Thursday, August 25, 2011

Has Patri Friedman Never Heard Of Pirates?

A friend from the Mises Institute in Finland recently contacted me to ask if he could translate the SOLE "Be The Hero" video into Finnish. Of course that was fine and he e-mailed me back to tell me the video is up. They did a great job with it and even added a few animated flairs all their own so I recommend you check it out.

At the end of the e-mail he also included a link to a video of Patri Friedman speaking at the Mises Institute in Finland about his Seasteading Institute and the seasteading project. Readers of the main EPJ page may remember our own Robert Wenzel posting about the involvement of billionaire libertarian entrepreneur Peter Thiel with this project.

Now, I've read a lot of stuff from all three of the Friedmans over the years, including Patri, and I had heard of the Seasteading Institute and the idea for these floating countries out in international waters. As a result, I wasn't too interested in following the link because I assumed there wasn't much new for me to learn. But, as the link was sent by my friend I thought it would be polite to at least review the first few minutes...

I ended up watching the whole thing.

If you're already familiar with "seasteading" and you like the idea and want to share it with others, this is the link to send around. And if you've never heard of seasteading and you want to learn about the philosophy and practical considerations of the idea, this talk of Patri's at the Mises Institute in Finland is the most comprehensive one I have come across. It is clear from watching it that Patri "gets" the philosophy of freedom.

And what I like about this idea besides its revolutionary and original nature is its subversiveness. Don't let Patri's marketing of seasteading as "competitive government" fool you-- the seasteading philosophy is thoroughly libertarian and the practical implications of actual floating seasteads will be more places for people to live free of government regulation and intervention because anyone who wants to try socialism on the seas will find it breaks down even faster than communism on a kibbutz.

Sunday, August 7, 2011

Thank Zeus For Government Food Inspectors

Without them, we'd all be eating radiation-contaminated beef products (WSJ):
Within days of the disaster at the Fukushima Daiichi nuclear plant, Japanese food inspectors were spot-checking meat from the region's slaughtered cattle for radioactive contamination. Officials later fanned out to farms near the crippled plant to pass Geiger counters over the animals to determine whether they were safe to sell.

"We urge consumers to continue shopping as usual and retailers to do their business as usual," Agriculture Minister Michihiko Kano reassured the nation on March 31, more than two weeks after explosions at the plant first spewed radiation into the air.

That advice turned out to be misguided. On July 8, government officials testing meat from a Tokyo slaughterhouse said they detected levels of radioactive cesium at nearly five times Japan's limit. The contaminated beef was traced to a farm here about 16 miles north of the damaged plant—from an animal whose hide had been checked by inspectors.

The revelation has raised all kinds of questions about how much contaminated beef had already been consumed, kicking off a food scare that continues to grow as more tainted meat is discovered.
Oh, never mind.

Wednesday, August 3, 2011

How Do You Define Libertarianism?

I've often debated with people on the idea of whether libertarianism (or any other -ism, "movement", category, etc.) should be a Big Tent or a Little Tent. Obviously, the Tent gets bigger the broader your definition of a category tends to be.

Some people associate libertarianism with wanting more freedom, therefore anyone who claims to want more freedom, however it is defined, would be a libertarian.

A prominent libertarian blogger many of you have heard of once told me that a libertarian was anyone who hates the State.

My preferred definition of libertarian has always been "Anyone who accepts the primacy of the Non-Aggression Principle in social affairs and who applies this principle in interpreting the acts of other individuals, as well as themselves, in a fully consistent manner, making no excuses or exceptions."

I admit my definition is a bit wordy (surprise?) but I think it is more technical and specific. Sometimes I add as a corollary that acceptance of the NAP implies self-ownership and self-ownership implies private property rights. But I think at a minimum a libertarian is someone who sees the initiation of the use of force by any individual, in any society, at any time to be a criminal act.

I think you can want more freedom without being a consistent advocate of the NAP. Wanting freedom and understanding the NAP are not necessarily dependent ideas.

I think you can hate the State without being a person who consistently applies the NAP to their observations of human action. For example, you could be a common thief and still hate the State. Therefore, I think you can hate the State and still not be a libertarian.

I'm not trying to pick nits here, rather I am trying to wrestle with something important. If I'm going to label myself and be labeled by others as a libertarian, I need to have a clear, consistent and sufficiently restrictive definition of what that word means if I am to understand it myself. If I don't understand it myself I have little chance of communicating it to other people.

Monday, August 1, 2011

Bill Gates: When Good Intentions Meet Total Cluelessness

Bill Gates and his charitable foundation have been working to reform the public education system for years now. The result? Utter failure and a hint of despair (WSJ):
"It's been about a decade of learning," says the Microsoft co-founder whose Bill and Melinda Gates Foundation is now the nation's richest charity. Its $34 billion in assets is more than the next three largest foundations (Ford, Getty and Robert Wood Johnson) combined, and in 2009 it handed out $3 billion, or $2 billion more than any other donor. Since 2000, the foundation has poured some $5 billion into education grants and scholarships.
"But the overall impact of the intervention, particularly the measure we care most about—whether you go to college—it didn't move the needle much," he says. "Maybe 10% more kids, but it wasn't dramatic. . . . We didn't see a path to having a big impact, so we did a mea culpa on that." Still, he adds, "we think small schools were a better deal for the kids who went to them."
A decade of learning. And just what is it that Bill Gates has learned over the last decade?
Asked to critique these endeavors, Mr. Gates demurs: "I applaud people for coming into this space, but unfortunately it hasn't led to significant improvements." He also warns against overestimating the potential power of philanthropy. "It's worth remembering that $600 billion a year is spent by various government entities on education, and all the philanthropy that's ever been spent on this space is not going to add up to $10 billion. So it's truly a rounding error."

This understanding of just how little influence seemingly large donations can have has led the foundation to rethink its focus in recent years. Instead of trying to buy systemic reform with school-level investments, a new goal is to leverage private money in a way that redirects how public education dollars are spent.
Oh good grief! The man has learned nothing but thinks he has learned that there simply isn't enough money being thrown at the problem. It begs the question whether there ever could be.

Bill Gates has billions of dollars in his foundation and yet it does him no good because he's coming at the problem all wrong. He's trying to fix something that isn't broken. He is operating off the flawed premise that public education is a.) meant to educate (defined as, what?) and b.) can actually fulfill that objective in a state of calculational chaos.

What is Bill Gates's problem-solving methodology?
"I believe in innovation and that the way you get innovation is you fund research and you learn the basic facts."
Great news, Bill! The work has been done for you, the research already funded, the basic facts laid out and a real solution comes with it all. The best part? It won't cost you a penny!

Here's your homework assignment, Little Billy. Happy reading!

Secrets Of The Mises Institute

I visited the Ludwig von Mises Institute in Auburn, AL for the first time last weekend (July 26-29) along with some friends of mine from the Society of Libertarian Entrepreneurs. I met a number of people from around the world (students and faculty alike of this past week's Mises University 2011), became engrossed in more than one philosophical debate lasting several hours long, took in the sights and even came away with a few secrets.

I'll share a few with you, dear reader, if only you'll listen.

Secret #1: The Mises Institute is THE "home" of Austrian economics and libertarian thinking for the entire world.

As we drove around downtown Auburn last weekend looking for the Mises Institute, my friends and I ended up completely missing it the first time by because we had no idea what shape the Institute would take.

Was it actually on Auburn University's campus, nestled amongst the engineering school's buildings, the dorms and the massive football coliseum? Would it be a regal, brick-and-columned structure evoking the classic Southern university aesthetic similar to Dallas's SMU or the University of Virginia? Or perhaps it'd be completely lacking a visual distinctness, instead occupying a few floors of a local, nondescript office tower?

No, when I say the Institute is the "home" of worldwide Austrian economics scholarship and libertarian philosophy, I mean it literally looks like a home. A really big home.

Which is a good thing! The Mises Institute has character and warmth. Rooms with disparate uses on each of the three floors are wrapped around each other, the hallways and stairways are like so many tunnels between them rather than following sterile, repetitious floorplan of a modern office or college lecture hall. Corridors and rooms alike are adorned with sculptures, pictures and paintings relevant to the history and culture of the Austrian economics community.

The grounds are well-kept and clean. Along one side of the building is a terraced garden area resembling something like a quarter-odeon, where I am told lectures are given in nice weather and Mises U students enjoy projecting favorite films up onto the building's wall at night. There are a few simple fountains to add a sense of calm and tranquility with their gently bubbling sounds. Along the opposite side is a large, shaded outdoor gathering area where group lunches and dinners are held.

