Liberal Morality

Disregarding the Constitution

2009-03-21T06:00:00.001-04:00

In Article One, Section Eight of the U.S. Constitution are listed the things that Congress is allowed to do. In Article One, Section Nine are listed the things Congress is not allowed to do (more prohibitions were added in the Bill of Rights several years later). At the time of ratification, it was generally understood that the congress could not do anything except what was found in section eight, and in so doing could not do anything in section nine. Nowadays, for the most part, it's understood to mean that congress can do anything it wants, except what is in section nine.

"For the most part" because the House of Representatives just passed a law that is clearly in violation of "No Bill of Attainder or ex post facto Law shall be passed"—the new law on bonuses. They passed a law (the bailout) and later found out that they didn't like a provision of that law (maybe because none of them read the thing), so they're ex post facto fining people who made entirely legal decisions based on the law at the time. There's no conceptual difference between this and the government passing a law raising the 2007 tax rates and tossing you in jail if you don't pay.

This country was meant to be based on rule of law and the government was meant to be restrained, but in practice that's not the case any more. If you're in a minority that gets vilified by the press/government, you're going down, regardless of whether or not you did anything wrong. In this case, it's the people who agreed to risk their careers by sticking with shaky financial institutions in return for large retention bonuses. In the past it was crazy wackos or families who just wanted to be left alone.

This is what happens when you no longer have a working Constitution and instead have plain old democracy—two wolves and a sheep voting on what's for dinner.

Disillusion and collapse

2009-03-13T06:00:00.000-04:00

What's wrong with a little inflation? Hazlitt points to a number of consequences:

Like every other task, inflation acts to determine the individual and business policies we are all force to follow. It discourages all prudence and thrift. It encourages squandering, gambling, reckless waste of all kinds. It often makes it more profitable to speculate than to produce. It tears apart the whole fabric of stable economic relationships. Its inexcusable injustices drive men toward desperate remedies. It plants the seeds of fascism and communism. It leads men to demand totalitarian controls. It ends invariably in bitter disillusion and collapse.

Adam Smith on national debt

2009-03-12T06:00:00.000-04:00

Hazlitt quotes Adam Smith on the topic of national debt and bankruptcy:

When national debts have once been accumulated to a certain degree, there is scarce, I believe, a single instance of their having been fairly and completely paid. The liberation of the public revenue, if it has even been brought about at all, has always been brought about by a bankruptcy; sometimes by an avowed one, but always by a real one, though frequently by a pretended payment.

Opium of the people

2009-03-11T13:07:00.001-04:00

Hazlitt on the evil of inflation:

Inflation, indeed, throws a veil of illusion over every economic process. It confuses and deceives almost everyone, including even those who suffer by it. We are all accustomed to measuring our income and wealth in terms of money. The mental habit is so strong that even professional economists and statisticians cannot consistently break it. It is not easy to see relationships always in terms of real goods and real welfare. [...] Inflation is the autosuggestion, the hypnotism, the anesthetic, that has dulled the pain of the operation for him. Inflation is the opium of the people.

The roots of profits

2009-03-09T06:00:00.000-04:00

Henry Hazlitt makes an important distinction regarding the origins of profits:

Contrary to a popular impression, profits are achieved not by raising prices, but by introducing economies and efficiencies that cut costs of production. It seldom happens (and unless there is a monopoly it never happens over a long period) that every firm in an industry makes a profit. The price charged by all firms for the same commodity or service must be the same; those who try to charge a higher price do not find buyers. Therefore the largest profits go to the firms that have achieved the lowest costs of production. These expand at the expense of the inefficient firms with higher costs. It is thus that the consumer and the public are served.

A function of profits

2009-03-06T06:00:00.000-05:00

Price ceilings and taxes on windfall profits reduce market efficiency and prolong shortages, according to Hazlitt:

One function of profits, in brief, is to guide and channel the factors of production so as to apportion the relative output of thousands of different commodities in accordance with demand. No bureaucrat, no matter how brilliant, can solve this problem arbitrarily. Free prices and free profits will maximize production and relieve shortages quicker than any other system. Arbitrarily fixed prices and arbitrarily limited profits can only prolong shortages and reduce production and employment.

How to raise wages

2009-03-05T06:00:00.000-05:00

The government implements minimum wage laws, subsidizes farmers, and allows unions to bulldoze employers. Herbert Hoover encouraged businesses to maintain high wages in the early '30s, and FDR forced them to. But does paying laborers more than the market would give them really make us all better off? Hazlitt says no:

The question is not whether we wish to see everybody as well off as possible. Among men of good will such an aim can be taken for granted. The real question concerns the proper means of achieving it. And in trying to answer this we must never lose sight of a few elementary truisms. We cannot distribute more wealth than is created. We cannot in the long run pay labor as a whole more than it produces.

The best way to raise wages, therefore, is to raise marginal labor productivity. This can be done by many methods: by an increase in capital accumulation—i.e., by an increase in the machines with which the workers are aided; by new inventions and improvements; by more efficient management on the part of employers; by more industriousness and efficiency on the part of workers; by better education and training. The more the individual worker produces, the more he increases the wealth of the whole community. The more he is worth to employers, the more he will be paid. Real wages come out of production, not out of government decrees.

The value of releasing capital and labor

2009-03-04T06:00:00.000-05:00

Now in an economy in equilibrium, a given industry can expand only at the expense of other industries. For at any moment the factors of production are limited. One industry can be expanded only by diverting to it labor, land and capital that would otherwise be employed in other industries. And when a given industry shrinks, or stops expanding its output, it does not necessarily mean that there has been any net decline in aggregate production. The shrinkage at that point may have merely released labor and capital to permit the expansion of other industries. It is erroneous to conclude, therefore, that a shrinkage of production in one line necessarily means a shrinkage in total production.

Another fundamental economic truth from Hazlitt's Economics in One Lesson.

Let dying industries die

2009-03-03T06:00:00.000-05:00

Hazlitt on the ebb and flow of industries in a healthy economy:

The idea that an expanding economy implies that all industries must be simultaneously expanding is a profound error. In order that new industries may grow fast enough it is usually necessary that some old industries should be allowed to shrink or die. In doing this they help to release the necessary capital and labor for the new industries. If we had tried to keep the horse-and-buggy trade artificially alive we should have slowed down the growth of the automobile industry and all the trades dependent on it. We should have lowered the production of wealth and retarded economic and scientific progress. [...] Paradoxical as it may seem to some, it is just as necessary to the health of a dynamic economy that dying industries be allowed to die as that growing industries be allowed to grow. The first process is essential to the second. It is as foolish to try to preserve obsolescent industries as to try to preserve obsolescent methods of production: this is often, in fact, merely two ways of describing the same thing. Improved methods of production must constantly supplant obsolete methods, if both old needs and new wants are to be filled by better commodities and better means.

Saving the X industry

2009-02-27T06:00:00.000-05:00

Hazlitt on bailing out failed businesses:

The lobbies of Congress are crowded with representatives of the X industry. The X industry is sick. The X industry is dying. It must be saved. It can be saved only by a tariff, by higher prices, or by a subsidy. If it is allowed to die, workers will be thrown on the streets. Their landlords, grocers, butchers, clothing stores and local motion pictures will lose business, and depression will spread in ever-widening circles. But if the X industry, by prompt action of Congress, is saved—ah then! It will buy equipment from other industries; more men will be employed; they will give more business to the butchers, bakers and neon light makers, and then it is prosperity that will spread in ever-widening circles.

[...]

It is obvious in the case of a subsidy that the taxpayers must lose precisely as much as the X industry gains. It should be equally clear that, as a consequence, other industries must lose what the X industry gains. They must pay part of the taxes that are used to support the X industry. And customers, because they are taxed to support the X industry, will have that much less income left with which to buy other things. The result must be that other industries on the average must be smaller than otherwise in order that the X industry may be larger.

Unlimited work to be done

2009-02-26T06:00:00.000-05:00

The spread-the-work schemes rest also, as we began by pointing out, on the false assumption that there is just a fixed amount of work to be done. There could be no greater fallacy. There is no limit to the amount of work to be done as long as any human need or wish that work could fill remains unsatisfied. In a modern exchange economy, the most work will be done when prices, costs and wages are in the best relations with each other.

Another forgotten and ignored truth from Hazlitt's Economics in One Lesson.

The evil of reducing labor

2009-02-25T06:00:00.001-05:00

Hazlitt on the "evils" of job losses due to technological progress:

If it were indeed true that the introduction of labor-saving machinery is a cause of constantly mounting unemployment and misery, the logical conclusions to be drawn would be revolutionary, not only in the technical field but for our whole concept of civilization. Not only should we have to regard all further technical progress as a calamity; we should have to regard all past technical progress with equal horror. Every day each of us in his own activity is engaged in trying to reduce the effort it requires to accomplish a given result. Each of us is trying to save his own labor, to economize the means required to achieve his ends. Every employer, small as well as large, seeks constantly to gain his results more economically and efficiently—that is, by saving labor. Every intelligent workman tries to cut down the effort necessary to accomplish his assigned job. The most ambitious of us try tirelessly to increase the results we can achieve in a given number of hours. The technophobes, if they were logical and consistent, would have to dismiss all this progress and ingenuity as not only useless but vicious. Why should freight be carried from Chicago to New York by railroad when we could employ enormously more men, for example, to carry it all on their backs?

