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Thursday, January 31, 2008

'Stay Poor' but Get Rich: The Clinton Dialectic Exposed

In a recent speech, Bill Clinton said:

"And maybe America, and Europe, and Japan, and Canada -- the rich counties -- would say, 'OK, we just have to slow down our economy and cut back our greenhouse gas emissions 'cause we have to save the planet for our grandchildren.' We could do that.

"But if we did that, you know as well as I do, China and India and Indonesia and Vietnam and Mexico and Brazil and the Ukraine, and all the other countries will never agree to stay poor to save the planet for our grandchildren. The only way we can do this is if we get back in the world's fight against global warming and prove it is good economics that we will create more jobs to build a sustainable economy that saves the planet for our children and grandchildren. It is the only way it will work.

Those who have read my blog know my argument that environmentalists really are not concerned about human life but value nature instrinsically and therefore see man (who must reshape earth for his survival) as an enemy of the environment whose progress must be thwarted. Logically, limiting or stopping human progress necessitates human sacrifice. This is pretty typical stuff, right? What's more interesting about this speech is the blatant contradiction between calling for the economy to slow down amid expressions of concern relating to countries not wanting to "stay poor" and the claim that such a slow down is 'good economics' which lead to 'millions and milions of jobs'. More from Clinton:

"And guess what? The only places in the world today in rich countries where you have rising wages and declining inequality are places that have generated more jobs than rich countries because they made a commitment we didn't. They got serious about a clean, efficient, green, independent energy future… If you want that in America, if you want the millions of jobs that will come from it, if you would like to see a new energy trust fund to finance solar energy and wind energy and biomass and responsible bio-fuels and electric hybrid plug-in vehicles that will soon get 100 miles a gallon, if you want every facility in this country to be made maximally energy efficient that will create millions and millions and millions of jobs, vote for her. She'll give it to you. She's got the right energy plan."

So, according to Bill, we must slow down the economy, stay poor, yet this will somehow create millions of new jobs because of an "energy trust fund" that will create "sustainable" energy which will benefit our grandchildren. Huh?

Remember that Clinton is famous for splitting hairs over the meaning of the word 'is'. I think there is a pattern here. I believe that this type of "argument" has a term in modern philsophy: the so-called dialectic process. Let's let Hegel and Marx explain http://en.wikipedia.org/wiki/Dialectic:

As in the Socratic dialectic, Hegel claimed to proceed by making implicit contradictions explicit: each stage of the process is the product of contradictions inherent or implicit in the preceding stage. ...The Hegelian dialectic cannot be mechanically applied for any chosen thesis. Critics argue that the selection of any antithesis, other than the logical negation of the thesis, is subjective. Then, if the logical negation is used as the antithesis, there is no rigorous way to derive a synthesis. In practice, when an antithesis is selected to suit the user's subjective purpose, the resulting "contradictions" are rhetorical, not logical, and the resulting synthesis not rigorously defensible against a multitude of other possible syntheses...."

...This is what Marx had to say about the difference between Hegel's dialectics and his own:

"My dialectic method is not only different from the Hegelian, but is its direct opposite. To Hegel, the life-process of the human brain, i.e., the process of thinking, which, under the name of 'the Idea,' he even transforms into an independent subject, is the demiurgos of the real world, and the real world is only the external, phenomenal form of 'the Idea.' With me, on the contrary, the ideal is nothing else than the material world reflected by the human mind, and translated into forms of thought."

Marx wrote:
"The mystification which dialectic suffers in Hegel's hands, by no means prevents him from being the first to present its general form of working in a comprehensive and conscious manner. With him it is standing on its head. It must be turned right side up again, if you would discover the rational kernel within the mystical shell."

Got all that? Now Clinton's argument makes perfect sense, right? (Like all good socialists, I'm sure Clinton paid great attention to 19th century German philosophy.) The real point is that modern philosophy has intellectually disarmed the public. This type of nonsense is taken seriously and serves only to undermine the validity of reason and actual logic with the consequence that modern intellectuals have no ability to evaluate nor to condemn blatant contradictions from political leaders. According to modern intellectuals, who can really know anything for sure (except, of course, that America and capitalism are evil)?