The libraries are well-stocked with texts both friendly and critical of the Austrian framework. While the third floor library is more quiet, academic, confined and reminiscent of a traditional archive, the first floor library is more open, inviting and comfortable. I found it hard to get away from my favorite seat in one of the two reclining leather armchairs in front of the fireplace where a picture of Mises sits over the mantle. Nearby, the bookstore beckons to anyone who wasn't already enchanted enough with the library, tempting them to spend their savings on the spot in a mad dash to acquire fresh copies of all the Austrian classics and new releases alike.

And everyone that works at the Institute is just so nice. They are more than happy to show you around, they're always asking if you need anything and they make great local concierges in a pinch if you care to find something good to eat nearby and don't know where to go. It's not like a stuffy think-tank or college where many people and areas are off-limits to the uncredentialed or the "insignificant". You can wander around the Institute to your hearts content and no one will ever ask you what you're doing.

Want to drop by the office of Doug French, president of the Mises Institute, just to say hello? The door is always open. Want to see what Jeff Tucker, media and technology guru of the Mises Institute is busy with? Interrupt him at will, and rather than tell you off you'll probably find yourself an hour later standing with him in his doorway talking about his latest strategic vision for disseminating more and better information about Austrian economics to the world, all free of charge.

The Mises Institute feels like someone's home. You're always welcome. People appreciate your passionate desire to discuss Austrian economics and philosophy. For those who never knew it in college or afterward, it offers an authentic and collegial intellectual community.

Secret #2: The Mises Institute provides you with an opportunity to stand on the shoulders of giants.

Early Sunday morning before most of the Mises U students would arrive I found myself sitting around the table in the 2nd floor conference room, surrounded by my fellow chapter-organizers from SOLE, recent acquaintances from the US and rest of the world and portraits of some of the original Austrian scholars like Menger, Hayek and Rothbard who had come before us.

One by one these travelers from across the country and world stood up, introduced themselves and shared a bit about their hunger for liberty and the steps they're taking to achieve individual greatness. Those assembled had all declared themselves dedicated toward taking the collected wisdom and intellectual technology developed by original thinkers like Mises and Rothbard and putting it into daily practice. We realized that these wise, ferociously courageous theorists had figured out the "why" for all of us and now we had the opportunity to demonstrate to ourselves, our families, our communities and the world the "how."

As entrepreneurs and social practitioners, we have the unique opportunity and vision to take the intellectual heritage of our Austrian forefathers and use it to construct the free society of tomorrow. Sharing our strategies and ideas in local coffee shops and hotel meeting rooms as we typically do back home is all well and good, but coming together at the Mises Institute itself drives the point home even further that these principled men of the mind made it possible for us to be principled men (and women) of action.

Secret #3: Somewhere in the library of the Mises Institute sits a copy of Keynes's General Theory once owned by Rothbard, covered in his doodles and margin notes.

Okay, this secret was shared with me by a correspondent and unfortunately I was not able to verify it myself during my visit despite searching in earnest. It's possible I missed it or that it may have been checked out. It's also possible that the margin notes are completely illegible. Jeff Tucker advised me that the Mises Institute possessed a draft of what would've been volume five of Rothbard's Conceived in Liberty, but Rothbard's handwriting was miserable and as the manuscript was never type-written, it probably won't ever make it to print.

To me, the value in locating a treasure like this is not to sit in awe and worship of it as some sacred relic of a holy amongst holies. Instead, I sought it out as confirmation of the fact that Rothbard WASN'T a god-- he was another mortal man, like you and me, and he didn't just will his intellectual brilliance into his voluminous books, essays and other writings. He had to work, hard, at developing his own ideas and criticisms, culling them from his various research sources and adding to them his own thoughts and interpretations. A Rothbard-annotated copy of Keynes, for example, is an encouraging reminder that all men, even talented ones, must purposefully employ their reason if they hope to attain true knowledge.

Consider this secret one you might confirm yourself one day with a visit to the Institute.

Secret #4: Mises University is an A-List production and it attracts talented, passionate, highly intelligent young people from all over the world who are eager to spend part of their valuable summer vacation sitting around, learning!

I don't think it's much of a secret, at least not amongst those familiar with the Institute, that the once a year, week-long collection of seminars and events known as Mises University is the place to be for anyone interested in learning more about Austrian economics and libertarian philosophy and sharing that interest with others.

What I think is less well-known, verging on a potential secret, is the truly amazing quality of the individual students this event attracts. I didn't even get to stay for the whole event (I came in late on the Friday night before and left around noon the following Monday) and I am still in a state of shock and awe with regards to the personalities I came across.

For example, I met a young man from Germany who is currently living a "libertarian jetsetter" life, traveling around the world making connections and soaking up knowledge and experience from different people, places and cultures all while helping to coordinate a European chapter of Students for Liberty. In addition, he is preparing to begin a graduate program where he will study under Austrian money and banking theory master Jesus Huerta de Soto.

I met a young woman from Illinois who has recently "graduated" from her home school and is not only on her second tour of Mises U, but has managed to publish her own liberty-themed WW2-era novel. Back home she recently started a job in which her boss became so impressed with her reasoning and self-responsible manner that he hired two people based upon her recommendation and has essentially made her office manager. She was visiting the Institute with an older family friend who is so enraptured with this young person and her irresistible ideas that she is now something of a Mises Institute fanatic herself.

I met another young man from England who is doing a summer fellowship at the Mises Institute, working on what he calls a monograph that will not only integrate disparate elements of monetary theory by various classic Austrian theorists but, he hopes, will also result in his own original contribution to monetary theory as it relates to financial markets.

These are just a few of the many bright, motivated young torchbearers for liberty and sound economic reasoning I met that weekend. Here is the case for optimism. These people are taking Mises's dictum "Ideas move society" seriously. They're living their lives according to their knowledge and principles and fearlessly sharing their beliefs with others. They're leading, and convincing, by example.

It is hard not to be happy when surrounded by a crowd of these youthful doers (and thinkers), knowing that Mises University provides them a forum where they can be further enlightened and energized so they can shine the light of reason into the deepest, darkest corners of our statist planet.

Secret #5: The Mises Institute needs your help.

This is the final secret I will share from my trip. In my mind, it's also the most puzzling and maddening one. Keep in mind, I am not a paid sponsor nor am I a secret agent or a plant for the Mises Institute. I am speaking from the heart on this.

I was positively flabbergasted to learn of the shoestring budget the Mises Institute operates on annually. I had no idea that the Institute pulls together funding for each special event and presentation, such as its various Mises Circles, and even Mises University, on an individual basis. I did not know that the Institute does not have some massive, private endowment and that they have far more projects and ideas than they have funding for currently.

Case in point, this year's Mises University. While it was an outstanding event that provided a lot of young people a once-in-a-lifetime opportunity to learn, share and grow, a lot of eager people got left behind. Did you know that the 2011 Mises U saw record attendance of over 250 students, but that this was all they could accept out of a total application pool of 400?

That's nearly 150 young people that didn't get the learn about Austrian epistemology and ethics, the methodology of praxeology, the history of the struggle for individual freedom in economic thought, the philosophy of non-violence and peaceful, voluntary exchange with growing wealth and prosperity for all. Those people, and others, were hopefully catered for with the ongoing outreach efforts of, and this year got to enjoy live broadcasts of many of the speeches and seminars. But in not being able to attend due to funding limitations, many missed out on what could've been a transformative life experience.

That's just a rotten shame.

All the criminals and bandits and villainous scum out there, the politicians and their paid-for academic apologists, the connected-capitalist cronies and the bureaucratic legions munching down our stolen wealth as so much pigswill at the federal and state troughs don't seem to have any trouble finding millions upon billions of dollars to fund their various think-tanks and captured universities and research centers. But one of the few beacons of truth and consistent reason in the world, the Mises Institute, working 24-hours a day to spread the knowledge and intellectual technology of the free market and individual liberty, can't even find the money to host all 400 applicants to its one-week long summer program?

Part of the reason for this is that the Mises Institute is 100% privately funded-- it refuses, on principle, to take any money or grants which are or might possibly have been tainted by connection to the State. And this is good that the Mises Institute doesn't flout its own principles in the name of spreading its principles.

But it is positively baffling that there are not enough freedom-lovers in this country, or the world, to at least help 400 young knights of liberty find their intellectual arms and armor in the Auburn summer.

My friends and I at the Society of Libertarian Entrepreneurs have recently issued the challenge to our members and acquaintances to take our liberty advocacy seriously, to live our principles in a purposeful manner everyday. One way to do this is to put our money where our mouth is. We've encouraged our attendees to consider putting at least 1% of their net, after-tax income toward achieving personal freedom on a monthly basis. After all, the cretins who control us are spending a lot more than that every month trying to keep us all enslaved.