Overstimulation, overexpansion, and malinvestment

2009-02-24T06:00:00.002-05:00

The following was written by Hazlitt in 1946, not 2008:

Government-guaranteed home mortgages, especially when a negligible down payment or no down payment whatever is required, inevitably mean more bad loans than otherwise. They force the general taxpayer to subsidize the bad risks and to defray the losses. They encourage people to “buy” houses that they cannot really afford. They tend eventually to bring about an oversupply of houses as compared with other things. They temporarily overstimulate building, raise the cost of building for everybody (including the buyers of the homes with the guaranteed mortgages), and may mislead the building industry into an eventually costly overexpansion. In brief, in the long run they do not increase overall national production but encourage malinvestment.

We're paying the price for years of exactly this type of malinvestment, and yet capitalism is taking the blame.

Risks too great

2009-02-23T14:51:00.002-05:00

Why is it accepted that government intervention is required when risk is high? The first "bailout" was a perfect example of this—the attitude was no private investors would buy certain securities at the current prices; therefore, government had to. But Hazlitt exposes this:

The proposal if frequently made that the government ought to assume the risks that are "too great for private industry." This means that bureaucrats should be permitted to take risks with the taxpayers' money that no one is willing to take with his own.

Credit defined

2009-02-20T06:00:00.000-05:00

Hazlitt on the ~~monetary cranks~~ politicians who cry about banks not extending credit:

There is a strange idea abroad, held by all monetary cranks, that credit is something a banker gives to a man. Credit, on the contrary, is something a man already has. He has it, perhaps, because he already has marketable assets of a greater cash value than the loan for which he is asking. Or he has it because his character and past record have earned it. He brings it into the bank with him. That is why the banker makes him the loan. The banker is not giving something for nothing. He feels assured of repayment.

Perhaps a negative savings rate has something to do with it...

Job "creation," government style

2009-02-19T06:00:00.000-05:00

On the myth that government "stimulus" creates jobs, Hazlitt has the following to say:

For every public job created by the [state-initiated and funded] bridge project a private job has been destroyed somewhere else. We can see the men employed on the bridge. We can watch them at work. The employment argument of the government spenders becomes vivid, and probably for most people convincing. But there are other things that we do not see, because, alas, they have never been permitted to come into existence. They are the jobs destroyed by the $10 million taken from the taxpayers. All that has happened, at best, is that there has been a diversion of jobs because of the project. More bridge builders; fewer automobile workers, television technicians, clothing workers, farmers.

"At best." More likely, unproductive bureaucrats receive some of the "created" jobs, and productivity suffers because of government employment and management practices. So while we see the bridge, and lack the cars, TVs, clothes, and food, we also fail to see losses caused by waste.

Expenditures require taxation

2009-02-18T06:00:00.000-05:00

Hazlitt points out the obvious, which these days is sadly not obvious:

We shall have to say simply that all government expenditures must eventually be paid out of the proceeds of taxation; that inflation itself is merely a form, and a particularly vicious form, of taxation.

An entire generation of Americans (myself included) has grown up without any experience with serious inflation, nor have we seen the effects of marginal tax rates above 50%. Our ignorance isn't going to last long, by the looks of things.

Destruction creates jobs?

2009-02-17T06:00:00.001-05:00

Conventional wisdom says that there's a silver lining to natural disasters and war—yes, there's a lot of destruction, but think of the jobs that will be created during the rebuilding process! Hazlitt debunks this fallacy as well:

The people of Europe [post-WWII] built more new houses than otherwise because they had to. But when they built more houses they had just that much less manpower and productive capacity left over for everything else. When they bought houses they had just that much less purchasing power for something else. Wherever business was increased in one direction, it was (except insofar as productive energies were stimulated by a sense of want and urgency) correspondingly reduced in another.

Each person recognizes that the destruction of his own property is a bad thing. So how then does large-scale destruction become a social good?

"Make it rain candy!"

2009-02-16T14:51:00.004-05:00

And for a RCOB moment, here's an example of how well ~~institutional brainwashing~~ public education is indoctrinating our youngsters:

"Dear Mr. Obama, Please Make it rain candy!"

This from a first-grader. Only twenty-eight years until he can run for president!

(H/T Mises)

The Lesson

2009-02-16T06:00:00.000-05:00

Henry Hazlitt's One Lesson is so simple and yet so disregarded:

The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.

Comprehending this, apparently, is too much to ask of 60 senators and 246 representatives.

Lessons from 1946

2009-02-13T21:54:00.005-05:00

I'll start a new series next week, quoting short passages from Henry Hazlitt's Economics in One Lesson—a simple book that shows how modern economics so often relies on one simple fallacy. Here's a message pertinent to today's economy:

There are men regarded today as brilliant economists, who deprecate saving and recommend squandering on a national scale as the way of economic salvation; and when anyone points to what the consequences of these policies will be in the long run, they reply flippantly, as might the prodigal son of a warning father: "In the long run we are all dead." And such shallow wisecracks pass as devastating epigrams and the ripest wisdom.

But the tragedy is that, on the contrary, we are already suffering the long-run consequences of the policies of the remote or recent past. Today is already the tomorrow which the bad economics of yesterday urged us to ignore.

Credit card debt, ARM mortgages, negative savings rate—it's no surprise that John "instant gratification" Keynes has an audience in our society today. And just as we're paying for the follies of the New Deal and the Great Society, our kids will pay for this social experiment, no matter what happy-sounding name they apply to it. In the long run, we're all dead, it's true... but dead also will be the economy and society we leave for posterity if we don't get our heads out of the sand.

A new old essay

2009-02-10T18:19:00.003-05:00

I just added Albert Jay Nock's "Isaiah's Job" (1936) to the sidebar. An excellent essay, for these depressing times. The first paragraph describes something familiar to me:

One evening last autumn, I sat long hours with a European acquaintance while he expounded a political-economic doctrine which seemed sound as a nut and in which I could find no defect. At the end, he said with great earnestness: "I have a mission to the masses. I feel that I am called to get the ear of the people. I shall devote the rest of my life to spreading my doctrine far and wide among the population. What do you think?"

I didn't expect Nock's response.

Not pure evil?!?!

2009-02-09T08:48:00.002-05:00

This isn't something you're supposed to admit if you make more than the minimum wage, but...

I shop at Wal-Mart.

And I'm proud to do it. The way I figure, I'm a) saving a bundle of money and b) supporting a business that hires unskilled people who can't get better jobs elsewhere.

So naturally, when Insty links to Charles Platt's experience as a Walmartian (ha!), I feel vindicated.

Wal-Mart: Save money, support the hardworking poor, and laugh at crybaby unions.

It's official

2009-02-02T19:02:00.003-05:00

I found a sign of how bad things are in a Foxnews.com headline:

White House claims only tiny fraction of bailout package is being debated, but key Democratic senator tells FOX News he wants to strip 'tens of billions' from proposal.

You know it's bad when the two people making these statements are both completely correct.

Ah, elitism...

2009-02-02T08:56:00.003-05:00

Tam 1, Mr. Messiah 0.

Where oh where are the media's veiled insinuations of the evilness of the president for doing something so anti-environment? Oh that's right, they're too busy extolling the new White House culture—it's much less harsh now, much more smiley and happy and fuzzy. And warm.

I can't put Heinlein down...

2009-01-26T09:32:00.004-05:00

I tore through two Heinlein novels this weekend, to the chagrin of my sleep schedule. Glory Road didn't impress me—it was funny in a few places and in general a compelling story, but it didn't have enough meat to it to satisfy me. There was a classic Heinleinian critique of democracy at the end, however:

Democracy can't work. Mathematicians, peasants, and animals, that's all there is—so democracy, a theory based on the assumption that mathematicians and peasants are equal, can never work. Wisdom is not additive; its maximum is that of the wisest man in a given group.

But a democratic form of government is okay, as long as it doesn't work. Any social organization does well enough if it isn’t rigid. The framework doesn’t matter as long as there is enough looseness to permit that one man in a multitude to display his genius. Most so-called social scientists seem to think that organization is everything. It is almost nothing—except when it is a straitjacket. It is the incidence of heroes that counts, not the pattern of zeros.

Citizen of the Galaxy, on the other hand, was much more thought-provoking. The protagonist is repeatedly ripped from his comfort zone and forced to adapt to new situations and cultures, and yet through it all he manages to succeed and find his calling. Not as much knock-down drag-out fighting action as in Glory Road, but it's an enjoyable, uplifting, and moderately paced bildungsroman.