With respect to Clinton himself, I believe there is a psychological element to his madness which revolves around two interrelated issues: control and rage. Often a child lies to get his way. If he gets away with it enough times then it becomes a way to control the world around him. As he becomes an adult, compulsive lying yields the sense of being able to control reality itself. Clinton's compulsive lying is of course legendary. Also, note that Clinton's daring sexcapades fulfills this pathological need to control reality. To fool people and get away with it, whether it be a political lie or sexual adventures with the secretary while a diplomat (or his wife) sits in the other room, accomplishes the same goal psychologically: a sense of power emanati1ng from the feeling of controlling reality.

If you think I'm way off, then read the following from a NY Times article:

Mr. Clinton has reflected on his temper over the years, perhaps most revealingly in his autobiography. At one point in it, he recalls a day in junior high school when he hit a boy who had been taunting him. It was a moment from which he came to draw lessons.

“I was a little disturbed by my anger, the currents of which would prove deeper and stronger in the years ahead,” Mr. Clinton wrote. “Because of the way Daddy behaved when he was angry and drunk, I associated anger with being out of control and I was determined not to lose control. Doing so could unleash the deeper, constant anger I kept locked away because I didn’t know where it came from.”

And this guy's running for president again....

Monday, January 28, 2008

Anthropocene Epoch


Humans have altered Earth so much that scientists say a new epoch in the planet's geologic history has begun.

Say goodbye to the 10,000-year-old Holocene Epoch and hello to the Anthropocene. Among the major changes heralding this two-century-old man-made epoch:

* Vastly altered sediment erosion and deposition patterns.
* Major disturbances to the carbon cycle and global temperature.
* Wholesale changes in biology, from altered flowering times to new migration patterns.
* Acidification of the ocean, which threatens tiny marine life that forms the bottom of the food chain.

This is cool. Humans have so altered the earth that we get our own Epoch. What's strange about this article is that it describes this shift in a way that connotes concern and alarm.

I would add to the above list the following:

* Human life expectancy at all time highs
* Infant mortality at an all time low
* So much food that obesity is a medical problem
* People do such little manual labor that they pay fees to others to lift their weights and run in their gyms
* Can travel anywhere in the world in less than a day
* Can travel to other planets
* Higher education available to everybody independent of class
* Communication with anyone anywhere in the world instantaneous
* Ability to create lavish cities in previously uninhabitable areas (see Las Vegas)
* Periodic plagues that wipeout over 1/3 of the population pretty much eliminated
* Cures, vaccinations and transplants for previously life threatening conditions
* Information, knowledge about virtually any subject available instantaneously
* Recorded music, video and film
* Flourishing arts in every conceivable media
* Technology to control temperature such as heaters and air conditioners limit exposure to weather extremes

This is just off the top of my head. It truly is the Anthropocene Epoch...and we should be celebrating it!

Saturday, January 26, 2008

Fiscal Stimulus, Chia Pets, and a Crazy Theory

Allegedly, as part of its "stimulus package" the government is going to be giving people rebates on their taxes. However, retirees living on social security benefits are apparently angry they are not getting a "rebate,"so Senate democrats are preparing measures to include them.  (So they believe people who don't work and get a check from other people that do work have every right to be angry that the working people are not going to send them more of their wages?)

Ostensibly, if the premise of this action is that letting people keep their money is a stimulating thing to do, then why stop at $1,200? How about $1,300, or $5,000, or all of it? How about as I proposed in a previous post the government gives everyone 1 billion dollars? What's wrong with that?

Of course, its always good to let people keep more of their money. But has there been any talk about cutting government spending commensurate with the tax rebates? If not, logically doesn't this mean that the government's budget deficit will be larger than otherwise and it will have to borrow more money than otherwise? So, among other things, won't this plan drive up the interest on the deficit and/or increase inflation which will actually cost us all more in the long run?