Of course, nobody is obligated to do anything for personal freedom or the Mises Institute. That's one of the great things (though frustrating in this case) about our philosophical credo. That being said, if you've been a beneficiary of the Mises Institute, if you've had your eyes opened, the fallacious chains of your previous mental prison torn asunder, your life transformed for the better in a powerful, meaningful way, maybe you should consider what kind of an effect it might have on your world if you helped provide others the opportunity to do the same.

It's not about giving back. You haven't "taken" anything and you needn't feel guilty of what you have received. Rather, it's about ensuring that those who want to receive, those who can transform the world with this knowledge and these tools, have the continued and expanding opportunity to do so.

The Mises Institute works ceaselessly to promote an individualist, rational, pro-liberty philosophy that we all benefit from. Unfortunately, it is not a profit-generating business and so it can not support itself without some help. We can not all be politicians and academics. If we want to continue to enjoy the fruits of institutions like the Mises Institute, those of us who are out there "doing" in the world, putting these ideas into practice, entrepreneurs and employees alike, will have to make the voluntary choice to do what we can to help the Institute get its work done.

Some secrets should never be told. These, however, are secrets worth sharing. If this post was your first introduction to the Mises Institute, I hope it has inspired you to take a closer look and get more familiar with the Mises Institute and Austrian economics. If you're a long-time learner, I hope you'll consider spreading the message more urgently and earnestly than before. No one is coming to save us and no one is waiting in the wings to deliver liberty to all of us.

If we want to live in a free society, we'll have to build it (and advertise its merits) ourselves.

Sunday, July 31, 2011

The WSJ Is In Bed With The Crazies

Don't believe me? In a new op-ed, Nassir Ghaemi argues "In times of crisis, mentally ill leaders can see what others don't":
When times are good and the ship of state only needs to sail straight, mentally healthy people function well as political leaders. But in times of crisis and tumult, those who are mentally abnormal, even ill, become the greatest leaders. We might call this the Inverse Law of Sanity.
Got that? When society faces a crisis, you want an emotionally unstable nutbag in charge. Or, to put it another way, crazy times call for crazy people.

Somehow, this logic doesn't seem to apply when "great nations" are facing "great villains" in other countries, however. How many cheered the assumed insanity of Hitler? Wasn't one of the reasons the US supposedly had to go over and bomb Iraq because Saddam Hussein was a wacko tyrant who couldn't be reasoned with? And don't even start me on the entire philosophy of the War on Terror, whose central premise is that those being targeted are in the US government's crosshairs because they're motivated by irrational beliefs and their instability means they can't be brought to a diplomatic compromise.

And of course, the idea of "great leaders" is bandied about much in the article but never once defined.

This just goes to show that the WSJ has totally lost it.

But, I guess by their logic that's a good thing!

Thursday, June 30, 2011

How To Get Paid To Do Nothing, Part 2: The Easy Billionaire

This is so funny. It's like my original post, only better. I only wish I had thought to write it up myself because I've often shared these specific sentiments with others but never bothered to blog about it. I'm sure others have, as well.

I found the write-up via Ragnar Is A Pirate, but original credit goes to Business Insider, how to become a billionaire in the easiest way possible, courtesy of the Fed:
STEP 1: Form a bank.
STEP 2: Round up a bunch of unemployed friends to be "bankers."
STEP 3: Raise $1 billion of equity. (This is the only tricky step. And it's not that tricky. See below.*)
STEP 4: Borrow $9 billion from the Fed at an annual cost of 0.25%.
STEP 5: Buy $10 billion of 30-year Treasuries paying 4.45%
STEP 6: Sit back and watch the cash flow in.
There are a few more steps, you'll want to read the rest if you enjoyed these or would like to learn more about how you, too, can get paid to do nothing and thereby become a billionaire banker.

Sunday, June 19, 2011

Should Anarchists Vote? A Response To Tom Woods

Over on LRC, the esteemed Tom Woods recently put together the following arguments with regards to why he believes anarchists (those who understand that a voluntary, private property society is most just and most economically efficient) should vote for Ron Paul:
(1) If you were stuck in a prison camp, and the guards let you vote on whether you were to have gruel or prime rib for dinner, would you be “consenting to the system” to vote for prime rib, or would you simply be doing the best you could under the circumstances to improve your material condition? (I owe this argument to someone but can’t remember where I got it from. Roderick Long, maybe?)

(2) Many Americans won’t consider even listening to a point of view that barely registers on the political radar screen. Whether out of intellectual laziness, cowardice, whatever, they just won’t. So it hurts us if Ron Paul gets 1% of the vote. But if he gets solid double digits, those people who might be faint of heart might realize they aren’t totally alone in supporting him, and will be more willing to do so. Yes, this is ridiculous and unjust, but that’s how it is. That’s why I think it hurts the cause of the free society not to vote for Ron Paul.
Before I begin, I want to make the following clear:
  1. I like Tom Woods, as a thinker at the very least and as a person I would like to think (I don't know him personally so I can't know for sure)
  2. Ron Paul is alright (by this, I mean, this is not a Ron Paul hit-piece, nor is it a Ron Paul-support piece-- this might seem hard to conceive given the subject matter but I don't think Ron Paul should have anything to do with this but rather it should be the principles, not the person, that guide our conclusions in this matter)
  3. My aim overall here is to further the thought experiment, not start an argument or attempt to draw blood
With that, my response...

In regards to the first point, I enjoyed the metaphor but I think it misses the point. It accepts the prison conditions as given. The reason the (average) anarchist doesn't vote and suggests others do the same, or not do the same depending on your perspective, is because the anarchist believes that voting is one of the means by which the political elite arrive at the desired ends of imprisoning all of us.

In effect, the prison conditions are not a given. They are a choice. And they are chosen, in part, by voting. Voting is the means by which the great mass of people are deluded into thinking there should rightfully be someone else above them wielding the kind of power the voted-for politician wields. Voting is not, as Tom Woods characterizes it, the means by which the already imprisoned choose gruel over prime rib.

This is tangential to this point but, I am not sure why a person would endeavor to give his prisoner a choice over gruel and prime rib when he's gone to the trouble to imprison him in the first place. Maybe he's just that sadistic? The assumption, however, is that the political elite have designed a system which is most beneficial to them and that life is not a video game where you figure out the one weakness the "boss" had control over engineering yet left open for you, the player, to strike, and to strike mercilessly, in this case that weakness being voting. If voting really offers us the choice between gruel and prime rib, we have to assume that the people in charge of the political process left us this choice on purpose, in which case making the choice serves their purposes, or by accident, in which case they made a serious blunder that they have yet to figure out the danger of after hundreds of years of experience with this particular form of imprisonment.

In short, the prison is not a given, or rather, it doesn't have to be. If it is, what are we bothering about trying to get out of it for? We're stuck.

With regards to Mr. Woods's second argument, I can't say too much other than that I am uneasy with the consequentialist tone of it. Liberty should not and can not be built on the logical edifice of consequentialism-- it is an intellectual foundation known to be lacking in affirmative, lasting architectural support.

It seems rather simplistic, as well. This is it? The reason Ron Paul and the ideas of liberty are unpalatable to the average person is because of a series of accidents of history which resulted in the current political "dichotomy" being mainstream while Ron Paul-libertarianism is not? People won't vote for it, because people won't vote for it, and people won't vote for it because people won't hear of it, and people won't hear of it because people won't vote for it? Somehow communists and other radical programs get on the ballot and get into the public consciousness in other societies and at other points in time whereas before achieving these relative states of awareness they had none, but somehow this is a limiting factor for these ideologies only in the American political system?

I can't help but wonder if there isn't a little bit more to the equation than that, as tantalizing as the potential consequence of action here may be?

Those are my few thoughts on Mr. Woods's, for the time being. And in the meantime I'd like to plant seed for a future tree of debate, a sapling which hopefully will be watered by Mr. Woods himself in due time, that being:
  • If we were not to vote for Ron Paul (because he didn't exist or were no longer interested in running for office), then who?
  • And if the answer is, "Nobody", then why? (That is, why is Ron Paul uniquely qualified for compromise in this regard.)
  • And furthermore, if not Ron Paul and if not anybody else, then what? (What could and should we all do in the absence of a qualified candidate worthy of our vote, anarchist and non-anarchist alike?)
The answer or answers to the last question is or are potentially most interesting to a person of my disposition, as the time to engage in such strategies is afforded at all present moments, not just those corresponding to the willful candidacy of a "Ron Paul", and, I would like to think, being derived from something more closely resembling a set of eternal and immutable principles rather than contemporaneous consequentialism, has the highest potential of being something which is a verifiable truth. I find most comfort and most success in the truth because the truth is intimately connected to reality and furthermore, as it was said, "The moral is the practical", so I like to begin there whenever I can.

