Not So Crazy Libertarian Ideals – Page 77

How the State Buys Support for Its Expropriation

Advocates of higher taxes love to point to wealthy individuals and large corporations that also advocate higher taxes as proof that higher taxes are a good thing. What those advocates don’t bring up or remain entirely ignorant about is the motivation wealthy individuals and large corporations have for raising taxes. Take the case of AT&T, a company that recent came up in support of raising taxes. Why would AT&T want to raise taxes? The answer is simplicity itself:

[A bunch of nonsense implying that the Republican Party lowers taxes while the Democratic Party raises taxes.]

[…]

A skeptic might point out, however, that AT&T does a lot of business with the U.S. government. AT&T Government Solutions boasts that it employs “more than 4,000 scientists, engineers and analysts—many with security clearances” who “focus exclusively on the IT requirements of government.” One federal contract AT&T won last year had a potential value of $5 billion, which is real money even to a company as large as AT&T. The company, like other wireless phone providers, also earns revenue from the “Lifeline” program that provides subsidized cellphones—so-called Obama phones—to low-income customers. And AT&T has already seen what negative effects hostile government agencies can have on its business—when a Justice Department antitrust lawsuit and FCC opposition blocked AT&T’s takeover of T-Mobile, AT&T wound up paying T-Mobile a $4.2 billion “break-up fee.”

[…]

The sad reality, though, is that the thousands of dollars that my business would mean to AT&T, or the millions of dollars that the business of other like-minded Americans would mean, are dwarfed by the value of a $5 billion government contract or winning the favor of a regulator with the power to approve or deny a multi-billion-dollar deal.

When a business is in bed with the state they will often tend to support higher taxes because that means more potential revenue for the business as well. You always want to ensure your cash cow is flush with cash.

Politics and Sports Don’t Mix

Politics doesn’t mix well with entertainment venues such as sports. Sports are the circuses of our era that help to distract the people from the reality in which they live. Once in a while somebody in the world of sports opens their mouth on a political issue and raises all kinds of havoc. Bob Costas decided to be one of those people and gave a speech advocating gun control during a halftime show during a football game:

You want some actual perspective on this? Well, a bit of it comes from the Kansas City-based writer Jason Whitlock with whom I do not always agree, but who today said it so well that we may as well just quote or paraphrase from the end of his article …

Handguns do not enhance our safety. They exacerbate our flaws, tempt us to escalate arguments, and bait us into embracing confrontation rather than avoiding it. In the coming days, Jovan Belcher’s actions, and their possible connection to football, will be analyzed. Who knows?

But here, wrote Jason Whitlock, is what I believe. If Jovan Belcher didn’t possess a gun, he and Kasandra Perkins would both be alive today.

Obviously Bob Costas doesn’t know his job is to distract the serfs from politics, not remind them of it. The Romans knew that the secret to keeping the people docile was to give them bread and circuses. So long as the people were fed and entertained they were very willing to roll over and let the Roman government do as it pleased. The average American isn’t much different, which is why politics is such an incredibly caustic thing to mix with sports.

Not only did Costas perform the sin of mixing politics and sports but he did a lousy job of it. His speech made the typical gun control argument that firearms increase the rate of violence. That claims is false. The fact is gun control does the opposite of what its proponents claim. By reducing the number of individuals that have ready access to firearms gun control decreases the cost of performing violence and therefore makes violence a more acceptable risk than it otherwise would be.

Keep the politicians out of the circuses less the people be reminded about how bad they’re getting screwed.

Piers Morgan Gets Owned on Gun Rights

Browsing Reddit I came across a picture of Piers Morgan having his ass handed to him on the topic of gun rights:

Even though I don’t derive my right to own firearms from the Second Amendment any student of history would be absolutely floored by the claim that the amendment was written with muskets in mind. During the writing of the Constitution the memory of the Revolutionary War was still ripe in the minds of the people. They still remembered the British attempt to sieze weapons from Concord that started the war and how necessary firearms were to win America’s independence. It seems odd to believe the authors of the Second Amendment would desire to handicap future generations by limiting them to the arms available at the time of the Revolutionary War. You would think such a restriction would have been written down somewhere.

