Saturday, January 28, 2012

The CVOR: Just Another Government Extortion Scheme

To those not involved with the transportation industry or not owning a vehicle registered to carry or tow over 4,500 kg of weight in Ontario, the acronym CVOR probably means nothing. It stands for Commercial Vehicle Operator Registration and according to the good folks from Queens Park it is a program "developed by the Ministry of Transportation as part of Ontario's ongoing commitment to road safety." I had to renew the certificate for my company truck during the week that past, and was promptly charged $250.00.

While, the MTO assures us that this program is designated to somehow improve road safety, there are no further requirements set out for one to get the registration -- apart from filling a 2-3 page questionnaire. There is no skill test, nor does anyone ever check whether the information provided in the questionnaire is correct. However, if one fails to obtain a CVOR and is caught driving on Ontario roads, the fine starts at $325.00.

In essence, this program is an epitome of Keynesian philosophy: private enterprises and citizens are extorted funds which pay for someone's glorified welfare cheque. The CVOR provides no tangible benefit to its holder, nor to the residents of our Province. There are only two purposes that this annually renewable racket serves: it saves a person from the more expensive fine, and it fictitiously lowers the unemployment rate -- a benefit enjoyed by politicians who promise prosperity through increased state intervention.

Saturday, January 21, 2012

Communist Party Ideological Police Still in Charge

My native homeland, the Republic of Macedonia, is a former member-state of the now defunct Socialist Federal Republic of Yugoslavia -- a puppet state of Communist Moscow. For the past twenty or so years there has been a wide spread myth of the disappearance of the Soviet Union, simply because the Communist Regime in charge of the Soviet Empire repackaged itself. It seems that no one is willing to connect the dots, for instance when they see former KGB chief Vladimir Putin continuing the century-long ideological tradition inherited from Vladimir Ilyich Ulyanov Lenin. Unbeknownst to the casual observer, the system left in place during the overt existence of the Communist Empire is alive and thriving, at least in my former homeland. Bellow is a report that aims at debunking the myth of the collapse of the Communist system, and ultimately to warn the authorities and populace of my new Homeland to dangers of full-blown socialism when put to practice. 
A Report on the Work and Methodology of the Macedonian Secret Police 
An Examination of Authentic Dossiers (PREVIEW) 

The State Security Service is the Macedonian Communist Party Police, equal to the USSR's KGB. At different times it has operated under different names, but for the purposes of this paper will be addressed as the Secret Police. This is an entity that is frequently mentioned in the writings of the Committee for the Democratization of the Republic of Macedonia (CDRM). It is so because of the enormous influence this agency exerts on everyday life of Macedonian society within the Republic of Macedonia and in countries where Macedonian expatriates reside. In fact, we believe that it is the single most powerful organization in Macedonia. Indeed, in an interview dated October 24, 2010 for Macedonian TV channel ALFA, Božidar Spasić, former head of the Team of the Yugoslavian Secret Police assigned to combat emigrants of Croatian and Albanian ethnic origins, was asked if it is "possible for someone to ascend to power in any of the former Yugoslav republics, i.e. to get elected president or prime minister, if they were not an agent of the Secret Police? Is there anyone in power now in the former Yugoslavian republics that was not your agent?" Mr. Spasič replied: "It is not necessary for someone to have been our agent; however, we had to give our approval! That is what is important." (Source:

We, at the Committee for the Democratization of the Republic of Macedonia are aware that no Westerner has had a chance to see the inner workings of the Macedonian Secret Police—or for that matter any one from the former Yugoslavia—for which reason the topic of the human rights violations perpetrated by it remains an abstract issue at best and a total unknown at worst. To remedy that, we have decided to compile this report on the work of the Secret Police. To the best of our knowledge, this is the first work that depicts in detail the operation of a Communist Party police to be released in the West.

Two events made this report possible. First, in the year 2000 the Government of the Republic of Macedonia passed the Dossier Disclosure Act, a law that made copies of the dossiers (files) of those operated on by the Secret Police available to them. The law encompassed all dossiers from the formation of the original Secret Police under the Socialist Republic of Macedonia, which was a member-state of the Socialist Federal Republic of Yugoslavia from the end of World War II until 1991, until present day. While the exact number of dossiers, that is to say of persons who had at one point or another been under the treatment of the Secret Police, has never been released, it is estimated that since late 1991—when Macedonia became an independent country that adopted a liberal democratic constitution—there have been approximately 5,000 such cases. For the former period, the estimations vary from 25,000 to 100,000, depending on the source. Amazingly, only a handful of these dossiers have been at the center of any public scrutiny! Meanwhile, Macedonia has never had a population greater than 2,000,000.

Click here to get the rest.

Friday, January 20, 2012

Finally, a Real Debate in the GOP Campaign

Last night's GOP Presidential Debate was the best in the long series so far. The fact that it was a small field was probably the reason for it, as the candidates had a chance to give more elaborate answers and engaged in some actual debating. It didn't hurt that Ron Paul actually got some coverage as well.

In the wake of the Marianne Gingrich interview, the former House Speaker-turn Freddie Mac lobbyist employed theatrics and rhetoric about the "liberal media" to cheaply set him self up a disappointing standing ovation from the "conservative" crowd.

Although he denied the that he proposed Mrs. Gingrich #2 with an "open marriage," he did not deny having an affair with an office staffer -- the eventual Mrs. Gingrich #3.In the 1990's this sort of an unethical indiscretion of abuse of power was the root of the Clinton impeachment, led by the then Speaker of the House. I find it deplorable that Newt "Definer of Civilization" Gingrich had the audacity to berate the "liberal media" for preventing "decent people" to run for office -- suggesting by it that he was a decent person, who only happened to cheat on two wives. Whether the allegation of the "open marriage" proposal is true or not, it's certainly in line with what is known of Gingrich's self-inflated personality, as described by celebrated Republican commentators such as Ann Coulter and Mark Steyn.

It was equally disappointing to see the standing ovation that Gingrich got, despite the undisputed fact of the story: the infidelity. Here, perhaps the worst part of Gingrich's personality is on display: his disregard for the feelings of others, and one may suggest by the fact of multiple extramarital affairs -- his deep rooted disrespect for women.

There was something else that the former Speaker said that gave away his ideology: when he spoke of America being a grandiose country with grandiose ideas. The problem being that he said in the context that government should be behind that grandiosity, not the private sector. For all his rhetoric about his profound love of capitalism, once he got in the details of whatever topic was being discussed, Gingrich repeatedly spoke of one big government program or another. Try as he might to portray himself otherwise, Gingrich is more Roosevelt than he is Reagan.

However, last night Gingrich was not alone in his false professions of his love of capitalism. Similar lip-service backed by discussions of government programs, trade war with China, support for Big Labor and "good regulation" was given by both former Senator-turned Big Labor lobbyist Santorum and former Governor Romney. I don't get the feeling that either one of them understands the core of the economic problem of the West right now. Though Romney has private sector experience, I have a feeling he does't understand the problems that face small, family sized businesses.  

He may not have received an inheritance from his father, but nonetheless, he enjoyed far more privileges in life as a result of his family background that have prevented him from acquiring an authentic small business experience. His tactful use of keywords that made him sound like a pro-capitalist mean that former Senator Santorum was probably the big winner last night. Nonetheless, he can come through on his social and foreign policy agendas only by severe interventions in the market.  

