Time to Sever the Government-Market Connection
I was excited to see that the bailout plan (at least the first incarnation of it) was voted down yesterday. I was disappointed, however, to see the market plunge so dramatically in response. This points to the socialist/fascist/statist connection between the government and the market.
How is it that we have permitted such a degeneration into the uncivilized state of affairs in which a primitive, parasitic, political class can affect business transactions through the actions they take (or fail to take) in the halls of Congress? We should be ashamed of ourselves for voting for these despicable creatures and for allowing them to remain in power. From the writing of the Constitution on, we have steadily given the organized criminals we call politicians more and more power over us and our economy. This, as I've mentioned before, has led to a class of large businesses proficient at using the laws to crush their competitors.
But it's really our fault for asking politicians to fix various things we have perceived as problems through the years. What a primitive mindset. We don't like something, so we team up with others to use violence (government) to make them bend to our will, whether it's child labor, low wages, pollution, drugs, prostitution, or the way a bank is doing business. Rather than take the civilized route and work through voluntary efforts to persuade people to change their actions, we throw the very concept of human dignity and natural rights out the window and point a gun at our perceived "enemies." We've created an inhuman and wealth-destroying entanglement of government and markets, which has led directly to the crisis in which we now find ourselves.
We're now at a point where we can grow up and decide to stop our use of force to get what we want, or we can plunge so far into statism that we can't climb back out. We can say "no" not only to this bailout but to any bailouts, ever. We can say "no" not only to any proposed new regulations but to any regulations, ever. We can demand the dissolution of the IRS and Federal Reserve and an end to the use of violence to restrict banking or any other industry. We can call the entire spectrum of government regulation exactly what it is--a violation of the natural rights of every one of us and a sentence for our children and grandchildren to never achieve the prosperity and happiness that could be theirs under a true free market.
We can sever the destructive link between government and the economy, but our window of opportunity may be closing quickly.
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Path of Least Resistance
Here are some quick thoughts I had about the nature of our current economic crisis in an e-mail exchange with some friends:
Another way to look at this is like a physical or chemical system. Electrons follow the path of least resistance and chemical reactions occur via the pathways of least resistance. It's the same thing in the markets. Everyone (including each of us) is interested in making money through the path of least resistance (legally, of course). That is, we seek to make money doing what we're best at and using systems and processes we understand.
Now, when the government implements any regulation--any regulation--it has the automatic effect of hindering the smallest players the most and giving the biggest players incentives to find clever ways around the regulations (which they can more easily do because of their resources). This, of course, is why we often see the biggest players in a given industry lobbying for government regulations--it gives them a leg up on their smaller competitors. They find that it's easier to get the laws changed than to work harder at providing better and cheaper goods and services to their customers. They take the path of least resistance.
When it comes to housing and the financial markets, there's been so much regulation and meddling and anti-market activity by the government since 1913 (and even earlier) that what we have is a system that creates myriad paths of least resistance (or less resistance) that are vastly different from the paths that would exist in a perfectly free market--and it all results in a transfer of wealth from smaller players to bigger players and from tax payers to the companies that help write the regulations.
It's funny (or maybe not so much) that socialists and libertarians correctly identify the same end result but the socialists' solution (always more regulation and actions by government--like caps on executive salaries) is exactly the wrong thing to do. The libertarians always try to point out that it's the laws and government agencies (and GSEs) that caused the problems in the first place and are what should be eliminated without delay.
Of course, the guy on the street, being convinced by decades of government education that every problem he observes is due to a lack of government control, rails at the big bad businesses and says, "Stick it to 'em, Uncle Sam!" Sadly, these "big bad businesses" (even those who had nothing to do with the laws) are simply following the path of least resistance as it's been laid out for them by the regulations demanded by the frightened populace, written by big industry players, and eagerly promulgated by the parasitic politicians.
Now we face the prospect of a government "fix" for the current crisis, and it may well put the markets at ease in the short term. But it will do so by temporarily putting off the problem and making it worse, so that when the time finally comes for a true market correction it will be far worse than we can possibly imagine. I can only hope that cooler heads prevail between now and that future day and we find a way to extract the government from our economy without plunging ourselves into a new Stone Age (which is the only possible outcome of continued government interference).
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Pretend anarchists give real ones a bad name
All the recent news about so-called anarchists getting violent at the Republican National Convention is really bugging me. Despite popular opinion, anarchy and anarchism have nothing to do with chaos and violence, and these nut jobs are not anarchists. True anarchists (like us hardcore libertarians) support the abolition of government (i.e. a group of people with a monopoly on the use of force in a geographic area). True anarchists look for the day when individuals are free to interact voluntarily and prosper without having force initiated against them by an organization claiming to have a legitimate sovereign power to make and enforce laws. Now these punks breaking things and lighting fires in the streets are not true anarchists because their goal is the destruction of capitalism and the free market. But since the free market (to the extent that it still exists in this country) is simply the natural way that individuals spontaneously interact and produce and exchange goods and services in the absence of government force, the destruction of such an arrangement necessarily entails the initiation of force against others and the establishment of some sort of unimaginably powerful government to prevent people from continuing in their natural, free interactions. So, these 'anarchists' protesting at both the GOP conventions and some Democratic events (and nearly every free trade meeting) are about as far from supporting actual anarchy as possible. They are, in fact, totalitarians. What's funny is they don't realize how similar they are to the political parties they're protesting. It's the Libertarian Party convention at which they should have been protesting back in April (but of course no one but C-SPAN even covered that).
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Scary RNC Stuff
Apparently I felt like losing a few more IQ points tonight, so I'm sitting here watching bits and pieces of the Republican National Convention. It's kind of surreal. Every speaker (Steele, Romney, Giuliani) is ranting about "country first" this and "America first" that--nothing about freedom first or individuals first. Lot's of stuff about fighting the enemy and "war on terror" and "strong, experienced leadership"--nothing about eliminating government power and those 'experienced' at wielding it. And all this in front of a giant background of deep red with "McCain" and "Palin" separated by a little star. Eerily reminiscent of communist symbols, but I know I'm reading too much into that. All the jingoistic nationalism is what's really disturbing. They sound like they're rallying everyone for a war. What I see when the camera pans around the faces in the audience is a boat load of people chanting in unison who look like they would follow a McCain administration wherever it felt like leading them. There's next to nothing in these speeches about natural rights or the rights of individuals. All I sense is a burning desire to put "their team" in charge of the vast power of the U.S. government. It leaves me wondering how these jokers ever could have called themselves a "party of freedom."
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