Another aspect of this bothers me. Why do people think that the act of "spending" money is necessarily good for the economy? What if everyone spent their money on pet rocks, Chia pets, and dirt? All it would do is encourage producers of rocks, Chia pets, and dirt to make more Chia pets and the owners of these businesses certainly would make a lot of money. But, is this good for the economy in aggregate? Is the act of one person transferring his money for something else necessarily good? If I'm at the mall, and I watch someone buy a pretzel or a candle, how does that help me?

To quote a previous post: What really drives economic progress, i.e., real wages, living standards, etc.? The answer is productivity. If we can spend less time doing what we do now, it gives us more time to invent new things. Why is it that each of us don't have to spend all day hunting for food everyday or stockpiling wood for the coming winter like our ancestors? Practically 100% of the country used to be farmers. Now it's less than 5%. The greater division of labor that results from increased productivity frees everybody else to invent wonderful new things like computer chips and life saving drugs and run businesses like restaurants and art galleries. And what increases productivity? Capital investment.

Let me end by revealing a shockingly controversial plan based on a wild theory of economics I have been dabbling with recently: What if the government cut its spending? I know, I know, its a lot to take in, but just bear with me for a second. If the government cut its spending and then cut taxes people could keep more of their own money and it would not drive up the budget deficit. Wait, it gets crazier! If the government only spent what it took in there would be no budget deficit at all. This would further cut government spending by not increasing the amount of interest on the deficit. It would drive interest rates lower as there would be less competition for capital in the bond markets. It would drive inflation lower as the government wouldn't have to print as much money to buy bonds to fund its deficits. More capital in the hands of businessmen would lead to greater productivity, higher real wages, and increased standards of living for everyone as I just explained.

Wait, nah, forget it. Would never work. Just send me my billion dollars.

Thursday, January 24, 2008

What's A Socialist Dictator To Do?

Would if the government decreed that gasoline can only be sold at 5 cents a gallon and milk can only be sold for, um, let's say 8 cents a gallon? Do you think by the time you got to the store there would be any left? Say it costs the producers 50 cents a gallon to make gasoline and 80 cents a gallon to produce milk. How quickly do you think a producer would make new supplies available if he were facing a loss of 45 cents and 72 cents per gallon respectively?

What is the "fair price" of good? I explained this in great detail in previous posts.

Now, if you are a Socialist dictator or similarly, an American university professor, you may think that somehow the laws of economics don't apply to you. You might think that, somehow, your wish for goods to be cheaper than they are will come true. And of course, if your wish doesn't come true, you must jail and kill people:


Venezuela's top food company has accused troops of illegally seizing more than 500 tonnes of food from its trucks as part of President Hugo Chavez's campaign to stem shortages. The leftist Chavez this week created a state food distributor and loosened some price controls, seeking to end months of shortages for staples like milk and eggs that have caused long lines and upset his supporters in the OPEC nation.

Price controls are tantamount to socialism. If the government decrees at what price your property may be sold, in what sense do you actually own the property? You are merely a steward of the property on behalf of the state. What distinguishes one dictator from the next is only the extent to which he is willing to use violence to enforce such controls. As always, note that price controls (socialism) by distorting prices and causing shortages leads to economic chaos. As the chaos continues and its consequences are manifested throughout other parts of the economy, the government must resort to more and more violent means to enforce the price controls. It is in just this way, that socialism must lead to tyranny.

The highly publicised campaign has also included government crackdowns on accused smuggling, with the military seizing 1,600 tonnes of food and sending 1,200 troops to the border with Colombia.

Troops said they halted the transport of 350 tonnes of food to states along the Colombian border on suspicion of smuggling, he said. Another 165 tonnes were impounded in an eastern state on accusations of hoarding, he added.

He also threatened to expropriate companies selling food above regulated prices.
"Anyone who is distributing food ... and is speculating, we must intervene and we must expropriate (the business) and put it in the hands of the state and the communities," Chavez said during the inauguration of a new state-run market in Caracas.

