The quote of the day comes from pages 476-477 of the 5th edition (2015) of Thomas Sowell’s Basic Economics:
At one time, it was believed that importing more than was exported impoverished a nation because the difference between import and exports had to be paid in gold, and the loss of gold was seen as a loss of national wealth. However, as early as 1776, Adam Smith’s classic The Wealth of Nations argued that the real wealth of a nation consists of its goods and services, not its gold supply.
Too many people have yet to grasp the full implications of that, even in the twenty-first century. If the goods and services available to the American people are greater as a result of international trade, then Americans are wealthier, not poorer, regardless of whether there is a “deficit” or a “surplus” in the international balance of trade.
Yes. And it matters not how Americans (or, more generally, how denizens of whatever country is considered to be the “domestic” one) gain greater access to goods and services produced globally.
If the Chinese become zealous devotees of a religion whose doctrine requires that they serve Americans by shipping to Americans goods and services free of charge, then Americans are made better off.
If the Chinese innovate in ways that lower their costs of production — and distribution and, thus, enable them to sell goods and services to Americans at lower prices — then Americans are made better off.
If the Chinese invent new products and offer to sell these new products to Americans at prices that Americans find attractive, Americans are made better off.
If the forces of international competition oblige Chinese producers to lower their export prices to levels closer to their costs of production, then Americans are made better off.
If the Chinese government forces Chinese citizens to subsidize the production of goods and services sold to Americans so that Americans can purchase these goods and services at artificially low prices, then Americans are made better off (although Chinese citizens, other than those involved in the export trade, are made unjustifiably worse off).
If the Chinese monetary authority buys US dollars with newly created yuan in order to (of necessity temporarily) make Chinese exports artificially inexpensive for Americans to buy, then Americans are made better off (although Chinese citizens, other than those involved in the export trade, are made unjustifiably worse off).
The above reality is missed by people, such as Donald Trump (but hardly limited to him) who judge trade to be “successful” only if the jobs and businesses that it visibly — that is, directly — creates in the domestic economy are perceived as being greater than the number of jobs and businesses that it visibly destroys.
This error is among the oldest and most difficult to kill in economics — not only because this error is serviceable to domestic producers who greedily seek protection from competition, but also because it appeals to people who refuse to think beyond what is immediately and blindingly obvious.
Donald Boudreaux is a professor of economics at George Mason University, a former FEE president, and the author of Hypocrites and Half-Wits.
https://drrichswier.com/wp-content/uploads/container-cargo-ship-e1440590384224.jpg426640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-08-26 07:59:572015-08-26 07:59:57The Oldest Fallacy in Economics by Donald J. Boudreaux
The Sarasota County School Board took up a discussion on a way to save the district money. The discussion died due to three school board members: Caroline Zucker, Jane Goodwin and Shirley Brown. This issue was about the costs associated with holding a tax increase referendum during an off year rather than during the November general election cycle. Here are some facts about the March tax increase referendum:
The tax increase referendum costs the School District $324,827.84 every four years. Five of these referendums have taken place costing approximately $1,714,139 to date.
Voter turnout is 16.76% during March referendums versus over 75% during a General Election.
The District March referendum suppresses the vote.
The Sarasota County School Board receives over 58% of all property taxes in the county.
The issue:
When the Sarasota County School Board has a “discussion” about issues, they get the feel for how everyone votes and then if there’s not a majority, they don’t schedule a public vote on it because they assume it’ll lose.
They only bring up winning votes instead of forcing votes and putting people on record. The threat of being on record and the accountability that comes from that could actually sway votes during a regularly scheduled School Board meeting. It would also allow for public input on this and many other issues that never make it out of these “discussions.” Discussions appear to be designed to keep important items off of the public meetings agenda.
This is a huge problem and amounts to the abuse of Sarasota County taxpayers, parents and voters.
Watch the video of the discussion held on August 17th, 2015:
During the discussion School Board (SB) Member Bridget Ziegler pushed to have the discussion about moving the Referendum to the General Election. SB Member Frank Kovach aggressively supported moving it as well.
Two of the three SB Members who opposed the move said that it would still pass in November. Caroline Zucker said it would pass in November (at 12:40) but opposed moving and saving money. Shirley Brown also said it would pass in November (at: 10:33 & 12:33) but opposed moving and saving money. Jane Goodwin did NOT support moving it.
Question: So why not save the money and hold the referendum in November?
There is no cost to the School District and taxpayers to add the tax increase referendum to the General Election unless it appears as a stand alone item on an extra sheet of paper, then the cost is only for the paper that is printed on for that one page, a minimal cost.
Those opposed argued that moving the tax increase referendum causes confusion for voters if they vote against referendum and then it’s still continuing from a previous vote. However, SB Member Kovach noted that the Sarasota County Commission did this and it caused no voter confusion.
The opposing SB members worried about the ballot getting crowded and being missed. See: Too much on ballot SB Member Zucker at 12:40 in the above video. However, SB Member Ziegler rips that apart by referencing voter turnout for the items at the ballot during a presidential general being at 50%+ rather than under 17%. It is also easy to vote via absentee ballot and during the early voting period.
Question: Why should the SB make it more difficult to vote? People aren’t used to voting in March.
Why are Zucker, Brown and Goodwin so concerned with the campaign to push for supporting the tax increase referendum rather than what’s best for taxpayers? Ziegler notes how bottom of the ballot items during a general election are three times higher than the tax increase referendum turnout. That means more voter engagement, not less.
SB Members have tried to paint first term SB Member Bridget Ziegler as a rookie. Maybe it’s good to have a fresh perspective to understand how much money this is costing the district. Maybe Ziegler is telling the truth and is being silenced at the expense of Sarasota County taxpayers?
Currently the tax referendum happens and is pitched as a rush and then when it’s passed there’s a rush on how to spend the money. It’s easy to spend money when it is not yours on off season tax increase referendums rather than on public school children. Especially when most of that money is used not to improve the classroom.
As SB Member Kovach pointed out the scheduling of the tax increase referendum is “more about victory versus the will of the people.”
Zucker is up for reelection. Perhaps she, Goodwin and Brown need to explain their anti-voter and anti-taxpayer positions?
https://drrichswier.com/wp-content/uploads/sarasota-school-board-logo-e1632046623427.jpg379640Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2015-08-19 09:59:452015-08-19 16:40:21Florida: Waste and Abuse at the Sarasota County School Board
More than 2,000 years before America’s bailouts and entitlement programs, the ancient Romans experimented with similar schemes. The Roman government rescued failing institutions, canceled personal debts, and spent huge sums on welfare programs. The result wasn’t pretty.
Roman politicians picked winners and losers, generally favoring the politically well connected — a practice that’s central to the welfare state of modern times, too. As numerous writers have noted, these expensive rob-Peter-to-pay-Paul efforts were major factors in bankrupting Roman society. They inevitably led to even more destructive interventions. Rome wasn’t built in a day, as the old saying goes — and it took a while to tear it down as well. Eventually, when the republic faded into an imperial autocracy, the emperors attempted to control the entire economy.
Debt forgiveness in ancient Rome was a contentious issue that was enacted multiple times. One of the earliest Roman populist reformers, the tribune Licinius Stolo, passed a bill that was essentially a moratorium on debt around 367 BC, a time of economic uncertainty. The legislation enabled debtors to subtract the interest paid from the principal owed if the remainder was paid off within a three-year window. By 352 BC, the financial situation in Rome was still bleak, and the state treasury paid many defaulted private debts owed to the unfortunate lenders. It was assumed that the debtors would eventually repay the state, but if you think they did, then you probably think Greece is a good credit risk today.
In 357 BC, the maximum permissible interest rate on loans was roughly 8 percent. Ten years later, this was considered insufficient, so Roman administrators lowered the cap to 4 percent. By 342, the successive reductions apparently failed to mollify the debtors or satisfactorily ease economic tensions, so interest on loans was abolished altogether. To no one’s surprise, creditors began to refuse to loan money. The law banning interest became completely ignored in time.
By 133 BC, the up-and-coming politician Tiberius Gracchus decided that Licinius’s measures were not enough. Tiberius passed a bill granting free tracts of state-owned farmland to the poor. Additionally, the government funded the erection of their new homes and the purchase of their faming tools. It’s been estimated that 75,000 families received free land because of this legislation. This was a government program that provided complimentary land, housing, and even a small business, all likely charged to the taxpayers or plundered from newly conquered nations. However, as soon as it was permissible, many settlers thanklessly sold their farms and returned to the city. Tiberius didn’t live to see these beneficiaries reject Roman generosity, because a group of senators murdered him in 133 BC, but his younger brother Gaius Gracchus took up his populist mantle and furthered his reforms.