Atlas is shrugging

2009-01-23T19:38:00.005-05:00

"We don't need to make a movie out of the book. We are living it right now."

I've added Ayn Rand's Atlas Shrugged to the sidebar, because it does what a good novel should—through a thrilling story, it tell us about ourselves. I finished reading it for the first time only recently, amidst the bailout extravaganza that has overtaken Washington. Comparing Rand's "fiction" to the "fact" all around me was inevitable; Stephen Moore does the same in his recent WSJ opinion piece, and follows it up with an excellent interview (in which he quotes Hayek!):

Perhaps I'm overly cynical, but I don't share Moore's optimism, and neither do I share Rand's. How will we learn when the lessons have been staring us in the face for years, in the forms of books written by thinkers like Tocqueville, Hayek, and Rand? I don't know, but nonetheless I hope that John Galt will appear when we finally realize how badly we need him.

H/T RightCoast, via Insty.

New resources

2009-01-22T22:02:00.004-05:00

I found two great websites today—LibertarianPapers.org and LibertarianChristians.com. The first is a brand new online peer-reviewed journal, and based on the first seven offerings, it looks like it's going to be a great resource. The fact that it's licensed with a Creative Commons Attribution license makes it even better.

The second is a blog by a libertarian Christian, so naturally I'm intrigued. Turns out that the author wrote a lengthy article defending libertarianism in light of several passages from the Bible, including Romans 13... which is something I've been thinking about a lot lately. So if you're as interested in reading it as I am, take a look at part one and part two of his work.

So much to read, so little time...

Darker days are coming

2009-01-19T17:55:00.003-05:00

On this, the eve of the ascension of the Obamamessiah and the final day of Bush's presidency, Donald Sensing's words from 2003 ring true:

The Bush administration will be seen by freedom-wishing Americans a generation or two hence as the hinge on the cell door locking up our freedom. When my children are my age, they will not be free in any recognizably traditional American meaning of the word. I’d tell them to emigrate, but there’s nowhere left to go. I am left with nauseating near-conviction that I am a member of the last generation in the history of the world that is minimally truly free.

There were no viable options in the 2008 election, either, and this time the American populace picked the greater of two evils. Even darker days for liberty are coming, but it's a mistake to give up. Liberty is worth fighting for.

It's not my fault!

2009-01-12T06:00:00.000-05:00

This isn't a financial blog, but bear with me for a bit. From the Wall Street Journal comes the following tale of woe:

After watching her account drop 44% last year, Kristine Gardner, a 35-year-old information-technology project manager in Longview, Wash., feels no sense of security. "There's just no guarantee that when you're ready to retire you're going to have the money," she says. "You either put it in a money market which pays 1%, which isn't enough to retire, or you expose yourself to huge market risk and you can lose half your retirement in one year."

A lot of people are feeling the same way Kristine is feeling. They've heard the financial media tell them how to get rich by investing in real estate or the stock market or whatever. They've had financial advisers tell them where to put their money to get the best return. They've thought, "I want to retire in 2015, so I'll put my entire savings into this Target Retirement 2015 mutual fund."

And sizable portions of their money have vanished into thin air, just like that.

Now, they're searching for the culprit, the evil thief who stole nearly half of their retirement savings and who is forcing them to work an extra five years. They're blaming the evil bank CEOs for not lending money. They're blaming the evil president for "deregulating" the financial industry. They're blaming their evil financial advisers, who should have foreseen all this. They're blaming the evil government for not adequately protecting them.

But in the midst of all this blaming, whose fault is it, really? The bankers? The president? The financial advisers? The government?

Nope. They, individually, are the ones who deserve the blame. They made the decision to invest or not to invest. They made the decision where to invest. They made the decision of who to trust. They made free choices, under no coercion, and are now suffering as a direct result of those choices.

Harsh? Yes. Unfair? No. Look, Kristine, I'm sorry you lost money in the stock market. I'm sorry that you didn't realize that the stock market doesn't automatically bounce back up every time it goes down by 10%. I'm sorry you thought "it'll never happen to me." I'm sorry you weren't aware of the risks. But who made the decision to not spend 10-20 hours doing research and reading a good investing book, like The Bogleheads' Guide to Investing or The Four Pillars of Investing? You did. Who made the decision to not evaluate your risk tolerance? You did. Who made the decision to not read and understand your mutual fund prospectus? You did.

Everything you needed to know was out there; all you needed to do was invest a little money and time to learn about it. You would have found out that market crashes are rather common events. You would have found out that, historically, bonds have been less risky than stocks. You would have discovered that there are a lot of scary scenarios that could happen in the future, and you would have learned that there are different ways to prepare for them.

You would have learned that life is risk. You can't avoid it. All you can do is mitigate it and handle it. You must decide, consciously or unconsciously, which bad scenarios you are going to prepare for and how you will prepare for them. If you fail to prepare for the bad scenario that actually befalls you, that's not the government's fault, it's not your parents' fault, it's not your kindergarten teacher's fault. It's your fault. You are responsible for yourself. If you make a bad decision, you are not entitled to demand help from those who made good decisions. Learn from your mistake, make better decisions next time, and teach others not to make your mistake.

It's impossible to be justified in having a sense of security, because if you're alive, there's no such thing as security, and if you're dead, there's no such thing as a sense. Complete security is impossible. All you can do, all anyone can do, is evaluate which risks are most dangerous, make what you believe are appropriate preparations, and then live your life. If you evaluated poorly or just got unlucky, that's unfortunate, but you made the choice, and you must live with the consequences.

Sorry Kristine, but the bottom line is that you're an adult—put on your big-girl pants and take responsibility for your own decisions.

Children citizens

2009-01-10T06:00:00.002-05:00

I am trying to imagine what new features despotism might have in today's world: I see an innumerable host of men, all alike and equal, endlessly hastening after petty and vulgar pleasures with which they fill their souls. Each of them, withdrawn into himself, is virtually a stranger to the fate of all the others. For him, his children and personal friends comprise the entire human race. As for the remainder of his fellow citizens, he lives alongside them but does not see them. He touches them but does not feel them. He exists only in himself and for himself, and if he still has a family, he no longer has a country.

Over these men stands an immense tutelary power, which assumes sole responsibility for securing their pleasure and watching over their fate. It is absolute, meticulous, regular, provident, and mild. It would resemble paternal authority if only its purpose were the same, namely, to prepare men for manhood. But on the contrary, it seeks only to keep them in childhood irrevocably. It likes citizens to rejoice, provided they think only of rejoicing. It works willingly for their happiness but wants to be the sole agent and only arbiter of that happiness. It provides for their security, foresees and takes care of their needs, facilitates their pleasures, manages their most important affairs, directs their industry, regulates their successions, and divides their inheritances. Why not relieve them entirely of the trouble of thinking and the difficulty of living?

Unfortunately, we don't have to imagine.

Promoting bad ideology

2008-12-18T09:18:00.003-05:00

Lew Rockwell:

The most recent financial meltdown [...] has unleashed a fury of socialistic blather and Keynesian central-planning mythology.

We have politicians and central bankers telling us that more paper money and bank nationalization will save us. Others say that capitalism has completely failed so we need to try socialism.

You would swear that these people were born yesterday, had never read a lick of history, and were wholly ignorant of economic logic. All of that is probably true. But here is what people don't entirely understand: it is in the interest of our rulers to promote bad ideology.

Who wins from bailouts, regulations, and inflation? It's not the middle class, taxpayers, or the businesses we know and love. It is the state, the bureaucrats, the megabankers, and the entire crew of connected interest groups who live at our expense.

This is the real basis of socialism and Keynesianism: ideologies that benefit the elites at the expense of everyone else.

In other news, I just found hours upon hours of lectures on economics, liberty, and history just waiting for me at mises.org. Time to load up the mp3 player!

Let. Them. Rot.

2008-11-15T16:38:00.005-05:00

Guess what happens when you reward failed business models by shoveling money at them—other people (who also have failed business models) want some of that money too! The next group of thieves begging for a bailout is the UAW, since they're not happy with the $73/hour that they're making and instead want to either bankrupt GM/Ford/Chrysler or bankrupt America. The AP reports:

Even as Detroit's Big Three teeter on collapse, United Auto Workers President Ron Gettelfinger said Saturday that workers will not make any more concessions.

Shut 'em down and send 'em home. I don't want to pay for their lousy cars, whether at the dealership or through the IRS.

What a mess...

2008-11-04T12:27:00.003-05:00

Why am I so frustrated by this stupid election? Tocqueville knows why:

The greater the role that the executive power plays in directing the affairs of government, the greater and more necessary its habitual functions, the more dangerous such a state of affairs becomes. In a nation that has become used to being governed by the executive, and still more in a nation that has become accustomed to being administered by it, elections are invariably sources of profound disruption.