Nevertheless, the open format of the debate finally gave Texas Representative Ron Paul a chance to shine. The strategy of going after not the frontrunner, but after the more vulnerable and perpetually changing "number two" in the polls seems to be paying off for him, as it has resulted in the departure of a few bodies that crowded the stage. The good Doctor schooled the field on free trade and the deleterious effects of government regulation. He spoke sincerely, as a veteran of war, of the mental anguish our youth is exposed to by being thrown behind enemy lines for a decade now. He was the only participant, and for that matter the only politician that I have heard to nail the root of the abortion issue: morality. No amount of laws will fix what must be solved on the family level. The expansion of government gives rise to less invested parents, since they fall in the trap of expecting someone else to do the hard part of rearing their children for them. Of course, many parents have no choice but to rely on the Big Brother to look after their young, due to the need of a double income -- a situation not getting any better by the monetary policy of inflationism, where it is impossible for a person to save (since inflation eats away the value of money), and debt is not only encouraged, but financially more advantageous (since due to government intervention the rate of interest is artificially lower than the rate of inflation). At the same time, capitalism is the system where free people own capital, and when all one owns is debt, then he owns nothing: the lender is the owner of it all. The lenders are nominally the banking institutions, of course, but for the past century the government has been the only money creating body, which means that it owns practically all the country's debt. A nationalization by the back door has been happening under the noses of Americans for longer that any of us would like to admit. 

Much like one of Ron Paul's talks, this segment on his debate performance trailed off into a complicated discussion that ties it all together. But, that's the point that Dr. Paul is trying to impress on the world: a society is an ecosystem that requires a wholesale approach. It is impossible to get America back on the path to prosperity if overseas spending doesn't get stemmed, the dollar doesn't become sound again, government doesn't get out of the way and generally if liberty doesn't get restored in all its glory. Cherry-picking which matter to solve, and which to make worse will only leave America spinning its wheels.

Last nights debate was hopefully a promise of more good things to come in this campaign, as we all expect one of Gingrich or Santorum to be the next to bid us farewell.

Wednesday, January 18, 2012

The Road to Serfdom is Paved With Ignorance

Knowledge is power and informed people prefer liberty over a life of servitude. It is no wonder, then, that Hitler burned books, Stalin did not allow freedom of the press, Tito mass-murdered the intelligentsia and Pol Pot destroyed any link to modern civilization. Sometimes, however, a ruthless dictator is unnecessary for a people to embark on the road to serfdom. All that is necessary is an ignorance of the mechanics of democracy and the notion of liberty. 

If a society is not free, then it is totalitarian. Totalitarianism can come in many forms, as long as the societal system is rigged up so that crucial decisions have been taken out of the hands of free people and have been put in the hands of a ruling class -- a type of aristocracy. This aristocracy decides what is "good" and what is "bad" for the body politic; it decides what the children will be taught in school; who will be the winners and who the losers in the market.

Ignorance paves the road to serfdom. The overwhelming majority of children is educated in public schools where the curriculum is chosen by none other than government bureaucrats, who are in fact the second echelon of the aristocracy: an unproductive class that lives off the surplus created by the entrepreneurial and labor classes. It is, of course, against the interest of the aristocratic class to educate the next generation of citizens that government intervention in the market strips the working class of potential prosperity, since the surplus of their production goes to pay for the aristocracy's lack of productivity.

Similarly, it is against the interest of those living on the public tit to educate children that Socialism led to both World Wars. It was the overbearing burden of the behemoth welfare state of Kaiser's Germany that lead to her compulsion for expansion in need of cheap resources to keep propping up its social system. Hitler's National Socialist, were, first and foremost socialist. Fascism, too is a form of national socialism: the national has less to do with nationalism and more with nationalization. Under national socialism private property is nominally preserved, but, through government regulation and taxation, it is the government that directs the flow of the economy -- sounds a lot like home, it is. Imperial Japan too, was governed by a largely centralized system. It was the imminent failures of these economies that drove the need for expansion into resource-rich regions; not the thirst for blood. F.A. Hayek explains the history of socialism in Germany in fine detail in The Road to Serfdom.

Hayek's passion for a free market society was lit by Alexis De Tocqueville Democracy in America where the the Frenchman depicts the libertarian utopia that were the United States of America of the mid- 19th century. This world did exist, and it was fueled by civic diligence. According to Ron Paul's The Case for Gold, until 1986 Americans turned out to vote in elections at the rate of 90%. So what happened to American democracy? Why is it that a voter turnout of 50% these days is considered high? American politics became moderate and education became public.

Unless one is passionate for economics, the only contact he or she will have with the science of economics is in a college or university class of ECON 101. The theory taught in North American educational facilities is as presented by Paul Samuelson, a follower of John Maynard Keynes and an admirer of none other than Karl Marx. The central theme of ECON 101 is the notion of "marker failure," which brings about the urgency of government intervention. Intelligent young women and men, who have no reason to doubt the authority of their teachers, are taught that capitalism -- the societal system of free exchange of people for their own benefit -- is not as good for them as is National Socialism (i.e. corporatism), as long as the aristocracy is humane and of a good nature: if it is kind to the working man, and ruthless to the business man. No one bothers tell the students that this economics is only one among at least a dozen schools of though.

That's where the notion of "moderate" politics is given rise. Have you heard lately that there is too much partisanship in politics these days; or the cries that politics has become polarized? It seems that you can't turn on a political program these days and not hear such complaints. But are they legitimate? I believe that not to be the case.

For one, when we take a closer look at how politics is conducted in North America, whether in the US or Canada, on a federal or a state or provincial level, differences among the parties are hard to come by. And yet, we are told that the two major political blocs in the US, and their counterparts in Canada have become polar opposites. This claptrap passes as legitimate punditry because people do not engage in politics as much as citizens of a democratic society must and there is an unhealthy relationship between politics, media and the corporate world (corporatism)!

The two blocs: the supposed conservatives on the right, and the pseudo liberals on the left offering themselves onto North American voters today are more similar to each other than at any point in history, giving moderation a whole new meaning. This new meaning for moderation is not to take ideology in moderation, rather to cherry-pick and take a little from every ideology being past around. It's the same mistake that has been made ever since the idea of social-democracy came about. In A Critique of Interventionism, Ludwig Von Mises argues that there can only be either socialism or capitalism. Any combination of the two is impossible, since it ultimately leads to full-blown socialism. That is to say that an interventionist economic order, such as the one presently in place in North America where private property nominally exists, but in reality the state gets involved in the market so much -- through regulation, spending, and inflation that it inevitably leads to socialism. It is so, because of the well established principle that because unexpected consequences that arise from government intervention in the market, every intervention breeds by itself even more interventions -- ultimately ending in totalitarianism. That is of course somewhat abstract to speak of in these day, after what the world has witnessed in the past century. Though, perhaps not too paranoid considering how little is known about the worlds of US and European politics if the mid- nineteenth century.

The idea that the current political scene is too divided is non-sense. True enough, politics today can get rather personal, but that is only a product of the monotony of the offer at hand. There are no core differences in the platforms that the major political movements present: it's all a matter of superficial tinkering of whether the populace gets taxed through inflation or through taxes on the "rich" and corporate entities. In essence, they all offer the same level of limited liberty, and no one goes against the grain. And why would they, it serves politicians no practical interest to limit their own power and ability to make unearned profits by exploiting the social-democratic system. At the same time, those who are loudest in their calls for "moderation" have an interest in the keeping of the "moderatist" status quo

The trouble is that we are heading down a quasi-moderatist road of mixing all sorts of bad socioeconomic concoctions. I believe that if a party stands for liberty, it ought to stand for liberty down the line. Or for that matter if it stands for coercion and a dictatorship of the (voting) majority it ought to make that clear. That way, we can see clearly which ideology leads to ruin, and which to prosperity. Because unlike what the folks calling for moderation believe, prosperity cannot be got one way or the other: the only difference being whether you choose to be a "cruel" capitalist, or a "humane" socialist to get it. Prosperity can be got only one way: though a society based on individual liberties and strong respect for private property. When people are left to make their own decisions, they have no choice but to start learning how to make the right decision every time. How else do you think we started out as just another mammal and ended up (hopefully not quite ended) flying to the Moon? -- By making rational decision based on self-interest.

