Monthly Archives: November 2009

Bruce Bartlett, May Your Chains Set Lightly Upon You

Ezra Klein quotes approvingly from Bruce Bartlett’s new book, The New American Economy: The Failure Of Reaganomics And A New Way Forward:

The reality is that even before spending exploded to deal with the economic crisis, the government was set to grow by about 50 percent of GDP over the next generation just to pay for Social Security and Medicare benefits under current law. When the crunch comes and the need for a major increase in revenue becomes overwhelming, I expect that Republicans will refuse to participate in the process. If Democrats have to raise taxes with no bipartisan support, then they will have no choice but to cater to the demand of their party’s most liberal wing. This will mean higher rates on businesses and entrepreneurs, and soak-the-rich policies that would make Franklin D. Roosevelt blush.

Shorter: “Hey conservatives, you’ve completely and hopelessly lost the spending war. If you don’t play nice, you’re going to get even more screwed by the tax man than if you sit at the table.”

To which Samuel Adams might have responded: “If ye love wealth better than liberty, the tranquility of servitude than the animated contest of freedom — go home from us in peace. We ask not your counsels or arms. Crouch down and lick the hands which feed you. May your chains sit lightly upon you, and may posterity forget that you were our countrymen!”

In short, Bruce Bartlett has surrendered. He has taken the view “posit a giant welfare state — now what’s the best way to pay for it?” He suggests that if conservatives try to set the menu at — as Billy Beck would call it — the cannibal pot, that MAYBE they’ll just lose an arm and not the leg to go along with it.

All in all, Bartlett’s view is probably the calmest and most peaceful answer. But it gives us a nation that is so unlike America that I’m not sure I want a part of it. The peaceful way out is to accept that Democracy has given us a giant welfare state, that Democracy is never going to rescind it, and that therefore we might as well pay for it. He’s taking Mencken’s quote at face value:

Democracy is the theory that the common people know what they want, and deserve to get it good and hard.

Bartlett is arguing that if we’re all to be slaves, it’s best to suck up and hope for the job of overseer, holding the whip rather than tasting its lash.

But I’m not ready to surrender.

Bruce Bartlett says that if we don’t find a way to pay for the monstrosity growing out of Washington, the whole system will come crashing down. I say I’d prefer that to the “success” of the system as the social democrats want it to exist.

Bruce Bartlett says that the “starve the beast” tactic doesn’t work, as the beast keeps on growing. Well consider me a cancerous tumor hoping to infect the populace into becoming an ever-growing resistance that eats away at the beast’s insides until it dies of rot.

Bruce Bartlett wants conservatives to make sure they have a seat at the table to divvy up the “spoils”. Well, if he wants to be a good little Tory, that’s his choice. He’s taken sides, and despite his pleas, the fight will rage on.

Somewhere deep inside, despite a century of statism trying to weaken it with bread and circuses, the spirit of America still exists. Until that’s no longer the case, I’ll take the side of Freedom.

Ayn Rand: The Fountainhead Of The Modern Libertarian Movement

atlas_02

There are few figures in the American libertarian movement that gave rise to as much controversy or passion as Ayn Rand. Love her or hate her, it’s hard to find a libertarian who doesn’t have an opinion about the author of The Fountainhead and Atlas Shrugged. For many of us, she was the one who lit the spark that sent us down the road toward becoming a libertarian. Even after her death, some still consider themselves hard-core Objectivists in the model of those who gravitated around the Nathanial Branden Institute in the 1960s. For most libertarians, though, while Rand is arguably the most influential moral philosopher, she is also someone who’s flaws, both personal and philosophical have been acknowledged, debated, and argued about for decades.

There’s always been a missing piece of the puzzle, though, and that was that nobody had really undertaken a full-scale intellectual biography of someone who, even today, can sell 200,000 copies a year of her 1,000+ page magnum opus. There were personal biographies by Barbara Branden and Nathaniel Branden, but those both seemed to concentrate on the more lurid details of Rand’s personal life and the circumstances behind the 1968 Objectivist Purge. The heirs of Rand’s estate, meanwhile, have guarded her papers closely in an obvious effort to protect her legacy and reputation. Someone wanting to learn more about Rand’s life, the development of her ideas, and her impact on American politics, had almost nowhere to go that wasn’t totally biased in one direction or the other.