That explains the record election spending, among other things. So what's the solution? Heinlein puts it in perspective:

Certainly the game is rigged. Don’t let that stop you; if you don’t bet, you can’t win.

Vote.

"not intended to take over the free market but to preserve it."

2008-10-15T01:21:00.003-04:00

When words lose their meaning...

Hear that? That's the sound of weary travelers pounding the dusty road that leads to serfdom. Bush clearly understands nothing of economics or history or political science, even though dozens of authors (Hayek and Friedman would be a nice start, though at this point George Orwell shouldn't be neglected either) could easily explain it to him if he'd just tell Paulson to stuff the scare tactics.

The worst part is that this is the guy who supposedly supported limited government. Now he's engineering the greatest government intervention since FDR. Next, he'll wonder why private businesses are continuing to take absurd risks and then asking for bailouts.

This president is an absolute disgrace.

Remaining free

2008-10-05T10:06:00.002-04:00

From Isaac Morehouse comes an valuable article on keeping the right perspective on elections and the continuous destruction of liberty:

An individual who wants to be free can be, no matter what the world brings. An individual who has let the spirit of freedom die will never be free, no matter what the world brings.

The idea that freedom is simply a state of mind may sound trifling, especially when considering some of the unimaginable horrors faced by unfree peoples across the globe. But even political freedom cannot be had without a people who keep the spirit of freedom alive within themselves; and if they do, political freedom is often not far behind.

And the takeaway:

Keep this in mind as America's government changes with each election. Remember this when you see government expanding its reach into your life. Rather than looking to political leaders to protect or expand our freedom we should cultivate the seeds of freedom in our own spirits, and inspire others to do the same. Nothing government can do can take away our freedom; and if we are a people who are truly free, the government will have to follow.

Willful ignorance

2008-10-02T18:39:00.003-04:00

That's the only excuse for Bob Casey, in his defense of his vote for the even-worse bailout package the Senate passed Wednesday and the House will pass Friday (how can it not, with all those yummy sweeteners?):

I am not happy with the current crisis, and I'm angry about the climate of deregulation and deference to Wall Street over the last eight years that got us into this mess.

Uh, yeah. "Deregulation"? I thought that meant reduction of rules and less government oversight. The kind of thing democrats have been fighting for years with respect to Fannie Mae and Freddie Mac. You're new to this "Senator" thing, so the Wall Street Journal has kindly provided a history lesson. Note the little letters after the names. "D" means democrat—i.e. the party you belong to. I'm sorry that all of the "R" names are people supporting the regulations you now seem to support, but them's the facts.

You should know that Congress has significantly improved the original proposal presented by the Bush administration.

I should, huh? Yeah, all those great improvements like increasing the FDIC insurance to $250k? Because we need to save the morons who like making 0.9% interest on their life savings. Or because we're going to have to monetize our growing debt and what I can buy for $100k today will soon cost $250k. Or because $700 billion in liabilities wasn't enough for you.

As improved by the Senate, the legislation also requires participating companies to provide warrants and other forms of equity so that taxpayers will share in the profits if the stock of these companies goes up as a result of Treasury Department intervention.

This one is especially juicy. I'm not sure how much education you've had in this whole "free market" thing (you really ought to read more), but here's a hint—if no one wants to buy these things that the FedGov is about to buy, it's not because they're big money makers. Investors aren't stupid; bad debt isn't attractive because it's expected to lose money. Sorry—there's just no way the American taxpayer is going to come out of this ahead.

But that's not really the point, is it? It's nice the the FedGov is already in the mortgage business (Fannie Mae, Freddie Mac) and now the insurance business (AIG), so why not expand things? Fannie Mae and Freddie Mac were run with such openness, such lack of corruption, clearly, this is the model for the future! The FedGov ought to get into all sorts of other businesses, and what better time than now, when companies want to unload their bad debt.

F. A. Hayek had a name for this. It's called collectivism, and it's the root of high unemployment in Europe, crappy health care in Canada, and oppression in China.

Buckle up folks. It's The Road to Serfdom, and we're on it.

"the largest one-week push for socialism in US history..."

2008-09-30T00:45:00.004-04:00

... has ended in epic failure. Of course, this probably increases the chance of electing a socialist president, but we're going to get one of those either way. Jeffrey Tucker has it right: this is a glorious moment for freedom, but perhaps not much more than a moment.

I, for one, welcome the lower taxes, inflation, and gas prices. Thank you, House Republicans. May the next five weeks prove you right.

Now is the crisis?

2008-09-28T06:00:00.003-04:00

Though he spoke of a different crisis, over 200 years ago, the Federal Farmer's words remain relevant:

It is natural for men, who wish to hasten the adoption of a measure, to tell us, now is the crisis—now is the critical moment which must be seized, or all will be lost: and to shut the door against free enquiry, whenever conscious the thing presented has defects in it, which time and investigation will probably discover. This has been the custom of tyrants and their dependants in all ages.

Please keep fighting, House Republicans.

The blame game

2008-09-22T06:00:00.001-04:00

Whose deserves the blame, really, for all this financial chaos? George Bush? Ben Bernanke? Henry Paulson? Big bad corporations? Greed?

Maybe it's our own fault, for not heeding the advice of Milton Friedman:

[G]overnmental measures constitute the major impediments to economic growth in the United States. Tariffs and other restrictions on international trade, high tax burdens and a complex and inequitable tax structure, regulatory commissions, government price and wage fixing, and a host of other measures give individuals an incentive to misuse and misdirect resources, and distort the investment of new savings. What we urgently need, for both economic stability and growth, is a reduction of government intervention not an increase.

From Capitalism and Freedom.

What Rule of Law?

2008-09-20T06:00:00.002-04:00

Bear Stearns? Sure! Fannie Mac? You got it. Freddie Mac? Yep. Lehman Brothers? Sorry pal. AIG? Oh fine.

The Rule of Law thus implies limits to the scope of legislation: it restricts it to the kind of general rules known as formal law and excludes legislation either directly aimed at particular people or at enabling anybody to use the coercive power of the state for the purpose of such discrimination. It means, not that everything is regulated by law, but, on the contrary, that the coercive power of the state can be used only in cases defined in advance by the law and in such a way that it can be foreseen how it will be used.

--F. A. Hayek, in The Road to Serfdom.

Adam Smith on Henry Paulson

2008-09-19T06:00:00.001-04:00

Adam Smith, quoted in The Road to Serfdom:

The statesman who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted to no council and senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it.

Too big to fail?

2008-09-18T06:00:00.000-04:00

"They're too big to fail"
"The economy needs more liquidity"
"If we don't intervene, the market will crash"

F. A. Hayek takes a close look at the positions of those defending the egregious actions of the federal government over the last several months:

That principle that the end justifies the means in individualist ethics is regarded as the denial of all morals. In collectivist ethics it becomes necessarily the supreme rule; there is literally nothing which the consistent collectivist must not be prepared to do if it serves “the good of the whole,” because the “good of the whole” is to him the only criterion of what ought to be done. The raison d’état, in which collectivist ethics has found its most explicit formulations, knows no other limit than that set by expediency—the suitability of the particular act for the end in view. And what the raison d’état affirms with respect to the relations between different countries applies equally to the relations between individuals within the collectivist state. There can be no limit to what its citizen must be prepared to do, no act which his conscience must prevent him from committing, if it is necessary for an end which the community has set itself or which his superiors order him to achieve.

So far, it's just money (via taxes and inflation) that we citizens are being called upon to commit, in order to do the bidding of our superiors. How about tomorrow?

Viva Fidel

2008-07-31T15:02:00.003-04:00

I'm in the middle of graduating and moving, so haven't had much spare time for blogging. But a friend pointed me in the direction of an amazing letter to the editor of the Richmond Times-Dispatch:

Each year I get to celebrate Independence Day twice. On June 30 I celebrate my independence day and on July 4 I celebrate America's. This year is special, because it marks the 40th anniversary of my independence.

On June 30, 1968, I escaped Communist Cuba and a few months later I was in the United States to stay. That I happened to arrive in Richmond on Thanksgiving Day is just part of the story, but I digress.

I've thought a lot about the anniversary this year. The election-year rhetoric has made me think a lot about Cuba and what transpired there. In the late 1950s, most Cubans thought Cuba needed a change, and they were right. So when a young leader came along, every Cuban was at least receptive.

When the young leader spoke eloquently and passionately and denounced the old system, the press fell in love with him. They never questioned who his friends were or what he really believed in. When he said he would help the farmers and the poor and bring free medical care and education to all, everyone followed. When he said he would bring justice and equality to all, everyone said "Praise the Lord." And when the young leader said, "I will be for change and I'll bring you change," everyone yelled, "Viva Fidel!"