And once Chavez "expropriates" these companies, how will he magically make the products cheaper than they are? Will the state brutally enslave its people ala the Killing Fields of Cambodia, the gulags of Russia, or the slave labor camps of China? Will the rivers suddenly flow with milk? Will he print more money and exascerbate an already runaway inflation? Just how will he make non-A an A?

The excuse for such brutally imbecilic evil is not ignorance. In fact its quite the opposite as Marxism is preached and lauded everyday on campuses all over the United States. The roots of these ideas are much deeper. As I have written many times, only when rational self-interest and the pursuit of happiness are considered morally good will individual rights and capitalism have a chance. As long as sacrifice is considered virtuous, the ruthless means will justify the ends of men like Chavez who will squeeze every last drop of blood from his sacrificial lambs. Tragically, the people of Venezuela will now be faced with a life and death struggle simply to obtain basic commodities like milk and eggs thus playing out the recurring theme of every socialist experiment and the theme of every attempt to make things not what they are.

Wednesday, January 23, 2008

Clinton's Violating 22nd Amendment?

What if Bill Clinton wanted to be president again so he goes out and finds a stooge to actually run then publicly proclaims that he (meaning Bill) will actually make all the decisions and that a vote for the stooge is actually a vote for him (Bill)? Of course, the stooge would be the one technically "elected", but it would clearly violate the spirit of the 22nd amendment in that Bill would be exercising effective control over the office. In this hypothetical case, it would be an obvious violation, but in principle, don't we have the same problem with a Hillary presidency? To what extent will Hillary actually make decisions and how can anyone know that Bill is not actually executing the office? After observing Bill Clinton's behavior in the campaign, is there any doubt he will have a material role in her presidency if not be a kind of shadow president?http://www.cnn.com/2008/POLITICS/01/21/obama.clintons/index.html?section=cnn_latest)

At the very least this should be seriously debated and better yet brought in front of a federal court to establish ground rules for his involvement.

Dr. George Reisman originally raised the question of whether Hillary's election to the presidency could represent a violation of the two-term limit here: http://georgereisman.com/blog/2007/11/would-hillarys-election-violate-two.html

For reference, here is the text of the 22nd Amendment:

Section 1. No person shall be elected to the office of the President more than twice, and no person who has held the office of President, or acted as President, for more than two years of a term to which some other person was elected President shall be elected to the office of the President more than once. But this article shall not apply to any person holding the office of President when this article was proposed by the Congress, and shall not prevent any person who may be holding the office of President, or acting as President, during the term within which this article becomes operative from holding the office of President or acting as President during the remainder of such term.

Section 2. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the legislatures of three-fourths of the several States within seven years from the date of its submission to the States by the Congress.

Tuesday, January 22, 2008

Freeze! Or I'll urge my friends to write you a letter threatening to sanction you!

There is a hilarious scene in the movie Team America: World Police (by the creators of South Park) where Hans Blix, the famed UN arms inspector, visits the maniacal Kim Jong Il of North Korea:

Kim Jong Il: Hans Brix? Oh no! Oh, herro. Great to see you again, Hans!
Hans Blix: Mr. Il, I was supposed to be allowed to inspect your palace today, but your guards won't let me enter certain areas.
Kim Jong Il: Hans, Hans, Hans! We've been frew this a dozen times. I don't have any weapons of mass destwuction, OK Hans?
Hans Blix: Then let me look around, so I can ease the UN's collective mind. I'm sorry, but the UN must be firm with you. Let me in, or else.
Kim Jong Il: Or else what?
Hans Blix: Or else we will be very angry with you... and we will write you a letter, telling you how angry we are.
Kim Jong Il: OK, Hans. I'll show you. Stand to your reft.
Hans Blix: [Moves to the left]
Kim Jong Il: A rittle more.
Hans Blix: [Moves to the left again]
Kim Jong Il: Good. [Opens up trap, Hans falls in]

I couldn't help but think of that scene when I read the following stories.