When we forfeit our ability to make decision based on our own self-interest, then we allow others to make decisions based on their self-interest without regard for us. Then we are effectively serfs to the aristocratic decision-makers.

Tuesday, January 17, 2012

Another Government Intervention Fails to Accomplish Goal

In 2005 the State of New Jersey adopted a so-called Botox Tax of 6% on cosmetic surgery. The rationale being, as NPR reports:
"This is an income situation where people are able to afford elective surgery, they're not medical necessities," [New Jersey Assemblyman Joseph] Cryan said. "Clearly, reconstructive surgery would not be part of it. So it's optional surgery designed to enhance one's appearance, as opposed to the necessity or quality of one's life."
Here's the first point where New Jersey state politicians were wrong: cosmetic surgery is not a merely function of plain vanity, it is a result of low self-esteem. People that choose elective surgery do it believing that the procedure would present them with an improved outlook on life. Low self-esteem drives people to all sorts of self-destructive behavior, such as alcoholism and heavy drug use; while others just lack the courage to reach for their full potential. Oversimplifying such a complex psychological state to a point of vanity is plain dangerous.

The other point that the New Jersey Assembly missed is that in a society where people are free to move about, they have the option of "voting with their feet." If an average breast enhancement procedure costs $7,000, then the 6% tax amounts to an additional cost of $420 for the customer. That constitutes enough of an incentive for them to opt for a road trip across the state line where instead of wasting the $420 on a tax - for which get get nothing in return - they can spend it on food, lodging and some sightseeing. And they have. Even Snooki can figure out that 400 bucks spent on pampering herself is better than setting it on fire. Despite the popularity of such shows promoting plastic surgery, like Jersey shore and The Real Housewives of New Jersey, the state of  New Jersey today is host to fewer such procedures, as a result of this government intervention. Thus not only have practitioners lost income, the Botox Tax has not brought in the expected tax revenue either.

The Botox Tax is about to expire today, unless Governor Chris Christie signs an extension. Despite the failure of the policy, there is still a voice arguing for the tax to remain in place:

New Jersey's tax on cosmetic surgery is only bringing in about $10 million a year, less than half of what was projected. Those revenues, however modest, go into a special fund that reimburses hospitals for charity care — a fund in which state contributions are matched with federal dollars. Suzanne Ianni of the Hospital Alliance of New Jersey is worried about losing those contributions.
"This is actually bringing in dollars to New Jersey that otherwise we wouldn't be able to get," (italics added) Ianni says. "Reversing these assessments that draw down federal monies, I feel, is going in the wrong direction."

Herein lies the crux of the issue. Mrs. Ianni is interested not in what is earned; she just wants to grab a chunk of change from the pockets of others. It's the socialist mentality on unabashed display. When pickpockets do this on the street, we call it robbery, when government does it: it's social justice.

Monday, January 16, 2012

The Priest's Conundrum

The old saying of "do as I say, not as I do" seems to perfectly fit the principle of Roman-Catholic Priesthood, as well as that of higher echelons of Eastern-Orthodoxy. On the one hand the Good Books proclaims: 
And God blessed them, and God said unto them, Be fruitful, and multiply, and replenish the earth, and subdue it: and have dominion over the fish of the sea, and over the fowl of the air, and over every living thing that moveth upon the earth. (Gen. 1:28)
On top of that, organized Christianity teaches that people have been placed on Earth for the purpose of worshiping God. The more we multiply, the more glory we give to the Lord. I will not argue the validity of this claim. Though I do want to draw attention to the fact that by failing to multiply, priests unarguably go against the command of the God they tell us that they represent on Earth. 

Friday, January 13, 2012

Government Regulation is Bad For Business

Despite all the resources at their disposal, it has been found that repairs of roads that need no repair, housing and stock market bubbles, more bureaucracy and an imaginary war with little green men from Mars is all that President Obama and his team of economic advisers can come up with. What else can one expect from the statist economic planner, anyway? History does not recall a government committee to have produced the automobile, transistor radio, personal computer, I-Phone, or comparable invention; nor something simpler, like the hammer, shovel, or even toothpick. While the planners of Hitler’s Germany produced all sorts of killing machines, and those of the USSR even put a man in outer space, the citizens of those societies did not enjoy any benefit from that kind of “progress”—rather they suffered at the hands of it. This is by no coincidence, since the objective of entities in power is to remain there. On the other hand, every single invention that has lead to benefit individuals and societies alike has been produced by personal creativity driven by the urge to improve one’s own condition (something that most people misguidedly classify as "greed"). 

The prevailing economic theory of the past one hundred years is that which John Maynard Keynes introduced and championed in the early years of the 20th century. More than one US president—but most notably the one who disregarded American republicanism the most, FDR—has declared, "we are all Keynesian now." Keynesian theory suggests that various barriers that lawmakers impose on business have no deleterious effects on the economy. Furthermore, John Maynard Keynes was a famous supporter of government intervention in the economy, since according to him the free market by itself will always fail to reach full employment. Since by Keynesian reasoning, the government can do no wrong he propagated that it ought to intervene in the market in order to fix what the directly involved parties cannot. Since Keynes missed the most important point of economics: that money does not equate to wealth he was severely hampered when making his conclusions. Opposite Keynes, Ludwig Von Mises realized that wealth is created by human action, while, Adam Smith had previously noted something else: that capital has no home. That is, capitalists—entrepreneurs—will always seek out the most hospitable environment to put themselves to work in. 

Any proponent of Capitalism is quick to point out that government restriction on business is bad for business. However, whenever such statements are made, most people’s imagination turns to Wall Street. Lost on most people are the incessant regulations that are daily applied to small and medium sized businesses and on the industries that used to produce blue-collar jobs for unskilled laborers. Whether one thinks of minimum wage or environmental laws; ever-increasing workplace and fire safety standards; growing types of insurance policies; or assurances that companies need to provide some government department with and so on, all of this adds to the cost of doing business. Unavoidably the added cost is applied to the various other costs that go into making any given product. Eventually, when two similar products are put side by side, and the consumer is left to decide which one to purchase, invariably he or she will choose with their wallet, and pick the lower priced one. When people wonder why jobs are being exported into Third World countries—China, India, Bangladesh and the like—they are often mislead to believe that it is done out of corporate greed. In fact, they would be closer to finding the culprit by simply looking in the mirror.

The fact is that people, clouded by Keynesian philosophy believe that nominal increases of their salaries mean an earnest increase of their wealth. So, workers support minimum wage laws, just as they support unions in their demands for higher wages and increased benefits. The trouble is, however, that while the increased wage in the medium and long run does not equate to more real wealth for the laborer—and it is in this medium to long run that wealth can truly increase—it does mean an increase in the cost of making the given product these laborers produce. The company selling the product is left with two choices, both of which will hamper it: to price their product higher on the market, and lose profit by losing volume of sales or by taking a smaller profit margin. By losing volume of sale, the company loses the need for some of its employees. On the other hand, while most incorrectly equate profit with greed, they neglect the role that profit has in attracting ambitious people to business, as well as the need for profit to be reinvested into existing companies in order for them to remain competitive and keep providing jobs for their employees.

Of course, the most important little point that is unseen by the workers that support minimum wage laws (as well as union mandated wage increases) is that there is someone else somewhere in the world ready to take a smaller wage if it means a meal and a roof over one’s head. The formerly unemployed persons of the Third World have a lower opportunity cost, that is, they have little else that is a more valuable way to spend their time and effort on than the work that the American laborer is rejecting as unworthy. The formerly unemployed dirt farmer of China or Mexico does not mind working for a wage deemed to be beneath the dignity of the Western worker. The laborer in the Third World is simply happy to have a job, and more importantly, an income. It is the principle that made the West the world’s powerhouse before and especially during the Industrial Revolution: people were willing to work for a living, because there was no better choice. There were no unemployment benefits, nor were there retraining programs paid for by the government, rather, if one worked, one had a house and a meal; if one did not there was no welfare office to collect a cheque from. Today’s Third World worker, unrestricted by minimum wage laws, is more than satisfied to spend his time utilizing his human action for less than his counterpart in the US (as well as Canada and the EU) is legally allowed to settle for.