But nobody asked about the change, so by the time the executioner's guns went silent the people's guns had been taken away. By the time everyone was equal, they were equally poor, hungry, and oppressed. By the time everyone received their free education it was worth nothing. By the time the press noticed, it was too late, because they were now working for him. By the time the change was finally implemented Cuba had been knocked down a couple of notches to Third-World status. By the time the change was over more than a million people had taken to boats, rafts, and inner tubes. You can call those who made it ashore anywhere else in the world the most fortunate Cubans. And now I'm back to the beginning of my story.

Luckily, we would never fall in America for a young leader who promised change without asking, what change? How will you carry it out? What will it cost America?

Would we?

Awesome. Hats off to you, Mr. Alvarez.

Preservation of liberty

2008-07-14T06:00:00.000-04:00

If Christians are to be pacifist, Jeffrey Snyder points out that we won't preserve our freedoms for long:

Only people willing and able to defend themselves can preserve their liberties.

Also from A Nation of Cowards.

Responsibility to family and community

2008-07-10T06:00:00.000-04:00

Again, a little bit from Jeffrey Snyder and A Nation of Cowards, in defense of the morality of self-defense:

One who values his life and takes seriously his responsibilities to his family and community will possess and cultivate the means of fighting back, and will retaliate when threatened with death or grievous injury to himself or a loved one. He will never be content to rely solely on others for his safety, or to think he has done all that is possible by being aware of his surroundings and taking measures of avoidance. Let's not mince words: He will be armed, will be trained in the use of his weapon, and will defend himself when faced with lethal violence.

Last to decay

2008-07-09T06:00:00.001-04:00

The consistent pacifist must consider the armed forces an inherently immoral institution, but the King of Scouts, Major Frederick Russell Burnham, has this to say on savagery and the army:

Sometimes I wish I had never learned to read or form any conception of duty, civilization, or religion; for then I might have been outwardly, as I am now at heart, a thorough savage, nothing more. As it is, I am to return to London—to swallowtails, clubs, soft carpets, soft food, soft life, soft men and women. I fear all these things will fit me about as neatly as Paul Kruger's plug hat fitted him.

But my boys must go into the army. I shall try to keep them in that branch of the human organization that is last to decay in a too luxurious nation. Fighting and bloodshed may be condemned by the good, but the army is the ark that carries the strong and enduring virtues far in the world's progress.

From Scouting Across Two Continents—definitely worth a read, for exciting (non-fiction!) tales and a look back to days of adventure and true masculinity.

Violence never solves anything?

2008-07-08T06:00:00.001-04:00

Heinlein has a bit to say through one of his characters in Starship Troopers about the morality of pacifism:

Anyone who clings to the historically untrue—and thoroughly immoral—doctrine that "violence never solves anything" I would advise to conjure up the ghosts of Napoleon Bonaparte and of the Duke of Wellington and let them debate it. The ghost of Hitler could referee, and the jury might well be the Dodo, the Great Auk, and the Passenger Pigeon. Violence, naked force, has settled more issues in history than has any other factor, and the contrary opinion is wishful thinking at its worst. Breeds that forget this basic truth have always paid for it with their lives and freedoms.

Though I don't exactly think of Robert "What's wrong with incest again?" Heinlein as an authority on morality.

Contempt for God's gift of life

2008-07-07T06:00:00.003-04:00

A friend sent me something that got me thinking about the Christian arguments for pacifism vs. self-defense, so an essay on the topic is forthcoming. Here's what Jeffrey Snyder has to say on the issue:

One who believes it wrong to arm himself against criminal violence shows contempt of God's gift of life […], does not live up to his responsibilities to his family and community, and proclaims himself mentally and morally deficient, because he does not trust himself to behave responsibly.

From A Nation of Cowards.

Redefining words, Obama style

2008-07-05T06:00:00.002-04:00

Apparently Mr. B. H. Obama has a different definition of the word "ask" than most people:

I will ask for your service and your active citizenship when I am President of the United States.

Because apparently what he means by that is:

I will set a goal for all American middle and high school students to perform 50 hours of service a year, and for all college students to perform 100 hours of service a year. This means that by the time you graduate college, you'll have done 17 weeks of service.

We'll reach this goal in several ways. At the middle and high school level, we'll make federal assistance conditional on school districts developing service programs, and give schools resources to offer new service opportunities. At the community level, we'll develop public-private partnerships so students can serve more outside the classroom.

So in Obamaland, "asking for your service" means "manipulating low-level bureaucrats [i.e., school district board members] into forcing you to serve."

No, wait, maybe it means something else:

For college students, I have proposed an annual American Opportunity Tax Credit of $4,000. To receive this credit, we'll require 100 hours of public service.

So "asking for your service" could also mean "manipulating you into serving by promising that you'll get other people's money."

Truly visionary leadership. I can't believe this hasn't been tried before. Maybe with a little more effort we'll be able to turn out model citizens!

(H/T Jonah Golberg, via Insty)

To secure these rights

2008-07-04T06:00:00.002-04:00

We hold these Truths to be self-evident, that all Men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the pursuit of Happiness.

That to secure these rights, Governments are instituted among Men, deriving their just Powers from the Consent of the Governed.

That whenever any Form of Government becomes destructive of these Ends, it is in the Right of the People to alter or abolish it, and to institute a new Government, laying its Foundation on such Principles, and organizing its Powers in such Form, as to them shall seem most likely to effect their Safety and Happiness. Prudence indeed, will dictate that Governments long established should not be changed for light and transient Causes; and accordingly all Experience hath shewn, that Mankind are more disposed to suffer, while Evils are sufferable, than to right themselves by abolishing the Forms to which they are accustomed. But when a long Train of Abuses and Usurpations, pursuing invariably the same Object, evinces a Design to reduce them under absolute Despotism, it is their Right, it is their Duty, to throw off such Government, and to provide new Guards for their future Security.

Happy Independence Day.

Conscience more effective than law

2008-07-03T06:00:00.001-04:00

Jeff Cooper has a bit to say on the topic of yesterday's essay, as well:

The Founding Fathers sought to forbid the establishment of a state church, but they were positively not advocates of irreligion. It seems odd that today's noisier elements on the Left seem to fear the establishment of a state church, which has not been a threat for a couple of hundred years. Some people can lead moral lives without any sort of church, but they are the minority. Most people need sanction in order to lead moral lives. The state describes what is a crime. The church describes what is a sin, and a given act may be either or both, with or without fear of punishment, here or hereafter. See what happens to the post-moderns who attempt to set up a society without rules, either civic or religious! A man's behavior is more effectively controlled by his conscience than by the law, because while he may be able to avoid legal punishment he can never escape his conscience. Of course, he must have a conscience, as the current counter-culture creeps apparently do not.

From his Commentaries, Volume 11.

Religion.gov

2008-07-02T06:00:00.001-04:00

It's a sad fact that civil libertarians and social conservatives (in particular the Religious Right) have a love-hate relationship. Love, because both tend to support free markets and gun rights. Hate, because they tend to disagree on gay rights, free speech, and the relationship between church and state. And it's sad, because when they fight, they end up with someone they both loathe (i.e. John McCain) as their presidential nominee.

Both claim to represent what the Founding Fathers had in mind when they founded the country. The libertarians focus on how we shook off the chains of tyranny, set down a strong Bill of Rights, and enjoyed a weak federal government. The social conservatives grudgingly accept this, but are quick to point out that the phrase "separation of church and state" doesn't appear in the constitution, and that even the Founding Fathers sometimes passed laws that were blatantly pro-Christianity.

Both have their facts right, but what did America look like, really, during those early years? Was it really a staunchly "Christian nation" as the social conservatives like to think? Or was it a society of nominal Christians and deists who were really only concerned with liberty?

There's a lot more out there that I need to read before I can take a strong position on this issue, but Tocqueville's widely respected work, Democracy in America, seems to point to a middle ground. He says that America was a nation of Christian morality, and in some sense, Christianity itself:

There are countless sects in the United States. Each reveres the Creator in a different fashion, but all agree about man's duties to his fellow man. Each worships God in its own way, but all preach the same morality in God's name. [....] All sects in the United States are encompassed within the overarching unity of Christianity, and Christian morality is the same everywhere.

But can it be possible that each person in a liberal society devotes himself to the same religion? Few are the examples of free societies consisting of an entire citizenry passionate about serving God in a unified way. Without political or cultural coercion, disinterest and disagreement is inevitable, but with coercion of some type, unity, or the appearance of unity, can be maintained:

Some Anglo-Americans profess Christian dogmas because they believe them, others because they are afraid lest they seem not to believe them. Christianity therefore reigns without impediment, by universal consent.

Since that time, obviously, things have changed. Charles Darwin made it respectable for smart people to question the existence of God, and other religions have expanded sufficiently to make pluralism the new status quo. Christian morality is no longer widely accepted on many issues, including divorce, abortion, and homosexuality. Only some of the general parts of Christian morality remain, such as prohibitions of theft and contract-breaking, and positive virtues such as personal responsibility and caring for the poor. Even these, however, exist not because people are concerned about obeying God but primarily to grease social interaction.