6 Powers Agree on Draft Iran Sanctions

Iran hails new delivery of nuclear fuel from Russia

Here is some actual text from one of these articles. Note the "Breaking News" in the middle:

"We agreed together today on the contents of such a resolution," Frank-Walter Steinmeier said after meeting his counterparts from the U.S., France, Britain, Russia and China. "Germany, France and Great Britain will submit a draft resolution to the Security Council."

The U.S. official referred specially to travel bans and asset freezes, but said the group agreed not to release the full text of the agreement until it had been distributed to the rest of the Security Council.

"This is a swift reminder to the Iranians that they are not in compliance," the U.S. official said.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

BERLIN (AP)—Six world powers may not agree to new measures against Iran's nuclear program after a meeting in Berlin on Tuesday, but the talks themselves show Tehran that the group still wants it to halt uranium enrichment, top diplomats said.

German Foreign Minister Frank-Walter Steinmeier said he could not predict if the meeting would produce a resolution on possible new sanctions, but stressed that the gathering of the foreign ministers of permanent U.N. Security Council members Britain, the U.S., France, Russia and China—plus Germany—sent a strong message.

Seriously, are you kidding me? Is the United States even a sovereign nation at this point. It appears we are de facto citizens of the United Nations.

Remember that document called the, uh the, uh the Constitution. Among the Enumerated Powers of the Congress in Article I, Section 8 of the US Constitution:

To declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water;

To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years;

To provide and maintain a Navy;

To make Rules for the Government and Regulation of the land and naval Forces;

To provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and repel Invasions;

Article II, Section 2 says of the President: He shall have Power, by and with the Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur

No mention of Hans Brix.

Monday, January 21, 2008

Clinton's Economic "Prod"


Based on the most objective source for presidential predictions, http://www.intrade.com/, Hillary has a 67% probability to get the Democratic nomination, the Democrats have a 62% chance of winning the presidency over the Republicans, and Hillary has a 47% chance of winning the presidency outright. The Democrats are overwhelming favorites to maintain control of both the House and the Senate. Now of course all of this can change, but the smart money right now is betting overwhelmingly on Hillary to win the presidency and Democratic control over the Congress.

Meanwhile, the global markets are plunging as the United States continues in a recession which could lead to a worldwide depression. The SP 500 has lost about 19% of its value from its high's set last year including down close to 10% this month.

On Friday, our savior in the Republican party, George W. Bush, announced his plan to rescue the global economy and prevent losses which have already wiped out hundreds of billions of dollars in capital. What is the plan? Give everyone 800 bucks.

Meanwhile, Ben Bernanke, the genius Federal Reserve Chairman promises to cut the Federal Funds target rate at some point in the future although not immediately. Fed Fund futures prices forecast a Fed Funds rate in the 2.5% range by end of the year although the current Fed target is around 4%.

As markets are forward looking and given the high probability of Hillary winning the presidency, perhaps we should look forward to possible policy changes after the election. The link above gives us some clues.

“If you go back and look at our history, we were most successful when we had that balance between an effective, vigorous government and a dynamic, appropriately regulated market,” Mrs. Clinton said. “And we have systematically diminished the role and the responsibility of our government, and we have watched our market become imbalanced.”

She added: “I want to get back to the appropriate balance of power between government and the market.”

What is that balance?
Mrs. Clinton’s approach to the economy would have three main components. She would roll back the Bush tax cuts for households with incomes over $250,000 while creating more tax breaks below that threshold; impose closer scrutiny on financial markets, including the investments being made by foreign governments in the United States; and raise spending on job-creating projects like the development of alternative energy. “We’ve done it in previous generations,” she said, alluding to large-scale public projects like the interstate highway system and the space program. “But we’ve got to have a plan.”