The Evolution of Markets and Shopping Local

How many times have you heard somebody tell you to shop local? It’s a popular phrase among small business owners, college students, and hipsters. In fact the whole shop local movement (if you can call it a movement) is so popular Obama even takes a moment to exploit it for publicity:

He’s done it again! Indie bookstore surprise supporter President Obama visited a local bookstore on Small Business Saturday, the second time he’s touted the shopping local day (and bookstores) in as many years.

This year Obama took his daughters Sasha and Malia to One More Page Books in Arlington, Va., near Washington. The trio spent about 20 minutes in the store browsing through books and quietly conversing with other shoppers.

Too bad One More Page Books didn’t get one of those multimillion dollar contracts the government is so quick to toss to donors who make large campaign contributions, but I digress.

Let’s consider local bookstores for a moment. I love bookstores (and libraries, although fewer and fewer libraries actually have books in them so they are falling more and more out of favor with me) and books but even I have to admit that shopping at local bookstores, unless they’re specialty stores, isn’t an ideal experience. What is more convenient between driving to a bookstore to pickup a title or tapping a few buttons on your e-reader screen and having the book appear almost instantly on the device? For me it’s the latter by a wide margin.

Apparently I’m not along in thinking this because e-books are outselling physical books on Amazon. This brings up an economic reality being denied by those in the shop local movement; markets evolve. Just as the lightbulb ousted the lantern, automobiles ousted the horse and buggy, and computers ousted the typewriter e-books are ousting physical books. Nobody should be surprised by this as e-books are far more convenient than their physical brethren. I can have an e-book downloaded almost instantly to my e-reader, view my e-books on any number of electronic devices, carry every e-book I own with me at all times, and avoid setting aside space for more books. E-books are an evolution that bypasses many shortcomings of physical books. Of course e-books aren’t the only game in town and it’s unlikely they ever will be. Let’s consider the physical book market that, I believe, will always exist as a niche (some people prefer physical books just as some people prefer typewriters).

Technological progress has caused a great deal of trouble for local stores that have failed to evolve. Local stores are no longer competing solely with other local stores. Today everybody is competing with the entire world thanks to the Internet. The biggest competitor to local bookstores is are online bookstores such as Amazon. For those times I find myself buying physical books (usually because the e-book version is either nonexistent or more expensive than the physical version) I go to Amazon. Amazon offers a far better shopping experience than any local bookstore I’ve ever been to (and I’ve been to a lot of them). Many of the titles I read are relatively unknown outside of certain circles. These are books that most bookstores rarely stock. The reason large book sellers like Barnes and Nobel became so popular, and coincidentally put many independent bookstores out of business, is because they stocked a huge number of books. Stores like Barnes and Nobel were a market evolution that people like myself, who were often looking for oddball literature, greatly enjoyed. Now Amazon is the new market evolution that stocks even more books than Barnes and Nobel and saves me the trouble of driving to a store.

I was recently looking for some titles on the history of the Middle East. Since most Americans care little for history outside of events that have occurred in America or Europe finding titles on the history of the Middle East at local bookstores is an exercise in futility. My options were to order the book at a local bookstore or order it on Amazon. Had I chosen the former option I’d have had to drive to the local bookstore, find a staffer, tell them what I wanted, wait for them to find it and order it, drive home, wait for the book to arrive (which could take days or weeks), drive back to the local bookstore, and pay for the book plus any local taxes. I chose the latter which only involved me finding the book on Amazon, selecting a seller (I was buying a used copy because it was dirt cheap), and paying for the book (a whopping $0.01) plus shipping (a whopping $3.99 since it wasn’t fulfilled by Amazon and therefore ineligible for free Prime shipping). Shopping on Amazon took me far less time, didn’t require any gas (that’s worth a few greeny points), and allowed me to pass on paying taxes. It was win-win. This is what local bookstores have to compete against and they generally do a very poor job of it.