Tiberius, incidentally, also passed Rome’s first subsidized food program, which provided discounted grain to many citizens. Initially, Romans dedicated to the ideal of self-reliance were shocked at the concept of mandated welfare, but before long, tens of thousands were receiving subsidized food, and not just the needy. Any Roman citizen who stood in the grain lines was entitled to assistance. One rich consul named Piso, who opposed the grain dole, was spotted waiting for the discounted food. He stated that if his wealth was going to be redistributed, then he intended on getting his share of grain.
By the third century AD, the food program had been amended multiple times. Discounted grain was replaced with entirely free grain, and at its peak, a third of Rome took advantage of the program. It became a hereditary privilege, passed down from parent to child. Other foodstuffs, including olive oil, pork, and salt, were regularly incorporated into the dole. The program ballooned until it was the second-largest expenditure in the imperial budget, behind the military.It failed to serve as a temporary safety net; like many government programs, it became perpetual assistance for a permanent constituency who felt entitled to its benefits.
In 88 BC, Rome was reeling from the Social War, a debilitating conflict with its former allies in the Italian peninsula. One victorious commander was a man named Sulla, who that year became consul (the top political position in the days of the republic) and later ruled as a dictator. To ease the economic catastrophe,Sulla canceled portions of citizens’ private debt, perhaps up to 10 percent,leaving lenders in a difficult position. He also revived and enforced a maximum interest rate on loans, likely similar to the law of 357 BC. The crisis continually worsened, and to address the situation in 86 BC, a measure was passed that reduced private debts by another 75 percent under the consulships of Cinna and Marius.
Less than two decades after Sulla, Catiline, the infamous populist radical and foe of Cicero, campaigned for the consulship on a platform of total debt forgiveness. Somehow, he was defeated, likely with bankers and Romans who actually repaid their debts opposing his candidacy. His life ended shortly thereafter in a failed coup attempt.
In 60 BC, the rising patrician Julius Caesar was elected consul, and he continued the policies of many of his populist predecessors with a few innovations of his own. Once again, Rome was in the midst of a crisis. In this period, private contractors called tax farmers collected taxes owed to the state. These tax collectors would bid on tax-farming contracts and were permitted to keep any surplus over the contract price as payment. In 59 BC, the tax-farmer industry was on the brink of collapse. Caesar forgave as much as one-third of their debt to the state. The bailout of the tax-farming market must have greatly affected Roman budgets and perhaps even taxpayers, but the catalyst for the relief measure was that Caesar and his crony Crassus had heavily invested in the struggling sector.
In 33 AD, half a century after the collapse of the republic, Emperor Tiberius faced a panic in the banking industry. He responded by providing a massive bailout of interest-free loans to bankers in an attempt to stabilize the market. Over 80 years later, Emperor Hadrian unilaterally forgave 225 million denarii in back taxes for many Romans, fostering resentment among others who had painstakingly paid their tax burdens in full.
Emperor Trajan conquered Dacia (modern Romania) early in the second century AD, flooding state coffers with booty. With this treasure trove, he funded a social program, the alimenta, which competed with private banking institutions by providing low-interest loans to landowners while the interest benefited underprivileged children. Trajan’s successors continued this program until the devaluation of the denarius, the Roman currency, rendered the alimenta defunct.
By 301 AD, while Emperor Diocletian was restructuring the government, the military, and the economy, he issued the famous Edict of Maximum Prices. Rome had become a totalitarian state that blamed many of its economic woes on supposed greedy profiteers. The edict defined the maximum prices and wages for goods and services. Failure to obey was punishable by death. Again, to no one’s surprise, many vendors refused to sell their goods at the set prices, and within a few years, Romans were ignoring the edict.
Enormous entitlement programs also became the norm in old Rome. At its height, the largest state expenditure was an army of 300,000–600,000 legionaries. The soldiers realized their role and necessity in Roman politics, and consequently their demands increased. They required exorbitant retirement packages in the form of free tracts of farmland or large bonuses of gold equal to more than a decade’s worth of their salary. They also expected enormous and periodic bonuses in order to prevent uprisings.
The Roman experience teaches important lessons. As the 20th-century economist Howard Kershner put it, “When a self-governing people confer upon their government the power to take from some and give to others, the process will not stop until the last bone of the last taxpayer is picked bare.” Putting one’s livelihood in the hands of vote-buying politicians compromises not just one’s personal independence, but the financial integrity of society as well. The welfare state, once begun, is difficult to reverse and never ends well.
Rome fell to invaders in 476 AD, but who the real barbarians were is an open question. The Roman people who supported the welfare state and the politicians who administered it so weakened society that the Western Roman Empire fell like a ripe plum that year. Maybe the real barbarians were those Romans who had effectively committed a slow-motion financial suicide.
Lawrence W. (“Larry”) Reed became president of FEE in 2008 after serving as chairman of its board of trustees in the 1990s and both writing and speaking for FEE since the late 1970s.
https://drrichswier.com/wp-content/uploads/rome-e1439905142296.jpg420640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-08-18 09:40:182015-08-18 09:40:18The Slow-Motion Financial Suicide of the Roman Empire by Lawrence W. Reed & Marc Hyden
America would be more prosperous if not a single sugar beet or sugar cane were grown anywhere in the United States because bankrolling sugar production in Florida makes as little sense as growing bananas in Maine.
So when Sen. Marco Rubio, R-Fla., walked into the Koch conclave earlier this month and defended his home state boondoggle in front of the most powerful enemies of corporate welfare, he became the bravest man in politics.
Rarely has such political daring been offered in a more worthless cause. Federal price supports and import quotas combine to force American consumers to pay more than $3 billion a year in higher prices, according to the Commerce Department.
Federal sugar policy has a long, sordid history. In 1816, Congress imposed high tariffs on sugar imports in part to prop up the value of slaves in Louisiana. In the 1890s, Congress abolished and then re-imposed the sugar tariff, spurring a boom-bust in Cuba that helped drag the U.S. into the Spanish-American War.
Sugar is perhaps America’s least efficient welfare program, costing consumers vastly more than it benefits farmers. Despite subsidies, the number of sugar growers has fallen by about half in the past three decades. The General Accounting Office estimated in 1995 that 1% of sugar growers captured almost half of all the benefits from the program.
As a result of the high prices, candy and other food manufacturers are shifting production to foreign nations (especially Canada). A study by Agralytica, an economic consulting firm, estimated the sugar program has cost over 120,000 jobs since 1997.
Because the U.S. mainland does not have a natural climate for sugar production, farmers have to compensate by dousing the land with fertilizer. As nearly 500,000 acres of the Everglades have been converted from swampland to sugar fields, phosphorous from the fertilizer has ravaged the region’s ecosystem. Politicians have launched hugely expensive efforts to curb the environmental harm but, as a New York Times 2010 exposé proved, the sugar industry benefited, not the Everglades.
The sugar program offers perennial confirmation of H.L. Mencken’s adage that every election is an “advance auction of stolen goods.” Congress shafts consumers because the sugar industry has directed millions to politicians, including almost $50 million in campaign contributions and lobbying between 2008 and 2013 alone. The economic arguments offered in defense of the program are merely camouflage for political plunder.
Food manufacturers, environmental groups and free-market activists are leading another assault on the program, and lawmakers are pushing a bill to limit the disruption the sugar program inflicts. That’s a first step, not a solution.
James Bovard is the author of ten books, includingPublic Policy Hooligan, Attention Deficit Democracy, andLost Rights: The Destruction of American Liberty. Find him on Twitter @JimBovard.
https://drrichswier.com/wp-content/uploads/rubio-2.jpg463640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-08-13 16:24:062015-08-13 16:24:06Marco Rubio’s Brave Defense of Corporate Welfare, Farm Subsidies, and Protectionism by James Bovard
The goal of this mega-mega philanthropic machine is to cement Common Core into American public education.
Here is a description of the purpose of CCFWG as noted in December 2013:
Recognizing the unique possibilities provided by Common Core standards, committed foundations are planning, learning, and acting together in a concerted way over the next two years as the “Common Core Funders Working Group.” A collaborative effort between the Education Funder Strategy Group, Growth Philanthropy Network and Grantmakers for Education, the Working Group seeks to leverage and organize the unique contributions of philanthropy——including resources, leadership, nimbleness, and independence——to support states and schools districts in successfully transitioning to the new Common Core standards.
The Working Group organizes funder interests and leadership on Common Core implementation issues at the national, state, and local levels. To learn more about getting involved——or simply to get added to the Working Group’s regular e-newsletter summarizing reports, research, and development with the standards——contact Grantmakers for Education.