I invite further comment from ladies and gentlemen alike, especially and most hopefully from gentleman scholars such as Mr. Woods.

How To Get Paid To Do Nothing

Consider this a public service announcement.

Recent economic events have led a great number of people in this country to be fearful about their individual financial circumstances. Job losses, real and potential, plague the populace and many wonder how they might free themselves from the rat race without simultaneously bankrupting themselves and their lacking-in-prosperity posterity.

For many the answer comes in the form of entrepreneurialism-- the art of seeing the future a bit more clearly than the rest, and having the confidence in one's own efficacy to realize that future in a profitable fashion. But many lack the "killer instinct" necessary to effectively execute on this vision, while more still have their hopes dashed on the rocks of regulation. Interventionism, it turns out, breeds not dynamism in affairs economic.

But it also doesn't breed nothing. And being by nature a wasteful and corrupting influence, it does manage to breed a form of opportunity all its own, namely, the opportunity to get paid to do nothing. You've read this far and your excitement is growing in direct proportion to your impatience, so if you'll only read a bit further you'll find the process explained by which you, too, can be paid to do nothing in our highly developed, technological, modern, division of labor economy.

How To Get Paid To Do Nothing, in 8 easy steps:
  1. Find a social problem or dilemma which is an outcome of the policies of government intervention, upon which public opinion is about evenly split but in a most agitated fashion, which has absolutely no chance of ever being resolved due to these very circumstances (for example: abortion, gun ownership, etc.)
  2. Form a non-profit advocacy/activism organization whose stated mission is to further one side of the debate, and install yourself as the chief executive
  3. (optional, but helpful) Choose for your organization a name which is both solemn and serious with regards to the mission but catchy, abrasive and self-righteous enough to grab headlines and media appearances in the future
  4. Begin fund-raising for your cause: set up "awareness" booths at local conventions, hand out flyers, attend public events as a featured speaker, begin a direct-mail campaign... remember, you can't get paid if you don't raise funds
  5. Use the funds raised to pay yourself a handsome salary, for as chief executive of this noble cause you have earned it; use the rest of the money to hire eager and unquestioning staffers who will go out and do the hard work of raising funds for you in the future, as well as a small detachment of DC lobbyists to be your boots on the ground
  6. As your prestige and importance grows, begin making appearances in the media as an "expert" voice on the subject, haranguing the misguided selfishness of your opponents while using the opportunity to make a "call to arms" in which you encourage your viewers to care deeply about this issue because you do, because we all should, because our future and freedom as a country depend on it! (Donate now!) Consider a book offer
  7. If any cynics should point out that you seem to have found a way to personally enrich yourself even though no material progress has or ever could be made towards actually achieving your stated ends given your proposed means, accuse them of ignorance, dishonesty, hatred of the freedom of the common man, etc., generally work to impugn their character and motives lest anyone catch whiff of the stench emanating from your own
  8. Finally, relax! You've made it! You've successfully managed to find a way to get paid to do nothing, and all in the middle of a global economic depression, no less

Free men have no need for lobbyists.

Wednesday, May 18, 2011

CATO Institute Believes Freedom Comes In The Form Of Government Vouchers

This video from the CATO Institute supports Paul Ryan's Medicare voucher contraption.

It claims it will solve "both of the big problems created by Medicare", namely:
  1. it would protect taxpayers by putting a [GDP-growth constrained] limit on budgetary costs
  2. by giving beneficiaries control over their healthcare choices by "reducing" the destructive impact of third-party payer outcomes on the healthcare system
Is this supposed to be a joke?

The voucher system, being chained to GDP growth (+1%!), ensures that so long as the economy isn't officially in a recession (facing quarters of decline in GDP), spending on Medicare will increase over time, not decrease. What's more, because government spending is a component of GDP, and Medicare spending is a component of government spending, increasing Medicare spending over the years actually creates a positive feedback loop by "juicing" the GDP growth stat and ensuring that Medicare spending grows a little bit faster still.

Additionally, the voucher system does absolutely nothing to fix the agency problem inherent in a third-party payer system like Medicare. Whether a government bureaucrat makes the decision about what to spend money on and how much of it is to be spent, or the actual individual receiving the service, the economy of the choice being made is irrelevant when it is Other People's Money (OPM) that is being spent. The voucher system is a taxpayer-funded scheme, meaning the money being spent was never earned by the person spending it so they have no reason to be thrifty as it costs them nothing to spend it.

In fact, it's worse than that-- a voucher system is a "use it or lose it" system. You don't get to save the value of your voucher payments if you don't spend them, thus encouraging voucher users to spend wisely and only when necessary. If you don't spend the full value of your voucher, the excess value is gone. This is a strong incentive to maximize the amount spent per transaction.

This voucher proposal is a horrible scheme which will do absolutely nothing to solve the economic problems related to government intervention in the healthcare market. And that is without taking time to address the fact that this is a proposal which ultimately maintains the political system's control over the healthcare system and the voters' lives who are concerned about it. Like every "reform" proposal, this is a not-so-clever way of rearranging the way the government controls this aspect of the economy, not any kind of deregulation or gradualist plan for getting the government out entirely.

The only solution to the government healthcare debacle is complete and total withdrawal. If you want to discuss the merits of different political strategies for getting to that point they should all revolve around how soon you end further participation in such systems by current and future generations and what kind of payouts existing participants should expect to receive along the way.

Quit hacking at the branches. The CATO Institute demonstrates, yet again, why it is a complete disgrace and a nefarious libertarian doppelganger.

Tuesday, May 17, 2011

What Did Kids Think Of Bin Laden's Reported Death?

Basically the same range of opinions exhibited by various "adults," which is somewhat frightening in and of itself.

Wednesday, May 11, 2011

China Leads The Way In Promoting Physical Fitness Amongst Its Citizens

I just found this disclosure in the most recent 20-F filing for Chinese MMORPG game-maker Perfect World (PWRD):
Under the anti-fatigue system, three hours or less of continuous play is defined as
“healthy,” three to five hours is defined as “fatiguing,” and five hours or more is defined as “unhealthy.” Game operators are required to reduce the value of game benefits for minor game players by half when those game players reach the “fatigue” level, and to zero when they reach the “unhealthy” level. In addition, online game players in China are now required to register their identity card numbers before they can play an online game.
Aside from the fact that I find it rather comical that a government which maintains a master-slave relationship with its citizens would see no irony in being nominally concerned with their health and fatigue levels, I'm surprised, really, that none of the Great Leaders in America thought to implement a system like this, first.

China leads the way!

Friday, May 6, 2011

Why There Will Be More Flash Crashes

Because traders have suffered "post-traumatic stress disorder" from previous episodes and the trauma of these incidents creates a feeling of personal insecurity and emotional vulnerability which can results in a psychological negative feedback loop.

Via the WSJ:
A year after the "flash crash," some Wall Street traders are still suffering from a type of post-traumatic stress that one psychologist calls "the flash-crash flashback."

"Your heart pounds, you sweat," said Ross Greenspan, a 25-year-old trader on the floor of the Chicago Mercantile Exchange. "You can get sort of a tunnel vision…you're looking at the screen, and you can't see anything in your periphery."
The young Mr. Greenspan is, of course, putting the cart before the horse, because it is the inability of most traders and market participants to utilize any kind of peripheral vision in the first place which affords them an opportunity to recklessly and single-mindedly take risks they aren't aware they are taking.
The feelings of panic that surfaced after the flash crash caused Mr. Greenspan to temporarily walk away from trading stock futures. He felt rattled during big stock-market gyrations, like the volatility seen following the Japanese earthquake in mid-March. It reminded him of May 6, 2010, when the Dow Jones Industrial Average plunged nearly 1,000 points and wiped out nearly $1 trillion of stock-market value in just minutes.
The strategic thinking of most market participants is diseased. Few have any sound, logical theory for engaging in the trades and investments they involve themselves with on a daily basis. They're so obsessed with the false idol of "empiricism" that they're convinced everything that has happened in the past will undoubtedly occur again in the future. In some instances they're correct, as their anxiety warps their decision-making and causes them to make their own fateful bed and then lie in it, such as with flash crashes.