I mentioned that specialty bookstores can still offer a good experience. This is because specialty bookstores stand to fill niches in the market that generally go unfulfilled by larger market actors. Mayday Books is one such specialty bookstore that caters to people who generally lean towards the socialist side of the political spectrum. Most large bookstores aren’t going to carry a great deal of socialist literature nor will their staff have much knowledge about socialist literature. A store like Mayday Books stands to offer socialist literature that is hard to find elsewhere and the knowledge of staffers that know a great deal about socialism and socialist literature. On top of that the consumers Mayday Books caters to are more apt to buy from a store like Mayday. Mayday not only specializes in socialist literature it also proudly doesn’t make a profit. Although the staff of Mayday may not want to hear it their store is a perfect example of market specialization.

The shop local movement fails to address the fact that markets are constantly evolving. Because of the Internet the entire world is now local. In fact online stores like Amazon are closer to me than any so-called local store. Amazon literally exists in my living room and on my phone. I don’t even need to put on pants to shop at Amazon (that’s convenience)! Instead of telling people to shop local members of the shop local movement should be telling local businesses to evolve. Tell local business to setup a website for customers all around the world to shop on. Point them towards an unfulfilled niche in their market so they can fill it. Encourage them to innovate. Stop telling consumers to inconvenience themselves for the sake of local businesses. Businesses are supposed to serve consumers and therefore should be expected to improve their goods and services to better meet consumer demands.

We’re Already Over the Fiscal Cliff

The current story arc of Politics: The Reality Television Show for Suckers deals with the so-called fiscal cliff. Republicans and Democrats are trying to rally support for the causes of spending cuts and tax increases respectively. Anybody who has watched Politics for any length of time knows that these arguments are illusionary and that the Republicans and Democrats are working together to soak the people for more tax money without truly entertaining any idea of spending cuts:

Mr Obama meets business leaders at the White House on Tuesday and members of middle-class families on Wednesday.

He wants Republicans to accept tax increases on the wealthy, while extending tax cuts for families earning $250,000 (£155,000) or less.

[…]

John Boehner, the top Republican in Congress, has said he would consider increasing tax revenue by closing loopholes, though he remains opposed to raising taxes.

“Closing loopholes” is merely a fancy term for curtailing freedoms and, ultimately, an insidious way to increase taxes without technically increasing taxes. Effectively John Boehner has stated a willingness to cooperate with Obama but is using language that perpetuates the myth that the Republicans and Democrats oppose one another.

This is nothing new. What is worth discussing though is the idea of the fiscal cliff. The fiscal cliff, like the Republican-Democrat opposition, is a mirage created by the state. When politicians discuss the fiscal cliff they are actually talking about measures placed in the Budget Control Act of 2011 taking effect, which include supposed spending cuts and tax increases. The Budget Control Act, like the fiscal cliff, is also a mirage created by the state. It was supposed to be a compromise between the Republicans and Democrats to resolve budgetary issues facing the federal government. These budgetary issues can be boiled down to the fact the federal government spends far more than it bring in. Put into actual terms the federal government is insolvent.

Insolvency is the real issue facing the federal government and it won’t go away even with the most audacious tax increases. America has two options before it. Either spending must be slashed or the debt must be repudiated… again:

Although largely forgotten by historians and by the public, repudiation of public debt is a solid part of the American tradition. The first wave of repudiation of state debt came during the 1840s, after the panics of 1837 and 1839. Those panics were the consequence of a massive inflationary boom fueled by the Whig-run Second Bank of the United States. Riding the wave of inflationary credit, numerous state governments, largely those run by the Whigs, floated an enormous amount of debt, most of which went into wasteful public works (euphemistically called “internal improvements”), and into the creation of inflationary banks. Outstanding public debt by state governments rose from $26 million to $170 million during the decade of the 1830s. Most of these securities were financed by British and Dutch investors.