Mores, as Tocqueville calls "the moral and intellectual state of a people," have changed, and that's not insignificant, because:

Laws are always shaky unless they are supported by mores. Mores are the only robust and durable power in any nation.

Indeed, Tocqueville fears that a weakening of religion makes political liberty impossible:

When a people's religion is destroyed, doubt takes hold the highest regions of the intellect and half paralyzes all the others. [...] When no authority exists in matters of religion, any more than in political matters, men soon become frightened in the face of unlimited independence. With everything in a perpetual state of agitation, they become anxious and fatigued. With the world of the intellect in universal flux, they want everything in the material realm, at least, to be firm and stable, and, unable to resume their former beliefs, they subject themselves to a master.

Hold on to your seats:

I doubt that man can ever tolerate both complete religious independence and total political liberty, and I am inclined to think that if he has no faith, he must serve, and if he is free, he must believe.

"Man" here refers to "mankind," so while Tocqueville is defending the utilitarian value of religion in a people, he isn't saying that atheists can't handle political liberty. His point is relevant—today, people are bombarded by pluralistic messages, making doubt toward religion almost inevitable. And indeed, as Christianity has lost acceptance, the people's demands for government-provided security have grown louder. That may be mere correlation and not causation, but I'm putting my money with Tocqueville on this one.

But even if the decline of Christianity is at least partially responsible for growing government, the Church hasn't effectively responded. Seeing its decline both in numbers and cultural significance, it has ignored Tocqueville's wise advice:

Religions should remain discreetly within their proper limits and not seek to venture beyond them, for if they try to extend their power beyond religious matters, they run the risk of not being believed about anything.

Instead, religious leaders have thoroughly involved themselves in politics, some of them spending more time denouncing political positions than teaching the Christian morality with which they allegedly conflict. Now, loud-mouths like Jesse Jackson, Jerry Falwell, Jeremy Wright, and Pat Robertson are the faces of the church—not a pretty sight. And while they do have small spheres of influence, they are intensely polarizing, and largely disrespected by the population at large. Indeed, whenever they open their mouths, they "run the risk of not being believed about anything."

The church no longer understands "that its empire is more secure when it reigns through its own intrinsic strength and dominates the hearts of men without assistance"; instead, it attempts to reign by stepping into the public sphere. It ought to return to its role of being the "safeguard of mores" (a task at which it has failed miserably of late), and stop attempting to join forces with the State (as seen in Bush's faith-based social programs initiative). Joining forces with the government is a road that ends in disaster:

Whenever a religion joins forces with political powers of any kind, the alliance is bound to be onerous for religion. It has no need of their help to live, and in serving them it may die.

The Church hasn't learned this yet, but civil libertarians have known for a long time that government shouldn't be your first pick for a teammate. Social conservatives, and especially the Religious Right, need to reconsider their tactics, and here's a hint—positively impacting individuals is more effective than trying to get the government to treat you "fairly."

It will take a long time before Americans again confound Christianity and liberty, but ultimately, that's what the Religious Right ought to have as their goal.

Moral self-interest

2008-07-01T10:47:00.001-04:00

Democracy in America:

American moralists do not hold that a man should sacrifice himself for his fellow man because it is a great thing to do; they boldly assert, rather, that such sacrifices are as necessary to the man who makes them as to the man who profits from them. […] They do not deny, therefore, that each man may pursue his own self-interest, but they do their utmost to prove that it is in every man's interest to behave honorably.

The people's power

2008-06-30T06:00:00.007-04:00

Via Kevin, I found a whopper on the website of the Potowmack Institute (google it; they don't need more links, even from insignificant bloggers like me):

When individuals in the State of Nature form government and consent to be governed they give up precisely the "executive power of the law of Nature" — that is, the right to exercise force except as authorized and permitted by law.

Wow. Just wow. And of course, I assume that being born implies consent. Naturally.

Now, let's hear from Noah Webster's "A Citizen of America":

The supreme power in America cannot enforce unjust laws by the sword; because the whole body of the people are armed, and constitute a force superior to any band of regular troops that can be, on any pretence, raised in the United States. A military force, at the command of Congress, can execute no laws, but such as the people perceive to be just and constitutional; for they will possess the power, and jealousy will instantly inspire the inclination, to resist the execution of a law which appears to them unjust and oppressive. [...] The powers vested in Congress are little more than nominal; nay real power cannot be vested in them, nor in any body, but in the people. The source of power is in the people of this country, and cannot for ages, and probably never will, be removed.

Four judges in 2008 did their best to dash Noah Webster's prediction, but they were defeated. Their minions will be back, again and again, so the "probably" remains—only we can ensure that we, the people of this country, retain our real power.

Constant vigilance

2008-06-28T06:00:00.001-04:00

Tocqueville's words (from Democracy in America) are just as true in a post-Heller world as they were in the 1830s:

It is above all in the present democratic age that the true friends of liberty and human grandeur must remain constantly vigilant and ready to prevent the social power from lightly sacrificing the particular rights of a few individuals to the general execution of its designs. In such times there is no citizen so obscure that it is not very dangerous to allow him to be oppressed, and there are no individual rights so unimportant that they can be sacrificed to arbitrariness with impunity.

Not the role of this Court

2008-06-27T06:00:00.002-04:00

Justice Scalia, in his DC v. Heller majority opinion:

Undoubtedly some think that the Second Amendment is outmoded in a society where our standing army is the pride of our Nation, where well-trained police forces provide personal security, and where gun violence is a serious problem. That is perhaps debatable, but what is not debatable is that it is not the role of this Court to
pronounce the Second Amendment extinct.

DC v. Heller

2008-06-26T06:00:00.004-04:00

Today is The Big Day. We shall see what our judges are made of.

The peace, prosperity, and very existence of the Union rest constantly in the hands of the seven federal judges. Without them, the Constitution would be a dead letter. […] Should imprudent or corrupt men ever fill the Supreme Court, however, the confederation would have to fear anarchy or civil war.

From Democracy in America.

Confounding Christianity and liberty

2008-06-25T06:00:00.000-04:00

Not even close to reality anymore:

Americans so completely confound Christianity with liberty that it is almost impossible to induce them to think of one without the other.

From Democracy in America, by Alexis de Tocqueville.

Countless sects

2008-06-24T06:00:00.000-04:00

Democracy in America, by Alexis de Tocqueville:

There are countless sects in the United States. Each reveres the Creator in a different fashion, but all agree about man's duties to his fellow man. Each worships God in its own way, but all preach the same morality in God's name. Though it matters a great deal to each individual that his religion be true, this is not the case for society. Society has nothing to fear from the other life, and nothing to hope for, and what matters most to it is not so much that all citizens profess the true religion as that each citizen profess some religion. In any case, all sects in the United States are encompassed within the overarching unity of Christianity, and Christian morality is the same everywhere.

Comrades: religion and liberty

2008-06-23T06:00:00.001-04:00

I've already talked about the importance of liberty for the preservation of individual morality, so now I'm working on an essay that discusses how individual morality keeps liberty from disappearing. Alexis de Tocqueville has a lot to say on the subject in Democracy in America, and one of his quotes that I expect to use is:

Religion looks upon civil liberty as a noble exercise of man's faculties, and on the world of politics as a realm intended by the Creator for the application of man's intelligence. Free and powerful in its own sphere and satisfied with the place ascribed to it, religion knows that its empire is more secure when it reigns through its own intrinsic strength and dominates the hearts of men without assistance.

Liberty looks upon religion as its comrade in battle and victory, as the cradle of its infancy and divine source of its rights. It regards religion as the safeguard of mores, and mores as the guarantee of law and surety for its own duration.

Sole control

2008-06-22T06:00:00.001-04:00

The Road to Serfdom, F. A. Hayek:

Economic control is not merely control of a sector of human life which can be separated from the rest; it is the control of the means for all our ends. And whoever has sole control of the means must also determine which ends are to be served, which values are to be rated higher and which lower—in short, what men should believe and strive for.

Hell on earth

2008-06-20T11:11:00.002-04:00

F. Holderlin, quoted in The Road to Serfdom, by F. A. Hayek:

What has always made the state a hell on earth has been precisely that man has tried to make it his heaven.

Bread and circuses

2008-06-19T06:00:00.000-04:00

Kevin has been asking some insightful questions lately, and in general making everything sound all gloomy, so I thought I would... continue the trend with a great Heinlein quote (from To Sail Beyond the Sunset, a truly terrible book):

The America of my time line is a laboratory example of what can happen to democracies, what has eventually happened to all perfect democracies throughout all histories. A perfect democracy, a 'warm body' democracy in which every adult may vote and all votes count equally, has no internal feedback for self-correction. It depends solely on the wisdom and self-restraint of citizens… which is opposed by the folly and lack of self-restraint of other citizens. What is supposed to happen in a democracy is that each sovereign citizen will always vote in the public interest for the safety and welfare of all. But what does happen is that he votes his own self-interest as he sees it… which for the majority translates as 'Bread and Circuses.'