That’s why Jennifer Burns’ Goddess of the Market: Ayn Rand and the American Right is so welcome.

Instead of dwelling on the lurid aspects of Rand’s affair with Nathaniel Branden, and without taking sides regarding the many controversies that followed Rand in years after Atlas Shrugged was published, Burns provides a thorough, well-written and well-researched survey of how Ayn Rand went from Alisa Rosenbaum of St. Petersburg, Russia, born just as Czarist Russia was beginning it’s decent into chaos, to Ayn Rand, the woman about whom more than one person has said “she changed my life.”

For people versed in the history of libertarian ideas, the most interest parts of the book will probably be Burns’s documentation of Rand’s interaction with the heavyweights of both the Pre World War II Right and the conservative/libertarian movement that began to take shape after the war ended. She corresponded with Albert Jay Nock and H.L. Mencken and, most interestingly, developed a very close personal and intellectual relationship with Isabel Patterson, best known as the author of The God of the Machine. For years, especially during the time that Rand was writing The Fountainhead, Rand and Paterson exchanged ideas and debated philosophy, and it’s clear that they both contributed to the others ideas.

The Rand-Paterson relationship, though, also foreshadowed something that would happen all too frequently later in Rand’s career, the purge. Paterson was among the first libertarian-oriented writers to experience Rand’s wrath for the perception that she was not sufficiently orthodox. Over time, that would continue to the point where, at it’s height, Objectivism displayed a level of orthodoxy and denunciation of perceived heresy that rivaled the religions that it rejected. It was, in the end, the reason why the movement’s downfalls was largely inevitable.

Burns also goes into great detail discussing the process and the ordeal that Rand went through while writing both of her great novels. After reading that part, one marvels at the fact that she even survived.

In the final chapter, Burns shows that, even though Rand herself had flaws that led to the demise of Objectivism as a formal movement, her ideas have a staying power that has permeated throughout the conservative and libertarian movements in the United States. There is hardly a libertarian in the United States who has not read at least one of Rand’s books and, it’s clear that her ideas have taken hold in a way that she probably never expected and definitely would not have approved of. That, however, is the power of ideas, the creator can’t control what people do with them once they’re out there.

Burns does a wonderful job of filling in the missing pieces about Rand’s life and her place in the wider context of the political and social history of Post World War II America. Whether you love or hate Ayn Rand – and I don’t think you can have no opinion about her once exposed to her idea – this is a truly fascinating book.

Ludwig Von Mises Finally Getting Some Of The Respect He Deserves

von_mises

When Ludwig von Mises first arrived in the United States after escaping from Nazi Europe, and pretty much up until the present day, he was essentially ignored by the mainstream economics community in the United States. It was only through the assistance of American businessmen that he was able to get a job teaching at New York University, and, even then, the work he did had nothing to do with official university activities because he was, effectively, shunned for his uncompromising defense of the free-market.

Earlier this week in The Wall Street Journal, though, Mises is given credit for being one of the few economists in the 1920s to foresee the impending Great Depression:

Mises’s ideas on business cycles were spelled out in his 1912 tome “Theorie des Geldes und der Umlaufsmittel” (“The Theory of Money and Credit”). Not surprisingly few people noticed, as it was published only in German and wasn’t exactly a beach read at that.

Taking his cue from David Hume and David Ricardo, Mises explained how the banking system was endowed with the singular ability to expand credit and with it the money supply, and how this was magnified by government intervention. Left alone, interest rates would adjust such that only the amount of credit would be used as is voluntarily supplied and demanded. But when credit is force-fed beyond that (call it a credit gavage), grotesque things start to happen.

Government-imposed expansion of bank credit distorts our “time preferences,” or our desire for saving versus consumption. Government-imposed interest rates artificially below rates demanded by savers leads to increased borrowing and capital investment beyond what savers will provide. This causes temporarily higher employment, wages and consumption.

Ordinarily, any random spikes in credit would be quickly absorbed by the system—the pricing errors corrected, the half-baked investments liquidated, like a supple tree yielding to the wind and then returning. But when the government holds rates artificially low in order to feed ever higher capital investment in otherwise unsound, unsustainable businesses, it creates the conditions for a crash. Everyone looks smart for a while, but eventually the whole monstrosity collapses under its own weight through a credit contraction or, worse, a banking collapse.