Beyond the lower wage that people all over the world are willing and unrestricted to accept as compensation for their labor, those same workers do not care much about the safety standards in the factories where they work nor do they care about the environmental impact of their jobs. The irony of environmental laws is particularly painful. Companies are forced out of North America because these laws make it unfeasible for them to operate here. Needing to survive and keep making a living, their solution is simple: move to China, where not only is the labor cheaper, the environmental laws are nonexistent. The temptation is simply too difficult to pass up. For, where half a century ago the political climate in the Third World practically guaranteed a bad investment, today those same countries play good host to capital. And while if those companies were still here the public might be able to influence the companies into finding solutions to the pollution created by these companies faster, by being out of sight, the same companies can, and likely do, pollute exponentially more than they would otherwise.

The banishment of entire industries leads to the problem of overcrowding of the remaining industries, which leads to bubbles, price wars and short life of companies, perpetuating the ailment. While capital moves on to greener pastures, and seeks out hospitable new jurisdictions to practice its trade, labor here is left idle and unemployed. Government regulation, instead of working to improve "working class" conditions, ends up hurting those who the policy aimed to benefit. 

Thursday, January 12, 2012

There is Danger in President Obama’s Rhetoric

People have an inherent ambition to climb to the top. Some choose to achieve this end by outdoing their peers in achieving what had been viewed as unachievable. Others choose to take shortcuts. Just as some athletes choose to take synthetic steroids in order to beat the competition, so have people in academia, publishing and politics often chosen to cheat themselves and their audiences. Obviously, some of these infractions have a greater impact on society than others. For instance, when an academician plagiarizes someone else’s work, it usually affects only the two involved. When a sub-par author of science fiction decides to display a dose of insanity in an effort to prey on the weaknesses of audiences with a knack for the truly incredible—like talking to the dead, or experiencing aliens—no one is hurt. In fact, from a capitalist point of view, both parties walk away happy from the transaction: the author gets recognition and a small fortune, while the audience gets their desires satisfied. More dangerous examples of preying on people’s ignorance and desire for the incredible can be cited with the mention of countless quasi-religious peddlers, the most dangerous ones of which being those whose tricks affect the greatest numbers of people. One of these failed authors—a quasi-religious peddler—was a Nineteenth century lazy German drunk, who went by the name of Karl Marx. After having his theories, and the theories of fellow socialists, rebuked repeatedly based on the laws of logic, Marx decided to declare logic irrelevant, as Ludwig von Mises describes in “Socialism, An Economic and Sociological Analysis”:

The staring-point of socialist doctrine is the criticism of the bourgeois order of society. We are aware that socialist writers have not been very successful in this respect. We know that they have misconceived the working of the economic mechanism, and that they have not understood the function of the various institutions of the social order which is based on division of labour and the private ownership of the means of production. It has not been difficult to show the mistakes socialistic theorists have made in analyzing the economic process: critics have succeeded in proving their doctrines to be gross errors. … By means of sophistry [Marxism] has prevented the scientific treatment of sociological problems and has poisoned the intellectual atmosphere of the time.

           According to the Marxist conception, one’s social condition determines one’s way of thought (Italics added). His membership of a social class decides what views a writer will express. He is not able to grow out of his class to free his thoughts from the prescriptions of his class interest. Thus the possibility of a general science which is valid for all men, whatever their class, is contested (Italics added). … Thus Marxism protects itself against all unwelcome criticism. (p. 27, 28)

Presently we are experiencing a very similar attempt at cheating by the most powerful man in the world: the President of the United States of America, as he is trying to achieve the end of one more term in office. In the fashion of a run of the mill peddler, the American President is abusing the ignorance of his audience.

In this day and age in the Western world, ignorance is absolutely a function of one’s choice; therefore the ignorance of Obama’s audience is completely voluntary. Generally speaking, people dislike giving their mind a workout. Therefore, they prefer gossip, trivia and noise pollution over meaningful information that might require more than a single-step thought. The ignorance which is at issue here is that of some of the most important pillars of a free society: the ones upon which the United States of America is founded. With the ready availability of the Internet, one needs invest no more than 30 minutes per day to educate oneself.

This rule of ignorance which has taken over American society comes about at a time when an unprecedented percentage of the population possesses degrees obtained by higher education. There is causality in this relationship. In fact, the overpowering ignorance that is pervasive among the American public has come about as a direct result of the vastness of the higher education system. One reason is the fact that, as has been said before, today we tend to learn more and more about less and less. That is, when people study one thing or another, they focus too much on studying the details of it, while all too often disregarding the knowledge that would produce what was once known as the phenomenon of the “well rounded individual.” 

A more far reaching reason for the present rule of ignorance, however, has to do with the quality of both the education given, as well as of those who receive it. Throughout human history, higher education has normally been reserved for the elite, that is, for a very small and very limited percentage of the population. Today, higher education has come to be seen as a basic human right which has resulted in colleges and universities getting reduced to nothing more than diploma printing presses. Educational institutions, just as any enterprise ought to be in the market for profit—the present problem being that government subsidies and student loans have grossly increased demand, thereby watering down the quality of the supply.

At the same time, the students who attend these institutions have no intention of getting educated or, God forbid, enlightened—they are just looking for an office, rather than an assembly line, job. The vast majority of students who attend post secondary educational institutions these days simply do it for the piece of paper they are given at the end of the ride. As long as the customers (the students) pay the tuition up front, the seller (the educational institution) has no problem providing them with the desired piece of paper, even though the students spend most of their class time checking “Facebook” or shopping online. Misled by their own equation of attending an educational institution with actually getting educated, very few people seek further enlightenment, that is: informal, independent education. There is no great mystery as to why this is the case: very simply put, there is a certain (usually small) percentage of the population that truly enjoys being educated. Higher education is for them, not for those who seek a university diploma only as a means to avoid honest labour.  

But I digress. The issue at hand here is US President Barak Obama’s cheap trickery. While Mr. Obama may have a flaw in his personality which consists in his ambitiousness, he is by no means a person who lacks intelligence or cunning—which he has used like very few in history. The system of elected delegate representation—commonly known as “democracy”—possesses in itself an inherent flaw, in that lawmakers are elected by the public for their relative likeability. Unlike the disciplines of business or sport, for example, where capability to perform a task at hand determines who advances, in the discipline of electoral democracy representatives get elected for reasons that are usually irrelevant to the capabilities necessary of them by the office they seek to win. In this system of elected rulers a sleek sweet-talker like President Obama is given more than a “fair” opportunity to fulfill his ambition of grandeur. All one needs to do is to give the audience what they want, or rather to tell them what they want to hear. So, Presidential candidate Obama told people what they had wanted to hear: that hard work, ingenuity, self-sacrifice and personal responsibility are not necessary in order for “ordinary people” to live like extraordinary ones. A perpetual campaigner, Obama keeps harping the same tune, thereby, discouraging “ordinary” Americans from rightfully seeing themselves as the cause of the current economic crisis they find themselves in. 

Even more deleterious to American society is the fact that the President’s rhetoric also prevents “ordinary” Americans from realizing that they are the only solution to that problem.

