Monthly Archives: June 2008

Happy Loving Day

A victory for personal freedom, 41 years ago today:

On this date in 1967, the US Supreme Court decided the case of Loving v. Virginia, striking down Virginia’s anti-misegenation statute. Mildred Loving passed away on May 2 of this year, promting a flurry of moving obituaries. As John Ridley noted on NPR’s morning edition, Barak Obama was born of a mixed race marriage in 1961 — during a time when several states would send cops to break into the bedrooms of and arrest people like his parents.

Times certainly have changed.

For the better.

H/T: Freedom Democrats

Barr: “I Was Wrong About the War on Drugs”

For those of you who are concerned about Bob Barr’s position on the war on (some) drugs, maybe this article Barr posted at The Huffington Post will help allay some of your concerns. I am among those who would like the congressman to speak out more forcefully on this subject as I have seen him miss opportunities to explain why libertarians oppose the war on (some) drugs.

Barr writes:

For years, I served as a federal prosecutor and member of the House of Representatives defending the federal pursuit of the drug prohibition.

Today, I can reflect on my efforts and see no progress in stopping the widespread use of drugs. I’ll even argue that America’s drug problem is larger today than it was when Richard Nixon first coined the phrase, “War on Drugs,” in 1972.

America’s drug problem is only compounded by the vast amounts of money directed at this ongoing battle. In 2005, more than $12 billion dollars was spent on federal drug enforcement efforts while another $30 billion was spent to incarcerate non-violent drug offenders.

The result of spending all of those taxpayer’s dollars? We now have a huge incarceration tab for non-violent drug offenders and, at most, a 30% interception rate of hard drugs. We are also now plagued with the meth labs that are popping up like poisonous mushrooms across the country.

Call me naive, but I think Mr. Barr gets it. The fact that Mr. Barr understands that so many tax dollars are being wasted on incarcerating non-violent drug offenders is evidence of this. According to the Bureau of Prisons, drug offenses account for 52.8% of all criminal offenses. How many of these are non-violent offenders and how many of the violent crimes would be dramatically reduced if drugs were legalized or decriminalized? With 1 in every 100 adults behind bars in the “land of the free,” America incarcerates more people than any country in the world. This needs to change.

However, because our government is divided into three separate branches, there is only so much a president could do in ending the war on (some) drugs. I can think of only three ways a Barr Administration could impact the war on (some) drugs at the federal level*:

1. Pardon all non-violent drug offenders en masse. This would have the effect of limiting law enforcement to going after violent drug offenders as any new offenders would be affected by the mass pardon. This is a question I asked Mr. Barr at the post debate press conference; you can listen to his answer here.

2. Veto any bill which funds the war on (some) drugs.

3. Direct the Justice Department, the DEA, and all other federal agencies not to enforce the existing federal drug laws. Not every law can be enforced; it’s the executive branch’s role to enforce the law. Rather than enforce unconstitutional, draconian drug laws the executive can direct all agencies to focus on keeping the American people safe from anyone who violates the individual’s rights of life, liberty, and property through force or fraud.

As Brad pointed out with some concern, Barr mentioned something about the “current” war on (some) drugs was a failure when he was a guest on the Colbert Report. Did Mr. Barr really mean the war on (some) drugs needs to be fought “smarter” rather than ended?

Barr continues using the tragedy of WWE wrestler Chris Benoit as an example of how a private organization can combat drug abuse without the help of government:

While it is clear the War on Drugs has been a failure, it is not enough to simply acknowledge that reality. We need to look for solutions that deal with the drug problem without costly and intrusive government agencies, and instead allow for private industry and organizations to put forward solutions that address the real problems.

[…]

In the wake of the tragedy, the head of the WWE, Vince McMahon, and its other leaders looked internally to recognize these problems and address them. Although in the two years before Benoit’s death, dozens of wrestlers had been suspended, gone to rehab, or been dismissed under the WWE’s recently adopted “Wellness Program,” the WWE strengthened its drug policy further, re-emphasizing that its policy wasn’t merely a document, but the internal laws of the company that would be enforced.

[…]

McMahon didn’t wait for Congress to pass a law or parade his wrestlers in front of congressional committee hearings; he took the lead and assumed responsibility over the health and welfare of the individuals who work for the WWE.

As part of the WWE Wellness Program, wrestlers go through regular drug testing and even cardiovascular testing. The latter identified a previously unknown heart condition for the wrestler “MVP” and he was treated for Wolff-Parkinson-White Syndrome. The government’s War on Drugs wouldn’t have done that.