The reality is, markets don't crash because history repeats itself-- history repeats itself because most people are ignorant of its lessons and choose the intellectually lazy way through life, playing the greater fool game and chasing momentum rather than doing the hard work of thinking critically about an investment thesis and digging through security filings and related data to find real value.
"Every little tick that goes against them feels like a personal assault on them and their ego…every little tick in their favor gives them a sense of hope and relief," Mr. Menaker said. "If you're experiencing a trade tick by tick, there's a lot of emotional volatility."
No real understanding of value, no real confidence in one's decision-making. This mindset guarantees volatility and upsets because your decision is only as good as the market says it is, second-by-second. Contrast that with an individual who has done his homework and identified $1 selling for fifty or sixty cents-- his margin of safety allows him some breathing room and he's consequently a lot less worried about how "popular" his decision is on a daily basis.

Searching out real value in the market is akin to cultivating authentic self-esteem via introspection and self-knowing.
"It's about dealing with the stress, dealing with the frustration, dealing with the fear," Ms. Shull said. "The fallacy of Wall Street is that we do it all quantitatively. Research shows you have to have emotions to make a decision."
Ms. Shull, an anxiety therapist hired by Wall Street, is obviously not in a position to be of much help. Emotions are the psychological reactions to the choices we make reflected against the values we hold. They don't help us make decisions, they come about in response to the decisions we've made.

What we've got here is a group of self-doubting, anxious, rudderless "empiricist" market participants being cared for by psychologists who have theory, but their theory is totally flawed and therefore unhelpful to the point of being harmful.

Essentially, it's like the guy responsible for hitting the "LAUNCH NUCLEAR WAR" button, standing over it, sweating, his stomach swirling while his psychologist friend says, "Well, do you feel like pushing the button?" Are you kidding? Of course he feels like pushing that button! Doing so would be the only way to achieve a definitive moment and relieve himself of his pent-up anxiety about all the close calls with nuclear war in the past.

Friday, April 15, 2011

What I Learned About The Oath Keepers' Founder Stewart Rhodes Last Night

Stewart Rhodes, founder of the Oath Keepers organization, spoke at a local Knights of Columbus hall in Dallas last night about his organization and its mission. I found out about the event through several local Meetups I follow and decided it would be a good opportunity to hear more about the Oath Keepers straight from the horse's mouth.

I arrived a skeptic, or worse. As an advocate of the private property society, I did not hope or expect to be impressed by an individual who runs an association for retired and active members of the military and law enforcement. I view many of those individuals suspiciously for their associations with coercive institutions which are the bane of existence for free-minded people everywhere. I assumed I would hear a lot about the "sacred honor" of uniformed personnel and how we all ought to support them even if they act errantly now and then. I expected to be disappointed with the Oath Keepers' mission statement for not going far enough, or not being fully consistent with the maintenance of individual freedom.

At this point, I am pleased to say I learned something and found myself reconsidering (or, considering for the first time) the value and merit of this organization and its founder.

I learned that the Oath Keepers' main purpose is to educate uniformed personnel about the oath they took to uphold the Constitution of the United States, and what the meaning and significance of that oath is, not to obligate anyone to a particular set of beliefs or social strategy. The idea is to help these individuals to learn the importance of personal responsibility and to develop the capability to think and study for themselves. Considering that part of military and law enforcement professional socialization is all about breaking down individual will power and inculcating a "hive mind" that is often mindlessly obedient to hierarchical authority, this is a laudable goal with tangible benefits for those who wish to live in a freer, more responsible society.

I learned that aside from the education mission, the Oath Keepers organization seeks to impress upon military and law enforcement personnel an ethic of preparedness. Rhodes specifically called upon veterans to take personal responsibility for developing strategies and and capabilities for dealing with:
  1. Food security, in the event of economic chaos which causes the food supply to become uncertain or unreliable
  2. Physical security, by forming neighborhood watch organizations and making known their interest in participating in a "sheriff's posse" with county law enforcement authorities who are deemed trustworthy and who take their oath seriously, in the event of widespread social violence
  3. Financial security, via the acquisition of sound money alternatives to fiat currency and the dollar
  4. State sovereignty, which Rhodes' sees as a critical bulwark against legally resisting federal tyrannies
Rhodes expressed explicit concern about a controlled, purposeful movement toward a new, international fiat currency system and a "one world government", which he thinks will be achieved through a series of disasters and crises exploited opportunistically by the elites who are after social control. The strategy outlined above, far from being an attempt to create another power center or an alternative or "shadow" government, is instead a suggestion for devolving and decentralizing power and achieving a level of social preparedness which will allow small communities to resist offers of "assistance" from federal authorities and agencies in a state of emergency, as well as to resist aggressive intervention from such bodies outright. By eliminating the risk of need, Rhodes believes communities will be better positioned to resist federal incursions and power grabs and protect their freedom in the process.

For those who are active participants in local militias, or are considering participating, Rhodes worries about the existence of spies and moles for the FBI, ATF and local police agencies who might try to entrap them. He suggests such individuals petition their county governments to create county militia ordinances, "then you are a part of the State, which is an advantage" because you can't be accused of doing something illegal or subversive. Not necessarily a fool-proof strategy and it comes with its own risks, but still an interesting suggestion.

In general, Rhodes views the idea (or ideal) of local and state militias favorably. He sees them as a necessary, legitimate and historical bulwark against political centralization and federal tyranny. He spent some time explaining the original intent of the militia system as a balance against federal military power and the way this balance has been disintegrated through the co-option of state militias into the National Guard system, who have since been deployed to foreign battlefields as offensive soldiery.

I also learned that Rhodes himself is a well-studied, articulate, impassioned and friendly individual. A graduate of Yale who currently operates a Constitutional law practice in Montana, Rhodes' grasp of facts, figures, events and ideas related to the American Revolution and the founding of the American political system were impressive, thoughtful and not at all robotic or mindlessly uncritical. He made it clear he is aware of advocates of the private property society and their principles and does not feel threatened by them. He spoke in front of the group of Lysander Spooner's writings (the No Treason articles) and shared his excitement and support for their ideals.

Rhodes knows his organization is not ideologically "pure" and that there are some issues (such as the fact that most every active duty member of the police and military is called upon to violate the Constitution on a daily basis simply by virtue of routine, daily orders) which he has purposefully not addressed even though they are disconcerting. Still, his response to such concerns was reasonable, especially because he admitted that more can be done-- this is his personal, voluntary strategy for attempting to achieve incremental change amongst the military and law enforcement communities. Rhodes does not excuse the participation in unconstitutional wars, or the prosecution of the War on Drugs, but he also believes that it will be more likely to bring uniformed personnel on board with that message if they are first made more aware of the oath they originally took, something he thinks all but the most violent and sociopathic are capable of grasping and understanding on their own.

Considering his organization is voluntary, not coercive, and he doesn't have to put his time or energy into running it, I think he is justified in making this personal, strategic decision. After all, Rhodes is nobody's slave and he's under no obligation to do anything in particular in regards to educating uniformed personnel or anyone else on this or that issue. Now, if Rhodes had made it clear that he thought participation in the War on Drugs or aggressive military invasions was justified (under any conditions) or constitutional (according to that standard) and that is why he didn't address them, that would be another matter entirely and I'd have a hard time signing off on what Rhodes is doing with the Oath Keepers.

As it stands, though, Rhodes as a fascinating character within the individual liberty arena and I was grateful for his ability to communicate his ideas in such a way that I left the meeting in a state of excitement, optimism and contemplativeness, even though the forecast Rhodes and I both share about where things are going in this country and around the world is actually quite depressing. The urgency of education, responsibility and personal preparedness are virtues that any liberty minded person should be able to get behind, whether one fully and consistently understands the logic and importance of the private property society or not.



Stewart Rhodes brought along a young friend of his, Brandon Smith, that same evening, who delivered a short speech on the coming economic storm and how people and communities might respond. Smith explained that people participate in the current monetary system because they don't feel they have any other options. He tied this in to the movement toward economic centralization, which he described as the purposeful reduction of options within a system (a simple idea but a neat way to frame it). He suggested that "the response to globalization is localization" and he meant that in the sense of the fragility of the current division of labor and its reliance on a single, fiat currency, the dollar as the world reserve.

Smith has spent some time studying other economic collapses and observed that barter networks naturally arise whenever a society faces economic or monetary collapse. Rather than waiting for the collapse to occur, however, Smith recommends people develop barter and other alternative exchange networks now. He is developing a website, the Alternative Market Program, to help educate people about the formation of local barter and alternative commerce networks.