'Bread and Circuses' is the cancer of democracy, the fatal disease for which there is no cure. Democracy often works beautifully at first. But once a state extends the franchise to every warm body, be he producer or parasite, that day marks the beginning of the end of the state. For when the plebs discover that they can vote themselves bread and circuses without limit and that the productive members of the body politic cannot stop them, they will do so, until the state bleeds to death, or in its weakened condition the state succumbs to an invader—the barbarians enter Rome.

Younger generation

2008-06-18T06:00:00.000-04:00

The Road to Serfdom, F. A. Hayek:

We cannot blame our young men when they prefer the safe, salaried position to the risk of enterprise after they have heard from their earliest youth the former described as the superior, more unselfish and disinterested occupation. The younger generation of today has grown up in a world in which in school and press the spirit of commercial enterprise has been represented as disreputable and the making of profit as immoral, where to employ a hundred people is represented as exploitation but to command the same number as honorable.

Our generation

2008-06-17T06:00:00.003-04:00

The Road to Serfdom, F. A. Hayek:

Perhaps the best guides through some of our contemporary problems will still be found in the works of some of the great political philosophers of the liberal age, De Tocqueville or Lord Acton, and, to go even further back, Benjamin Constant, Edmund Burke, and The Federalist papers of Madison, Hamilton, and Jay—generations to whom liberty was still a problem and a value to be defended, where ours at the same time takes it for granted and neither realizes when the danger threatens nor has the courage to emancipate itself from the doctrines which endanger it.

Review: The Road to Serfdom

2008-06-16T05:00:00.004-04:00

Elsewhere I've talked about some of the impact that F. A. Hayek's The Road to Serfdom has had on me, but this little book has a long history of influencing thought throughout the West. Originally published in England in early 1944 as the Allies began to have success against Germany, the book was published in the US later that year. A Reader's Digest version was published in 1945, exposing hundreds of thousands of readers to Hayek's ideas.

But even though the book got people talking on both sides of the Atlantic, Milton Friedman in 1971 wrote that "its message is no less needed today than it was when it first appeared" and that "the same collectivist fallacies are abroad and on the rise today." All that changed, he said, was that "the immediate issues are different and so is much of the jargon." "Central planning" was no longer popular, but replacing it were attempts to eliminate "urban poverty" and make businessmen "socially responsible." Friedman continued:

Unfortunately, the check to collectivism did not check the growth of government; rather, it diverted its growth to a different channel. The emphasis shifted from governmentally administered production activities to indirect regulation of supposedly private enterprises and even more to governmental transfer programs, involving extracting taxes from some in order to make grants to others—all in the name of equality and the eradication of poverty but in practice producing an erratic and contradictory melange of subsidies to special interest groups. As a result, the fraction of the national income being spent by governments has continued to mount.

In 1994, Friedman similarly wrote:

Today, there is wide agreement that socialism is a failure, capitalism a success. Yet this apparent conversion of the intellectual community to what might be called a Hayekian view is deceptive. While the talk is about free markets and private property [...] the bulk of the intellectual community almost automatically favors any expansion of government power so long as it is advertised as a way to protect individuals from big bad corporations, relieve poverty, protect the environment, or promote "equality." [...] The intellectuals may have learned the words but they do not yet have the tune.

So Hayek's critique of collectivism seems to have had some impact, in that few serious collectivists now talk about central planning and state-run industries. But as Friedman says, all that has changed is the vocabulary—government continues to become more powerful and freedom more scarce.

In his book, Hayek addressed a similar consistency of ideas disguised by distinct vocabulary, but then, the dividing words were "central planning" and "naziism." Hayek saw a significant "similarity of much of current English political literature to the works which destroyed the belief in Western civilization in Germany and created the state of mind in which naziism could become successful." And while "few people, if anybody, in England would probably be ready to swallow totalitarianism whole, [...] there is scarcely a leaf out of Hitler's book which somebody or other in England or America has not recommended us to take and use for our own purposes." Then, as now, the battle was over words, not ideas—the notion of the desirability of government control remained constant. Indeed, Hayek warns:

We should never forget that the anti-Semitism of Hitler has [...] turned into his enemies many people who in every respect are confirmed totalitarians of the German type.

Collectivists today think of Fidel Castro and Che Guevara just as collectivists of the 1940s thought of Hitler: "Yes, I have problems with some of the things they did, but many of their ideas were good!" Now, as then, "most of the works which are preparing the way for a totalitarian course in the democracies are the product of sincere idealists and often of men of considerable intellectual distinction." It's telling when the supporters of one sincere idealist in particular seem to also have an affinity for El Che.

Still relevant, thus, is Hayek's systematic demonstration that collectivism inevitably leads to corruption, arbitrary rule, tyranny, discrimination, individual irresponsibility, and the destruction of morality. Though the jargon is now "universal health care" and "Patriot Act" and "a living wage," nothing has changed—government continues to grasp for more power.

Hayek learned the lessons of those who thought they could make the world a better place by using the government for good. He saw that their real accomplishments were the destruction of liberty and the rule of murderous dictators.

Sadly, most of our society seems intent on repeating history.

The "moral" state

2008-06-14T16:10:00.001-04:00

The Road to Serfdom, F. A. Hayek:

As soon as the particular effects are foreseen at the time a law is made, it ceases to be a mere instrument to be used by the people and becomes instead an instrument used by the lawgiver upon the people and for his ends. The state ceases to be a piece of utilitarian machinery intended to help individuals in the fullest development of their individual personality and becomes a “moral” institution—where “moral” is not used in contrast to immoral but describes an institution which imposes on its members its views on all moral questions, whether these views be moral or highly immoral. In this sense the Nazi or any other collectivist state is “moral,” while the liberal state is not.

Thus, the collectivist state becomes moral at the expense of individual morality, while the liberal state avoids morality and thereby gives individuals the opportunity to be moral.

Essence of morals

2008-06-13T06:00:00.002-04:00

The Road to Serfdom, F. A. Hayek:

Freedom to order our own conduct in the sphere where material circumstances force a choice upon us, and responsibility for the arrangement of our own life according to our own conscience, is the air in which alone moral sense grows and in which moral values are daily re-created in the free decision of the individual. Responsibility, not to a superior, but to one's conscience, the awareness of a duty not exacted by compulsion, the necessity to decide which of the things one values are to be sacrificed to others, and to bear the consequences of one's own decision, are the very essence of any morals which deserve the name.

Anglo-Saxon virtues

2008-06-12T11:16:00.002-04:00

The Road to Serfdom, F. A. Hayek:

There is one aspect of the change in moral values brought about by the advance of collectivism which at the present time provides special food for thought. It is that the virtues which are held less and less in esteem and which consequently become rarer are precisely those on which Anglo-Saxons justly prided themselves and in which they were generally recognized to excel. The virtues these people possessed--in a higher degree than most other people, excepting only a few of the smaller nations, like the Swiss and the Dutch--were independence and self-reliance, individual initiative and local responsibility, the successful reliance on voluntary activity, noninterference with one's neighbor and tolerance of the different and queer, respect for custom and tradition, and a healthy suspicion of power and authority. Almost all the traditions and institutions in which democratic moral genius has found its most characteristic expression, and which in turn have molded the national character and the whole moral climate of England and America, are those which the progress of collectivism and its inherently centralistic tendencies are progressively destroying.

Unwavering faith

2008-06-11T06:00:00.001-04:00

The Road to Serfdom, F. A. Hayek:

If we are to succeed in the war of ideologies and to win over the decent elements in the enemy countries, we must, first of all, regain the belief in the traditional values for which we have stood in the past and must have the moral courage stoutly to defend the ideals which our enemies attack. Not by shamefaced apologies and by assurances that we are rapidly reforming, not by explaining that we are seeking some compromise between the traditional liberal values and the new totalitarian ideas, shall we win confidence and support. Not the latest improvements we may have effected in our social institutions, which count but little compared with the basic differences of two opposed ways of life, but our unwavering faith in those traditions which have made England and America countries of free and upright, tolerant and independent, people is the thing that counts.

Good and harm

2008-06-10T06:00:00.001-04:00

Capitalism and Freedom, Milton Friedman:

The power to do good is also the power to do harm; those who control the power today may not tomorrow; and, more important, what one man regards as good, another may regard as harm.

Liberalism, defined

2008-06-09T06:00:00.004-04:00

A commenter brought up the issue of vocabulary--after all, the meaning of the word "liberal" in this blog's title does not match today's typical definition of the word. Instead, I've taken a page from Milton Friedman and identified myself with the great classical liberals of past centuries. The distinction between the two types of liberalism is described by Friedman in Capitalism and Freedom:

The nineteenth-century liberal regarded an extension of freedom as the most effective way to promote welfare and equality; the twentieth century liberal regards welfare and equality as either prerequisites of or alternatives to freedom. In the name of welfare and equality, the twentieth-century liberal has come to favor a revival of the very policies of state intervention and paternalism against which classical liberalism fought.