This is one area where the government can and should combat drug abuse; not by locking people up but by allowing businesses and organizations to set their own policies. This means that an employer should have the ability to discriminate against anyone who they believe would harm his or her business (be it drug abuse, alcohol abuse, smoking, obesity, or whatever). Once again freedom is the answer to the drug problem (in this case, freedom of association).

I have only one major complaint with the Barr campaign remaining regarding the war on (some) drugs. I suspect that someone inside the Barr campaign is reading this. If so, please tell Mr. Barr to express these thoughts to the likes of Sean Hannity, Glen Beck, or anyone else on the Right that brings up the war on (some) drugs question.

» Read more

Stormfront, Ron Paul, and Bob Barr — aka Why I Hate Politics

Yes, I hate politics. That may surprise some of you. After all, I administer The Liberty Papers, and you’d be likely to wonder why someone who administers a political blog can hate politics so much. But politics is a dirty, nasty business, and nothing makes that more clear than the Stormfront fiasco.

Back in the thick of the Republican nomination process, Don Black of a racist group called Stormfront donated $500 to Ron Paul’s campaign, and the campaign kept the money. At the time, they were widely criticized for this decision, largely by other libertarians (including a few who contribute to this blog). I myself tried to stay out of the fray, but eventually penned a post discussing why I thought Ron Paul was morally correct but politically inept. I specifically stated that the money in Ron Paul’s hands is a lot more of a force for good than the money in Don Black’s hands. Ron Paul would be likely to put it to a more liberty-friendly use than Don Black, and thus he was morally correct to keep the money and not return it to Black. But from a political standpoint, keeping the money raises a lot of questions about whether or not it means Ron Paul actually agrees with Don Black, even though his history shows that he doesn’t. And it was Ron Paul’s attempt to play by moral rules rather than political rules that scuttled his campaign. That’s why I hate politics.

You see, in politics the rules don’t follow logic, nor ethics, and certainly don’t reward honesty. Ron Paul made a cardinal sin, not only in this instance, but in his entire campaign– he actually stated what he believes! You see, Ron Paul is a principled and honest person, and was more than willing to treat potential voters like adults. He’s willing to explain what he believes and then explain why. And that just doesn’t fly in the political arena.

Ron Paul would tell you what he thought on most issues. On half of his issues, it annoyed conservatives and made them think he wasn’t “one of them”. On the other half, it annoyed libertarians and made them think he wasn’t “one of them”. For law-and-order conservatives, the idea that we should scrap the PATRIOT act and RealID, end the war on drugs, and no longer act as the world’s policeman made them think Ron Paul was “soft”. For libertarians (a movement known for cannibalizing their own), his positions on immigration and abortion were a major sticking point, making many believe that he was libertarian on many issues but not quite libertarian “enough”. Each time he opened his mouth, he alienated another voting bloc, simply by being honest about his principles.

Contrast this with Bob Barr. I suggested when I saw Barr’s appearance on The Colbert Report that I thought his response to the question about the war on drugs was duplicitous. He could clearly have stated that he was against the war on drugs as an infringement of personal liberty. But that might have scared away the conservatives. He could have claimed that the war on drugs should be fought on the state and local level, where it would be more effective than at the federal level, but that would have caused us more doctrinaire libertarians to believe his conversion wasn’t genuine. So he tried to play the middle ground and claim the “current” war on drugs isn’t working, but without really stating any belief.

And it worked! In the comments to my post, I saw different readers interpret his response through their own ideological spectrum. He was able to play the middle ground with his answer, and everyone came off thinking that he agreed with their own preconceived notions. In fact, this is what makes Barack Obama such a masterful politician. In the early months of the Democratic nomination process, he was very bland about wanting “change” but without really getting into definite principles. I heard libertarians, Republicans, and Democrats who all interpreted his comments as if he would pursue policies similar to what they desired.

Which brings me back to Bob Barr and Stormfront. Stormfront attempted to donate to Barr’s campaign, to see what would occur (and likely, to try to gain publicity for themselves). Bob Barr played the political side of this to the book. In fact, he overplayed it. Listen to the tone of his campaign’s response to Stormfront (which drew praise from my fellow contributor Doug):

The Barr campaign is not going to be a vehicle for every fringe and hate group to promote itself. We do not want and will not accept the support of haters. Anyone with love in their heart for our country and for every resident of our country regardless of race, religion, nationality or sexual orientation is welcome with open arms.