Monday, March 28, 2011

Mish's Libertarian Economic Model Proves Friends Can Be More Dangerous Than Enemies

In attempting to dismantle the confused claims of one of his readers concerning "libertarian economics", blogger Mike "Mish" Shedlock ends up doing damage of his own to the logic of sound economic and political theory as espoused by consistent libertarians, demonstrating that sometimes we have more to fear from our friends than our enemies.

To be sure, overall Mish is a strong advocate of sound economic theory, knowledgeable financial market interpretations and a trustworthy explainer of the libertarian perspective. But every now and then he botches things up, badly, and as something of an authoritative voice out there he needs to be corrected lest his readers come across with a disjointed and self-contradictory interpretation of free market economic theory and its political implications for those seeking to live in a just, free individualist society.

To that extent, let's examine the two competing claims that Mish introduces, which he refers to as the "Regulation Model" of his reader, Tin Hat, and the "Libertarian Model" which he puts forth in its place, and see if we can arrive at a fully consistent third way that ultimately rejects both of these approaches as flawed.

First, the explanation by Tin Hat of the "core premise behind libertarian economics":
The private business sector will put ethics, morality and public employee good above profits, shareholders, bonuses, golden parachutes and CEO compensation -- IF they were completely unfettered from any government imposed rules, laws, and regulations.

And IF the private sector entity failed in its fiduciary duty to the public, Main Street would rise up and kick them out.

That's Corporatism.
Mish himself does a good job of responding to these claims and successfully refutes them, so I won't bother covering the same ground here. In addition, Mish outlines the "Libertarian Economic Model" as the alternative, which I reproduce below and have added bold emphasis to highlight claims I disagree with and will address afterward:
The Libertarian model does not end all regulation. Indeed the basis of the Libertarian economic model is that we need to protect private property, prevent fraud, protect human rights, and give everyone an equal chance under the law.

Had we done that, and "just" that we would not be in this mess.

In the Libertarian model, Fannie Mae and Freddie mac would not have existed. Nor would there have been a Fed keeping interest rates too low, too long. Without the loose lending model of the Fed, and without banks being able to lend more money than they have, the housing securitization model that blew up would not have happened or if somehow it did, it would have been less problematic by orders of magnitude

In the Libertarian model, there would not have been government sponsorship of the rating agencies Moody's, Fitch, and the S&P.

In the Libertarian model the construct of "Too big to fail" does not exist. Indeed, allowing failure is one of the tenants of the Libertarian model.

Note that something like Glass-Steagall would work in the context of a Libertarian model because its purpose is to put a firewall to prevent fraud. Pollution laws would still be needed to protect private property. Child labor laws would still be needed to protect human rights. Public safety laws are fine. No one would be allowed to yell "fire" in a movie theater.

If you want to take that model and add some social safety nets, all but strict Libertarians might agree.
First things first, an important distinction should be made between economic models and political/judicial models. Mish treats the two terms as essentially equivalent. He's correct that the free market economic theory or model he describes is generally one espoused by libertarians, but in describing the role that government intervention into the economy should or could play, he's describing a political system, not an economic one. I don't want to pick nits here but it's important to point out that there is no such thing as "libertarian economics", as opposed to "conservative economics" or "liberal economics" or whatever other type of economics you want to come up with.

The science of economics is supposed to be a description and analysis of fundamental, natural laws seen to operate in the realm of economic behaviors and relationships. These laws and cause-effect interactions are to be constant and immutable at all places, at all times, for all people. They are not dependent upon a particular political system or political viewpoint to remain true and they certainly can not be transformed through willful disbelief or the ideology of "perception is reality." Just as there is no "libertarian physics" or "libertarian biology", there is really no "libertarian economics." There is only physics, biology, economics, etc.

I think Mish would essentially agree with that proposal but I point it out nonetheless because the way he's chosen to frame the argument would seem to invite a response from people like Tin Hat to say, "Well, that's what you think based upon your political biases, which I don't share, so I reject the truth of your claims."

With that out of the way, I want to address the bold emphasis claims one by one.

The Libertarian model does not end all regulation
In reality, it absolutely does. In basic economic theory we can categorize all economic behavior as either voluntary or involuntary in nature. Voluntary behaviors are those which are willfully carried out by individual economic participants because they perceive such acts to be welfare enhancing. This could be anything from producing shoes, to selling shoes to somebody, to wearing those shoes (production, exchange, consumption). Involuntary behaviors are those which are carried out by individual economic participants because they perceive they will be punished, harmed or otherwise physically coerced by a third party if they do not do so. These behavior are necessarily welfare reducing, because the participant is behaving in a way they do not judge to be in their best interest and would not commit to were they not under threat of coercion.

Economic theory seeks to understand the structure and mechanics of voluntary economic behavior. Technically speaking, while economic theory can provide comment and observation as to the results of involuntary behaviors, truly this is a subset of economic theory known as "political economy", that is, the forceful redistribution of wealth and manipulation of free economic behavior.

Economic theory accepts as implicit the idea that private property exists and that its existence is observed and adequately protected by all participants, ie, that economic participants are barred from stealing from, defrauding or attacking one another and that these types of behaviors are essentially outside the scope of analysis.

These coercive acts do not require legislation or regulation to address. Their untenability is taken as given and is a necessary precondition for the operation of the market economy and the division of labor, which is based upon voluntary, peaceful exchange of wealth and values.

In other words, there is no need for any 3rd party "regulation" to make a voluntary economic system work. Any act initiatory force is an attack of that system from without-- it is not assumed into the model and does not require any particular regulatory structure or considerations ex ante to ensure everything runs smoothly.

Prevent fraud, protect human rights
These are absolutely not bases of the "Libertarian economic model" (quick note: big "L" Libertarian generally means having to do with an official, proper noun-type libertarian body, such as the Libertarian Party in the US, while little "l" libertarian typcially refers to the general body of concepts applicable to libertarian thinking, which is what I assume Mish is actually referring to here).

The libertarian political or legal framework underlying basic economic theory has essentially one major, axiomatic tenet, known as the Non-Aggression Principle (NAP) which simply states, "It is unjust for any individual to initiate the use of physical force against any other individual or his personal property." The NAP wholly and absolutely bans theft, fraud (a form of theft) and assault as illegitimate forms of social interaction and deems these to be punishable acts. All other consensual, voluntary exchanges are permissible. That's it.

While the NAP "outlaws" acts of fraud and deems these acts to be punishable as criminal in nature once committed, it does not approve of any law or regulation which would seek to "prevent fraud" before it occurs. The prevention of fraud, like the prevention of any other crime such as theft or assault, is up to every individual to make preparations for on his own time, at his own expense and according to his own reason. There is no way to justifiably enact a regulation or law which seeks to coerce individuals into arranging themselves and their property in ways they would not arrive at voluntarily, in the name of seeking to "prevent fraud," because in such a case the prevention of fraud has been gained at the expense of the actual commission of initiatory coercion.

The legal authorities, whoever they may be, are not the rightful owners of any property but their own and therefore they have no claim as to how other individuals should arrange their own property and business agreements so as to try to prevent fraud. Any attempt to have such an influence, short of peaceful, non-physical, verbal persuasion, constitutes an aggressive act of physical interference which is the very anti-thesis of the stated aims being pursued.

Similarly, there are no "human rights" as a special class of rights which can be legitimately protected under regulatory law. The only rights anyone possesses are property rights, that is, property rights in themselves and property rights in their possessions. These are the sacred boundaries and rights which must be respected by all social participants at all times, there are no additional "human rights" that can or must be protected.

Glass-Steagall would work in the context of a Libertarian model because its purpose is to put a firewall to prevent fraud

See the discussion above about the illegitimacy of "anti-fraud laws."

Glass-Steagall was a coercive act which treated the property and business arrangements of particular financial institutions as the property of public regulators. It made rules and restrictions as to how these institutions could voluntarily conduct their internal and external relationships in the name of preventing the possibility of actual malfeasance at an indeterminate point in the future. In effect, Glass-Steagall claimed that large banking operations were "guilty of fraud until proven innocent", a 180-degree contradiction of the normal legal precedent of "innocent until proven guilty."

It was a form of physical interference in the consensual, voluntary exchanges of those within the banking industry as well as those seeking to do business with those in the banking industry. It violated every participant's ability to engage in voluntary exchange within the construct of the NAP.

Furthermore, it was one of the pinnacle achievements of the Progressive Era and was enacted in 1932 as part of a wave of anti-liberty, interventionist "anti-trust" legislation of the statists of that time. The genesis of the law itself should lead any true libertarian to eye it suspiciously and seriously question its compatibility with the NAP and sound economic and political theory. Mish should know better than this.