And again:

Jealous of liberty, and hence fearful of centralized power, whether in governmental or private hands, the nineteenth-century liberal favored political decentralization. Committed to action and confident of the beneficence of power so long as it is in the hands of a government ostensibly controlled by the electorate, the twentieth-century liberal favors centralized government.

Both classical liberals and modern-day liberals claim to be on the side of "liberty," but as their goals are diametrically opposed to each other, this isn't possible without playing with the meaning of the word. In The Road to Serfdom, F. A. Hayek explains that the difference between liberals comes from their different definitions of "liberty" and "freedom":

To the great apostles of political freedom [the classical liberals] the word had meant freedom from coercion, freedom from the arbitrary power of other men, release from the ties which left the individual no choice but obedience to the orders of a superior to whom he was attached. The new freedom promised [that of modern-day liberals], however, was to be freedom from necessity, release from the compulsion of the circumstances which inevitably limit the range of choice of all of us, although for some very much more than for others. Before man could be truly free, the "despotism of physical want" had to be broken, the "restraints of the economic system" relaxed.

Freedom in this sense is, of course, merely another name for power or wealth.

Indeed, it is the modern-day liberals who have perverted the English language, first redefining "liberty" to mean "wealth," and then claiming to be "liberal" when in fact they support making people equally wealthy (through methods completely impossible in systems where individual liberty exists).

Classical liberals value equality, but not in the same way, as Friedman explains:

The [classical] liberal will therefore distinguish sharply between equality of rights and equality of opportunity, on the one hand, and material equality or equality of outcome on the other. He may welcome the fact that a free society in fact tends toward greater material equality than any other yet tried. But he will regard this as a desirable by-product of a free society, not its major justification.

Tocqueville, in Democracy in America, argues that the struggle between individual liberty and equality plagues all democratic peoples, and that our natural tendency is unfortunately to prefer equality:

Democratic peoples have a natural taste for liberty. Left to themselves, they seek it out, love it, and suffer if deprived of it. For equality, however, they feel an ardent, insatiable, eternal, invincible passion. They want equality in liberty, and if they cannot have it, they want it still in slavery. They will suffer poverty, servitude, and barbarity, but they will not suffer aristocracy.

This "ardent, insatiable, eternal, invincible passion" must be conquered. History has demonstrated the superiority of true liberalism in bringing wealth, political freedom, and happiness to mankind, and has likewise shown that collectivism, by any name (including today's "liberalism"), results in poverty and tyranny.

Some say that Confucius said that "when words lose their meaning, people lose their liberty." Whether he did or not, surely this is doubly true when the word "liberal" itself loses its meaning. Modern-day collectivists have bastardized the term and assigned it to themselves, hoping to give credibility to their debunked system of political thought. On this blog, however, I refuse to allow such destruction of language to go unchecked, and defend liberty--both the word and the ideal.

The essence of individualism

2008-06-07T06:00:00.001-04:00

The Road to Serfdom, F. A. Hayek:

This is the fundamental fact on which the whole philosophy of individualism is based. It does not assume, as is often asserted, that man is egoistic or selfish or ought to be. It merely starts from the indisputable fact that the limits of our powers of imagination make it impossible to include in our scale of values more than a sector of the needs of the whole society, and that, since, strictly speaking, scales of value can exist only in individual minds, nothing but partial scales of values exist--scales which are inevitably different and often inconsistent with each other. From this the individualist concludes that the individuals should be allowed, within defined limits, to follow their own values and preferences rather than somebody else's; that within these spheres the individual's system of ends should be supreme and not subject to any dictation by others. It is this recognition of the individual as the ultimate judge of his ends, the belief that as far as possible his own views ought to govern his actions, that forms the essence of the individualist position.

Neither goodness nor badness

2008-06-06T06:00:00.003-04:00

The Road to Serfdom, F. A. Hayek:

Outside the sphere of individual responsibility there is neither goodness nor badness, neither opportunity for moral merit nor the chance of proving one's conviction by sacrificing one's desires to what one thinks right. Only where we ourselves are responsible for our own interests and are free to sacrifice them has our decision moral value. We are neither entitled to be unselfish at someone else's expense nor is there any merit in being unselfish if we have no choice. The members of a society who in all respects are made to do the good thing have no title to praise.

The blunting of moral sense

2008-06-05T06:00:00.002-04:00

The Road to Serfdom, F. A. Hayek:

What are the fixed poles now which are regarded as sacrosanct, which no reformer dare touch, since they are treated as the immutable boundaries which must be respected in any plan for the future? They are no longer the liberty of the individual, his freedom of movement, and scarcely that of speech. They are the protected standards of this or that group, their “right” to exclude others from providing their fellowmen with what they need. Discrimination between members and nonmembers of closed groups, not to speak of nationals of different countries, is accepted more and more as a matter of course; injustices inflicted on individuals by government action in the interest of a group are disregarded with an indifference hardly distinguishable from callousness; and the grossest violations of the most elementary rights of the individual, such as are involved in the compulsory transfer of populations, are more and more often countenanced even by supposed liberals.

All this surely indicates that our moral sense has been blunted rather than sharpened.

Morality requires liberty

2008-06-04T14:55:00.005-04:00

A movement whose main promise is the relief from responsibility cannot but be antimoral in its effect, however lofty the ideals to which it owes its birth.

Experience has made [liberal Germans] wiser and sadder men: they have learned that neither good intentions nor efficiency of organization can preserve decency in a system in which personal freedom and individual responsibility are destroyed.

These little passages, combined with the rest of the excellent 14th chapter of The Road to Serfdom by F. A. Hayek, have changed my way of thinking of the relation between liberty and morality. I've never been able to resolve the conflict in my head between liberal thought and social conservatism, and there are still areas of conflict, but it's now clear to me that liberalism is the foundation for morality—without it, morality cannot exist.

I've recognized for a long time that collectivism (in all its incarnations--big government, welfare state, socialism, communism, fascism, etc.) is A Bad Thing, since it must use coercion to achieve arbitrary ends. Forcing individuals to pay for the healthcare, retirement, vocational training, and recreation of others is folly. Worse, as Hayek points out elsewhere, collectivism breeds arbitrary rule, making tyranny even more unbearable. In the U.S., we see unchecked government bodies creating rules and regulations that impact the lives of millions of Americans, without direct oversight from elected officials, and it's worse in most other countries.

I've also known, especially since reading Democracy in America, that collectivism kills personal responsibility, because it leads people to rely on government to solve problems and take care of them:

What good does it do me, after all, if an ever-watchful authority keeps an eye out to ensure that my pleasures will be tranquil and races ahead of me to ward off all danger, sparing me the need even to think about such things, if that authority, even as it removes the smallest thorns from my path, is also absolute master of my liberty and my life; if it monopolizes vitality and existence to such a degree that when it languishes, everything around it must also languish; when it sleeps, everything must also sleep; and when it dies, everything must also perish?

Indeed, Hayek agrees:

The virtues which are less esteemed and practiced now--independence, self-reliance, and the willingness to bear risks, the readiness to back one's conviction against a majority, and the willingness to voluntary cooperation with one's neighbors--are essentially those on which the working of an individualist society rests.

But while I've known this, I never made the connection that Hayek makes in the quotes at the top of this post: that as collectivism kills individual freedom and responsibility, it simultaneously kills morality. How? Because morality requires a choice. It's not "moral" for me to pay the medical bills of a stranger if I'm forced to by an IRS agent with the power to put me in jail. It's only a good deed if I make a donation voluntarily. All government coercion is like that--it eliminates the morality of every decision that it touches. As Hayek says, "only when we ourselves are responsible for our own interests and are free to sacrifice them has our decision moral value."

Eliminating the morality in a decision isn't always a bad thing, however, because some people have no qualms about being immoral to the extent that they endanger civilization. Thus, it's essential to have a government capable of enforcing laws against theft and murder, for example. But when moral choices are increasingly replaced by coercion, the result is a society of robots, the polar opposite of the type of men God created us to be. "Man’s chief end is to glorify God, and to enjoy him forever," but without the power of moral choice, glorifying and enjoying God becomes impossible except in punishment and death at the hands of the state. I can't glorify God with my money if the government takes it all away from me. I can't glorify God with my talents if the government forces me into an occupation outside my skill set, through excessive regulation, price floors, or price ceilings. The overall effect of this government intervention may not be ultimately bad (though it almost certainly will be), but it is still antimoral, because it forbade me the chance to be moral with the gifts God gave me.

Thus, the fight for liberty is more than a rebellious teenager's fight for the freedom to do what he wants without authority telling him what to do. Without individual liberty, it is impossible to glorify God. That's why liberty must be defended.