives there is a pervasive belief that “unfettered” markets require some level of “control” by the government. The poster child for this viewpoint is Rockefeller’s Standard Oil which at its peak achieved 90% market share. The formation of such a “monopoly” (it wasn’t, a monopoly would be 100% market share – something only a government can achieve in the many areas it deems worthy of nationalization) is sufficient proof in their minds of both ill deeds and ill intent. Unfortunately the facts do not support a narrative of ill will. In 1865 when Rockefeller was just starting and had virtually no market share kerosene cost 58¢/gallon. By 1870 Standard Oil’s (SO) share was a mere 4% and yet they had driven the price down to 26¢. Only 10 years later SO’s market share had shot up to 90% and did prices skyrocket as well under this “monopoly”? No, prices declined to 9¢. And by 1890 still at 90% market share prices fell even further to 7¢.  So who exactly was harmed here? Certainly not the consumers of kerosene.

One could argue that the competitors were “harmed” but so what? SO achieved its market position by becoming more efficient so that it could profitably charge lower prices. It did not engage in violence or the threat of violence to achieve its goals, as the state/government is wont to do. Mere “harm” cannot be the nebulous standard by which we invoke the necessity of state intervention. If five people apply for a job then the four that did not get the job are arguably harmed, so, should the state step in and penalize the person who got the job by making him or her share it with the others? When two sports teams play each other is not the losing team “harmed”? Upset fans, potential decreased ticket sales, lower potential ad revenue – all these things constitute types of harm, yet no one is (yet) screaming for the state to step in. Most likely because all recognize the solution would be absurd – they would simply mandate all games end in a tie or that wins and losses must be equalized. We certainly can’t have an unequal “win” distribution, how unfair.

One type of specific harm that anti-trust proponents say must be banned is the practice of “predatory pricing”. This is the practice of a competitor temporarily lowering their price and losing money in order to drive out competitors that can’t afford to lose money as long (the economic equivalent of a game of “chicken”). Problem is, this has never actually happened. Sure there might be temporary “price wars” between competing retailers that go on for a few days, but neither side gets ahead and at the end of the day no company has ever actually been driven out of business this way. The reason for this is the following: either you have to buy up the whole world (impossible) or the act of driving competitors into bankruptcy creates replacements that can more readily compete on price. For example, if a competitor went into bankruptcy then someone else would buy up their assets at pennies on the dollar and reopen the business with a much lower operating overhead. Now they are in a much better position to compete with you. Not a useful outcome.

But lets say for the sake of argument somehow it all worked and you could drive out competitors this way. Where is the natural rights violation? What is essentially happening here is large competitor A is using their deep financial resources (savings) to compete with small competitor B in a way that B is incapable of because of their smaller size. Is this unfair? Well before you answer that consider that this goes on all day long in the business world. Larger companies can spend a lot more of their financial resources (savings) on: more sales personnel, larger R&D budget, improving efficiency through automation and so on. That is deemed perfectly fair, however using those exact same resources to facilitate deep pricing discount is not. Simply put, there is no reason to arbitrarily single out such a practice and threaten to throw people in cages if they engage in it. It is no more of an excuse for state intervention in the market than is a dislike of the font in a company’s logo.

As long as no aggression (fraud, violence, or the threat of violence) is occurring then any and all actions or businesses or products should be permitted. No one should live in fear that men with guns will throw them in cages because of someone’s subjective opinion of what constitutes fairness or harm. Opinions are fine, but opinions backed up by a threat of violence violate everyone’s natural right to liberty and the pursuit of happiness.

Imagine

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This one still gives me chills. It touches on a visceral emotion that all humans share, namely the instinct to defend oneself and ones loved ones from actual (not hypothetical) aggression. We know how we (Americans) would react… why is it so hard to understand that others respond the same way?

 

Ron Paul, March 11, 2009

“Imagine for a moment that somewhere in the middle of Texas there was a large foreign military base, say Chinese or Russian. Imagine that thousands of armed foreign troops were constantly patrolling American streets in military vehicles. Imagine they were here under the auspices of “keeping us safe” or “promoting democracy” or “protecting their strategic interests.”

Imagine that they operated outside of US law, and that the Constitution did not apply to them. Imagine that every now and then they made mistakes or acted on bad information and accidentally killed or terrorized innocent Americans, including women and children, most of the time with little to no repercussions or consequences. Imagine that they set up checkpoints on our soil and routinely searched and ransacked entire neighborhoods of homes. Imagine if Americans were fearful of these foreign troops, and overwhelmingly thought America would be better off without their presence.

Imagine if some Americans were so angry about them being in Texas that they actually joined together to fight them off, in defense of our soil and sovereignty, because leadership in government refused or were unable to do so. Imagine that those Americans were labeled terrorists or insurgents for their defensive actions, and routinely killed, or captured and tortured by the foreign troops on our land. Imagine that the occupiers’ attitude was that if they just killed enough Americans, the resistance would stop, but instead, for every American killed, ten more would take up arms against them, resulting in perpetual bloodshed. Imagine if most of the citizens of the foreign land also wanted these troops to return home. Imagine if they elected a leader who promised to bring them home and put an end to this horror.

Imagine if that leader changed his mind once he took office.

The reality is that our military presence on foreign soil is as offensive to the people that live there as armed Chinese troops would be if they were stationed in Texas. We would not stand for it here, but we have had a globe-straddling empire and a very intrusive foreign policy for decades that incites a lot of hatred and resentment towards us.

According to our own CIA, our meddling in the Middle East was the prime motivation for the horrific attacks on 9/11. But instead of re-evaluating our foreign policy, we have simply escalated it. We had a right to go after those responsible for 9/11, to be sure, but why do so many Americans feel as if we have a right to a military presence in some 160 countries when we wouldn’t stand for even one foreign base on our soil, for any reason? These are not embassies, mind you, these are military installations. The new administration is not materially changing anything about this. Shuffling troops around and playing with semantics does not accomplish the goals of the American people, who simply want our men and women to come home. 50,000 troops left behind in Iraq is not conducive to peace any more than 50,000 Russian soldiers would be in the United States.

Shutting down military bases and ceasing to deal with other nations with threats and violence is not isolationism. It is the opposite. Opening ourselves up to friendship, honest trade and diplomacy is the foreign policy of peace and prosperity. It is the only foreign policy that will not bankrupt us in short order, as our current actions most definitely will. I share the disappointment of the American people in the foreign policy rhetoric coming from the administration. The sad thing is, our foreign policy WILL change eventually, as Rome’s did, when all budgetary and monetary tricks to fund it are exhausted.”
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Imagine!: speech written & given by Ron Paul

CREDITS:
Ron Paul for the speech
Voice & Music: Jeremy Hoop
Video animation: Nicholas Bozman & MysteryBox. http://mysterybox.us