The system is dramatically susceptible to errors, both on the policy side and on the entrepreneurial side. Government expansion of credit takes a system otherwise capable of adjustment and resilience and transforms it into one with tremendous cyclical volatility.

(…)

We all know what happened next. Pretty much right out of Mises’s script, overleveraged banks (including Kreditanstalt) collapsed, businesses collapsed, employment collapsed. The brittle tree snapped. Following Mises’s logic, was this a failure of capitalism, or a failure of hubris?

Mises’s solution follows logically from his warnings. You can’t fix what’s broken by breaking it yet again. Stop the credit gavage. Stop inflating. Don’t encourage consumption, but rather encourage saving and the repayment of debt. Let all the lame businesses fail—no bailouts. (You see where I’m going with this.) The distortions must be removed or else the precipice from which the system will inevitably fall will simply grow higher and higher.

That was Mises’ argument in The Theory Of Money And Credit, but he did so much more than that. In Socialism, first published in 1921, Mises laid out in detail the reasons why the centrally planned economy of nations like the USSR could never produce a rational economy and were doomed to failure. He was, of course, proven right in that regard as we learned only twenty years ago. Mises’ magnum opus is Human Action: A Treatise on Economics and while it’s not easy reading it is well worth consuming for even the amateur student of economics.

Here’s hoping people will start taking Mises’ lessons to heart before we make the same mistakes all over again.

The Death of Language: Terrorist Edition

But the special function of certain Newspeak words, of which oldthink was one, was not so much to express meanings as to destroy them. These words, necessarily few in number, had had their meanings extended until they contained within themselves whole batteries of words which, as they were sufficiently covered by a single comprehensive term, could now be scrapped and forgotten. The greatest difficulty facing the compilers of the Newspeak Dictionary was not to invent new words, but, having invented them, to make sure what they meant: to make sure, that is to say, what ranges of words they cancelled by their existence.

George Orwell 1984

Today an email landed in my inbox sent by the Peter Schiff campaign. Breathlessly and self-importantly, it declared:

One week ago today, our new website was repeatedly attacked by cyber terrorists bent on slowing the progress of our campaign.

Cyber-terrorists?!?

What the hell? Saboteurs, perhaps, but terrorists?

Are people who launch denial of service attacks on a politician they disapprove of to be lumped in with people who massacre innocents in order to paralyze a population with fear?

One of the greatest dangers to liberty is that the ideas of freedom will die out and be forgotten. The 19th century had a rich tradition of freedom, including a powerful vocabulary of ideas, a vocabulary that contained numerous words for similar or related concepts, with different words used to express nuance with specificity.

Let’s for example consider people who use violent means for political action. Consider the words we have to choose from:

  • Activist,
  • Agitator,
  • Demonstrator,
  • Dissenter,
  • Dissident,
  • Insurgent,
  • Insurrectionist,
  • Malcontent,
  • Mutineer,
  • Objector
  • Protester,
  • Rebel,
  • Resister,
  • Revolutionary,
  • Saboteur,
  • Striker,
  • Terrorist,
  • Traitor,
  • Vandal,
  • Wrecker

These words all are related to each other. Yet they describe a wide range of people engaged in political action. Some terms describe people engaged in reprehensible acts, other describe people whom we view as being honorable.

In choosing to use the word ‘terrorist’ to describe the people launching DOS attacks on his website, Peter Schiff is falling for the linguistic Newspeak-like trap laid by the United States Government, which describes its enemies as terrorists so that an honest farmer trying to protect his opium crop is lumped in with pacifists holding prayer meetings an with men who make “snuff porn” movies by sawing the heads of living people in front of a camera.

We must defend our language as seriously and consciously as we defend our homes. For our civilization is dependent on language, and when different concepts are all subsumed together under a single word, we thinking with clarity and precision becomes more difficult, and communication becomes far more difficult.

For shame Mr Schiff… For shame.

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.

Quote of the Day

“You see that’s the whole point of being the government. If you don’t like something, you simply make up a law that makes it illegal.” –Kenneth Brannagh in “Pirate Radio”

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

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