During the deflationary 1840s succeeding the panics, state governments faced repayment of their debt in dollars that were now more valuable than the ones they had borrowed. Many states, now largely in Democratic hands, met the crisis by repudiating these debts, either totally or partially by scaling down the amount in “readjustments.” Specifically, of the 28 American states in the 1840s, 9 were in the glorious position of having no public debt, and 1 (Missouri’s) was negligible; of the 18 remaining, 9 paid the interest on their public debt without interruption, while another 9 (Maryland, Pennsylvania, Indiana, Illinois, Michigan, Arkansas, Louisiana, Mississippi, and Florida) repudiated part or all of their liabilities. Of these states, four defaulted for several years in their interest payments, whereas the other five (Michigan, Mississippi, Arkansas, Louisiana, and Florida) totally and permanently repudiated their entire outstanding public debt. As in every debt repudiation, the result was to lift a great burden from the backs of the taxpayers in the defaulting and repudiating states.

[…]

The next great wave of state debt repudiation came in the South after the blight of Northern occupation and Reconstruction had been lifted from them. Eight Southern states (Alabama, Arkansas, Florida, Louisiana, North Carolina, South Carolina, Tennessee, and Virginia) proceeded, during the late 1870s and early 1880s under Democratic regimes, to repudiate the debt foisted upon their taxpayers by the corrupt and wasteful carpetbag Radical Republican governments under Reconstruction.

State debt has been repudiated in the United States before and it can be done again. Many people will claim that repudiating the debt would lead to catastrophe but that wasn’t the outcome of the above mentioned cases:

Rothbard’s History demonstrates how the repudiations of the 1830s and ’40s did not cause the sky to fall. In fact, the return to sound money coupled with a liberalization of the economy spurred a tremendous amount of growth. Rothbard explains:

It is evident, then, that the 1839–1843 [monetary] contraction was healthful for the economy in liquidating unsound investments, debts, and banks, including the pernicious Bank of the United States. But didn’t the massive deflation have catastrophic effects — on production, trade, and employment, as we have been led to believe? In a fascinating analysis and comparison with the deflation of 1929–1933 a century later, Professor Temin shows that the percentage of deflation over the comparable four years (1839–1843 and 1929–1933) was almost the same. Yet the effects on real production of the two deflations were very different. Whereas in 1929–1933, real gross investment fell catastrophically by 91 percent, real consumption by 19 percent, and real GNP by 30 percent; in 1839–1843, investment fell by 23 percent, but real consumption increased by 21 percent and real GNP by 16 percent. (p. 103)

Repudiating the debt had the opposite effect that most people would lead to you believe, it actually caused economic boon instead of of bust. Iceland, which recently repudiated its debt, is now experiencing economic growth as well.

It’s obvious that the federal government isn’t going to cut spending and it can’t tax its way out of the fiscal hole it has dug, which means the only other option is bankruptcy.

It was Bound to Happen

New York and California have demonstrated what happens when governments try to soak the wealthy for more taxes, the wealthy leave. Before Britain’s last general election the country’s government raised the top tax bracket to 50 percent. Needless to say the things went exactly as expected:

In the 2009-10 tax year, more than 16,000 people declared an annual income of more than £1 million to HM Revenue and Customs.

This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election.

One of the reasons taxing the wealthy to makeup for government shortfalls doesn’t work is because the wealthy have the means to leave. What motivation does a person making $1,000,000 have to stay in a country if they are being forced to give $500,000 of it to the government?

Of course this only applies to declared income. As we agorists know the state can’t tax what it doesn’t know about.

What Gun Control Reduces Lawful Individuals To

Gun control is an interesting paradox. Advocates of gun control believe the use of state initiated violence against all gun owners will reduce the amount of violence in society. Truthfully gun control merely makes the lawful unlawful. Deciding to obey a law, like everything else humans do, is based on a cost-benefits analysis. If an individual’s perceived cost of obeying a law exceeds that individual’s perceived benefit then the individual will disobey the law. With the constant increase of violent crimes in Mexico, a state with very strict gun control laws, lawful individuals are finding themselves having to restort to unlawful behavior by arming themselves:

Mexico has some of the toughest gun-control laws in the world, but drug cartels have well-stocked arsenals. For law-abiding citizens, it’s difficult and expensive to apply for a gun permit. It’s why many gun owners decide to defy the law.