The dangers of Obama’s sweet-taking rhetoric have become all too obvious through the recent Occupy Wall Street protests. One underlying cause which all “Occupiers” seem to rally around is the notion that “the rich” need to pay higher taxes. It is not difficult to see where this idea comes from if one listens to any given speech the President recites these days. One of the most commonly repeated lines by the President is that “the rich” need to pay their “fair share” of taxes, thereby suggesting that “the rich” fail to pay what is their fair share. The President’s line implies that since “the rich” fail to pay their “fair” share of taxes, they pay a share that is “unfair”. As one who has lived under a totalitarian regime, I find this rhetoric all too familiar. “The rich” of our time are quickly becoming the Jews of Hitler’s reign, or “the capitalist” of the time of my grandfather when the Communists took over the reins of power of my former Homeland. “The rich” are being demonized and presented as inhumane—subhuman even—heatless, soulless “rat bastards” who in some Devilish way are feeding upon the blood, sweat and tears of the common, working man—the Proletariat, if you will.

First, I will address the threat posed by the demonizing of a segment of the population and what it can do to a society. As a child I used to spend a large portion of my time with my grandfather, who was a teenager when the Communist Party became the ruling force of Yugoslavia, when Macedonia was part of that federation. My grandfather and I used spend our time by having him tell me stories from the past, a common theme amongst which were the years that immediately followed the Communist takeover. The one story that stuck in my mind is the one about how priest and “capitalists” were treated at the time: it was common practice to parade them on Sundays, have them stoned and ridden like donkeys, while they wore signs that said “criminal”.

Assuming that the “capitalists” were some Monopoly Man, captains of industry types, I asked my grandfather who these people were, and what factories had they owned before the Communist takeover. His answer was shocking. The “capitalists” were no captains of industry; there was no industry to speak of at the time, since Macedonian society had not yet gone through the Industrial Revolution by the end of WWII. There were no large landowners, nor were there factories or capitalists as one may imagine. The people that were labeled “capitalists” were shopkeepers, bakers, butchers and artisans—small business people. They were used by the Communist regime as a scapegoat for the poverty of society at large and were identified as the “Enemy from within”. Those who have sufficiently studied Hitler’s pre-war Germany will know that the Nationalist Socialists went after the Jews, not driven by religious fervor, but rather because the Jews were seen as “the rich”: as a class that lives parasitically off the backs of the working people.

I worry when I hear rhetoric of Mr. Obama’s choice which divides portions of the population, and labels one as being an abuser of another in what is essentially a free society. Today the President is labeling the top one percent of the population as the evildoers. What will happen when the pitchfork armed mob starts executing the richest one percent and plunders their money? If the present is to be our guide for what the future will bring, then it is not unreasonable to expect the mob to feast on its newly obtained booty until there is no more. At that point there will be a new top one percent upon which the mobs will point their pitchforks. The vicious cycle will go on perpetuating itself until the corner store shop owner becomes the newest incarnation of the Devil—in the eye of the mob, of course—“the rich.” A brilliant poet, Venko Markovski, one of Macedonia’s earliest communists, after his fatal fallout with the heads of the Yugoslavian Regime wrote a telling truth: “The Revolution eats its own children.” 

There is further danger in President Obama’s rhetoric, especially in way he speaks of opponents to his policies in Congress. He calls upon them to “act like grownups” and to “get to work”, suggesting that they oppose his policies as a result of a refusal to do the work that they are paid to do as public servants, and for being childish, rather than because of the objective fallacies those polices have. Such personal attacks are another technique that Ludwig von Mises noticed among opponents of liberty:

The enemy is not refuted: enough to unmask him as a bourgeois. Marxism criticizes the achievements of all those who think otherwise by representing them as the venal servants of the bourgeoisie. Marx and Engels never tried to refute their opponents with argument. They insulted, ridiculed, derided, slandered, and traduced them, and in the use of these methods their followers are not less expert. (Ludwig von Mises, “Socialism, An Economic and Sociological Analysis”, p. 29)

Since I am not rich, and since the most honest and wise way to view any situation is through the prism of self-interest, I come to the most far reaching danger of Obama’s rhetoric against “the rich”: demonizing the rich poses a danger to future prosperity of society as a whole. When being rich or well off becomes seen as an act of villainy, then fewer people will want to become rich because they will be punished for it. As a result, those with an entrepreneurial acumen, the ones who bring positive changes to society will opt against chasing their dreams and will drop into the fold of mediocrity. This translates into fewer jobs and no more new inventions that make life better for the not rich. I, along with my family, have experienced persecution by the state in the name of financial equality. The result of that persecution is over one hundred extremely well paying jobs lost in my former home town of Kumanovo, tax revenue and all that accompanies such an enterprise as well. My former townsfolk have grown poorer, while my family has been forced to contribute its efforts to a different society.

Wednesday, January 11, 2012

A Skeptical Look At the Wheel

Life has a tendency to be unjust to some, quite unjust indeed. Men and women often find themselves working hard, contributing toward the common interest of Society, even sacrificing parts of themselves for the good of all, yet in return, they receive no credit for it. Anecdotes, nay, tragedies by the volume have been written for ages past of such injustice; greater still are the tragic cases where not only are the deserving ones overlooked, but when additionally, the wrong party is credited. Of all the great snubs of all time, not one is greater than the greatest of historical wrongs: the usurpation of the Axle and its inventor’s rightful place in history by that smug scoundrel known as the Wheel. No one praises the Axle or has their ears caressed by proverbs spun around it. However, despite the overwhelming credit that human history has given to the Wheel, due to the genuine engineering genius required to invent the Axle, its’ simple nature and proven versatile independence, the latter, not the former deserves the unique place in history as the seminal human invention. 

As an illustration of our historical injustice, two simple questions may be taken into consideration: How often does one hear scholars refer to the supposed invention of the Wheel as to the greatest moment in the history of Mankind—the “Eureka” if you will? In contrast, does one ever mention the Axle or even the shaft in such a connotation? Yet, the buffoons who parade themselves as intellectuals are no more great minds than the Wheel is a genuine human invention. For, it takes a person one look at the clear sky to see a wheel; it scarce takes more of an effort of the intellect to look upon an apple or a peach or an orange fall from a tree and roll on the ground. That great inventor of the Wheel, it seems clear, was no man at all, but rather it was Nature or God. On the other hand, can the Axle be found rollicking effortlessly and without purpose in the wilderness? True enough, sticks are made by nature, as are other straight objects that pierce various holes, but none that connects two apples or peaches or oranges in a way that capacitates them to carry a load. Indeed, when looking at a wheel and an Axle, only one constitutes a genuine human invention: therefore, only one was created by a Man or Woman of genuine genius.

Furthermore, the brilliance of the Axle’s ingenious design is underlined by its’ simplicity. Can a product or invention of a simpler design be even thought of; certainly not one as simple as the Axle, for what can be simpler than a shaft? It is without doubt the simplest invention ever thought of, yet, not one other can even come near its’ importance in the progress of Mankind.  In the monumental pamphlet on justice, “Common Sense”, Tomas Paine argues that all things honest are kept simple; only when one has mischievous intentions does one corrupt them by means of complication. In spite of the continual progress of humanity, the Axle remains today as simple as the very first time it probed a Wheel. Simple, humble and above all honest, certainly not the characteristics of that showboating cheat—the Wheel.

Equally important to its’ simple, yet genius nature, is perhaps the most obvious, and for that reason most overlooked, detail: without an axle, a wheel is but a hoop! Any device, whose function is designed around the motion of a Wheel, is rendered useless by the absence of an axle probing the Wheel or Wheels. The Axle, on the other hand, grants itself just as useful on its own as while used in tandem with a compliment. Indeed, one can use a shaft as an exercise contrivance, a rolling pin device, a peace maintenance apparatus or as a skewer for a rotisserie cooking whatchamacallit, to list a few of the axle’s alternative uses.  Yes, the shaft faithfully works hard in any number of combinations and functions; it sets no conditions upon which to give benefit to its’ enjoyer. Conversely, one can often find the “royal majesty”, the Wheel, lazily lying in the ground or idly leaning against a wall, listing its demands: all of which center on the point of sharing the burden with someone else.