In other words, as the world's economy suffers in the wake of the bust engineered by Federal Reserve monetary policy and stagnates due to burdensome and costly regulations (which is forcing more companies to actually go private rather than deal with the costs and liability of being public), as individuals pour 25 to 50% of their income down the Federal Government sewer, as they pay for goods and services with after tax dollars that reflect higher prices due to taxes on production, imports, wages, regulations, etc. not to mention sales taxes, as we pay higher energy prices due to global warming and environmentalist hysteria, as health care costs spiral upward due to government intervention in the marketplace, as the public education system continues to churn out illiterate morons, as the social security system robs wage earners of their savings, as we drive on government roads and bridges in desperate need of repair, as we spend billions of dollars to bring "democracy" to medievel cultures in the Middle East, what does she propose ? Well naturally, in the worst retread of every bad idea of the past 200 years and in defiance of all rational principles of economic science and in absolute ignorance of actual history, she proposes higher taxes, more regulation, and public works projects.

And what is the Republican response? Two words: John McCain. He currently has a 50% probability of getting the Republican nomination with his nearest challenger, Romney, at 26%. We can bet that if Hillary proposes 50% tax rates, a 100% expansion of federal regulations, and 500% increases in public spending the Republicans will counter with a bold, courageous plan calling for 49% tax rates, a 95% expansion of regulation, and a 450% increase in public spending (yes to her "job-creating projects like the development of alternative energy" but no to her "space program" idea.)

The financial markets are telling George W. Bush and Hillary what they think of their plans.

Thursday, January 17, 2008

More Djembe Drum

"On Disko Bay in western Greenland, where a number of prominent world leaders have visited in recent years to get a first-hand impression of climate change, temperatures have dropped so drastically that the water has frozen over for the first time in a decade."

Yes, this proves that climate does change.

"Data obtained from ice cores indicate that between AD 800 and 1300 the regions around the fjords of the southern part of the island experienced a relatively mild climate similar to today. Trees and herbaceous plants grew in the south of the island and the prevailing climate initially permitted farming of domestic livestock species as farmed in Iceland."

Humans must have secretly been driving gas-guzzling SUV's and using too much toilet paper in 800 AD.

"The real reasons for climate changes are uneven solar radiation, terrestrial precession (that is, axis gyration), instability of oceanic currents, regular salinity fluctuations of the Arctic Ocean surface waters, etc. There is another, principal reason—solar activity and luminosity. The greater they are the warmer is our climate. "

"Astrophysics knows two solar activity cycles, of 11 and 200 years. Both are caused by changes in the radius and area of the irradiating solar surface. The latest data, obtained by Habibullah Abdusamatov, head of the Pulkovo Observatory space research laboratory, say that Earth has passed the peak of its warmer period, and a fairly cold spell will set in quite soon, by 2012. Real cold will come when solar activity reaches its minimum, by 2041, and will last for 50-60 years or even longer."

Well, I'm just glad that Al Gore and the "experts" have reached a consensus on this one.

http://weblogs.baltimoresun.com/news/local/bay_environment/blog/2008/01/global_warming_protest_snowed.html Many of the protesters who endured the cold to chant "Stop Global Warming!" said they didn't think the snowfall conflicted with their message. Davey Rogner, a 22 year old student at the University of Maryland College Park, beat on an African Djembe drum to rev up the crowd. He said the snow was a "gift" to remind eveyone about how rarely Maryland has been blanketed with beautiful white in recent years as temperatures have increased.

We have reached the point where people are protesting warm weather and chanting for miserable living conditions.

Russians are bracing for temperatures of as low as minus 55 degrees Celsius (minus 67 degrees Fahrenheit) in Siberia as Russia's emergencies ministry warns on Wednesday of its impending dangers in the coming weeks.

The freezing temperatures have already caused overloading of electricity grids and power interruptions in the regions of Irkutsk and Tomsk because of overused heaters in homes. Two people have already died and more than 30 others hospitalized with forst-bite in Irkutsk, reports AFP citing state media.

Don't they realize that this "beautiful white" is a "gift"? Incidentally, if the global warming nuts were really concerned about human life don't you think they might want to consider the fact that cold literally kills people? How many people have died from global warming again? Anyone, Bueller, Bueller...?

Wednesday, January 16, 2008

Expert Plan for Economy: If you rob me, then I will rob you

Experts say $150 billion stimulus needed

What does the Harvard professor want us to do about the ailing economy? What do the experts in Congress want us to do?