People living in Mexico often find themselves subjected to the violent drug cartels. Without a lawful option to defend themselves the people are resorting to unlawful methods. Sure, violating the country’s gun control laws could land somebody on the business end of the state’s gun but being unable to defend one’s self could land them in a coffin.

Gun control creates a vicious circle of unlawfulness. Violent criminals, who disregard the law by definition, will arm themselves whether or not guns are made illegal. Armed with their weapons and the knowledge that the gun control laws have reduced the cost of inflicting violence on other individuals these violent criminals will begin to prey on the general populace. Being faced with the state’s violence and violence brought on by non-state criminals individual will have to make a decision: obey the law and hopefully avoid the state’s wrath or disobey the law and hopefully avoid the wrath of non-state criminals. As the state generally proves to be ineffective at defending the people it claims reign over individual will begin leaning more and more towards disobeying gun control laws in order to defend their lives. At that point previously lawful individuals become unlawful, a necessity brought on by gun control laws.

How the State Reduces the Cost of Making Bad Decisions

I’ve explained how the state reduces the cost of committing violent act but that’s not the only thing the state reduces the cost of. The state greatly reduces the cost of making bad decisions. Consider the state’s actions after hurricane Katrina. New Orleans, a city left devastated after Katrina, was constructed below sea level next to the sea. Normally a series of levies kept the city from flooding during natural disasters but those levies broke and the city was hammered. One might ask why building a city below sea level next to the sea is a good idea. Considering the expense of rebuilding the city and building new hopefully better levies it may not make sense. If the residents of New Orleans were forced to front the entire cost of rebuilding they may choose to relocate to a more sensible reasons. To help residents of that area avoid having to deal with the consequences of building there the federal government has chosen to sink a great deal of money into rebuilding.

After hurricane Sandy the federal government is swooping in again to help relieve people from the consequences of their bad decisions. Dauphin Island, a small speck of land in the ocean, has been destroyed by hurricanes before and Sandy didn’t show the island any special treatment. The federal government is providing funds to rebuild the island:

The western end of this Gulf Coast island has proved to be one of the most hazardous places in the country for waterfront property. Since 1979, nearly a dozen hurricanes and large storms have rolled in and knocked down houses, chewed up sewers and water pipes and hurled sand onto the roads.

Yet time and again, checks from Washington have allowed the town to put itself back together.

Across the nation, tens of billions of tax dollars have been spent on subsidizing coastal reconstruction in the aftermath of storms, usually with little consideration of whether it actually makes sense to keep rebuilding in disaster-prone areas. If history is any guide, a large fraction of the federal money allotted to New York, New Jersey and other states recovering from Hurricane Sandy — an amount that could exceed $30 billion — will be used the same way.

The state distorts reality. When common sense would lead most people to abandon dangerous property instead of constantly rebuilding it the state provides funding to alleviate people’s suffering from their bad decisions. Consequences that once seemed far too expensive to repeat the cause become bearable when the state foots a portion of the bill. This leads people to repeat the same mistakes again and again knowing that they will not be forced to deal with the entirety of consequences.

Obama and Civil Liberties

Supporters of Obama likes to praise his advancement of civil liberties. Unfortunately such claims are entirely false as Obama has been busy eroding civil liberties since taking office:

Most troubling, however, is the state of our freedoms. Indeed, during Obama’s first term, our civil liberties were utterly and completely disemboweled. The great irony, of course, is that this happened with a self-proclaimed constitutional law professor at the helm—a man who was supposed to understand and respect the rule of law as laid out in the U.S. Constitution.