Of course, the herd that likes to think itself the intelligentsia of our Society will doubtless point to such and such advancements through history that owe their gratitude to the Wheel: transportation, clocks, construction and so forth. However, the Wheel’s contribution to human advancement is not the point of this contention. Only a fool would argue against all the benefits humanity made possible by the Wheel. An equally great fool, however, will forget to mention the Axle’s share. 

To be sure, while the Axle is not history’s lone unsung hero, one would be hard pressed to find a case equally unjust. For the offence against it is not that, like the multitudes of others, it is simply forgotten or carelessly omitted, the way that the fellow who invented soap, or the great mind that thought up bread or “Che” Guevara's comrade have fallen by the popular wayside. The Axle suffers the added insult of tyranny: having its’ rightful place in human history usurped by an object that depends upon it! Still, no one ever hears the Axle complaining; it keeps quiet, obediently working on, in full magnanimity, respectful of its’ master.

Tuesday, January 10, 2012

An inquiry into the state of present day politicians as the cause of the decline of liberty and prosperity

Without a healthy democracy, there can be no liberty; nonetheless, democracy by itself does not produce a state of liberty. Liberty needs to be gained and maintained daily by human action in the form of civic diligence. Many have come to lament and bemoan the current state of affairs in Western politics; many blame the influence of big business and lobby groups for the problems faced by democratic societies and call for the abolishment of these ties. While interest groups are a part of the problem, they are not the cause of it; rather, they are an effect of the growing power given to politicians. Unfortunate as it is, citizens are no longer the conductors of democracy; politicians are. Since politicians are the masters of democracy—and those who lend their ears to lobbying groups—it is wise to examine their role in society.

Each new election year brings with itself the hope of an ensuing change toward a better reality than the one presently enjoyed; this feeling becoming ever more prevalent in more recent times as a result of the decay of the economic system which has continually bread prosperity for over three centuries. At the same time, both the United States and Canada see dwindling voter turnouts, which suggest resignation on behalf of the body politic. Mainstream pundits tell us that the public has grown tired of the cynicism and bickering tone of politicians. I contend this not to be the case, instead I believe that people have resigned themselves from participating in democratic processes as a result of a protracted move toward an abandonment of the liberal ideals upon which our society was founded and a turn toward socialistic practices. There is an expectation of great change toward unseen prosperity and equity that a great new leader—an Enlightened Despot—would bring about; the only challenge being finding this Enlightened Despot. Keynesian economists of Paul Krugman’s mold write paper upon paper convincing the public that governments can solve any problem, just as long as the voting public allows them to frivolously spend enough fiat money. This civic attitude of serfdom comes as a result of decades of indoctrination of the public by politicians and unionized educators alike that liberal, pro-free market individualism is the cause of every single societal problem; therefore, they claim, people ought to forfeit their liberty to their representatives, who, with the tools of central planning can provide all that the citizens’ hearts may ever desire.

A hint as to where the seed of our current troubles indeed lay may be drawn from that seminal piece penned some two hundred and fifty ago—the aptly titled “Common Sense”: “I draw my idea of government from a principle in nature, which no art can overturn, that the more simple any thing is, the less liable it is to be disordered, and the easier repaired when disordered (emphasis added).”[i] Centuries after Mr. Paine’s call to simple government, the world finds itself plagued by one big and complicated government regime after another. The American republic that Alexis De Tocqueville wrote about has been forfeited in exchange for something that the French aristocrat may have found closer to his home:

There are countries in Europe, where the natives consider themselves as a kind of settlers, indifferent to the fate of the spot which they inhabit. The greatest changes are effected there without their concurrence, and (unless chance may have apprised them of the event) without their knowledge; nay, more, the condition of his village, the police of his street, the repairs of the church or the parsonage, do not concern him; for he looks upon all these things as unconnected with himself, and as the property of a powerful stranger whom he calls the government. He only has a life-interest in these possessions, without the spirit of ownership or any ideas of improvement. This want of interest in his own affairs goes so far, that if his own safety or that of his children is at last endangered, instead of trying to avert the peril, he will fold his arms, and wait till the whole nation comes to his aid. This man, who has so completely sacrificed his own free will, does not, more than any other person, love obedience; he cowers, it is true, before the pettiest officer; but he braves the law with the spirit of a conquered foe, as soon as its superior force is withdrawn; he perpetually oscillates between servitude and license.[ii]

It is no wonder then, that our world is riddled with the various problems of ailing economies, lost youth, discontented masses and the destruction of lives and the environment with no end in sight.

As a result of growing influence of socialistic ideologies, governments have grown morbidly obese over the past century; our so called free and democratic societies bear witness to citizens’ lives greatly more influenced by the authority of the state today than was the case in the feudal societies of the Middle Ages. The cause of this gross infringement on personal liberties has been the rise of the cult of the omnipotent statesman-politician with his infinite wisdom and do-no-wrong capacities: despite the deliveries of blunder upon blunder, politicians have become the be-all-end-all deities of our times; believing that any sphere of private and public life can be positively shaped by political decisions. This is not to say that political figures have substituted pop-stars as the idols of the populace; rather, it is to say that people—though, so uninvolved in the political processes of their societies that they can probably name only the head of their government and no one else—have come to see all problems as solvable by political action.

It seems that few care to notice that this move toward the centralization of power in the hands of a minority elite contradicts the original liberal ideas upon which modern Western societies were founded, whereby the universality of human fallibility was in fact realized and thereby the glorification of some over others abandoned. Alexis De Tocqueville explains why this was so:

However enlightened and skillful a central power may be, it cannot of itself embrace all the details of the life of a great nation. Such vigilance exceeds the powers of man. And when it attempts unaided to create and set in motion so many complicated springs, it must submit to a very imperfect result, or exhaust itself in bootless efforts.

Centralization easily succeeds, indeed, in subjecting the external actions of men to a certain uniformity, which we come at last to love for its own sake, independently of the objects to which it is applied, like those devotees who worship the statue and forget the deity it represents. Centralization imparts without difficulty an admirable regularity to the routine of business, provides skillfully for the details of the social police; represses small disorders and petty misdemeanors; maintains society in a status quo alike secure from improvement and decline; which the heads of the administration are wont to call good order and public tranquility; in short it excels in prevention, but not in action.[iii]

At best centralization brings about stagnation, and at worst societal decline; while human nature desires perpetual improvement.

The state funeral given to Canadian socialist, leader of the New Democratic Party, Jack Layton, or a glance at ceremonies thrown during G20 meetings tell stories of our elected leaders assuming the roles of newfound royalty. Indeed, one cannot blame a person, in this case the politician, for attempting to make the most of his life; however, since by doing so the statesman-politician negatively influences the lives of the common citizenry, the impetuous is on the citizenry itself to take a close look at the institution which is claimed to be the embodiment of leadership on the path to a brighter future. That is, the onus on the citizen is to make an objective judgment of the institution of politician, as it stands today, in order to make a decision of self-interest: whether or not to continue to give up as much of its sovereignty to this institution. The statesman-politician in essence risks nothing while reigning over the state, constitutes an extreme case of unproductive labor and serves the interests of his party, rather than those of his constituency, therefore it can be drawn the professional politician represents an adverse entity for any society.