Pollution laws would still be needed to protect private property
This is at best an ambiguously correct claim. What is needed is proper definitions of private property rights, in all cases. Then, it's a simple matter of adjudicating claims of interference or damage to those property rights. This is not something a legislative body can or will ever properly "regulate."

Child labor laws would still be needed to protect human rights
Again, completely false.

Child labor laws essentially are a body of laws which prevent individuals from hiring children to work in their businesses as paid employees or, to the extent that they are allowed to be hired, limits are placed on the age at which a child can be hired, the wage with which they can be paid, the hours they can work and the type of work they can engage in.

As a reminder, the NAP simply states "It is unjust for any individual to initiate the use of physical force against any other individual or his personal property." Parents are responsible for their children. Assuming a potential employer voluntarily wants to hire a child, the child voluntarily wants to work and the parent voluntarily agrees to let them, "child labor" is not problematic under the framework of the NAP and any law or regulation which would seek to create rules or restrictions on such exchanges would necessarily be a criminal act of coercive, physical interference in the voluntary, consensual exchange of the parties involved.

Yet again, like Glass-Steagall, child labor laws historically have been the work of union organizers and activists who were frustrated with the ability of employers to hire children and women as cheaper labor instead of paying padded wages to unionized, male personnel. The intent of these laws was not to protect children and preserve "human rights" but to prevent wage competition and protect the interests of unionized labor. As an outspoken critic of unions and organized labor, Mish should know better than to walk into this trap.

Public safety laws are fine. No one would be allowed to yell "fire" in a movie theater
False! False false false false false!

There is simply no need for "public safety laws". An act either constitutes a violation of the NAP (theft, fraud, assault) and is punishable as a crime, or it does not. There is no need to try to predict harm or behavior before the fact or create special classes or crimes or rules for protection, deemed to be "public safety laws."

The example of yelling fire in a crowded theater is a red herring, based upon faulty premises. It assumes that without some special public law governing behavior inside the private property of a movie theater, a person could get away with shouting "Fire!" and causing a lethal stampede.

The reality is that such an act, were it to occur, is covered under the rubric of fraud in the NAP! If someone were to shout "Fire!" in a crowded public space, or otherwise try to alarm a group of people to an immanent danger which does not actually exist, this would be an act of fraud. Further, if their intent was to cause a panic that would lead to injury and death, this would be an act of assault, just as if they were to brandish a crowbar and start beating and injuring people themselves.

Would you be surprised to learn that the genesis of this oft-misquoted "libertarian dilemma" cliche is, once again, statist agitation? The phrase and the thought problem originated from the opinion of Oliver Wendell Holmes, a Supreme Court justice, in the 1919 Supreme Court case Schenck vs. United States. The case was not about public safety and shouting "Fire!" in crowded public theatres-- it was about the supposed right of Congress to prohibit the distribution of anti-draft materials during World War I!

Do your homework, Mish!

All but strict Libertarians might agree
This final and last claim is perhaps most dangerous of all!

"Social safety nets" are a euphemism for slavery and a violation of the NAP. Any "social safety net" that would be publicly provided (aka, the responsibility of the government) would necessarily be the result of taxation, which is a coervice redistribution of private wealth. This is a clear violation of the NAP and it makes the provider of the resources for the "social safety net", the taxpayer, the effective slave of the despondent who depends upon such grace.

Libertarians uphold one, single axiomatic rule, the NAP, and they uphold it consistently and without compromise. Any libertarian who would make an exception for "social safety nets" and affirm the violation of the NAP in their pursuit is no libertarian, at all. Maybe they're a liberal, a conservative, a communist, or what have you, but they've given up their right to accurately and honestly call themselves a libertarian at that point.

Further, it's absolutely incredible that Mish would suggest that libertarian principles and sound logic allow one to mix and match different contradictory logical claims and integrate them into one system of thinking or worldview without problem. This is simply not possible! It doesn't make sense to say you agree with the NAP, except when it comes to bombing foreigners. Or, you agree with the NAP, except when it comes to handouts for the poor. Or, you agree with the NAP, except when it comes to grants of monopoly power to unions via regulations passed by the government.

You either agree with the NAP (how could you not? It's quite simple!), or you do not. Wholesale, fullstop.

Sunday, March 27, 2011

What Can I Do? The Eternal Libertarian Dilemma, Solved

So you've just finished explaining the moral tenets and economic principles of the libertarian social framework to your best friend, coworker, family member, fellow protest attendee, grocery clerk, quiet old man on a park bench, argumentative person riding public transit with you or loved or unloved one alike.

Miracle of all miracles, they've allowed you to say your piece without interrupting (more or less) and after a short pause, they end up citing their agreement. For some, it's a moment of exhilaration and excitement, for others it's a moment of frustration and resentful final submission to the unrelenting power of consistent, dispassionate logic. Either way, they agree with you and have intellectually come on board.

And then, it happens. The most dreaded question a committed libertarian can hear from someone they've just converted.

"Okay, so the world is a mess and everything I've been told up to this point in my life has basically been a great, big lie. It's completely rotten and now I'm upset and want to change things. What can I do?"

Careful now, careful! There are many potential responses to this question and almost all of them have led to some form of disaster in the past. One has been known to steal this vital energy just unlocked and channel it into a lifetime of pointless and ineffective political agitation. Another has caused many a good person to turn away from the rest of the world almost completely, traumatized by utter delusion and hopelessness about humanity. Still another has given back the victory as suddenly as it was won as the ex-convert becomes disgusted and angered with the libertarian's honest declaration that "I can only open your eyes, not show you the way. Part of being a libertarian is taking personal responsibility for your life-- there are some things you must figure out yourself."

"Yeah, thanks Master Yoda, but I don't have time to get that creative and/or run around the swamps of Dagobah all afternoon, so get back to me about your libertarian revolution when you've got a real solution I can put my energy toward."

How to answer that question, "What can I do?", is likely the one, true dilemma of the libertarian philosophy.

Until now.

Yes, friends, I am here to say unto you that that dilemma has been solved, once and for all, because a visionary group of young libertarian thinkers has come up with an answer that is both reasonable and practicable for anyone who is so inclined as to ask what they can do.

The answer, in short, is the motto of the Society of Libertarian Entrepreneurs (SOLE): "Improve every day. Be the hero."

Why is this the solution? Because besides being both moral and practical, it's sustainable and within every concerned individual's personal power to realize.

Political organization is expensive, time-consuming and ultimately futile. Opportunities to enact political change are occasional and limited. When it isn't "election season" and communities are not captured with the temporary spirit and excitement of an impending vote, it's hard to seem relevant and harder still to get people interested. What's worse, your ability to improve the condition of your own life with this strategy is dependent upon the whims of countless strangers. Not to mention the potential for change is limited by the radicalism of the candidates or ballot-initiatives being voted on.

Hermit-izing is pointless and self-defeating. You lose social power and prominence by choosing to withdraw. You give up relevance and appeal when your strategy for improving the state of social affairs is to neglect them entirely. You miss out on opportunities to benefit your quality of life via social participation and the division of labor in the market economy (or what's left of it, anyway) when you select retreat. You risk depression and debilitating negativity by adopting a strategy which assumes all hope that may be found will likely be under a rock.

Seeking self-improvement is a versatile, adaptable and ultimately superior solution that "wins" no matter what happens in the larger economic and political realms within which we all exist.

Consider: if the world becomes a freer place tomorrow, being smarter, healthier, wealthier, better looking, better networked, better informed and harder-working means you'll have more tools, resources and opportunities to take advantage of in a social context which permits you to enjoy these things much easier; conversely, if the world becomes even more statist, bureaucratic and arbitrary tomorrow, improving yourself in the aforementioned ways gives you more ways to survive the setback and still find a way to achieve happiness, prosperity and personal success as much as such a context may permit.

Everyone's goal is to live a happy life. Freedom is a necessary, but not sufficient, condition for the realization of that goal. The other meaningful part of the equation is exercising effective, reasonable and intelligent sovereignty over your own life.

The likelihood is that things will get worse before they get better, and that the average person's social context will become more interventionist and controlled rather than less, in the short term. That means every person will have to fight that much harder to maintain or improve the quality of their individual life experience-- self-improvement not only makes this easier, it makes it possible.

But if freedom were to arrive at the push of a button tomorrow, what good would it be if you were still the same uninspiring, boring, self-doubting, self-deluding, dishonest, out of shape, anti-social, unconnected, resourceless, penniless, talentless, thoughtless slob then that you potentially are now? Even if you're not that miserable to begin with, the point remains-- freedom can't do the heavy lifting, it is only a condition that allows you to enjoy the fruits of that labor.