In July 2015, CCFWG published a nine-page report summarizing what it “had learned” in its efforts over three years, from 2012 to 2015– as well as its decision to continue those efforts. Here are excerpts from the beginning of their July 2015 report, including their take on Common Core– and their assumption that they should promote it in schools that their own children are highly unlikely to attend– public schools:
The Common Core State Standards–finalized in 2009 and adopted by 46 states and D.C.—define a 21st century visionfor what young people need for success in college and careers in mathematics and English language arts. As such, their authors and many advocates believe the standards present an unprecedented opportunity to elevate the quality and effectiveness of teaching and learning in America’s schools—and to tackle persistent problems in new ways.
With their emphasis on problem-solving, critical thinking and writing, the Common Core standards can usher sweeping changes in schools, districts and states. And the transition to these higher expectations has shone a new light on many problems (such as allocation of resources towards ineffective professional development activities, and lack of scrutiny in the adoption of quality teaching materials) that have hampered effective teaching and world-class education in U.S. schools.Education funders interested in supporting the success of Common Core standards have therefore been pushed to consider solutions to deeper challenges and to consider more powerful ways of exerting influence and encouraging change. [Emphasis added.]
Two notes: First, these CC mega-funders considered Common Core “finalized in 2009,” when Common Core was not officially released until June 02, 2010. Second, they see their role as one of “exerting influence” in “powerful ways.”
And here are the concluding paragraphs of the July 2015 CCFWG report. Of course, the Common Core mega-funding push mustcontinue:
The challenges and needs posed by the Common Core standards remain. Funder support —for better teaching materials and better tests, for communications and advocacy, for teacher development—will still be critical and even decisive in the years ahead.
Working individually and jointly, philanthropy has influenced the adoption and implementation of the new standards. But the need for aggressive and well-organized advocacy and communications; the simultaneous potential and limitations of funder collaboration; the lessons about continuous improvement; and remaining questions about philanthropy’s role in systems change all remain pressing needs for continued support and future undertakings. [Emphasis added.]
CCFWG has plans to pay for “better tests”; it plans to continue to “advocate” for the Common Core “adoption” it has “influenced,” and its goal is to create “systems change”– with the “system” changing to “define the 21st century vision” for publicly educating the economic classes to which these rich folk do not belong.
In December 2013, Grantmakers for Education (GFE) and the Helmsley Trust produced this executive summary of three reports to help would-be Common Core funders. (Find more GFE reports here.) Here is their floral treatment of the glory of Common Core– “according to the project’s leaders”:
Announced in 2009 by the National Governors Association and Council of Chief State School Officers and voluntarily adopted by most states, the Common Core State Standards offer a new blueprint for what students in virtually every corner of the country will learn in English language arts (ELA) and literacy as well as mathematics. The Common Core are designed to be “robust and relevant to the real world, reflecting the knowledge and skills that young people need for success in college and careers,” according to the project’s leaders. States and local school systems are working overtime to implement and adjust to the higher expectations. Meanwhile, advocates and critics are engaged in spirited discourse over whether the standards can effectively drive improvement in K-12 education.
Note that the “spirited discourse” over the Common Core experiment follows the adoption– and still philanthropy is more than willing to push Common Core.
It must be just fine since “the project’s leaders” say so.
The opening of the executive summary is a more realistic in its portrayal of the 2009 “announcement” of Common Core (though by the time of the announcement, 46 states and three territories had already signed the Common Core memorandum of understanding).
Here are some noteworthy excerpts from the December 2013 funders executive summary:
…Funders should explore whether the Common Core affects their existing grantmaking strategies, and how they might use the standards as a rallying point to help accelerate pre-existing work and goals. …
Reflecting on grantmaking goals and objectives, funders should think about how to acknowledge the Common Core in their education investments. …
In addition to grantmaking, are there other leadership roles we can play to focus attention on the Common Core? …
But this excerpt is my favorite, by far:
The new standards have come under political and public attack in multiple states, and the opposition is expected to grow. Despite the states’ collaborative development and voluntary adoption of the standards, opponents on the right argue that the Common Core is a federal mandate. Opponents on the left are concerned about how the standards will affect teachers under new accountability systems, and about a perceived over-emphasis on testing. As a result, anti-Common Core campaigns are emerging in states across the country—some organic, but many highly coordinated and well-funded.
The Common Core—with its focus on raising expectations for how well students write, solve problems, and think critically—represents the culmination of reforms that many grantmakers have been trying to advance individually and in isolated efforts.Now, funders can use their resources and bully pulpit to help protect and advance the new standards. …
Funders can play a key role in helping build and maintain public will in support of the new standards. Some foundations have chosen to exercise their voice directly,publishing opinion pieces and convening key stakeholders to express support for the Common Core.Others have chosen to fund advocacy groups to support the work. Funders may also leverage their relationships with key stakeholder groups, such as the business community, which can provide powerful local voices in support of reform.
Advocacy shouldn’t stop with the new standards: Funders can play an essential role in helping state education policy leaders understand the value proposition of the new, common assessments most states will likely use. The reality is: Standards, no matter how good, aren’t very helpful if they aren’t well-measured. [Emphasis added.]
Common Core needs public support. So, let’s buy some.
We’ll call it “leveraging our relationships.” This is all the more important since Common Core opposition is “well organized and well funded.”
These are millionaires and billionaires soliciting Common Core pushes who are writing about supposed “well funded” Common Core opposition. Their solution? Manufactured support via the purchasing of pro-CC organizations, fabricating CC support meetings, and writing “I’m rich so my opinion is valuable” op-eds about an education initiative from which rich kids are exempt.
And Common Core needs common assessments; so, let’s “help” education policy leaders “understand” the need for the tests that must accompany Common Core. (The feds, who are supposedly not puppeting state involvement in Common Core, publicly agreed in 2009 to foot the bill for Common Core assessments. So, no need for philanthropy to directly pay for the assessments. However, indirect funding is always, uh, “helpful”….)
If it isn’t tested, it doesn’t count… for the lower- and middle-class kids. After all, that’s who the moneyed, CC-exempt are using their “bully pulpits” to advocate for–
–the Common Core guinea pigs.
https://drrichswier.com/wp-content/uploads/children-at-chalk-board.jpg426640Mercedes Schneiderhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngMercedes Schneider2015-08-12 08:13:062015-08-12 08:13:06A Funders’ Guide to the Common Core State Standards
During my campaign for Congress, I was often asked the question, “Why are they doing this?” The “this” the people asking the questions were referring to was typically some new tax, regulation, or government scheme designed to empower the political-class, and the bureaucrats, and disempower Americans. While watching the GOP debate last week, it became apparent that the conservative movement needs to do a better job of exposing the agendas of many of the thought leaders on the far-left.
While the modern Democratic Party cloaks the agenda of many of its thought leaders in populist rhetoric and “hope and change”-type slogans, the real agenda of many of their intellectual oligarchs is frightening. Stanley Kurtz of National Review has written extensively on this topic and has done a wonderful job of exposing the true agenda of anti-growth advocates such as Bill McKibben who have attracted large followings.
In writing this, my hope is to make the case that Kurtz, and others who have committed their time and energy to exposing the dangerous agenda of many on the far-left, are absolutely right and we, as conservatives and libertarians, must carry the torch and help sound the alarm about what is really motivating the wizard behind the curtain. We cannot continue to allow the Left to throw out the quickie “pay your fair share,” and “it’s all about the environment” soundbites without warning America about what this really means to them.
The far-left’s sabotaging of our economy has taken many legislative and ideological forms but their goal is the same: to ensure that we revert back to a “simpler” time where the use of affordable fossil fuel energy is rare, and the allocation of scarce resources is tightly controlled by “visionary” bureaucrats. I wonder if the acolytes of anti-growth advocates like McKibben, fossil fuel “divestment,” and the anti-economic growth movement in general, are aware of this. Are they aware of the fact that in a fossil fuel scarce economy that the cost to fuel up their gas tanks is going to be dramatically higher? Are they aware that their iPhones, tablets, and all of the social media and applications that make use of the power on these devices, are not powered by wood stoves?
Look no further than the European example for a real-world model of what happens to your wallet and quality of life when anti-growth advocates force unrealistic renewable energy mandates onto the backs of their country’s citizens who are struggling to pay the bills.
Another front in the far-left’s war on economic growth and prosperity is their attack on private property rights. Again, they disguise this as an initiative designed to protect and preserve the environment but its real goal is to ensure that private property rights are diminished and bureaucratic, and backdoor control over your property is increased, destroying economic growth potential in the process. Whether at the federal level through suffocating regulations such as the EPA’s new “Clean Water” rule which, oddly enough, expands the definition of a navigable waterway to streams in your backyard that are barely “navigable” by a Polly Pocket-sized toy boat. Or, through oppressive state regulations such as the infamous “Plan Maryland” legislation, which destroyed the value of large swaths of privately held land by restricting who the land owner could sell it to by enacting numerous development restrictions, the far-left is waging a well-disguised effort against prosperity and must be called on it.