To be sure, every decision carries within itself an underlying risk. All citizens risk something whenever making a decision: to pay to attend university without the guarantee of graduating or materializing that education into an adequate compensation; to invest their monies into real estate or the stock exchange markets; or to choose one career path over another, to list a few. If any or all of these decisions result in failure or bad fortune, the common citizen is left with a rather brief list of options, all of which ultimately see him reduce his discretionary spending, while increasing the amount and intensity of work he commits himself to, in order to make up the loss; sometimes he even sees reductions in his spending on essentials such as food, clothing and shelter. On the other hand, what does the statesman-politician risk, or rather: what does he stand to lose from a poor policy decision or even a catastrophic tenure in office? While history shows some statesmen ending their careers in front of the firing squad, they are the few and far between—at the same time, while the firing squad momentarily relieves public anger, it does not reverse the policies undertaken by the deposed statesman. Further, in modern Western societies, the most a statesman-politician stands to lose is an election. We are told that ousting a politician from office causes injury to his dignity, public standing and self respect. However, it can be observed that the rules that apply to these feelings within the state of mind of the politician vastly differ to those of the common citizen: once the statesman-politician exposes himself to the public in such profane fashion as he does, he becomes bound not by the social mores that govern the common voter, but by those that command prostitutes.

In terms of poor fiscal decisions, it is not the statesman’s discretionary spending that gets diminished: while his policies may cost his constituents their homes, their life savings or their children's education funds, the statesman’s personal wealth does not suffer at all—in fact, it often happens that because of their involvement in the decision making processes, that the personal wealth of politicians grows. More so, whenever the politician runs the state into deficit or debt, he simply asks the citizens to work longer, harder hours and to cut down on their spending in order to make up for the politicians mistakes, all the while he keeps vote purchasing welfare programs intact. Worst of all, however, is the fact that no matter how well intentioned, the consequences of a statesman’s poor decision can be felt for generations after his ultimate departure from the political scene, as history bears witness to so many of the entitlement programs introduced by the FD Roosevelt administrations. Then, it can be said that granting the responsibility and power to run the lives of present and future generations to people who in return put nothing at stake but their disputable reputations is surely utter recklessness.

Equally important is to accordingly allocate the statesman-politician’s place in society by virtue of his utility. To achieve this, it is constructive to begin by locating the politician with respect to Adam Smith’s basic discernment of contribution to society. “There is one sort of labor which adds to the value of the subject upon which it is bestowed : there is another which has no such effect. The former, as it produces value, may be called productive; the latter, unproductive labor”[iv] While some unproductive labor inarguably has its merits by which society benefits, nonetheless, it is the overall productivity of productive labor that feeds society as a whole.

Many a noble professions are classified as unproductive labor: doctors and educators among which; the least noble of this class of labor is surely that of politicians. Much like the bureaucrat who is constantly aware of his lower relative worth to the undertaking which he is a part of, so too is the politician perpetually aware of society’s absence of real use for him. In response, the statesman-politician embarks on missions ad infinitum by which he creates an artificial need of himself. Thus, problems are never solved with solutions, but rather with further problems: that is, problems never get solved. Entitlements do not get discontinued; rather the government's debt grows larger. In lieu of producing an environment which would generate the conditions for outsourced jobs to start returning to the country, by voting in new regulations the statesman-politician pushes those jobs farther away. Economist Philip Bagus gives a concise example of how politicians caused the current economic crisis dubbed by some as “The Great Recession”:

When fractional-reserve banks expand credit, malinvestments result. Entrepreneurs induced by artificially low interest rates engage in new investment projects that the lower interest rates suddenly make look profitable. Many of these investments are not financed by real savings but just by money created out of thin air by the banking system. The new investments absorb important resources from other sectors that are not affected so much by the inflow of the new money. There results a real distortion in the productive structure of the economy. In the last cycle, malinvestments in the booming housing markets contrasted with important bottlenecks such as in the commodity sector.[v]

He goes on to explain how politicians have gone on to perpetuate the crisis that they caused:

All three aforementioned adjustments (relative prices changes, increase in private savings, and factor-market flexibility) were inhibited. Many bankruptcies that should have happened were not allowed to occur. Both in the real economy and the financial sector, governments intervened. They support struggling companies via subsidized loans, programs such as cash for clunkers, or via public works.

Governments also supported and rescued banks by buying problematic assets or injecting capital into them. As bankruptcies are not allowed to happen, the liquidation of malinvestments was slowed down.

Governments also inhibited factor markets from being flexible and subsidized unemployment by paying unemployment benefits. Bubble prices were not allowed to adjust quickly but were to some extent propped up by government interventions. Government sucked up private savings by taxes and squandered them maintaining an obsolete structure of production. Banks financed the government spending by buying government bonds. By putting money into the public sector, banks had fewer funds available to lend to the private sector.

Factors of production were not shifted quickly into new projects because the old ones were not liquidated. They remained stuck in what essentially were malinvestments, especially in an overblown financial sector. Factor mobility was slowed down by unemployment benefits, union privileges, and other labor market regulations.[vi]

Three simple solutions lend themselves to the ongoing problem of job loss in North America: cessation of unemployment benefits, eradication of minimum wage legislation and the lowering of taxes. High cost of doing business is the reason why so many companies have been moving their production away from North America over the past twenty years. With the termination of the distribution of further unemployment benefits and the elimination of the artificial minimum wage standards, more people are likely to start accepting jobs at wage levels they otherwise would not. Similarly, by reducing business and employment related taxes–which amount to nothing more than the penalizing of contributing to the real wellbeing of society–the overall cost of entrepreneurship is bound to recede from the inflated levels at which it currently resides. Lower taxes and fewer entitlements would cause the ratio of productive to unproductive labor to normalize. The combined effect of these steps would be that North American economies become competitive once again with respect to our sweatshop fueled rivals in the Far East, and thus be back on the path of prosperity.

Of course, as far as the politician is concerned, such policy would constitute career suicide. By it, he is bound not only to lose “special interest” votes, such as those of the labor unions; more so, the statesman-politician is bound to be exposed for what he really is: the unproductive labor of the worst kind. He therefore personifies a largely useless sham of an institution which we are told was at some distant point in time served only by the wisest and most experienced of the citizenry. In a situation of a self regulating, free-market driven societal life the statesman-politician’s own job is bound to become obsolete and resultantly outsourced into to the annals of history.

In addition, one ought to remember the cry of the American Revolution of “no taxation without representation”, specifically, as we are living under a system of delegate-democracy whereby the common citizen relinquishes a growing amount of his own sovereignty to that of his elected representative. Jean-Jacques Rousseau likens the political system which we enjoy today more with that of feudalism than with the Roman republic[vii]. To his credit, the parliamentary democracy scheme is drawn by the template of British constitutional monarchy rather than the ancient republics. In fact, Monsieur Rousseau refers to anyone who forfeits his sovereignty to a delegate a “slave”. While this idea may at first seem extreme, it deserves some consideration: the citizen himself grows more and more distant to his representation, as each new law and regulation take away his right to act accordingly to his own free will, and as each new government sponsored institution adds more administration by which the voter is kept farther from, not closer to, his representative. At the same time his delegate, the member of the various assemblies, once elected, does not steward the platform of the citizen who voted for him, nor of the one who did not: the elected representative finds himself subservient to the platform, or rather the interests of the political party to whose caucus he belongs; the political party’s sole interest being gaining power.  