If you want to get "ripped", you've got to pick up the weights and heft them around yourself. There's no better time than now and no better day but today to begin cultivating that kind of discipline and focus. This is a strategy that will begin paying dividends immediately and will serve you well whether your society devolves into a totalitarian nightmare or springs forth the fresh blossoms of a paradise of freedom.

Furthermore, it is a strategy that greatly enhances your ability to influence others and orchestrate real, positive change society-wide. Social power is derived from charm, intellect, appearance, wealth, physical strength and the possession of skills and networks which are useful to others. In other words, the more you improve your own personal values, the more valuable you become to other people and thus the more influential you become to other people. Nobody changed the world sitting on their couch watching TV. The simplest, most effective way to gain the kind of social power necessary to influence the way others choose to think and act about political and economic topics is to seek to be impressive to others in as many ways as you can by developing your own personal values.

And to the end of improving every day and being the hero, the newly-formed Society of Libertarian Entrepreneurs seeks to provide an authentic, useful community for like-minded individuals to associate with one another. The Society of Libertarian Entrepreneurs seeks to build the peaceful, productive and enlightened libertarian community of tomorrow by laying the groundwork today and providing people who hear the libertarian message and wonder "What can I do?" with a place to socialize with other people who are on that quest of self-discovery themselves.

Currently, there are branches in Los Angeles, Dallas and Ohio (full disclosure, I am the director of the recently-formed Dallas branch). You can view a video "manifesto" produced by the group below:

You can also learn more about the Society of Libertarian Entrepreneurs and their upcoming Meetups by visiting their website at

Stop waiting for a savior, political or otherwise, and stop cowering in distraught terror in your closet. Seek out self-improvement and be the hero in your own life. Be reflective and be reflected. Change yourself for the better and watch the world change around you.

Oh, and that "visionary young libertarian" bit above? That was tongue-in-cheek, as we make no real claim to total originality in advocating the strategy of self-improvement, though we do find ourselves perplexed as to why we had never come across such an explicit suggestion in any of our previous, extensive research and readings on the topic. It may not be an idea we came up with all by ourselves, but we're here to publicize it all by ourselves if we have to do so.

Friday, February 25, 2011

Cracking The Oil Debate: What To Do With The SPR?

Social unrest in the Middle East is leading to increased uncertainty in foreign oil and energy markets, with the result being renewed discussions about whether or not this is the appropriate time to tap the Department of Energy's approximately 727 million barrel strong Strategic Petroleum Reserve. According to the WSJ, Democratic parasite-politicians pleaded in a letter to the White House to consider the use of the SPR in light of the approaching summer driving season. Meanwhile, Daniel Yergin, "energy expert" and author of the critically-acclaimed book The Prize: The Epic Quest for Oil, Money & Power, has warned against drawdowns in the SPR, arguing that it is "unwise for the U.S. government to get in the business of price controls."

So, who is correct in this debate? For frequent readers of my commentary here at EPJ, it will likely come as little surprise to know that both sides of the debate are wrong because they're offering a false dichotomy to observers.

Let's take a step back for a moment. The question to be asking in this situation is not, "Given that we have the SPR, how should we utilize its resources?", but rather the question that should be asked is, "Why do we have an SPR in the first place?" or even better, "Should the US government be in the business of establishing something like the SPR?"

Sometimes it's hard for people to see issues like this as clearly as they should because the whole topic has been clouded by politics, which fools observers into thinking such decisions should be made according to arbitrary opinions and pragmatic political concerns. While the resources in question are indeed controlled by political bodies, the problem we are confronted with is, as per usual, economic in nature. At root, the Yergins of the world are arguing, This is not the appropriate/most economically efficient way to utilize the oil in the SPR, while the self-serving Democrat parasite-politicians are arguing, Given the potential alternative uses of the SPR, using some of it to try to keep oil prices down so my constituents don't raise hell with me is the appropriate/most economically efficient way to utilize the oil in the SPR.

But both of these arguments are backed by nothing other than the opinions of the people who put them forth. The reality is that the best use for the oil in the SPR, the one that would make the most economic sense, would be the individual decisions made by end consumers of the oil on the free market. Some individuals might decide to consume the oil immediately by using the oil to fuel their cars; others might choose to use some of the oil as a current capital good to fabricate petrochemical derivative products; still others might decide to transform some of the oil into a long-term capital good by storing it for later use (this is also known as "saving").

Who is Daniel Yergin, or the Democrat "lawmakers", to tell any of these people they are right or wrong for preferring to use the oil as they see fit if they're willing to pay the going price to obtain it?

Instead, we have the worst of all worlds, where the SPR is actually contributing to the very problem it was nominally established to defend against-- oil supply uncertainty and the threat of rising prices. In the grand scheme of things, the SPR's reserve capacity is somewhat laughable. Despite $4B cost of constructing the large, underground salt dome caverns used to store the oil (gee... why pay oil companies to pull their oil out of the ground in one place if it's just going to be put right back into the ground somewhere else at enormous cost?), the SPR only holds enough oil to supply the US for 34 days, at current rates of consumption.

Still, at current oil prices of nearly $100/bbl, that is $72.7B worth of oil being withheld from the market. With supply constrained thusly, prices are that much higher than they would be. Didn't Daniel Yergin say something about how the US government shouldn't be in the business of price controls? Seems like it's too late for that.

As for uncertainty, there's almost zero visibility for investors and consumers of oil as far as what conditions would elicit a decision from the DoE to release some of the oil in the SPR and thus "stabilize" supply. No visibility, that is, unless you're a major oil company. Take a look at a small list of disclosed drawdowns in the SPR available on Wikipedia. How many of those sound like emergencies to you, worthy of tapping into the country's "strategic" reserves?

Now, remind yourself that that's just your opinion, and it's bound to be different from your neighbor's, Daniel Yergin's, vote-hungry Democrat parasite-politicians and even the Big Kahuna, El Presidente, himself. It's all arbitrary. There is nothing scientific or objective about this decision-making process and it's ultimately finalized by the person with the gun (that is, not you).

This isn't planning. It's not strategy. It's whimsical, authoritarian chaos. National strategic petroleum reserves are tools of the State for fighting future wars, winning votes and rewarding politically-connected oil corporations and other members of the elite. They're not for you and me to dip into when we want to go on a summer road trip and Libya happens to be experiencing a revolution.

The SPR and other national reserves like it are a disgrace to "free energy markets" everywhere and they should be ended immediately. All oil to the people, and let them pay for it what they will!

Monday, February 14, 2011

Mubarak: "So Long, And Thanks For All The Fish!"

A good read over at the blog of Pater Tenenbrarum, pseudonymous "blogfather" to Mike Shedlock, on the latest capers in Egypt:
One day later – poof! – no more Mubarak. He's gone - and with him, his loot. As some enterprising journalists and bloggers have in the meantime found out (estimates for the total he 'earned' for his family have by now been raised to 'between $62 and $72 billion', which seem nicely spread over all the places where tinpot dictators these days like to keep their plunder), the total amount appropriated by the Mubarak clan is roughly similar to the entire US 'aid' Egypt has received in the period since it has become a US client state, courtesy of unwitting US tax cows.

Phew! What a relief! Dear US tax cows, you may breathe easier now. Your money did not, after all, finance a tyrannical regime of torture and terror. Instead you merely financed Mubarak's personal piggy bank! They did the rest all by themselves. Any disquietude that may have invaded your minds, any slight stirring of the conscience upon hearing that Egypt was not the nice place you thought it was – it can all be safely sent back to the deep slumber it was in previously.

Meanwhile, Egypt's military has taken over the State apparatus in Egypt, has suspended the constitution entirely and is promising elections within six months. We'll see what becomes of that, won't we? As we related previously, the Egyptian army is in the main a business. It runs resorts, it has its fingers in manufacturing, in fact it has business interests all over the show. Whatever happens next, the army will want to protect these interests.
My thoughts exactly. I am glad Robert Wenzel has been working hard to point out to EPJ readers that the fate of the average Egyptian going forward is going to be complicated because they have no real, consistent freedom ideology to replace the power vacuum left by their recently departed strong-arm dictator.

I'm no fan of written constitutions by any means but I find it kind of strange that no one seems all that concerned about the Egyptian army suspending theirs-- wouldn't one be able to accurately call the "anything goes" legal environment that follows such an act a military dictatorship? It's not like the military in Egypt has a monopoly on angelic intentions and kind governance. Mubarak, after all, originally hailed from that storied institution.

As Gob Bluth might say, Egypt appears to be returning from whence it came.