"Summers, an economics professor at Harvard University, had previously said $50 billion to $75 billion in tax cuts and pump-priming government spending is needed to boost the sagging economy. Now, his recommendation is double that — though perhaps employing a "trigger" that would release the money only if the economy worsens further." [italics mine]

"Democrats are coalescing around ideas such as extending unemployment benefits, boosting food stamp payments and doling out aid to ailing state governments."

"Sen. Edward Kennedy, D-Mass., said home heating subsidies and new job training programs should also be considered for a stimulus package."

I have an idea. How about the government "gives" each US citizen $1 Billion. That's right, each person will then be a billionaire. Now where would the government get this money you ask? Ok, good point, then let's just make it $500 Million.

In a previous post (
http://dougreich.blogspot.com/2007/04/wishing-for-non.html), I discussed Ayn Rand's idea that all of the evil in the world is in essence the result of wishing for things to not be what they are. I quoted the following passage from Atlas Shrugged:

“And that is the whole of their shabby secret. The secret of all their esoteric philosophies, of all their dialectics and super-senses, of their evasive eyes and snarling words, the secret for which they destroy civilization, language, industries, and lives, the secret for which they pierce their own eyes and eardrums, grind out their senses, blank out their minds, the purpose for which they dissolve the absolutes of reason, logic, matter, existence, reality – is to erect upon that plastic fog a singly holy absolute: their Wish.

“The restriction they seek to escape is the law of identity. The freedom they seek is freedom from the fact that an A will remain an A, no matter what their tears or tantrums -that a river will not bring them milk no matter what their hunger - that water will not run uphill, no matter what comforts they could gain if it did, and if they want to lift it to the roof of a skyscraper, they must do it by a process of thought and labor, in which the nature of an inch of pipe line counts, but their feelings do not - that their feelings are impotent to alter the course of a single speck of dust in space or the nature of any action they have committed."

Maybe she was onto something. The pursuit of a free lunch is not only impractical but immoral and destructive on an epic scale. (see the track record of religion and Marxism for starters.)

What really drives economic progress, i.e., real wages, living standards, etc.? The answer is productivity. If we can spend less time doing what we do now, it gives us more time to invent new things. Why is it that each of us don't have to spend all day hunting for food everyday or stockpiling wood for the coming winter? Practically 100% of the country used to be farmers. Now it's less than 5%. That frees up everybody else to invent wonderful new things and run businesses like restaurants and art galleries.

So what leads to productivity? Freedom - freedom to think, trade, and profit. Human wants are unlimited, and as long as people are free they will continue to make their lives better. Capital must flow freely to those most able to use it and they must be free to profit from their work. The government's function is to protect property and person. That's it. When the government does anything else it is a destroyer of capital.

Taxation destroy's capital and reduces or distorts incentives to work and invest in productive enterprises. The government's budget deficits crowd out capital from private usage by siphoning investment capital from business to the sewer hole of the federal budget. The government's inflation of the money supply (to fund its budget deficits) destroys capital in myriad different ways including but not limited to malinvestment and perverse tax effects. Regulation and licensing restricts people from trading freely and therefore restricts capital flow. To the extent that capital is destroyed, real wages decline and unemployment increases (Dr. Reisman has an excellent post on the relationship of inflation to economic inequality and stagnant wages, see http://georgereisman.com/blog/2008/01/credit-expansion-economic-inequality.html#links)

With all due respect to Professor Summers and Ted Kennedy the solution is: stop "stimulating" or "pumping and priming", and Let Us Alone!

Saturday, January 12, 2008

A Nation of Men

In thinking about the presidential race, there is a more important point to be made over and above criticism of the pathetic rogues gallery of contenders now before us and the excruciatingly vacuous "debates" that are supposed to set them apart from one another. The more frightening problem is that we are at a stage in the devolution of our nation's founding principles where we have to care about the outcome. The old saying that properly the US is a "nation of laws and not of men" is less true than ever.