Isn’t it interesting how the mainstream media is constantly calling on conservatives to apologize for the comments and actions of anyone claiming to be a conservative whenever some real or imagined verbal faux pas occurs but, they rarely ask political figures on the Left to apologize for the actions of the Bill McKibbens and Bill Ayers of the world? You can’t have it both ways. Either political parties are responsible for the words and actions of the thought leaders behind their party curtain, or individuals running under political party banners are individuals with different ideas for legislative and leadership paths forward and should be treated as such.
It’s time we publicly call on the Democratic candidates for president to answer questions about where they stand on the anti-growth movement. If these candidates have any guts they will condemn this nihilistic movement and ensure that this movement is positioned strictly on the fringe where they belong. Or, if they refuse, we should shout from the rafters that the “war on the economy” has begun, and the Democrats are using it as their battle cry.
EDITORS NOTE: This column originally appeared in the Conservative Review. The featured image of Democrat presidential primary candidate Bernie Sander is by Ringo H.W. Chiu | AP Photo.
https://drrichswier.com/wp-content/uploads/WeekendAtBernies-e1439380733881.jpg323640Dan Bonginohttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDan Bongino2015-08-12 08:01:562015-08-12 08:03:21Podcast: Is the Left Intentionally Tanking the Economy?
Hillary Clinton late Friday afternoon released her 2007-2014 tax returns, showing that she and Bill reported $139.1 million in adjusted gross income, paid $43.9 million in taxes (a 31.6% tax rate), and made $15 million (10.8% of their AGI) of charitable contributions, $14.9 million of which went to the Clinton Family Foundation and the Clinton Global Initiative.
I previously blogged the Clintons’ tax returns for prior years:
https://drrichswier.com/wp-content/uploads/Clinton-Foundation-Logo-e1439123681280.jpg351640Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2015-08-09 08:36:212015-08-09 08:36:46Hillary: 99% Of Charitable Contributions Went To Clinton Family Foundation
In 1944, F.A. Hayek’s Road to Serfdom rocked the English-speaking world. The book argued that there can be no political or civil liberty without economic liberty as a first principle. Every step away from economic liberty takes us closer to authoritarian control over the whole of society. With central control comes corruption, servitude, and relative impoverishment. The difference between the Reds and Browns, Hayek argued, matters in theory but not in practice: both paths lead to serfdom.
This argument shocked a generation of intellectuals who — very much like now — refuse to consider the integral relationship between liberty generally and freedom in the economic realm.
The timing of the book is significant. The world had been at war. Even countries with relatively free economies turned to economic planning and political centralization for the duration. Hayek regarded this path as deeply dangerous, one that threatened to convert free nations into the very thing they were supposedly fighting.
Popular wisdom regards this book as a warning against socialism, which is true enough, but a closer look reveals something striking: its primary warning concerns not Soviet-style socialism but rather the fascist form that was then sweeping Europe. Hayek sought to show that fascist forms of economic organization were not peculiar to the “German mind” or limited to rarified times and places but rather represent a grave danger to the whole world.
In 1945, the Readers Digest released a masterful reduction of the book for a popular audience. The Foundation for Economic Education has made this reduction available online in HTML and in PDF.
In addition, a magazine called Look, distributed by General Motors, released a much-reduced version of Hayek’s argument in the form of cartoons. It tells the dramatic story of a society dealing with economic decline in wartime turning to unworkable political fixes, authoritarianism, and eventual control of the whole of economic life. It’s a chilling presentation.
The Foundation for Economic Education is happy to present this work to a new generation. The dangers about which Hayek warned are ever present.
Friedrich Hayek (1899 – 1992) was an economist and philosopher, author of seminal works that changed intellectual history, who won the Nobel Memorial Prize in Economic Sciences for his pioneering work in the theory of money and economic fluctuations and penetrating analysis of the interdependence of economic, social and institutional phenomena. He taught in Vienna, London, and Chicago.
https://drrichswier.com/wp-content/uploads/road-to-serfdom-in-cartoons.png492640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-08-08 16:16:352015-08-08 16:19:58The Essence of the Road to Serfdom — in Cartoons! by F. A. Hayek
Senator Elizabeth Warren supports debt-free education, which goes even further by guaranteeing that students don’t take on debt to pay other expenses incurred while receiving an education.
While all of these plans would certainly increase access to higher education, they would also be expensive. President Obama’s relatively modest community college plan would cost $60 billion over the next decade. What makes this an even worse idea is that all of that taxpayer money wouldn’t solve the most important problems currently facing higher education.
Whatever the other social or spiritual benefits of attending college are, they don’t justify wasting that so much time and money without seeing much improvement in wages or job prospects.
Proponents of debt-free college argue that these programs are worth the cost because a more educated workforce will boost the economy. But these programs would push more marginal students into college without any regard for how prepared they are, how likely they are to graduate, or how interested they are in getting a degree. If even more of these students enter college, keeping the low completion rates from falling even further would be a challenge.
All of these plans would just make sure that everyone would have access to the mediocre product that higher education currently is. Just as the purpose of Obamacare was to make sure that every American had a health insurance card in their wallet, the purpose of debt-free education is to make sure that every American has a student ID card too — whether it means anything or not.
But there are changes coming in higher education that can actually solve some of these problems.
The Internet is making education much cheaper. While Open Online Courses have existed for more than a decade, there are a growing number of places to find educational materials online. Udemy is an online marketplace that allows anyone to create their own course and sell it or give it away. Saylor Academy and University of the People both have online models that offer college credit with free tuition and relatively low examination fees.
Udacity offers nanodegrees that can be completed in 6-12 months. The online curriculum is made in partnership with technology companies to give students exactly the skills that hiring managers are looking for. And there are many more businesses and non-profits offering new ways to learn that are cheaper, faster, and more able to keep up with the ever-changing economy than traditional universities.
All of these innovations are happening in response the rising costs and poor outcomes that have become typical of formal education. New educational models will keep developing that offer solutions that policy makers can’t provide.
Some of these options are free, some aren’t. Each has their own curriculum and some provide more tangible credentials than others. There isn’t one definitive answer as to how someone should go about receiving an education. But each of these innovations provides a small part of the answer to the current problems with higher education.
Change for the better is coming to higher education. Just don’t expect it to come from Washington.
Bryan Jinks is a ?freelance writer based out of Cleveland, Ohio.
https://drrichswier.com/wp-content/uploads/obama-warren-hillary-e1438627374773.jpg364640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-08-03 14:44:372015-08-03 14:44:37Who Is Doing More for Affordable Education: Politicians or Innovators? by Bryan Jinks
Is there anything more tragically monotonous than a failing welfare state? From ancient Rome to modern Greece, the story is one of the most repetitive in history. It goes like this:
People increasingly decide they’d rather vote for a living than work for one. An academic and intellectual class, dependent on subsidies and anxious to command the economy, advises the people that this is a really good thing. Politicians cater to them with high-sounding rhetoric (“We’ll take care of you”) and low-balling promises (“We can afford it. It won’t cost much. We’ll just take it from the rich”).
Responsibility, self-reliance, and enterprise give way to an entitlement mentality. Power concentrates and corruption ensues. Taxes and debt rise. The government debases the money. Crisis leads to more government, which leads to more crisis. What was always bankrupt morally finally goes bankrupt economically. Goodbye economy, liberty, and often even civilization itself. The barbarians take over. What else is new?
Now it’s Puerto Rico’s turn.
The Commonwealth of Puerto Rico is a US territory in the northeastern Caribbean. Its governor, Alejandro García Padilla, startled the world back in June when he announced that the island cannot pay back its $72 billion public debt.
“The debt is not payable,” García Padilla said. “There is no other option. I would love to have an easier option. This is not politics; this is math.”
He called the situation a “death spiral.” Suddenly, millions of Americans were learning what a basket case the Puerto Rican economy has become. It is indeed a crisis but one that was, to an embarrassing extent, made right here in America.
It was foisted on Puerto Ricans by one lousy New Dealer in particular. His name was Rexford Guy Tugwell.
More on the egghead Tugwell in a moment, but let me bring everybody up to date on just how bad things are down there. Be sure to read to the end because there’s a silver lining in this very dark cloud.
Puerto Rico has been in a funk for a good while. Its stubbornly high, double-digit unemployment rate is more than twice that of the United States. In fact, it hasn’t been below 9.7 percent in 40 years.