Not only did Obama continue many of the most outrageous abuses of the George W. Bush administration (which were bad enough), including indefinite detention and warrantless surveillance of American citizens, but he also succeeded in expanding the power of the “imperial president,” including the ability to assassinate American citizens abroad and unilaterally authorize drone strikes resulting in the deaths of countless innocent civilians, including women and children.

The article goes on to cover 17 of the more egregious civil liberties violations that have occurred under Obama’s watch. What’s interesting is considering how many people make political decision in this country. During 2004’s presidential race many of John Kerry’s supporters expressed outrage over Bush’s wars and civil liberties violations. They brought up the wars in the Middle East, the PATRIOT Act, Guantanamo Bay, and numerous other despicable situations caused by the Bush administration. When McCain ran against Obama in 2008 Obama’s supporters were brining up Bush’s actions again and claiming McCain would continue down the path to tyranny.

Fast forward to today. Obama has proven to be another George W. Bush. Since taking office in 2008 Obama has continues the polices put into place by the Bush Administration and added some of his own including signing a bill that grants the president the power to indefinitely detain American citizens without trail. You would think Obama’s supporters would have turned against him during the 2012 presidential race but he managed to maintain a great deal of support. How could a man who ran on a platform of civil liberties and undoing the tyrannical policies of the Bush administration continue to have the support of his 2008 followers? Simple, a majority of voters in the United States care more about teams than issues.

Most Americans have pledge allegiance to one of the two major political parties. While some of these party loyalists may periodically vote for somebody on “the other team” to convince themselves that they’re not party shills they generally vote party lines. If “their guy” doesn’t support their issues they’ll concoct reasons to support him. I saw some rather interesting concoctions during the 2012 race from both sides of the political fence. Those who were expressing support for Romney claimed he would support gun rights (even though his has a history of doing otherwise) and fix the economy (which a president has no ability to do). People on the other side of the fence claimed Obama would bring forth a new era of gay rights (which he’s shown no intention of doing) and ensure healthcare would be available for all (which he won’t). One of my Obama supporting friends even implied that people opposing Obama were racists.

Nothing will be changed in this country through the political system. As George Carlin pointed out the public sucks:

When people are more concerned about which party gets into office than finding solutions to the problems facing people there’s now hope of improving things. So long as people care more about “their guy” getting into office than stopping the wars, fixing the economy, and defending civil liberties the wars will continue, the economy will languish, and civil liberties will keep eroding. American voters have spoken and they resoundingly said they want “their party” in power regardless of his policies.

Unwarranted Fear

I’m sure you’ve all heard the news that Hostess, the company that produces Twinkies and other foodstuff that’s bad for you, have decided to liquidate:

Hostess Brands Inc., the maker of iconic treats such as Twinkies and traditional pantry staple Wonder Bread, said Friday it is shuttering its plants and will seek to liquidate the 82-year-old business.

The company, which filed for Chapter 11 in January, said it has requested bankruptcy-court authorization to close the business and sell its assets.

A victim of changing consumer tastes, high commodity costs and, most importantly, strained labor relations, Hostess ultimately was brought to its knees by a national strike orchestrated by its second-largest union.

I could write about the Union’s effectiveness at preventing Hostess from cutting its employees’ wages by 8% by forcing them to cut wages by 100% but you’ve heard it all by now. Instead I want to focus on the panic buying. There has been a lot of talk about people buying up stocks of Twinkies in the hopes of either storing them for personal consumption or selling them when they become more scarce. Although I expect this I’m still baffled by the behavior.

There is obviously a demand for Twinkies. Now that Hostess is being liquidate enterprising entrepreneurs have an opportunity to buy up the trademark, recipe, and production equipment for Twinkies and produced them without repeating the same mistakes as Hostess. Through the miracles of the market Twinkies are almost certain to continue on. Somebody else will own the manufacturing capabilities, pay the employees, etc. but they will likely be the exact same yellow cream-filled cakes as people seem to love.

In the immortal words inscribed on the cover of The Hitchhiker’s Guide to the Universe, don’t panic.