Tell the haters I said don’t let the door hit you on the backside on your way out!

Particularly in that last sentence, you see the “Look at how politically smart we are! We hate racists as much as fellow libertarians do!” tone. Which is fine, and which is how I’d hope a campaign to feel about giving the donation back. But the self-congratulatory nature of the statement was purely for political effect.

Bob Barr understand the rules of politics much better than Ron Paul. He follows the rules, and those people who accept the “game” applaud him for playing it well. Ron Paul rejects the rules of the game, and acts accordingly. This caused his supporters to respect him, but they never quite realized that his refusal to play by the rules wouldn’t inspire quite the same response in non-politicos.

The political game is pure farce from start to finish. To win, you need to be a megalomaniacal sociopath. You need to care more about winning than about principle. You need to be a chameleon, telling every group you’re in front of that you’re going to do exactly what they expect you to do. And above all, you need to hide your true beliefs, because every expression of opinion turns off some voters.

So where do I stand this political cycle? I don’t care which unprincipled chameleon gets elected. I simply don’t believe either of them are the lesser of evils. They’re just taking us down a different lane on the highway to ruin.

My personal goal here at The Liberty Papers is to point out that the system itself is flawed. I do my best to try not to blog about elections; rather I point out that elections aren’t actually going to solve the problem the candidates promise to solve. We’ll never get out of this hole by trying to elect a savior. Rather, we need to understand that the government can’t save us, and get off our asses and do it ourselves.

Three Words

Well, three words, and three thoughts associated with them…

I’ve not spoken much about politics this year, specifically because when I WAS talking about it I found that it was absolutely impossible to have any kind of civil discourse with the Paulistinans, and Obamaddeans; and that the Mitt and Huck types were all heavily into self delusion.

Let’s not even talk about Bob Barr (libertarian he certainly is not… publicity stunt, he certainly is), or Dennis Kucinich (really… my life would be so much better if I never heard his name again).

What was the point? The aggravation wasn’t worth it.

Now that the parties have settled on their respective choices (finally), I’m going to say what will hopefully be my last GENERAL words on the subject (obviously I may end up commenting more as particular issues come up).

I’m going to be voting for John McCain (or more particularly not for McCain, but against the Democratic Party) and here’s why (three words, three thoughts):

* Barack
* Hussein
* Obama

* Supreme Court Justices
* Executive appointments
* Cooperative congress

So, let me just close with the sentiments of my good friend Kim DuToit:

McCain2008
I am a cynically romantic optimistic pessimist. I am neither liberal, nor conservative. I am a (somewhat disgruntled) muscular minarchist… something like a constructive anarchist.

Basically what that means, is that I believe, all things being equal, responsible adults should be able to do whatever the hell they want to do, so long as nobody’s getting hurt, who isn’t paying extra

Do Government Regulators Protect Investors?

In a thread at Reason’s hit and Run, during a discussion where Enron was cited as an example of what happens when governments fail to regulate private behavior, frequent commenter fluffy wrote an insightful comment which is well worth reading in full. The second half of her comment read:

It is customary in the US for the Wall Street markets to be seen as the embodiment of unbridled capitalism, and they really aren’t. What they are is a complex system of federal regulation designed to foster “confidence” in publicly-traded companies, to facilitate the growth of those companies via debt and capital aggregation and intermediation. Their existence is a deliberate policy choice of the state, to attempt to use regulation to make it possible for small investors to trust people they have never met and of whom they have no knowledge – in order to allow corporations to grow larger, or to grow more quickly, than they would have in the days when trust was based on the personal or family qualities of the entrepreneur behind the corporation or the bank doing the underwriting for the corporation’s stock. The complex rules regarding accounting, corporate reporting, transparency, etc., are designed to allow corporations and investors to trust each other without actually having to do anything to establish trust beyond participating in the regulated system. Traders who use trading apps uk as well as trading resources from China, Australia, the USA, etc need to know that companies they’re trading in are not going to foil their investments and that their investment is totally legitimate.

This has two unintended consequences. First, it allows corporations to be much larger and more powerful than they would otherwise be. The social and economic effects of this are open to debate. Second, it creates a situation where the “incentive problem” MNG talks about looms pretty large. As long as a corporation can do the bare minimum necessary to keep the SEC from shutting them down, they are in a position to command broad respect from investors that they may not deserve. The highly technical nature of the regulations in question also creates a milieu where a company like Arthur Andersen can begin to see its task as ensuring technical compliance and nothing else; the exotic techniques their consultants were using to build earnings or smooth earnings in that context begin to look not like “frauds” but simply “innovation”. By trying to facilitate the operation of the market, the state has in a sense corrupted it, or at least created an environment where corruption can hide behind the wall of paper the SEC requires.