The island’s debt is higher on a per capita basis than that of any US state and four times that of Detroit, which went bankrupt two years ago. Businesses are collapsing. People are fleeing (200,000 have left since 2005). Almost half of the island’s 3.7 million residents earn incomes under the US federal poverty line. Nearly 40 percent of all households get food stamps. Until recently, the retirement age for government school teachers was as low as 47, prompting underfunded pension fund crisis so endemic to welfare states. (The retirement age has lately been raised to at least 55 for current teachers, and 62 for new teachers.)
As Tyler Durden explains at ZeroHedge.com, policies imposed from Washington must shoulder a big part of the blame for this mess: the wizards on the Potomac encouraged debt and deficit spending, priced hundreds of thousands of Puerto Ricans out of entry-level jobs with a punishing minimum wage, taxed and regulated commerce and investment to a crawl, and showered the island with debilitating welfare. The place would be a showcase of government-induced prosperity except for one sticking point: government.
All of this has been decades in the making, which brings me to the character named Tugwell. I’ve long had a distaste for this pompous meddler. The more I learn about his role as Puerto Rico’s appointed governor (1941–1946), the more I’m ashamed that a US president was dumb enough to put him in charge of anything.
I first heard of Tugwell as an undergraduate economics major at Grove City College in the early 1970s. Fascinated by what my econ prof, Dr. Hans Sennholz, had said in class about America’s 22nd and 24th president, Grover Cleveland, I checked out a biography of him. It carried the imaginative title, GroverCleveland, and included a revealing subtitle, A Biography of the President Whose Uncompromising Honesty and Integrity Failed America in a Time of Crisis.
The author was Rexford Guy Tugwell, widely regarded as the most influential ideologue of economic planning during Roosevelt’s New Deal. The Cleveland terms were largely wasted opportunities, according to Tugwell, because Cleveland would not turn the economy into his personal plaything. If only he had trashed his honesty and integrity, Cleveland could have been the scientist and the rest of us the lab rats.
Tugwell was the Jonathan Gruber of his day. (Recall the smug academic who admitted that deception was employed to fool stupid Americans into supporting Obamacare.) He went straight from academia as a student (the Wharton School at U-Penn, then Columbia) to academia as a professor (University of Washington, American University in Paris, and Columbia University). His intellectual mentors were socialists like Upton Sinclair and Edward Bellamy. Woodrow Wilson’s wartime administration gave him his first real glimpse of the glorious fun of central planning, and he loved it even when it flopped.
In 1932, President-elect Franklin Roosevelt invited Professor Tugwell to join the first White House “brain trust.” These were the whiz kids — the social scientists and experimenters of the administration. Blessed with power and attention, they were ready to “transform” America and “plan” our way out of the Great Depression.
H.L. Mencken was less charitable in his description. He called them “an astonishing rabble of impudent nobodies,” “a gang of half-educated pedagogues, starry-eyed uplifters and other such sorry wizards.” Along with FDR, they “planned” the Depression into the longest slump in American history.
Tugwell loved to set up and run what came to be known as “boondoggles.” He was an architect of the Agricultural Adjustment Act and later director of its Agricultural Adjustment Administration (AAA), which taxed agricultural processors and used the revenue to destroy crops and cattle to raise prices. It was declared unconstitutional by the Supreme Court and ridiculously destructive by clear thinkers.
From its inception in 1935, he directed the Resettlement Administration (RA), which relocated the rural unemployed to new, planned communities in suburbs. Urban authority Jane Jacobs, in her classic The Death and Life of Great American Cities, showed that his program simply displaced people and ruined neighborhoods. The RA was also thrown out as unconstitutional. True to the statist stereotype, Tugwell learned nothing from either experience. “Planning” was his religion and he was going to be its high priest, come hell or high water.
In 1936, Tugwell left Washington and two years later showed up as the first director of the New York City Planning Commission. He tried retroactively to enforce nonconforming land uses with almost no legal or public support. He proved too much an ideologue even for the polarizing Robert Moses, who killed Tugwell’s 50-year, pie-in-the-sky master plan for public housing.
Now let’s get back to Puerto Rico.
By 1941, Rexford Guy Tugwell had behind him a 20-year career of pontificating for big government and managing expensive government flops. Somehow that gave Franklin Roosevelt the idea of naming him governor of Puerto Rico. What Tugwell did for the mainland, he could now do for an island. Maybe this central planning stuff works better if you work small, right?
Nope.
So for five years, Professor Tugwell became Governor Tugwell. One of the first things he did was to create, with the legislature’s approval, the Puerto Rico Planning, Urbanization, and Zoning Board in 1942. If only he had done what John Copperthwaite did later in Hong Kong or what Ludwig Erhard did in postwar Germany or what inspired free marketers have done in freeing their cities, Puerto Rico might today be a beacon of liberty and prosperity. But Tugwell wanted to plan, plan, plan.
Pedro Serra is president of a new organization in Puerto Rico, the Alliance for the Protection of Liberties. He is a businessman from San Juan whose interest in free-market economics led him to work with the 2012 Ron Paul campaign. Looking back on the Tugwell period, he observes,
When President Roosevelt appointed Rexford G. Tugwell governor of Puerto Rico, it was in keeping with the same economic attitude that characterized the New Deal — that the government can solve an economy’s woes. Our government has since taken as an axiom that economic stagnation results from too little government, not too much. If this were the case, then today’s Puerto Rico should be paradise on earth. Instead our economy is depressed, our people jobless, and our government bankrupt.
Climate would seem to have blessed Puerto Rico for agricultural pursuits. Tugwell’s infinite wisdom suggested it should opt for industry instead, so he directed public policy against farming and toward manufacturing. He lobbied for all the aid and welfare from the mainland he could get. He set the tone for decades of a top-down welfare state. Joe Milligan, a colleague of Serra’s, is originally from Rochester, Michigan, and now brings his passion for free markets to San Juan, Puerto Rico, as the director of development for the Alliance for the Protection of Liberties. Here is how Milligan sums it up:
Governor Tugwell’s legacy is alive and apparent on the island. His tenure in office was characterized by central planning, government growth, and expansion of the welfare state. He stamped out the thriving sugar cane and coffee industries in favor of manufacturing. The result is that now we have neither. Today in Puerto Rico our government is the island’s largest employer and half of all residents require government financial assistance to subsist. In this sense Governor Tugwell truly left his mark.
Indeed, for many years after Governor Tugwell left Puerto Rico for academia back in the United States (where failure is celebrated as long as you worship the state and have good intentions), other New Dealers sojourned to the island to offer more of the same.
One of them was Hugh Barton, who had directed the US State Department’s Office of Strategic Services until he was fired for his knowledge of the communist affiliations of some of his top staff. Barton set up shop with the Puerto Rico Planning Board and the Office of Economic Research. If you had a college degree and a penchant for planning the economy of other people, you could get a government job in Puerto Rico in the 1950s and ’60s. Except for a brief retrenchment under one-term Governor Luis Fortuño, Puerto Rico has been run for decades as Tugwell first envisioned it, exacerbated by Washington’s poor policies to boot.
As I promised early in this article, there’s some good news in this bleak course of events. Puerto Rico now has a nascent libertarian movement and an organization devoted to spreading ideas of liberty as an antidote to the Tugwell legacy — the Alianza para la Protección de Libertades (Alliance for the Protection of Liberties) that Pedro Serra and Joe Milligan have launched.
The Alliance seeks to improve the lives of Puerto Ricans by building a new consensus around this proposition: a free society — not a centrally planned, politicized one — is a more prosperous and tolerant society. It works to build public support for smaller government and advise policy makers in choosing the proven path toward prosperity. The Alliance’s programs include developing a college campus lecture circuit, starting a YouTube channel specific to Puerto Rico’s issues, and disseminating compelling literature to legislators.
Never let a crisis go to waste, as the saying goes. Puerto Rico represents a unique opportunity to undo a painful, statist history. I hope readers will want to help.
“The curious task of economics,” Austrian economist F.A. Hayek taught us, “is to demonstrate to men how little they really know about what they imagine they can design.”
Rexford Guy Tugwell never understood that. With the help of the Alliance for the Protection of Liberties, Puerto Ricans may yet embrace Hayek’s wisdom and thereby shake the curse of Tugwell.
Lawrence W. (“Larry”) Reed became president of FEE in 2008 after serving as chairman of its board of trustees in the 1990s and both writing and speaking for FEE since the late 1970s.
https://drrichswier.com/wp-content/uploads/puerto-rico-shoreline.jpg288460Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-08-03 14:32:342015-08-03 14:37:31The Man Who Sowed the Seeds of Puerto Rico’s Collapse by Lawrence W. Reed
If you had no idea what was going on in St. Cloud, this story from the St. Cloud Times would not be very useful to bring you up to speed!