A constitutionally limited government would have little effect on the day to day life of a nation. The main purpose of the chief executive would be as commander in chief of the armed forces and therefore as principal conductor of the nation's foreign policy. Of course, this would be a vital role and the president's philosophy would set the tenor for foreign relations and he would be the voice and symbol of the country internationally. The leadership of the armed services in times of war would obviously be critical but of course this is practically rare. Additionally, the founders left the declaration of war, the ratification of treaties, and the funding of the military to the Congress which of course is a massive check on the power of the chief executive.

Today, in opposition to our founding principles and the rational purpose of government, the federal government pervades every aspect of our lives. A full list would take a thousand pages but consider the fact that each person under threat of prison and fines, must detail virtually every financial transaction they make throughout the course of the year and pay a multitude of taxes representing a substantial and in some cases majority of one's annual income to Washington. Consider that these taxes are actually taken at source through payroll taxes and that the government forces an individual to "contribute" a substantial portion of their earnings to the social security system with no guarantee of repayment or of interest. Consider that a private bank known as the Federal Reserve bank was granted the power to print money and that Americans must use its notes which are backed by nothing but the Federal government's future taxing power. Consider that this bank can then buy government bonds which provides the government an unlimited ability to borrow and spend at the expense of anyone who owns the currency and that the president nominates the chairman of this bank for a term of 4 years. Consider that the president's cabinet contains secretaries of departments with regulatory power over every aspect of our lives from education to property, banking, medicine, and literally the "environment" in which we live. Each day, the government can make decisions regarding taxes and regulations that will affect and possibly destroy the lives of millions of people in countless different ways.

Unfortunately, this is why it matters who is president. We have become a nation of men and not of laws. The personality and philosophy of the president can have tremendous ramifications for everyone. Like a medieval kingdom the nation suffers more or less from term to term depending on whether our neighbors elect the next Ivan the Terrible or Hillary Clinton.

The solution is not to hope for a benevolent dictator but a return to a government limited in power so that less of our individual lives are spent worried about our next master. To discover the proper function of government and the nature and meaning of individual rights will require a philosophical revolution among the nations' intellectuals. Then and only then will we have another presidential election such as the election of 1800 when your choice would have been between John Adams and Thomas Jefferson not Huckabee and Obama. I just scared myself.

Wednesday, January 2, 2008

The Change to "Climate Change"


Reisman's latest blog post "Is There a Problem? Blame Global Warming" is great. In case you haven't noticed, the environmentalists have slowly shifted their propaganda from "global warming" to the more abstract concept of "climate change". First, this allows them an out from the increasing scientific scrutiny which continues to cast doubt on their claims of man made warming (see for example http://epw.senate.gov/public/index.cfm?FuseAction=Minority.Blogs&ContentRecord_id=f80a6386-802a-23ad-40c8-3c63dc2d02cb). Second, it enables them to package deal any perceived "change" in weather patterns whether it is in the form of increasing or decreasing temperatures, storms, rain, frozen Avocados to be Man's fault. The NY Times article that Reisman cites is symptomatic of this recent trend.

Of course, in previous posts I have argued that Environmentalists are not concerned with saving the Earth for man but saving the Earth from man. In other words, because man by his nature must use the Earth, the environmentalist who values nature "intrinsically" must in principle consider man to be only an enemy of the earth (which has now attained the status of a pseudo-god to be worshipped for its own sake.) Therefore, the scientific issue of "warming" is a smokescreen, i.e., a convenient claim carrying a pseudo-scientific veneer which can more easily confuse the ignorant public as to the movement's true aims. If "warming" were wholly disproved it would not temper the Environmentalist cause for a second as they would move on to something else as they are already doing with "climate change" or some to be determined apocryphal fantasy aimed at scaring the public into accepting sacrifice and global government decrees thwarting production and economic progress. Remember global cooling, acid rain, DDT, overpopulation, soil erosion, etc. etc.

(It dawned on me that humans exhale CO2 which must contribute to greenhouse gases, right? The implications of this are obvious so I'm sure this is coming soon. If anyone has seen anything on this please send.http://catalog.com/sft/bobf/global_warming.html this is pretty interesting)