But why has this corruption occurred? Why wouldn’t it happen in a private stock market? Well, a thought experiment will explain why the government intervention is corrupting. Imagine two stock markets. One, the Boston Stock Exchange is interested in attracting investors with assurances that their money will be safe. This is the kind of one many who check the robinhood app review (or other reviews) would be drawn to most likely. The other, the New York Stock Exchange does not care. The owners of the Boston Stock Exchange publish a set of accounting standards and demand that any company that trades on their stock exchange must follow those rules and publish those reports, thus helping people who would be seeking information from TradeZero and other stock market trading platforms. The New York Stock exchange does not have that requirement.

Some investors choose only to invest money in companies trading on the Boston Stock exchange. They eschew the New York exchange. In the meantime investors who are less choosy (or more foolish) continue to invest in companies on the NY exchange. Some people might not agree with this decision. Of course, some investments will suit some people, whilst others might not be interested. In order to find the best investment, it might be worth using some Investment Apps. That could be useful and it should help people to invest properly. Anyway, as a result of these investments, the companies that invest in meeting the requirements of the Boston exchange have access to additional capital that they couldn’t get if they were limited only to getting it from the NY Stock exchange. If the additional capital is worth the expenses involved in meeting the Boston standards, a company will rationally choose to adopt the Boston standards. Companies that find the additional cost not to provide sufficient benefit will not adopt the standards. Those companies will forego being traded on the Boston exchange and will make do with the capital available in New York.

In this scenario, the cost of adopting accounting rules is an investment in the business, much like the cost of marketing or the cost of insurance. Companies that choose to spend the money will attempt to ensure that it is well spent, that they are necessary for investor protection. There will be a negotiation between investors, the Boston Stock exchange, accountants and the companies being audited to arrive at meaningful standards that satisfy everybody. In the commercial insurance industry there instances of fraud tend to be aberrations rather than systematic because this very process is in place.

Now let us assume that for a variety of reasons the U.S. government passes a law mandating that all companies meet the Boston standards. Immediately all the companies trading exclusively on the New York exchange are slapped with an additional cost that they don’t want. The benefit of compliance will be reduced since the capital funds available in Boston will now be spread over many more companies. These companies, having been saddled with an unwanted cost will attempt to reduce the cost. They will seek out corrupt auditors who will rubber stamp their records. In the meantime the auditors who specialized in Boston accounting rules, now assured of a captive market, have to expend less effort pleasing their customers, the stock exchanges. In fact, they merely have to satisfy government regulators to keep their licenses, so they will pay less attention to the officers of the stock exchange. Since the government regulators, unlike the Boston Stock exchange, face no losses should they certify a corrupt regulator, they have a much lower incentive to ensure that the auditors are doing a good job.

At this point the accounting industry will not only become corrupt, it will also stagnate. The process that causes the stagnation is quite straightforward:

Let us assume that a couple of investors think that the Boston system is flawed. So they come up with a new system, and establish a stock exchange in Chicago which insists upon these alternate standards. Let us further assume that they convince a number of investors to agree with them, to the point where a few companies are interested in adopting the new standards. Whereas before the companies would merely have to switch to the Chicago system and to abandon the Boston system, they are not allowed to do this. They must continue to spending the money required to comply with the Boston system. If they want to meet the Chicago rules, they must purchase this as an additional cost. And, if the Chicago sytem contradicts the Boston system they cannot adopt the system at all.

This sets up a nearly insurmountable hurdle for anyone to adopt the Chicago system. And there is little chance of the Chicago system being mandated, because there will be many people with a vested interest in keeping the Boston system in place. Only in a time of crisis will the adoption of the Chicago system be considered by the legislature. And, if they should mandate it, they will be mandating an untested system. Should the system not work out as advertised, they could set back the industry dramatically as is happening as a result of the Sarbanes Oxley law.

If people truly wish to protect investors, they would lobby for the immediate dissolution of the SEC and allow stock markets to compete again on the quality of auditing. We would see a dramatic improvement in investor satisfaction as Stock Exchanges were not limited to competing for customers using price.

I am an anarcho-capitalist living just west of Boston Massachussetts. I am married, have two children, and am trying to start my own computer consulting company.
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