You might want to first start by reading our post from Thursday, here.
Union organizer, Jane Conrad, did some serious backpedaling after first planning a rally against a local VFW (Veterans of Foreign Wars for our readers elsewhere in the world!) that hosted local citizens wanting to hear about the economic and social costs of resettling more refugees in St. Cloud, MN. As we reported, she and a faculty member from St Cloud State University were clearly aiming to intimidate the Granite VFW Club for daring to allow diners to speak freely over their meal. There is more at WND, here.
Obviously, quickly seeing the error of taking on a venerable veterans group, she and her Somali supporters moved their demonstration down town. You can read all about their tiny rally hereat the St. Cloud Timeswhere Conrad claims they are protesting a Minnesota citizen, Bob Enos, for talking about sharia law.
You might think Enos was some two-headed monster to listen to Conrad. I wonder did the Times reporter seek comment from Enos?
Here is Mr. Enos giving a thoughtful presentation to a local government body recently.
Meanwhile the Times, other than a few photos tacked on at the end of the ‘news’ story, doesn’t tell readers about the huge and friendly gathering of veterans and friends supporting the VFW (which remember was the original target of Ms. Conrad and Professor Mark Jaede).
And, what a coincidence the St. Cloud Times also published a pro-more-Somali-refugees opinion piece at the same time!
SC Times columnist Patrick Henry, who previously said this, is trotted out for the occasion! How convenient is this timing!
”Minnesota’s 5th District Rep. Keith Ellison’s taking his oath of office on Jefferson’s copy of the Quran was a quintessential American moment…..the portrait of America as a Christian nation is groundless.”
Guess we know where he is coming from!
I have no time or energy to rebut yesterday’s opinion piece by Patrick Henry, retired executive director of the Collegeville Institute for Ecumenical and Cultural Research who has zero understanding of the finances involved with federal refugee resettlement grants and contracts and that is precisely why Mr. Enos’ call for serious fiscal studies is vitally important now.
Patrick Henry, St. Cloud Times columnist.
Here is how the St. Cloud Times opens its ‘news’ story today:
A group of St. Cloud-area residents took to the stairs in front of the Stearns County Courthouse to protest an anti-immigration speaker who visited St. Cloud earlier this week.
Jane Conrad, a field representative for the East Central Area Labor Council, planned the rally after Bob Enos, of Willmar, appeared at an event booked at the Veterans of Foreign Wars speaking out against refugees and Sharia, the Islamic law.
“We know we have issues in our community and we know they exist, but we don’t need people coming in and mixing it up and creating more problems,” Conrad said. “You’re welcome to come in and be a part of our community, but don’t create division.”
Worried that some citizens may be confused that Conrad and her group were speaking out against the VFW, Conrad made it clear they support troops and veterans and were strictly protesting Enos.
Enos, oh right! It is all about Enos!
Develop alternative media!
I guess what I am trying to say to all of you: It is time, past time! for the citizens of St. Cloud to develop their own alternative media. And, this applies to all of you in ‘Pockets of Resistance’. You do not have to depend on the local biased newspaper to reach like-minded people. I started RRW when my local paper wouldn’t publish FACTS about refugees and the cost to our community.
One of the first things I would post at your new publication are the financial facts about Lutheran Social Service of MN that clearly Patrick Henry has no clue about!
Write a website or a blog to put out your research and your opinions! Maybe find another small newspaper that is willing to publish your information. Definitely use conservative talk radio. Put papers like the St. Cloud Timesout of business, or at least begin to diminish their readership!
Or, consider this! Concerned citizens in Twin Falls, ID (a pocket of resistance) are printing up literature and taking it door-to-door to get around their own biased press!
This post is filed in our new category ‘Pockets of Resistance’ to help all of you better understand the tactics that will be used against you and how to counter them.
EDITORS NOTE: The city of St. Cloud is a UN/U.S. State Department preferred resettlement site right along with Minneapolis and St. Paul in Minnesota.
https://drrichswier.com/wp-content/uploads/granite-vfw.jpg356640Ann Corcoranhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngAnn Corcoran2015-08-02 14:19:202015-08-04 07:11:12Veterans of Foreign Wars concerned about Economic & Social Costs of Somali Immigrants
This speech was delivered at FreedomFest in Las Vegas, Nevada, on July 8, 2015.
Over a nine-month period beginning in 1831, a 26-year-old Frenchman visited nearly every corner of what were then the 24 states of the American Republic. He traveled from New England to the upper Midwest to the Gulf Coast in the Deep South to the mid-Atlantic. Then he wrote a great book full of amazing insights. It made its appearance 180 years ago, in 1835. Perhaps nobody before or since has defined the essence of America better than he did; but then, no other nation in history offered an essence so profoundly exceptional.
Less than half a century after the ratification of the Constitution, America was still an infant nation, but Alexis de Tocqueville sensed the stirrings of greatness. He praised our entrepreneurial drive and initiative, our self-reliance and personal independence, and our vibrant civil society institutions and voluntary associations. He felt that our ideals would eventually lead us to lead the world. He believed that America had placed two sacred principles — freedom and equality — on a higher pedestal than any previous civilization had. They were, he said, our most defining characteristics, the sources of our strength. But he also feared that we would carry one to an extreme that would undermine the other. Milton Friedman was echoing Tocqueville when he said in the 20th century, “A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both.”
Tocqueville’s appreciation of freedom knew few bounds. Here is perhaps his most eloquent endorsement of it:
Even despots accept the excellence of liberty. The simple truth is that they wish to keep it for themselves and promote the idea that no one else is at all worthy of it. Thus, our opinion of liberty does not reveal our differences but the relative value which we place on our fellow man. We can state with conviction, therefore, that a man’s support for absolute government is in direct proportion to the contempt he feels for his country.
He masterfully described how the growth of government could smother our freedoms:
After having thus successively taken each member of the community in its powerful grasp and fashioned him at will, the government then extends its arm over the whole community. It covers the surface of society with a network of small, complicated rules, minute and uniform, through which the most original minds and the most energetic characters cannot penetrate to rise above the crowd. The will of man is not shattered, but softened, bent, and guided; men are seldom forced by it to act, but they are constantly restrained from acting. Such a power does not destroy, but it prevents existence: it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to nothing better than a flock of timid and industrious animals, of which the government is the shepherd.
Tocqueville’s view of equality is more nuanced. He had no issue with the ideal of equality before the law or even equality of opportunity. He hated slavery and any unwarranted discrimination. He agreed with the words of our Declaration of Independence that “all men are created equal.” But he had no illusions that individuals were thereafter equal in their energies, their talents, their ambitions, their intellect or their character. He was afraid that our egalitarian impulses might someday get the better of us.
“I have a passionate love for liberty, law, and respect for rights,” he wrote. “Liberty is my foremost passion. But one also finds in the human heart a depraved taste for equality, which impels the weak to want to bring the strong down to their level, and which reduces men to preferring equality in servitude to inequality in freedom.”
This issue is so critical to our freedoms and our future that I want to dwell on it for a moment.
Remember this: Free people are not equal, and equal people are not free.
Put another way, in terms of economics, think of it this way: Free people will earn different incomes. Where people have the same income, they cannot be free.
Economic equality in a free society is a snare and a delusion that redistributionists envision. But free people are different people, not programmable robots, so it should not come as a surprise that they earn different incomes. Our talents and abilities are not identical. We don’t all work as hard. And even if we all were magically made equal in wealth tonight, we’d be unequal in the morning because some of us would spend our newfound wealth, and some of us would save it.
To produce even a rough measure of economic equality, governments must issue the following orders and back them up with punishment and prisons:Don’t excel or work harder than the next guy, don’t come up with any new ideas, don’t take any risks, and don’t do anything different from what you did yesterday.
In other words, don’t be human.
Economic inequality, when it derives from the voluntary interaction of creative individuals and not from political power or connections, testifies to the fact that people are being themselves, putting their unique skills to work in ways that are fulfilling to themselves and of value to others. As Tocqueville himself might say, Vive la différence!
People obsessed with economic equality do strange things. They become envious of others. They covet. They divide society into two groups: villains and victims. They spend far more time dragging somebody down than they do pulling anybody up. They’re not fun to be around.
And if they make it to a legislature, they can do real harm. Then they not only call the cops — they are the cops.