Since the early days of the American republic, political parties have over time morphed into enterprises, no different from profit oriented organizations with a view only on the short term. Rather than serving the purpose of maintaining the republic, present-day politics gives its practitioners a more expedient purpose: that of winning power and holding on to it, simply as a means of gainful employment. Alexis De Tocqueville tells us that as recently as the 1830’s a career in politics in America meant something drastically different to what is the case today:

Even the State is only a second-rate community whose tranquil and obscure administration offers no inducement sufficient to draw men away from the home of their interests into the turmoil of public affairs. The Federal Government confers power and honor on the men who conduct it; but these individuals can never be very numerous. The high station of the Presidency can only be reached at an advanced period in life; and the other Federal functionaries of high class are generally men who have been favored by good luck, or have been distinguished in some other career.[viii]

The politician of our day is not some wise old head who keeps watch over the state of his posterity; rather, he enters politics a beardless young buck and dies a politician—politics is his chosen career. The professional politician goes from the classroom straight into an office in the Capitol, failing in the meanwhile to observe and practice the mechanics of society for a single day. Yet, in a gesture of pure madness, he is given the ultimate decision making authority over that same society. It is of little wonder then, to see the ascent of the idea of the welfare state: the idea that the statesman-politician is a parent, a demigod, an irreplaceable hand that gives life to life everlasting. By means of socialistic programs, entitlements, healthcare and innumerable other get-something-for-“nothing” arrangements, politicians of the various indistinguishable parties lure the masses to keep propping them up to the current status of nobility they have come accustomed to luxuriate in. The statesman-politician cares not how he comes to maintain himself in power: he defers the solution of a problem further down the road; he pits the “working class” against “big business”; he blames and penalizes job generating enterprises for pollution, while maintaining legislature that prevents financially viable means to the discovery and use of pollution solutions; he pits neighbors of different ethnicity, race or religion against each other, all for the sake of keeping himself relevant.

Reason must take precedence: how is the statesman-politician to be trusted to make useful policies for his constituency when his preeminent goal is to further his own employment. This he cannot accomplish by means of peace, prosperity and harmony; for, the statesman-politician’s interest is his own welfare, rather than ensuring that he creates the conditions for a fair and free competition among his constituents and thus leaving it to them to produce the best arrangements for themselves as they see them fit. After all, when each citizen is given an opportunity to seek out his own best interest, it is foolish to expect some opinion-poll driven, career politician who never in his life held a real job, living in a bubble with his comrades, to know what is really best for every single member of body politic.

On the other hand it can be argued that laws are needed for a society to function justly and therefore the statesman-politician is a necessary evil. The institution of the state itself is a product of the desire for justice among men; that is, the state is present for the purpose of protecting men from the harm of other men—however, it is missed that the state does not have the purpose of preventing people from harming themselves. This necessity, however, does not stipulate a mandate for the state to do harm onto one in order to establish what it arbitrarily considers just; or to impose the wishes of some on to others: cautious treading is called for, as in the pursuit of his own best interest–that of winning votes–the statesman-politician does harm to the state itself, as well as his fellow citizens. Furthermore the phrase “necessary evil” brings to the fore the reality of what the politician truly is. Therefore, much like a vaccine ought to be administered in tolerable dosages only, so must be the case with the statesman-politician’s role in the life of the state; for if left to rummage unchecked, history and presence show how harmful his consequences to society indeed are.

At the same time, some will bring forth the issue of, as it is euphemistically termed, social justice. If the mandate of the state and henceforth the mandate of the statesman-politician is to ensure that no one does harm onto another’s liberty, consequently then, the notion of social justice through the redistribution of wealth for the purpose of bringing financial equality to the citizenry, not only does not fit this mandate, rather it constitutes a blatant foul against it: for the redistribution of wealth deals only with a finite amount of wealth and therefore stunts the creation of more of it, and by taking away from those who have more in order to those who have less, violates the liberties of those who are plundered. Subsequently, as actions with the aim of creating equity in wealth curtail the citizenry’s ability to reach its greatest happiness, these dubious policies do more harm to those whom its propagators claim that they are instituted to benefit. Then, since the statesman-politician is an evil, the less of this evil is present in the life of society; the better off society would seem to be.

Common sense would suggest that it is most unwise for the citizenry to go on forfeiting its destiny to a class–the politicians–that stands to lose nothing by its poor work and only to gain by keeping the living conditions of said citizenry below what they potentially can be. Unfortunately, the present “Occupy” movement testifies for a complete abandonment of reason. Democracy can lead to tyranny, just as soon as it can lead to liberty. The fact that in the early days of America, democracy flourished into liberty was no accident: it was a result of civic diligence, as every individual wisely looked out for himself, instead of depending on some enlightened despot to do it for him, as De Tocqueville documented:

The native of New England is attached to his township because it is independent and free: this co-operation in its affairs insures his attachment to its interest; the well-being it affords him secures his affection; and its welfare is the aim of his ambition and of his future exertions. He takes part in every occurrence in the place; he practices the art of government in the small sphere within his reach; he accustoms himself to those forms without which liberty can only advance by revolutions; he imbibes their spirit; he acquires a taste for order; comprehends the balance of powers, and collects clear practical notions on the nature of his duties and the extent of his rights.[ix]

The occurrence of the “Occupiers” demonstrates an embracing of serfdom as a prevailing civic attitude and speaks volumes of how desperately Western societies need to turn toward pure republicanism. The movement brings to light a painful reality: the fact that citizens have not got the slightest clue as to how democracy works. Protests are only a manifestation of the subservience of the masses toward the ruling elites: indeed, protesters bring forth their grievances and ask politicians to remedy them, rather than take responsibility for their own lives in their own hands.

Presently, the subservient masses are asking for politicians to wave their magic wands and improve their condition; they also ask for the abolishment of lobbying activities. However, lobbying of special interest groups and corporate donations that control politicians will linger and menace democracy for as long as it exists, and politicians, as they are only human will seek their own best interests—which as proven here, often conflict with the best interests of the common citizen. Simply abolishing the institution of lobbyist will not make the practice go away; what will make lobbying go away is a curtailment of the powers granted to political office and the abandonment of centralization. Claude Frédéric Bastiat recognized the danger which politicians pose to liberty when he wrote:

Since all persons seek well-being and perfection, would not a condition of justice be sufficient to cause the greatest effort toward progress, and the greatest possible equality that is compatible with individual responsibility? Would not this be in accord with the concept of individual responsibility which God has willed in order that mankind may have the choice between vice and virtue, and the resulting punishment and reward?

But the politician never gives this a thought. His mind turns to organizations, combinations, and arrangements—legal or apparently legal. He attempts to remedy the evil by increasing and perpetuating the very thing that caused the evil in the first place: legal plunder. We have seen that justice is a negative concept. Is there even one of these positive legal actions that does not contain the principle of plunder?[x]
While defining legal plunder thusly:

See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime.[xi]

If logic were to be followed, rather than rhetoric, there would be no problem to speak of; this not being the case, the challenge, it is obvious, is to bring awareness to the body politic. Logic suggests that the cumulative brain powers of the multitudes vastly transcend those of the few in the Capitol and therefore more adequately handle any given challenge. Then, the masses are truly only slaves to themselves in believing that the politician, their delegate, as some modern day fable knight in shining armor, would ride into the Capitol and bring them the justice they ought to earn for themselves. The identity of the cause of our problem lies with not necessarily with any politician in particular, but with the habitation of the professional politician as a quasi-celestial presence in the lives of common citizens. Rather than turning to the politician as a bringer of solutions to Society, it is clear that Society would be the wiser for accepting the politician-statesman as the cause to its problems, and consequently to seek out ways to keep professional politicians at bay, while encouraging each member to take an active role in the democratic processes of his jurisdiction.


[i] Paine, Tomas. Common Sense. New York: Dover Publications Inc., 1997. p 5
[ii] De Tocqueville, Alexis. Democracy in America. New York: Penguin Group, 1956. p 68
[iii] De Tocqueville, Alexis. Democracy in America. New York: Penguin Group, 1956. p 66
[iv] Smith, Adam. The Wealth of Nations Books I-III. Middlesex: Penguin Books Ltd., 1970. p 429
[vii] Rousseau, Jean-Jacques. The Social Contract. Middlesex: Penguin Books Ltd., 1968. p 141
[viii] De Tocqueville, Alexis. Democracy in America. New York: Penguin Group, 1956. p 60
[ix] De Tocqueville, Alexis. Democracy in America. New York: Penguin Group, 1956. p 61
[x] Bastiat, Claude Frédéric. The Law. New York: Cosmo, 2006. p 24
[xi] Bastiat, Claude Frédéric. The Law. New York: Cosmo, 2006. p 17
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