If economic inequality is an ailment, punishing effort and success is no cure in any event. Coercive, envy-based measures that aim to redistribute wealth prompt the smart or politically well-connected “haves” to seek refuge in havens here or abroad, while the hapless “have-nots” bear the full brunt of economic decline. A more productive expenditure of time would be to work to erase the mass of intrusive government that ensures that the “have-nots” are also the “cannots.”
Another superb alternative to coercive redistribution would be to work on our character — each of us, one at a time — so that we’re not only good enough for liberty, but good enough to earn a living instead of voting for one.
This economic-equality thing is not compassionate. When it’s just an idea, it’s bunk. When it’s public policy, it’s compulsory insanity. To those who can’t understand how different or unequal we are as individuals, I say, “Get over it!”
Tocqueville warned that this unhealthy obsession with economic equality, combined with an erosion in the respect for liberty and property, would produce what we today would call the welfare state. Let me offer you a description of the welfare state. Somebody once said that it got its name because in it, the politicians get well and the rest of us pay the fare. Just picture people in a giant circle with each having one hand in the next person’s pocket.
The whole notion of the welfare state rests on this really dumb proposition: since people are not decent and compassionate enough to assist their deserving fellows in distress, we must expect them to elect politicians who are more decent and compassionate than they are. How ridiculous! Those politicians then take money from us under threat of imprisonment, launder it through an expensive bureaucracy, and spend what’s left not to actually solve the problem but to manage it into perpetuity for endless dependency, demagoguery, and political gain. And then the advocates of the welfare state compliment themselves for possessing a monopoly on compassion and totally ignore the destructive results of their own handiwork.
So here we are now, decades into the very egalitarian welfare state Tocqueville warned would be the death of American exceptionalism. It threatens to make us like all the other forgettable welfare states that languish in history’s dustbins, Greece included. Should we just assume it’s inevitable and go along for the ride? Or should we muster the character that built a nation and that Tocqueville identified as quintessentially American?
If you’re pessimistic, then you’re no longer part of the solution. You’ve become part of the problem. What chance does liberty have if its supposed friends desert it in its hour of need or speak ill of its prospects?
Ask yourselves, What good purpose could a defeatist attitude possibly promote? Will it make me work harder for the causes I know are right? Is there anything about liberty that an election or events in Congress disprove? If I exude a pessimistic demeanor, will it help attract newcomers to the ideas I believe in? Is this the first time in history that believers in liberty have lost some battles? If we simply throw in the towel, will that enhance the prospects for future victories? Do we turn back just because the hill we have to climb got a little steeper?
This is not the time to abandon time-honored principles. I can’t speak for you, but someday, I want to go to my reward and be able to look back and say, “I never gave up. I never became part of the problem I tried to solve. I never gave the other side the luxury of winning anything without a rigorous, intellectual contest. I never missed an opportunity to do my best for what I believed in, and it never mattered what the odds or the obstacles were. I did my part.”
Remember that we stand on the shoulders of many people who came before us and who persevered through far darker times. The American patriots who shed their blood and suffered through unspeakable hardships as they took on the world’s most powerful nation in 1776 are certainly among them. But I am also thinking of the brave men and women behind the Iron Curtain who resisted the greatest tyranny of the modern age and won. I think of those like Hayek and Mises who kept the flame of liberty flickering in the 1940s. I think of the heroes like William Wilberforce and Thomas Clarkson who fought to end slavery and literally changed the conscience and character of Britain in the face of the most daunting of disadvantages. And I think of the Scots who, 456 years before the Declaration of Independence, put their lives on the line to repel English invaders with these thrilling words: “It is not for honor or glory or wealth that we fight, but for freedom alone, which no good man gives up except with his life.”
As I think about what some of those great men and women faced, the obstacles before us today seem rather puny.
This is a moment when our true character, the stuff we’re really made of, will show itself. If we retreat, that would tell me we were never really worthy of the battle in the first place. But if we resolve to let these challenging times build our character and rally our dispirited friends to new levels of dedication, we will look back on this occasion someday with pride at how we handled it. Have you called a friend yet today to explain to him or her why liberty should be a top priority?
Nobody ever promised that liberty would be easy to attain or simple to keep. The world has always been full of greedy thieves and thugs, narcissistic power seekers, snake-oil charlatans, unprincipled ne’er-do-wells, and arrogant busybodies. No true friend of liberty should just roll over and play dead for any of them.
Take an inventory every day of what you’re doing for liberty. Get more involved in the fight. There are plenty of things you can do. If your state isn’t a right-to-work state, work to make it so. Support people and organizations like the Foundation for Economic Education that are teaching young people about the importance of liberty and character. Get behind the Compact for America and its plan for a balanced federal budget and an end to reckless spending and debt. Work for school choice in your state to help break the government monopoly on education. And be the very best example for liberty and character that you can possibly be in everything you do.
Whatever you do, don’t give up no matter what. Remember these words of the great US Supreme Court justice George Sutherland: “The saddest epitaph which can be carved in memory of a vanished liberty is that it was lost because its possessors failed to stretch forth a saving hand while yet there was time.”
Can Tocqueville’s American exceptionalism be restored? Can it last? You bet it can. The American Dream still lives, in the hearts of those who love liberty and refuse to meekly surrender it. So let’s wipe the frowns off our faces and get to work. Our future, our children’s future — liberty’s future — all depend on us.
Lawrence W. (“Larry”) Reed became president of FEE in 2008 after serving as chairman of its board of trustees in the 1990s and both writing and speaking for FEE since the late 1970s.
https://drrichswier.com/wp-content/uploads/alexis-de-touqueville-e1438099806130.jpg317640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-07-28 12:11:042015-07-28 12:11:04VIDEO: Liberty Still Has a Fighting Chance by Lawrence W. Reed
Sam Patterson (sam@samuelrpatterson.com) is an author and technology enthusiast from Virginia. He has written about decentralized technologies such as bitcoin and OpenBazaar. Sam recently cofounded a company called OB1 to help build the decentralized marketplace OpenBazaar.
The Freeman: Your project, OpenBazaar, has been awarded $1 million in seed funding so far. Congratulations. What is it, and what does it do?
Patterson: OpenBazaar is an open source project to create a decentralized marketplace online where anyone in the world can buy or sell any goods or services with anyone else in the world, for free, using bitcoin. A few of the core project members (including myself) recently started a company called OB1, which received the funding in order to hire full-time developers and make OpenBazaar a reality.
Online commerce today is mostly centralized; companies own websites where users visit to buy and sell things. Those companies charge fees, monitor their users’ data, and censor their transactions based on their own rules and on behalf of the government.
OpenBazaar is different. Instead of relying on a centralized third party, trades occur directly between buyers and sellers. Users install peer-to-peer software on their computers, similar to bitcoin or BitTorrent, and this connects them to other users running the same software. They transact in bitcoin. Since there’s no middleman, there are no fees, no collection of data, and no censorship of trade.
The Freeman: Some people will object to OpenBazaar by saying it’s not transparent — that it will help criminals thrive. How do you answer such charges?
Patterson: Some have inaccurately labeled us as an evolved Silk Road — an underground drug marketplace. This is absolutely false, for many reasons. The Silk Road was centralized and run by a small group for profit. It catered to a specific group of people who traded in illicit goods.
In contrast, OpenBazaar is a decentralized marketplace, not run for profit. It doesn’t cater to any group, or any type of trade, but is open for all users to buy and sell anything they want with each other. It’s a much bigger vision than these narrow dark markets.
We expect that use of OpenBazaar will reflect markets in society. There will be some users who engage in activity that is morally or legally objectionable, but the vast majority of users will be engaging in positive and constructive trade. We don’t know exactly how people will use OpenBazaar to better their lives, but we believe that it will, and we can’t wait to see it happen.
The Freeman: What are the implications of this kind of technology for the world’s poorest people?
Patterson: Most of the existing centralized market platforms that I mentioned earlier don’t focus on the developing world, or even if they do, the payment methods used aren’t accessible for many of the world’s poor. Bitcoin requires no credit checks to use; an Internet connection and computer are all that’s needed. OpenBazaar is the same as bitcoin in this sense. It costs nothing to join and use, and the trade is direct between buyers and sellers; there are no middlemen to take a cut. We hope that by lowering the barriers to entry for online trade, OpenBazaar and bitcoin will bring millions of new users into the online economy.
The Freeman: What are the implications of this kind of technology for most of our readers — that is, wealthier Westerners?
Patterson: Establishing a protocol, client, and network for people to directly engage in trade with each other allows for more efficient transactions. Sellers on eBay who use PayPal regularly pay up to 10 percent fees on each sale. Those are 0 percent on OpenBazaar.
OpenBazaar is also more private. Instead of the centralized platforms getting all the information about your buying or selling habits, now that information is only available to the parties you directly engage with.
Also, if some of your readers are already bitcoin users, OpenBazaar is the first decentralized platform for them to spend their decentralized money. Many value decentralized technology simply because it takes power away from the gatekeepers in our world.
The Freeman: How do you market OpenBazaar? How do you build culture around it?
Patterson: We haven’t needed to market OpenBazaar so far. The bitcoin community is very excited to see it built. Once we look to go beyond bitcoin users and into the broader e-commerce space, then we’ll need to consider how to market ourselves. Likely, it will be around the lack of fees, which is compelling to retailers who have small margins.
Our culture is one that supports free trade and voluntary interactions in society. The ability to engage in trade directly with someone in person is a great thing, and it’s a shame that hasn’t been possible online — until now.
The Freeman: How flexible, robust, and “anti-fragile” is this system — especially with respect to predatory states who will likely try to foil its development?
Patterson: OpenBazaar is very robust, similar in design to bitcoin or BitTorrent. Because it’s run locally on users’ computers, there’s no central point of failure to attack. We don’t anticipate that OpenBazaar will face opposition from governments any more than other online platforms have; they have the same tools at their disposal to go after individual storeowners. But they cannot take down the whole system at once, unlike the existing platforms.
The Freeman: When will OpenBazaar be ready to use?
Patterson: We plan on publishing the first full release in November this year. The code is open source so developers can view it any time at our Github.
The Freeman is the flagship publication of the Foundation for Economic Education and one of the oldest and most respected journals of liberty in America. For more than 50 years it has uncompromisingly defended the ideals of the free society.
https://drrichswier.com/wp-content/uploads/sam-patterson-e1438005846575.jpg317640Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-07-27 10:06:292015-07-27 10:06:29Who Is Building the Private, Peer-to-Peer Marketplace? An Interview with Sam Patterson
The European project — a project I have always praised and supported — has just been dealt a terrible, perhaps fatal blow. And whatever you think of Syriza, or Greece, it wasn’t the Greeks who did it.
Paul Krugman has always praised and supported the European project? Really? Here’s Prof. Krugman in his own words on the centerpiece of the European project, the euro:
Paul Krugman, “The Euro: Beware Of What You Wish For”, Fortune, December 1998: “But EMU wasn’t designed to make everyone happy. It was designed to keep Germany happy — to provide the kind of stern anti-inflationary discipline that everyone knew Germany had always wanted and would always want in future.So what if the Germans have changed their mind, and realized that they — along with all the other major governments — are more worried about deflation than inflation, that they would very much like the central bankers to print some more money? Sorry, too late: the system is already on autopilot, and no course changes are permitted.”
Paul Krugman, “Can Europe Be Saved?”, NY Times, January 12, 2011: “The tragedy of the Euromess is that the creation of the euro was supposed to be the finest moment in a grand and noble undertaking: the generations-long effort to bring peace, democracy and shared prosperity to a once and frequently war-torn continent.But the architects of the euro, caught up in their project’s sweep and romance, chose to ignore the mundane difficulties a shared currency would predictably encounter — to ignore warnings, which were issued right from the beginning, that Europe lacked the institutions needed to make a common currency workable. Instead, they engaged in magical thinking, acting as if the nobility of their mission transcended such concerns.”
Paul Krugman, “Europe’s Many Economic Disasters”, NY Times, July 3, 2015: “What all of these economies have in common, however, is that by joining the eurozone they put themselves into an economic straitjacket.Finland had a very severe economic crisis at the end of the 1980s — much worse, at the beginning, than what it’s going through now. But it was able to engineer a fairly quick recovery in large part by sharply devaluing its currency, making its exports more competitive. This time, unfortunately, it had no currency to devalue. And the same goes for Europe’s other trouble spots. Does this mean that creating the euro was a mistake? Well, yes.”
When reading Prof. Krugman’s works, it’s prudent to fact check. Prof. Krugman has always been in the Eurosceptic camp. Indeed, the essence of many of his pronouncements can be found in declarations from a wide range of Eurosceptic parties.
Steve H. Hanke is a Professor of Applied Economics and Co-Director of the Institute for Applied Economics, Global Health, and the Study of Business Enterprise at The Johns Hopkins University in Baltimore.
https://drrichswier.com/wp-content/uploads/krugman.jpg284460Foundation for Economic Education (FEE)http://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngFoundation for Economic Education (FEE)2015-07-24 09:41:332015-07-24 09:41:33Paul Krugman Is Even Wrong about What Paul Krugman Thought by Steve H. Hanke
The hypocrisy of government “planners” is astounding. Government planners are experts at planning destruction, distancing themselves from the results, and then recommending additional planning to fix what they have destroyed. They have been rearranging society according to their social engineering agenda, redistributive economic theories, cynical “division politics” strategies, and racial quotas for decades and the more planning they do, the more chaos we get.
I have been closely following the Obama Administration’s recently announced plan to racially diversify upper middle income neighborhoods through their recent HUD directive titled “Affirmatively Furthering Fair Housing” for some time now, and continue to wonder when the media and curious Americans are going to start asking the hard questions about this incessant drive to socially engineer our lives, and the devastating outcomes they have produced.
Sadly, I doubt the media will delve into the complicated but overwhelmingly negative externalities generated by years of adherence to the liberal social planners’ agenda, and their societal reorganization goals. So it’s our turn to bypass them and ask the hard questions ourselves.
Here’s the critical question for the government planners: Who is in charge of the neighborhoods and cities with significant minority populations, and why are many of these areas struggling?
Of course, the answers are extremely inconvenient for the liberal social planners among us because the correlation between liberal governance and their symbiotic “planning” agenda in inner cities, and economic hardship for its citizens, is high. If the government planners who engineered the negative economic outcomes, housing outcomes, and education outcomes in the inner cities they dominate failed to generate even average outcomes for their citizens, then why would middle-class America be remotely open to the idea of these destructive planners engineering outcomes in their neighborhoods?
The planners, in conjunction with the liberal political and activist class, will, of course, blame the inevitable backlash against this attempt to place government sponsored housing in upper middle income neighborhoods on racism, but Americans are tiring of this old trick. Americans of all races, creeds, and countries of origin want to live in neighborhoods of their own choice and choose these neighborhoods for a variety of reasons. Some choose the convenience of city-living because they dislike long commutes. Others choose the suburbs because they want a yard for their children to play in. And some choose the country because they like the relaxing symphony of the Lord’s sounds of nature at night. Pretending these decisions are the twisted result of a devoutly racist country is an insult to every American who bought their home because it was their piece of the American Dream, not a bullet point in a government master-planning document.
The rank hypocrisy here, which escapes the media spin doctors who are avoiding this story because of its potentially explosive impact on electoral politics, is that it’s the planner’s adherence to the tax-and-spend ideology and zoning regulations which are primary drivers of generational poverty in the very areas many struggling Americans are looking to escape from, and the low income housing crisis in America, respectively. Restrictive zoning and “rent control” policies have long been pointed to as drivers of housing shortages and any Econ 101 student understands that when you restrict the supply of any good or service, the price will rise.
Magnifying the problem is that restrictive zoning requirements add layers of fixed costs to housing construction projects which make the business of building homes profitable and sustainable only if you build high income housing to defray the fixed costs. The Left employs this same hat trick often; first they create a problem, and then they propose more of the poison as an antidote. They created the low income housing crisis through their adherence to heavy zoning, planning, and housing regulation, then they ruined the many inner cities, where they govern unchallenged, forcing people out of those cities to the suburbs, and now they chase those same people to the suburbs following them with legislative and regulatory threats to impose their big government agenda on them, regardless of how far away they move or how desperate they are to escape their grasp.
I know many of you are overwhelmed right now with the avalanche of bad news emanating from the Obama Administration on both the foreign policy and domestic fronts. It’s a challenge to keep up with it all. But, the Obama Administration’s war on the suburbs is an attack on that portion of the unique American Dream which every American cherishes, a small piece of land which we can look at and call “home.”
Conservatives should fight this HUD rule and defund this attack on their constituents’ front door.
EDITORS NOTE: This column originally appeared in the Conservative Review. The featured image is of an abandoned home in Detroit, MI.
https://drrichswier.com/wp-content/uploads/Detroit-1-e1437657281812.jpg323640Dan Bonginohttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDan Bongino2015-07-23 09:16:022015-07-23 09:16:02Obama’s Attack on the Suburbs is an Attack on the American Dream
The Sarasota County School Board took up a discussion on a way to save the district money. The discussion died due to three school board members: Caroline Zucker, Jane Goodwin and Shirley Brown. This issue was about the costs associated with holding a tax increase referendum during an off year rather than during the November general election cycle. Here are some facts about the March tax increase referendum:
